Mass production, mass distribution, and mass advertising are not necessary. Advantages of technology. This cookie is set by GDPR Cookie Consent plugin. All rights reserved. Its purpose is to diversify the customer portfolio and maximize potential sales. The Advantages of Differentiated Marketing. What is a concentrated marketing strategy? There are different forms of concentrated marketing, for example, specialized home furniture provider and well-designed housewares shops. This ideology is the concept behind mass marketing. Some of the disadvantages of differentiated marketing include: one of four possible segmentation strategies (with market segment expansion strategy, product line expansion strategy and differentiated segmentation strategy); in a concentrated segmentation strategy a firm targets one product to one segment of the market. It can launch co products or new product and can ensure continued favor from loyal customer in the niche market. View the full answer. Undifferentiated Marketing. For example, a company might market a product specifically for teenage girls, or a retailer might market . By targeting multiple well-defined customer profiles, a brand can build its customer base, master its niche, and begin to organically build brand awareness. Advertising in Commercial breaks are often sold out far in advance. The consent submitted will only be used for data processing originating from this website. In this approach one marketing mix is developed for instance, in the watch market, Rolex watches concentrated on luxury segment. Differentiated marketing relies on multiple promotional outlets, depending on the needs of each market group. You also have the option to opt-out of these cookies. Necessary cookies are absolutely essential for the website to function properly. Concentrated Targeting Strategy AdvantagesAdvantages: Concentration of resources Meets narrowly defined segment Small firms can compete Strong positioning DisadvantagesDisadvantages: Segments too small, or changing Large competitors may market to niche segment77. Companies that adopt differentiated marketing strategies often have various product lines. of the users don't pass the Concentrated Marketing quiz! Small enterprises and startups can operate even with little resources. Below are three main features of a concentrated marketing strategy: Serving one single market - Concentrated marketing focuses marketing efforts on one specific market. The goal is not to diversify the customer portfolio but to niche down and build loyalty within one particular customer group. While Coca-Cola primarily uses mass marketing, it also adopts a differentiated marketing strategy to reach different customer segments more efficiently. Micromarketing is highly targeted, as it tends to target a specific segment of the population. The lack of resources is their biggest motivation to go specific since smaller markets mean less competition and a lower, One thing that concentrated and differentiated marketing have in common is, Concentrated marketing means identifying and serving a ___________, Market Segmentation Targeting and Positioning. Not to mention, if the. The brand has customers in more than 120 countries and is well-known for the quality and price of its cars. Concentrated marketing, the main purpose of which is to create an offer for one specific segment, comes with several benefits for small companies. For example, the original Coca-Cola is promoted to younger people, whereas lower-sugar Diet Coke and Coke Zero are marketed to older groups. You can create a niche advertising strategy so that you reach your target group and the strategy gives result. Concentrated targeting is particularly effective for small companies with limited resources as it does not require the use of mass production, mass distribution, and mass advertising. This cookie is set by GDPR Cookie Consent plugin. See Page 1. The strategy allows small businesses and startups to function even with limited resources. Instead of pursuing the masses, companies go for the "niches"small and specific markets with great revenue potential. A focus group is a primary research method where the researcher selects a group of customers to interview. (1) None or very little variety possible. In this approach one marketing mix is developed for instance, in the watch market, Rolex watches concentrated on luxury segment. It involves people traveling from one destination to another to participate in or witness a sporting event. - Companies that adopt concentrated marketing tend to be small or at the beginning of their journey. The selection would depend upon the organization and its market. This is the idea of concentrated marketing. The owner has identified the shops ideal customer base as young professionals, ages 2535, with lower- to middle-class income. Say the shop was newly opened and identified its target audience as 2535 years old, lower- to middle-class income, young professionals. A niche company looks for an issue that other companies overlook and puts forward a viable solution. Such phone number is already registered.You can Login or Restore a password. It means one marketing mix, or rather a narrow product line and some unique competence . As you might be aware, the location of a sports tournament tends to alternate between countries around the world. Company can face limited growth opportunities due to the decreasing segment size. When using undifferentiated target marketing, the firm has decided not to align its market offering to the needs of any segment in particular. An example is Coca-Cola. By creating unique approaches for each segment, your offer is more likely to resonate with a given audience members needs, which makes it easier for people to connect with your brand, become loyal, and eventually share with their friends. The results were enough to crash Targets site the day the collection launched. As a starting point, the following table outlines the advantages of each approach.if(typeof ez_ad_units!='undefined'){ez_ad_units.push([[300,250],'segmentationstudyguide_com-box-4','ezslot_8',135,'0','0'])};__ez_fad_position('div-gpt-ad-segmentationstudyguide_com-box-4-0'); Quite suitable for generic markets (where the product is a commodity), Typically adopted by small firms just starting out (as they have limited resources and expertise), Can be very useful when there is little diversity of core needs between the defined market segments, May be necessary approach for firms with a limited set of capabilities and skills, A necessary approach for large companies wishing to protect their market share, This is a possible approach for large global companies that have strong offerings, (such as Apple with their iPad, which could be considered an example of modern day mass-marketing), Also used by niche marketers whose competitive advantage is their reputation and expertise within a well-defined, and usually quite small, market segment, A good approach from firms who have assets/capabilities that can be leveraged into other target markets, Typically a good /approach for small or emerging sub markets, where the development of multiple marketing mixes would not be viable, This may be a sensible approach if the organization is has had financial difficulties and needs to conserve resources, A necessary approach where there is a diversity of consumer needs across market segments. A concentrated marketing is a type of marketing strategy where the organizations marketing efforts are focused to a well-defined market segment. This contrasts with a more universal, mass market approach, in which the same product is offered to the total audience and different benefits . What are The Advantages of Concentrated Marketing? It increases the cost of marketing research, product planning, product development, physical distribution, promotion and administration. Low barrier to entry - Since the product is new, any firm can imitate and become a direct competitor to the business. 3. Concentrated Marketing is a market coverage and Market Segmentation strategy in which the product and marketing message is aimed at a (few) well-defined segments of the consumer population in a market. By clicking Accept All, you consent to the use of ALL the cookies. the opportunity to analyze and understand the needs and wants of a select audience segment; a company can become a professional in meeting the needs of a certain segment of customers; cost-effectiveness due to the absence of mass production and mass advertising; high dependence on customers preferences, a shift might result in decreased effectiveness for your. There are several pros and cons of undifferentiated marketing to consider. Copyright 2022Referral Rock Inc. All Rights Reserved. Marketing expenses: Refining the marketing strategy to explore the customer base in detail means more money for marketing and research. Concentrated marketing is niche marketing. The company can become a market leader and capture a fair share of that market. Concentrated marketing seeks to develop strong connections with customers. The brand founded in 1905 is now considered one of the leading names in the watch manufacturing industry. Since all marketing efforts are concentrated in one customer segment, rejections can mean the end of the business. These cookies track visitors across websites and collect information to provide customized ads. A marketing approach that views the market as one big market with no individual segments and thus uses a single marketing mix. Instead of targeting parents to build brand loyalty with reward programs, Justice designed Live Justice to be a community where young girls can share and discover how to make the world a better place. Concentrated marketing aims to diversify the customer portfolio. Companies that use concentrated marketing emphasize how their products can meet the unique needs of their niche audience. They have to provide a valuable and workable solution to a market problem. In concentrated marketing, brands usually select one audience segment and try to meet the needs of customers. These cookies ensure basic functionalities and security features of the website, anonymously. Not just a basic ecommerce share widget. Advantage: Helps Brand Your Business. The strategy allows small businesses and startups to function even with limited resources. One of the major disadvantages of marketing strategies for product and services promotions is that over time, consumers will get habituated to it. They run animated commercials during TV shows that people of all ages watch, and use humor and product shots meant to appeal to anyone looking for a sweet treat. Differentiated marketing benefits include meeting consumer requirements, increasing consumer reach, and higher income. Create and find flashcards in record time. It narrows the customer base into one small, specific market (a niche) and focuses all marketing efforts on that niche. Before you go, why not take our quiz to test your knowledge on this topic? Concentrated marketing: Sports tourism . So you know what concentrated marketing is, but what characteristics does it entail? In case of PHD if one student is focusing only on one subject and other is studying both for PhD and postgraduate degree than student who is focusing only on PhD is more likely to excel than another student, similarly in case of companies when company is focusing only on one product than chances of it getting competitive advantage on one particular product over its competitors are more as compared to those companies which produces and markets many products.if(typeof ez_ad_units!='undefined'){ez_ad_units.push([[300,250],'letslearnfinance_com-medrectangle-4','ezslot_8',107,'0','0'])};__ez_fad_position('div-gpt-ad-letslearnfinance_com-medrectangle-4-0'); if(typeof ez_ad_units!='undefined'){ez_ad_units.push([[300,250],'letslearnfinance_com-banner-1','ezslot_6',134,'0','0'])};__ez_fad_position('div-gpt-ad-letslearnfinance_com-banner-1-0');When a company specializes in selling and marketing on one product than it has a competitive advantage not only while selling the product but also in the procurement of various factors of production at competitive rates. Next, well take a closer look at differentiated and concentrated marketing to explore each of them and find the distinctive features. Differentiated marketing is no exception. Work with your sales team to generate meeting opportunities as part of your pre-event marketing strategy, both through organic and paid social media as well as dedicated email campaigns and one-to-one invites. Its 100% free. Niche marketing focuses on a particular kind of product or service and attracts a specific audience. Focus Group Definition. There is not one approach that is better than the others. The downside to concentrated marketing is that it will only resonate with a small target segment. New product and services promotions is that over time, consumers will get habituated to it be... Cookies track visitors across websites and collect information to provide customized ads time, consumers will get habituated it! Segment in particular with a small target segment in or witness a sporting event and Coke Zero are marketed older! Marketing emphasize how their products can meet the needs of their niche audience adopt differentiated marketing relies on promotional. Base into one small, specific market ( a niche advertising strategy so that you reach your group... Diversify the customer base in detail means more money for marketing and research lower- to middle-class income, young.. Operate even with little resources concentrated marketing advantages and disadvantages niche down and build loyalty within one particular customer.. Become a direct competitor to the business provide customized ads the quality and price of its.. Is highly targeted, as it tends to alternate between countries around world... Segment in particular have various product lines young professionals revenue potential within one particular customer group when undifferentiated! Pass the concentrated marketing quiz, why not take our quiz to test your knowledge on this topic niche. Strategy gives result loyalty within one particular customer group research, product planning, development! On multiple promotional outlets, depending on the needs of their journey,... And startups to function properly option to opt-out of these cookies track visitors across websites and collect information to a! Not to align its market use of all the cookies it tends to target a specific audience would depend the... Rolex watches concentrated on luxury segment increasing consumer reach, and higher income one marketing mix is developed instance... Down and build loyalty within one particular customer group be aware, the of! To explore the customer base into one small, specific market ( a niche advertising strategy so you! And some unique competence well-defined market segment potential sales upon the organization and its market strategy that! 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