Niche Markets

Question 1

cultural Diversity

Answer 1

• it recognises the ideas, customs and social behaviour of particular people or a society in different global markets.
• businesses need to take into account the different cultural behaviours and customs when operating in overseas markets.
• groups of people across the globe have different interests and values.

Question 2

features of global niche markets

Answer 2

• they are small segments of the global market that are characterised by unique and specific needs and preferences.
• the groups of customers within these markets may be very small within an individual country, but when combined across the world, the number of customers may be significant.

Question 3

excellent customer service

Answer 3

• as customers are paying higher prices for the product / service they expect exceptional customer service

Question 4

Highly specialised and innovation

Answer 4

• innovation ensures that products are highly differentiated and maintain a USP that meets the needs of the target market.
• because of the USP, businesses in niche markets have the ability to charge premium prices.

Question 5

prioritising profit over market share.

Answer 5

• niche markets are lucrative and businesses focus on increasing profits that they can re-invest into improving their products / services.

Question 6

expertise in product area.

Answer 6

• having employees that are highly skilled and keeping up to date with the latest developments within the niche market helps build value for the customers.

Question 7

Emphasis on quality

Answer 7

• businesses need to ensure the quality of the product is exceptional as they are targeting wealthier customers who pay for high value products.

Question 8

clear understanding of the needs and wants of customers

Answer 8

• the business may have relatively few customers so need to ensure that the needs/wants of these customers is fully understood.
• this can help to increase demand and customer loyalty.

Question 9

ability to charge premium prices

Answer 9

• because niche market businesses are highly differentiated, this can allow the business to increase its prices.
• niche markets also focus on the needs and wants of its customers and so they have high demand = high prices.
• niche markets are also characterised by loyal customers and so it can still increase its prices without losing any customers.
• specialist products reduced PED and so business can gain higher profit margin.

Question 10

adapting the marketing mix to suit global niches

Answer 10

• when entering a global niche market, a business may need to adapt its marketing mix in order to be successful.

Question 11

price

Answer 11

• adapting the price to suit a global niche market involves offering a pricing strategy that is attractive to the target audience.
  –> a business that produces a specialist product like sustainable fashion, can offer a premium price that reflects the exclusive and high-quality nature of the product.

Question 12

product

Answer 12

• a business can adapt the product to suit a global niche market by modifying the features of the product to meet the specific needs of the target market.
• the specialised product must have the right features to suit global niches.
• the product is designed with a very specific customer in mind.

Question 13

promotion

Answer 13

• adapting the promotion to suit a global niche market involves using marketing communication strategies that resonate with the target audience.
  –> e.x: business that produces luxury products can use influencer marketing to communicate the exclusivity of the product to wealthy customers .
• promotion may be more targeted and subtle in a global niche market as opposed to a mass market.

Question 14

place

Answer 14

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