Niche And Mass Marketing

Question 1

What are advantages of mass marketing?

Answer 1

• Economies of scale / large production scale can mean lower unit costs.
• High revenues / due to high volume of sales.
• Brand awareness / mass marketing increases brand awareness, assisting sales and over shadowing smaller players in the market.

Question 2

What are disadvantages of mass marketing?

Answer 2

• Higher fixed assets / larger factories, extensive & expensive machinery, delivery lorries.
• Standardisation means less scope for charging higher prices.
• In “boom” periods there is a risk of customers switching from low cost products to premium products.

Question 3

What are advantages of niche marketing?

Answer 3

• Less competition / the firm is a ‘big fish in a small pond’.
• Profit margins are higher.
• Customers tend to be more loyal.
• Clear focus / target particular customers.

Question 4

What are disadvantages of niche marketing?

Answer 4

• Risk of dependence on a single product or market.
• Vulnerable to market changes / “all eggs in one basket”.
• Likely to attract competition if successful.