In any business, when there is clarity about who the products are to be sold to, then working on all other aspects of the business becomes much easier. Therefore, before starting the business, it is necessary to clarify whether I want to make my product or service a mass brand or a niche brand.
Niche brand means, which is not for all but for some people, which may be few in number. In other words, the product or service is designed for a certain segment and not for all consumers. This type of brand adopts a strategy of targeting a specific market or segment. For example, to put it simply in today’s context, a food store that only makes or sells organic food is specifically targeting organic food consumers and not the general public. So, it is clear that they want to target customers who want organic food. This type targets a specific segment of customers.
In contrast, mass brand means, in which the brand tries to get customers for its product or service at a higher mass level. They do not restrict themselves while marketing the product and focus on getting maximum number of customers. The main objective behind this is to find a large number of potential customers. For example, any cola or personal care or food brand. The aim of this is to target a large number of customers for this brand.
Regarding Niche, if you have decided that your brand will be for a niche segment then it is easier for marketing to promote the brand in that segment. Often as per the marketing strategy if your brand is built for the masses but when you launch the brand you are at the beginning of the product lifecycle i.e. at the introductory stage, at this point you are trying to convince people what you have. So, niche marketing is more effective to reach new customers with new products or services. Once you reach the growth stage of the product lifecycle, mass marketing can become more effective. You have a niche segment base ready to support your product and a streamlined process that allows you to keep costs down while maintaining profits. This allows you to promote with discount offers, which is one of the most effective mass marketing tools. But at such times also be careful not to offend your niche segment with this offer as they may believe that they were paying too much until now.
Looking at the advantages and disadvantages of both niche and mass; the advantages of mass are that the cost of production is greatly reduced with the help of economy of scale, the goods are sold in mass so the business increases and the profit increases, there is no need to do much research for the product or it can be said that it is easy to replicate what is going on in the market and if the product works, it can provide long-term success. Looking at its disadvantages; competition is high as there are many brands in the market for the same product, brand loyalty cannot be claimed as consumers will go to the brand that offers the best deal, traditional retailers who can help sell the goods are difficult to agree to because they are sitting with many other brands, there will be a need to spend sufficiently on marketing and advertising
Against this look at the advantages and disadvantages of the niche; in this competition will be less as all will bring their own product with some specialty and for specific segment, premium pricing will generate more profit, differentiation can be created at product level and most importantly brand loyalty will be strong as competition is less. If we look at the disadvantages against this; demand will be limited because the segment is fixed, earning potential will be low because you are limited to few people, price will be high because it will not be produced in mass and most importantly if the trend changes, then people might go back to adopt the new one.
In short, a niche brand targets a specific market while a mass brand targets the entire market. Niche consumers intend to buy the product for a long time while mass consumers keep changing. A niche strategy involves intensive marketing through the use of simple media such as attractive websites, niche magazines containing informative and relevant content, and emails, while a mass strategy adopts extensive marketing through multimedia such as television. Product variety may be less in niche whereas in mass you will get to experience different product variety. A niche strategy may have relatively little competition in certain products or services, but mass competition is seen as high because there are many other competitors targeting the same customer in the same product or service age group.
Whether you choose a mass or niche brand, the end goal is the same, customer acquisition. You can acquire them one by one. Determine which brand is beneficial for you to build, niche or mass, by understanding what your objective is.
This article was originally published in Mumbai Samachar – a leading Gujarati-language daily newspaper published in India. This article has been written by Mr. Sameer Joshi, Founding Partner – Sam & Andy.