Market Niches and the Pharmaceutical Industry

Market Niches and the Pharmaceutical Industry

Three men were asked to race in a competition across a desert for a grand prize. Of the three men, the two strongest and fastest start running franticly into the desert in hopes to beat the other. The third man stood calmly and watched the race for a moment and then began to walk in the other direction with a smile on his face. A judge of the race stopped the man walking in the other direction and asked him, “Where are you going? The race is that way, to the east.” The man turned and pointed at the two other men racing as they disappeared over the horizon, and then replied to the judge, “I’m running my race towards the west and by looks things I’m already winning.” Companies don’t have to be the biggest, strongest or wealthiest to compete in an economy, sometimes they just simply have to recreate the competition.

Companies that target small markets and strive to become leaders in those markets are known as Market-nichers. The central bases in which market niches can exist relies on a business or a company to fill a void that will satisfy consumer needs. Nichers three tasks are to create niches, expand niches and protect niches.

There are several main avenues to take when creating market niches. In the twelfth edition of Marketing Management, authors Philip Kotler and Kevin Keller list several common types of market niches, two of which, are the End-user specialist and the Product-feature specialist. According to authors Kotler and Keller, the End-user specialist is a firm that “specializes in serving one type of end-use customer.” An end-use customer, simply stated, is the customer who will eventually receive the product for its intended purpose. For example, the costumer who buys candy bars from a candy bar manufacturer is not usually the end-use customer. Usually a store buys the candy bars from a candy bar manufacturer. The store has no intentions for using the candy bar for its intended purpose. The consumer who buys the candy bar to eat is the End-use customer. End-use specialists sell products that are only intended for certain consumers. Product-feature Specialists focus on producing a product. Authors Philip Kotler and Kevin Keller state that Product-feature specialists are firms that specialize “in producing a certain type of product or feature.” Usually these types of firms or companies try to create something new where there is little to no competition.