Being unique is more important than ever. The internet landscape is flooded with eCommerce, and the trend is of further growth.
In times of Amazon, services like fast or free delivery are no longer features you can shine with. You have to find something you are doing different or better than your competitors.
Would you like to hear more about it? Keep on reading!
As just mentioned, the number of online stores is steadily growing. According to Ecommerce News Europe, in 2017 there were around 800,000 eCommerce stores active in Europe. Along with the growth, the rivalry is increasing as well.
We are living in a brand-agnostic world, where loyal customers are not the norm. This fact is underlined by the findings of Salesforce in collaboration with Publicis.Sapient: Consumers tend to prefer second purchases on market platforms like Amazon instead of retailing stores. Furthermore, did a survey in the US uncover another sad truth. 37% of respondents claimed that it requires at least five purchases to become a loyal customer.
These circumstances lead to highly competitive markets with fights to win over other companies’ clients. Most common practices seen in all different industries are market participants trying to outperform the competition in order to get a greater piece of the cake.
We would like to introduce you to two alternative solutions though, which are not rivalry-driven, but working with another method: Being unique!
Finding a niche
Think small, grow big.
Do you remember the sentence from your childhood when discovering for the first time something you have no talent for: “Darling, you cannot be good at everything”. Years later, once grown up, the sentence has more power than ever. This sentence your mom or dad might have told you is not only applicable in private but also in business life.
Many companies are using a broad product offerings approach while assuming that a bigger product range equals to higher sales. That not only leads to high infrastructure requirements but more importantly to a loss in focus.
Targeting a broad mass is difficult. Preferably, a business can start being unique and focusing on smaller audiences. A good way is to find a niche market which is a small sub segment of the market. In this market segment, the company serves consumers who have been overlooked so far by mainstream providers. Instead of being a me-too company, it should begin to be a me-only business or at least a hybrid version.
A streamlining focus helps you to become an expert in your niche. Furthermore, a smaller target group allows more specific advertising, as you it gets studies better. What is more, the required budget will shrink, too. Despite saving money in product promotion, you might think now, that you will miss out on sales by being too tight. But have you heard of the 80/20 concept? According to this principle are 20% of the market share responsible for 80%of the revenue. Worth mentioning is also that this approach allows to grow a loyal customer base which can function as brand ambassadors.
“Try not to do everything. Do one thing well.” – Steve Jobs
Being unique and serving a niche does not necessarily mean to coming up with a product or service innovation. Me-only in the broader sense suggests being the one who is doing it way better or different from the rest. At this point, we would like to quote one of the most successful figures in history, who has more than succeeded with this mindset, Steve Jobs. “Try not to do everything. Do one thing well.”
The launch of the first iMac in 1998 happened to be a big seller after a long bad period for Apple. With Jobs’ return to the company and the strategy of focusing on fewer projects, he brought new perspectives. Nowadays Apple is the most valuable publicly traded company.
How did Apple do it?
Apple had not invented the computer itself. Also, it was not selling a complicated product, more the opposite: it was made to be used intuitively. It listened to consumer’s needs and has been creating customer experiences that have been exceeding any possible expectation ever since. Through the creation of a unique selling proposition, the company managed to surpass competitors in a highly competitive market.
Apple aimed to approach a small target market with sophisticated computer buyers. It recognized the necessity of finding a niche and through its USP evolved a strong value proposition.
While Apple managed to find a niche in a mainstream market, there are other businesses like Lefty, the left hand store, narrowing their offer to a really distinct buyer group as left-handers.
As you can see, the next niche market is just around the corner. Often it is obvious and hidden at the same time. Significant, in following a niche marketing strategy, is the opportunity to expand and scale the business in the future.
However, you could also go a step further and rethink your whole business with the blue ocean strategy.
“In order to be irreplaceable one must always be different.” – Coco Chanel
The blue ocean strategy
Think big, grow even bigger.
The blue ocean strategy forces companies to rethink their current business model and offerings. “Are my products still what consumers want?”
The concept is breaking out of red oceans – which are a metaphor for the bloody competition – and creating blue oceans. The strategy suggests thinking outside the box and getting away from competitive thinking. By doing so, a business is “creating uncontested market space which makes the competition irrelevant”. Through swimming out alone in the blue ocean, no comparisons in terms of product and prize can be drawn by consumers.
There is not always the need to do rocket science and release a new technology innovation. Also, like the niche marketing strategy, the blue ocean strategy states that getting your business to the top does not require bringing unprecedented cutting-edge technology to the market. The importance is to provide value innovation for buyers, instead.
Even though the niche marketing overlaps with the blue ocean strategy in terms of focusing, there are decisive disparities. Let’s take a closer look at their differences
Differences between niche marketing and blue ocean strategy
- When serving a niche, the focus is set on the target group, while the blue ocean strategy tries to focus and reduce a product or service to only necessary features.
- Against the niche strategy which concentrates only on a small share of the market, the blue ocean strategy aims at targeting non-customers also from other industries through reconstructing market boundaries. Hence, it is about finding the greatest amount of customers to serve.
- Besides, blue ocean strategy is a holistic approach. It requires alignment of three key components of the strategy: value proposition, profit proposition, and people proposition. Niche marketing on the other hand, as the name already says, concerns mainly the marketing department and a few others.
- Unlike the niche strategy that is searching for a not served gap in existing markets, the blue ocean approach aims at reconstructing market boundaries and creating a new industry.
Blue ocean examples
Let’s take Starbucks as an example of a blue ocean. This company accomplished a revolution in the coffee house business.
Did it introduce the world to coffee?
No, it designed a new way of drinking or rather enjoying coffee beverages in a cozy environment.
Is the high price worth the quality of the drink?
That might lead to discussions now, however, what cannot be argued is that every visit is worth it. Experience and service of Starbucks cannot be reproduced easily.
Did it focus on a small target group?
No, absolutely not. The brand turned non-coffee house visitors into fans and thus reached buyers outside of the original market.
Competition never sleeps
Whether you are following the niche or the blue ocean strategy you should ensure to have imitation barriers as well as a long-term profitable and scalable path. As you may know, competition never sleeps, so neither should you. Even though you are trying to leave the competition behind, imitators will try to reach you when sensing an excellent business opportunity.
A good example at this point is the development of digital music. After Napster failed with the file sharing system due to copyright infringement, Apple recognized the potential of the digital music industry. By winning external partners like Warner Brothers Records, Apple was able to adopt the idea of Napster in a legal way with a sustainable strategy (for many years) and thus created a Blue Ocean with iTunes until the transition to music streaming took place. With the music streaming service, Spotify created the next blue ocean in 2006. In April 2018, Spotify had around 83 million premium subscribers. Since the offering of Apple Music in 2010, Apple has been lagging behind with 40 million and has been trying to catch up to enter the blue ocean.
Netflix disrupted the video on demand industry with its own blue ocean, after getting its business away from a DVD sales and rental by mail service. It transformed the market bysteering it away from vast masses of illegal and free video streaming. Indeed, a statistic shows that more people are embracing VOD. While in 2016 more people (40%) utilized free streaming services rather than paid streaming (35%), in 2017 those percentages were reversed.
From the competition perspective, Netflix is nowadays the most successful video-on-demand service with the lion share of 137 million subscribers. Even though there might be overlapping functions with Hulu and Amazon video, surveys revealed that these companies complement rather than fight against each other. Unlike Amazon video, which is being primarily used to watch movies, Netflix is a popular platform to watch series.
Nonetheless, it will inevitably have to renew its blue ocean in the future.
We are sure that every business can find its way to uniqueness.
Whether it’s following the niche path and opening a dog salon for poodles or creating a new industry in line with the blue ocean strategy. The vital key for success is finding something which is profitable and sustainable in the long run and hard to imitate.
Online shopping is continuously growing, and new online businesses will pop up every hour in the world. As Coco Chancel once said: “In order to be irreplaceable one must always be different.”
Get your business out of the mainstream pool and start to streamline your focus.