Page 148 - Cambridge IGCSE Business Studies
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Cambridge IGCSE Business Studies Section 3 Marketing
What is mass marketing?
KEY TERM Mass marketing is the opposite to niche marketing. This is where a business sells
the same product to the whole market, for example fl our. This type of marketing is
Mass marketing: selling the
less popular than it used to be. Most businesses now see the benefits of dividing the
same product to the whole market and providing a slightly different product to each segment. Th is recognises
market.
that consumers do not all want the same product; for example toothpaste is
produced for sensitive teeth, for children’s teeth and in diff erent fl avours. Dividing
the market so that products better meet the needs of different types of consumers
can help to increase sales, revenue and profi ts.
TOP TIP
Use examples from your own
country to help you understand
and remember the diff erence
between niche markets and mass
markets.
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Manufacturers target different sections of the market
Benefits and limitations of niche marketing and
mass marketing
The tables below outline the benefits and limitations of these two approaches
to marketing.
Benefits of niche marketing Limitations of niche marketing
Small firms are able to survive and earn The opportunity to earn high profits
profit even in markets that are dominated might attract competitors and this will
by larger firms. reduce prices and future profits.
There is less competition in these The small size of the market means that
markets. Firms do not waste scarce economies of scale are unlikely to be
resources responding to competitor achieved. This means that unit costs are
actions. higher than they would be if the product
was sold to a mass market.
Consumers will usually pay more for Small changes in consumer spending
a high status, exclusive product. patterns could have a very significant
This offers firms the opportunity to impact on firms operating in niche
charge high prices and earn high markets.
profit margins.
Table 10.1 Benefits and limitations of niche marketing
