Profiting with Niche Marketing

The “long-tail phenomenon” is a buzz word for selling smaller quantities of a wider range of goods. The goods are designed to mirror consumer preferences and have higher profit margins. They fill a niche.

Companies have embraced the long tail for some time. Low volume, high-profit product examples include super-premium ice cream, heritage meats and heirloom vegetables.

The idea doesn’t work for all types of products, but it does work for unique marketing areas in which products are so pleasing that certain consumers are willing to pay more.

Other qualifications, according to The Wall Street Journal:

Determine what is a real sweet spot rather than a valueless niche. Listen to what customers say to you and on their blogs. But think about it. Henry Ford reportedly said if he’d asked people what they wanted in the way of transportation, they would have told him, “a faster horse.”

Using tools like SpredFast, TweetBeep, StepRep and HowSociable make keeping a pulse on your market more manageable. These tools enable you to track brand and keyword mentions, so that you can respond accordingly.

Standardize components to limit the costs of producing another product line. Variety and standardization can be achieved at the same time.

Before starting anything new, review your present products and weed out those that are not profitable. But some products that make little profit have value when considered in broader terms. They can make your company’s other products more profitable.

The sweet spot products don’t have to be better than others already on the market, but they have to be different and appeal to the targeted customers.

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