How do I decide which niches to market my products to?

In the fast-paced and ever-changing markets of today, marketers face an increasingly overwhelming need to place products in the correct market niche almost immediately.Failure to do so can result in the market not responding to a new product and substantial losses being realized by the manufacturer.Because of this marketers of new products and services must be able to identify the niche market they want to attract for their product or service and place it in the best possible position to attract the most revenue.The first step in determining the niche market they want to attract is actually knowing their product and its parameters.There are four factors that need to be considered:

1. The product itself-Marketers must have a thorough knowledge of the product or service.This allows the marketer to know what the possibilities can be in designing the marketing campaign.Is this item or service something people will need or just want?Will this item be reliable? Is this a one-time purchase or something that will be purchased repeatedly?All of these questions help determine what niche the marketer wants to attract.

2. Price-The marketer must determine what the market will bear as far as price.Will the consumer see this product or service as a quality purchase and be willing to pay a premium price?Are there other factors that will be more important than price to the consumer?What is the competition for this product or service priced at? Price is a major factor in helping determine what niche will be attracted to this product or service.
3. Place-Where will the product or service be sold?If the item is a tangible product will it be sold in grocery stores, discount stores or upscale department stores?Is this an on-line only product or service?Will the product be placed somewhere that attracts a great amount of foot traffic or will the consumer need to be drawn to the product?Is this a product or service that will only be sold by another vendor?All of these questions must be asked to help determine a pool of potential customers.
4. Promotion-The savvy marketer will then use all the above factors to determine how the product or service will be marketed.Promotion becomes a huge part of the target advertising to attract the niche market.If it is determined the product or service will be in the discount arena versus an upscale placing than a whole different type of promotion will have to be designed for the product.For example if the product or service is of the discount variety than the marketer may determine to send out coupons to value-minded consumers, since price tends to be an overriding factor in determining a purchase for these customers.If the product is placed in the upscale or luxury market than the marketer may use a fashion show, art gallery or in-store promotion at an upscale department store where he or she may attract his pool of potential customers.

When all of these factors come into consideration a niche market starts to define itself.The marketer can use marketing tools at his disposal to then market the product or service to the defined niche market.A firm's success in a market depends on satisfying customers by producing the products they want and selling those goods and services at prices that meet the competition they face from other businesses. In addition the company marketing the new product or service must not only meet the competition but address the need better than anyone else for a product or service that is not being addressed by mainstream providers. While the niche market may be somewhat narrowly defined successful marketing can insure a products maximum ability to make profit.