Dave's Health Food Shop
4] Dave’s bank manager believes that the identification of a market niche will increase Dave’s chances of success. To what extent do you agree with this view? (15 marks)
Always start with a definition:
Niche marketing is a strategy based on identifying and filling relatively small market segments.
In this case Dave Murphy wanting to set up a health food shop in Westleigh.
What should a good answer 'look like'?
1. Opening brief paragraph with a definition.
2. Two substantial paragraphs giving the advantages of Dave opening in this niche market.
3. Two substantial paragraphs giving disadvantages.
4. Concluding paragraph with your judgement.
Example paragraph:
If Dave successfully identifies a niche market for health food in Westleigh he may secure a solid market position.↓
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This is because consumers see his health food shop as the original and superior. This will be especially true if Dave has spent time building up a base of loyal customers.
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This is important for Dave because if others see the success of the business they may be tempted to open a rival store. With Dave having a solid reputation, regular customers and a recognised position in the community the rival company is very likely to struggle to gain market share.
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A consequence of this is that Dave has the opportunity to grow the business with less risk because of the lack of competition.
Your turn:
A second benefit of targeting a niche market is that customers may be willing to pay a price premium for a more exclusive product.
Can you add three arrows?
Concluding paragraph:
In conclusion I feel that the most important point is.............
This is because...................
