The BCG matrix. Help in choosing a segment or niche market.
The market niche is aa highly specialized type of business, intended for a small number of consumers. It has a small but constant capacity of the market and a significant reduction in competition. The niche of the market can be the result of targeted marketing - the direction to a stable, but rather small part of the market that large businessmen can not or do not want to pay attention to, and where the competition press is relatively low. The BCG matrix (Boston Consulting Group) puts forward the hypothesis that the owner of the largest niche has the highest profitability compared to the rest of the market participants, and therefore the maximum revenue.
- The emergence of a new niche market can beis formed due to a special situation on the market - a certain confluence of circumstances and conditions that cause the emergence of specific requests and unique needs on the part of the consumer that can not be met with the goods or services already available on the market. As the prosperity of the four major market groups, as the BCG matrix asserts, does not always happen, the emergence of a new niche may be due to the emerging consumer vacuum.
- A new niche of the market may be a consequencevertical marketing, which is specifically focused on finding a new business, for example, the search for ways to implement a unique product with a similar product simultaneously in several segments of the market.
- A new niche may be the result of a horizontal marketing, designed to find a horizontal market niche. Such income, as a rule, implies regular expansion of services and products, while targeting them for one target segment.
- Shrub or beam marketing can help define a new niche market by forming a range of stable consumers, attracted by a full package of services or goods.
Today, the choice of the market segment or its ownniches can only affect the personal qualities of the entrepreneur, ability, knowledge, qualifications. Many successful enterprises occupying niches of the market owe much of their leadership not for the fact that it was striving to create a completely new product, but for trying to promote conventional products in a completely different way. To date, a deep specialization is required not only to develop new production technologies, but also to work with its customers. That's why many highly developed countries use the latest developments in the sphere of selling services and goods to determine the niche of the market. The process of determining your own niche market, unfortunately, very often resembles the search for a free vacuum, which must be filled as soon as possible. In fact, the market niche is a harmonious tandem between well-realized and overdue needs with non-traditional methods, forms and ways to meet them. The main task of marketing is to determine the way to solve the consumer's problems, because today niches arise in any economic sector, even in long-divided markets.
The highest quality of products and services is considered one of the most important conditions for successfulimplementation and justification in the niche market. It is worth noting that any company is 100% sure that it is its services and products that represent the highest quality. Nevertheless, in order to focus on the niches of the market, one must be able to respond sensitively to even the smallest changes in demand and supply, to foresee future changes in the structure of business conduct and to apply their unique knowledge to solve a wide variety of issues. For example, the segmentation of the market of educational services is considered to be the most promising today because of the low level of free education.
The BKG matrix to date highlights theThat a small increase in the market does not require additional funding. A similar hypothesis takes place, but in some cases it does not work. It is not always possible to count on a successful enterprise in the niche of the market. Many well-known entrepreneurs believe that it is better to buy business from competitors than to start it from scratch. The focus on the niche of the market depends on the efficiency of production, this allows you to reduce the cost of transport costs and unreasonable advertising. Nevertheless, the search for a niche market is far from being limited to market analysis, the appropriate organization of the enterprise and experienced specialists able to establish a narrow-profile production are also a necessary condition for this. As a rule, for large enterprises this is an insurmountable task: all attempts to separate small firms from their environment come into conflict with the organizational methods of large business. As a result, small flexible narrow-profile companies, merging with large enterprises, begin to lose their true identity and lose competitiveness.
Matrix BKG - an excellent assistant in the searchfree niche or market segment, especially in making decisions about market positions. Its simplicity and accessibility makes it possible to make the right choice on the way to the prosperity of your own business.