Consumer Fragmentation – Turning Challenge Into Opportunity

As business is changing, brand marketing is changing because of digital disruption. So whether or not a brand or company accepts technology will replace it, it will. Whether it writes new upstart disrupters off as peripheral, they may become central. As there are many of these upstarts, they will disrupt markets in many different ways. It makes it increasingly difficult for companies to define their industries.

With the accessibility that the digital medium brings, consumers today have better access to more buying opportunities than ever before. With the use of smartphones, consumers have immediate access to more retailers than to count on. For big businesses, niche boutiques are a massive competition as they are well-positioned to gain market share while for small companies the barriers to market entry and growth are low.

One of the key factors to identify while establishing a thriving online marketplace is a fragmented industry.

What is a fragmented industry?

A fragmented industry is one in which many companies compete, and there is no single or small group of companies that dominate the industry. The competitive structure of the industry means that no company is in an overly strong one or at an influential position in the industry.

Fragmented industries, however, make ideal targets for companies that are looking to enter and potentially dominate a market. The nature of fragmented sectors often means fewer barriers to entry than other consolidated industries.

Consumer Fragmentation – Turning Challenge into Opportunity

One of the best strategies for disrupting a fragmented industry is by developing a multi-sided platform model, or marketplace, that does a better job at meeting the unmet demands and allocating resources more efficiently for the benefit of the consumers.

In the recent times, consumers’ media usage has also fragmented with the rise of digital content and the proliferation of online devices. Every channel has their own requirements, audience appeal, and economics that need specialized attention on web, mobile or even social sites. Therefore, media campaigns need to be carefully coordinated for effective consumer messaging to disrupt the fragmentation.

The top-performing e-commerce companies acquire new customers at a rate of 3.5 times faster than the average e-commerce companies by using media fragmentation to their advantage and building one-to-one customer relationships in a world where marketers are still using guerilla tactics.

Overcoming fragmentation can be a very significant strategic opportunity. The cost of uniting a fragmented industry is usually high because the prices of entry into it are low in comparison, and there tend to be small and relatively weak competitors who offer little threat of retaliation as well.

Opportunities in fragmented industries still abound for entrepreneurs willing to provide the right sort of platform. E-commerce has provided many businesses the chance to sell their goods and services online. Many of these businesses are the ones that have been competing in what could be classed essentially as fragmented industries.


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