Niche markets can offer opportunity during recession and build a sustainable future

For the UK manufacturing sector the current economic crisis comes not after years of boom that banking, retail and housing enjoyed, but after decades of a shrinking manufacturing base. Once the manufacturer for the world Britain as the first to enjoy an industrial revolution, that situation has long since changed culminating in recent times with the big shakeout of the 1980s seeing a major erosion of the once mighty industrial base. As other nations became major low cost suppliers volume manufacture largely moved offshore with China just the most recent of supplier nations. Meanwhile not only has British industry been addressing niche markets, but also redefining what is a niche market. Once seen as uninteresting due to low volumes today’s niche markets are not just about providing manufactured goods, but a package that includes consultancy and service support both adding value for the customer and contributing margin to the provider’s balance sheet. There is also the benefit of an on-going partnership between manufacturer and customer - a distinct advantage compared to products that would only be sold every 20 or 30 years. The combination of consultancy, manufacture and service changes the traditional demarcations and is leading to greater innovation, design flexibility and customization. The customer experience provides direct market research input and builds in loyalty and of course can lead to new opportunities. Meanwhile the beleaguered retail sector resorts to deeper and more frequent discounting. This seems an unsustainable strategy when they neither control the cost of products or design and at some stage the discount approach must run out of headroom. Likewise banks who have to some extent misused marketing methods to sell money they either did not have or was unsecured, might be forced to reappraise whether service might be more valued than selling so called financial products. Just as the manufacturing sector has reinvented itself, so may the retail and banking sector need to rethink service and support, not to mention prudence to the mix and give customers reasons to return loyalty. So niche marketing should no longer be viewed as a back water but perhaps the future. At Technical Marketing we have long espoused a similar philosophy. In short we build relationships with clients that includes advice, but also many deliverables and yes a degree of service support too.