Market niche is term of marketing used to refer to a portion of a market segment in which individuals possess characteristics and needs homogeneous, and the latter are not entirely covered by the offer overall market.
The niche market is based on recognizing in the segmentation a new business opportunity arising from unmet needs and then be economically exploited by a company, but it may also be because there are not enough companies to supply that need. In terms of a niche market we must understand certain basic things to be able to have a fruitful activity, one of these is that this must be broad enough to derive a business from it and another aspect to keep in mind is that we must know if there is something of competence, this last one is not necessarily something negative since we will know that there is already an audience and therefore a demand a
Characteristics of market niches
In general a niche market has the following characteristics:
- It is a small group: It is made up of people, companies or organizations in a small amount (compared to the market segment to which it belongs).
- They have specific or similar needs or desires: In general, they consist of very specific needs or desires, and also have their degree of complexity; Therefore, this group is willing to pay an "extra" to acquire the product or service that meets their expectations.
- There is a willingness to satisfy their needs or desires: That is, they have a "good predisposition" to acquire a product or service that meets their expectations, and in the case of companies or organizations, they have the ability to make purchasing decisions.
- There is economic capacity: Each component of the "market niche" has sufficient economic capacity that allows you to incur the necessary expenses to obtain the satisfaction of your need or desire. They are even willing to pay an additional amount to achieve better satisfaction.
- It requires specialized operations: When there are needs or desires with specific and even complex characteristics, the market niche requires specialized suppliers capable of meeting their expectations.
- There are very few or no supplier companies: In those niche markets where the particularities and complexity of their needs or desires require a high specialization, it is normal that there are no more than one or two supplier companies, it can even be that there is no.
- It has enough size to generate profits: According to Prof. Phillip Kotler, an ideal market niche is one that has the necessary size to be profitable.
The market niches are formed by: a) needs to be met b) unsatisfied needs to wake up and a or c) communication
Examples of niches
- Within the food market: Inorganic food.
- Within the information market: Blogs and specialized magazines.
- Within the entertainment market: plays, concerts.
- Within the engineering market: Advice, supplies.
- Within the writing market: Mechanical typewriters.
- Inside the video game market: Japanese videogames with an anime aestheti.