Niche Markets Flashcards
1
Q
What is a niche market?
A
Small segment of a larger market
2
Q
Describe mass markets
A
Firms attempt to exploit the gap in the market, those that do, benefit from high sales and profits
Satisfy the need for a product or service
Often used by small businesses
3
Q
Advantages of niche markets
A
Charge a high price
Low unit cost, high production volume (lack of economies of scale)
Less competition (big 🐠small pond)
Clear focus - target particular customers
High profit margins
4
Q
Disadvantages of niche markets
A
Risk of over dependance on a single product
Vulnerable to market changes - all eggs one basket
Likely to attract competition
