Niche domination works

I read recently about Boar’s Head the deli meat company. While this company presents great learning opportunities, which I will get to next, I should also mention that since my Great-Uncle helped build the Best Kosher Foods Company into a dominant niche player, ultimately sold to Sara Lee Corporation, I have an affinity for companies like Boar’s Head anyway.

Boar’s Head has carved out a dominant position in the premium deli meats market over the last 30 years or so. While its exact market share in the premium position is not known (it is a private company and what appears to be the #2 company, Dietz & Watson is also), most of its retail outlets give it exclusivity. This, or course, irritates the folks at Dietz & Watson who complain that giving Boar’s Head exclusivity is bad because it reduces consumer choice. Wrong.

Studies over many years have shown that consumers don’t value having too many choices. Boar’s Head is the premium brand. House brands and national brands are still available in the store, so choice still exists. And I suspect that if the situation were reversed, Dietz & Watson would not be arguing for allowing Boar’s Head into stores to enhance consumer choice.

Boar’s Head gained its place by creating great products, providing store door service that is outstanding, and using their advertising and promotion budget to attract consumers to their brand. In exchange they strive for an exclusive position in the stores.

They are a relatively small, private company when compared to the big boys in the deli department, but in their niche, they seem to dominate.

Mitch

Advertisements
This entry was posted in Marketing, retail, strategy and tagged , , , , . Bookmark the permalink.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s