Retail Niche Marketing

I was recently asked these questions by a marketing major in college and thought I would share my answers with you.

1. Do you think that the retail formats Niche Marketing has created is a fad or will it endure the test of time?

It will endure the test of time. As the world's population grows, it becomes more and more difficult (expensive) to advertise to a general population and generate enough sales to earn a return on investment for advertising expenditures. There is just too much advertising noise to cut through to get to the general population. Therefore, the solution is to choose a selective niche market(s) that make up your "perfect" customers and focus all advertising on that niche market(s). You only want to spend advertising dollars on consumers that are a strong fit for buying your product/service. Otherwise you are just wasting your advertising money on consumers that have zero interest in your product. It is far more profitable to advertise to 100,000 ideal customers (or 10,000, or 5,000 or 1,000...) that are a perfect fit for your product than to advertise to 1 million people of a general, non-targeted, population. For example, if you sell high-end jewelry where the average price of your jewelry is $10,000, advertising to low income people and even middle class people is going to be a waste of advertising money because these consumers markets most likely cannot afford to purchase your high-end jewelry products. Therefore, you would want to focus your advertising only on high income individuals that may earn $200,000 or more per year or more. This can be done with direct mail marketing to contact lists of high income individuals, advertising in magazines read primarily by the wealthy, wealthy women in particular.

2.What are some disadvantages of creating a niche strategy for retailers?

None. Niche marketing was developed because it produces a far better return on investment than large scale general advertising (i.e., more profitable) and is therefore, financially far less risky.


Peter Geisheker, CEO
The Geisheker Group marketing firm
(920) 471-1638
"We don't help you compete, we help you dominate!"