Niche dominance and Market Share, A Story of both
A Niche is a special area of a market the big firms fail to fill. A small firm comes into fill the niche, or as I like to call it “small hole” the big guys in the market over look. An example is when Amazon first came in to fill the need for customers to buy books online. At the time it was niche, the big players such as Barnes and Nobles thought was insignificant.
Another niche can be found in the Beer Industry. Called Craft Beer, these specialty type Beers were until recently overlooked by Millar, Anuhiser-Bush and Coors, the big three in beer. However in the face of lower demand for Regular Beer the big three have come in to buy and start their own Craft beer companies. The reason for this is for past few years Craft Beers have been the only part of the Beer Industry that has been growing. The Craft Beer Niche has dominated growth while regular beer was flat.
Now the big three, with the biggest market share also own Niche, Craft Beers with the highest growth.
-Blue Moon is owned by Coors
-Skip Jack Amber, Rolling Rock, Bare Knuckle Stout are owned by Anheuser- Busch
-Henry Weinhard’s, Milwaukee’s Best, Mickey’s, South-pair, Steel reserve are owned by Miller.
The firms with the biggest Market Share have dominated. The Big guys win. Again!
Government Protected
Government Protected = Incompetent
The worst way to run a business is for the government to intervene in it. The MTA, Amtrak, and Con-Edison are a few firms that come to mind. Remember the summer of 2006 in Queens. Customers were without electricity for weeks. Government Protection had given Con-Edison a relaxed corporate culture that did not know how to act in an emergency. In the 1980’s when AT&T became too big the Federal Government broke it up. In 2000 there was talk about breaking up Microsoft. However, Con-Edison is allowed to monopolize a whole industry in New York City. Same can be said about the MTA and Amtrek.
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4 comments:
Yes, I remember a couple of incidents where Con-Edison should have had faster response times. They are a great example of a monopoly! However, I don't think this will help them sustain their competitive advantage forever. Yes, they have been around for a long long time but I am sure somewhere down the line, there will be protests, objections etc. where the gov't will be forced to change certain laws pertaining to Con-Edison's monopoly.
I remembered we had a case study on craft beer in Marketing Strategy class. When you talk about niche markets, you can also consider it to be a group of customers that the company is trying to target/appeal to. Craft beer has certainly become popular for those who are tired of the regular beers such as Coors Light, Bud Light, etc. and crave for something more exquisite and less mainstream.
Overall, nice analysis Waruna the V!
I think our topic is to provide examples of various firms' competitive advantage, but from your post (government protected = incompetent), it seems like what you have said about those companies ("The worst way to run a business is for the government to intervene in it") is opposed to government protection.
i love how you twisted the assignment. instead of talking about things to do to be great, you spoke of what NOT to Do to be great.
i agree with you and how MTA, Con Edison, and all govt related monopolies suck, however... if i was able to get govt intervention, i think i would dominate just like the other monopolies.
i think its great for the firm/company to have government intervention, but its not good for the public.
These specialty type Beers were first movers at one point however "big beer companies" become second movers capitalizing in this niche. A beer company that may capture competitive advantage over the other beer firms, is Stampede Light a beer with government approved vitamins, such as: Vitamin B1 (Thiamine), Vitamin B2 (Riboflavin), Vitamin B3 (Niacin), Vitamin B5 (Pantothenic Acid), Vitamin B6 (Pyridoxine), Vitamin B9 (Folic Acid) and Folate. With the increase of health conscious consumers and the increase in light beer consumption (10% growth from 2004 to 2005); Stampede Light has emerged in a profitable niche and may in the future gain the competitive advantage as first movers
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