Concentrated Marketing: Definition, Advantages and Examples

Updated June 24, 2022

Many businesses consider a range of marketing strategies to advertise and sell their products. With a concentrated marketing strategy, companies may reduce the resources they need, personalize their marketing efforts and build customer loyalty. Understanding how concentrated marketing works can help you decide if a company or business could benefit from using this marketing strategy. In this article, we discuss what concentrated marketing is, explore its advantages, explain how it differs from other marketing strategies and provide examples of effective concentrated marketing.

What is concentrated marketing?

Concentrated marketing is a marketing strategy in which a company focuses on one specific target market group for most or all of its marketing initiatives. Companies that use concentrated marketing emphasize how their products can meet the unique needs of their niche audience. Businesses may define their target or niche audience segment by factors such as gender, race, shopping habits, personality traits or interests. Examples of target or niche markets include:

Children
Pet owners
People with health conditions
Roller skaters
Farmers
Eco-conscious consumers
Homeowners
People who live in rural communities
Fitness enthusiasts
Movie lovers
People of the same religion

What are the advantages of concentrated marketing?

There are several advantages of concentrated marketing, including:

Using fewer resources for marketing efforts: Since concentrated marketing focuses on targeting one specific audience segment, companies typically use fewer resources to advertise their products or services effectively. This could mean lowered manufacturing and marketing costs.
Becoming an expert in your chosen field: It may be easier for business managers to become experts in their field when using concentrated marketing because it can help them learn how to best market to consumers in their specific industry. This may help a business build customer loyalty and trust.
Customizing your branding for your audience: Many marketing teams personalize their campaigns or techniques based on their target consumer. With concentrated marketing, it often becomes easier to personalize marketing efforts because you're targeting only one audience segment.
Analyzing the effectiveness of campaigns and strategies: Concentrated marketing may generate less marketing data for a company since it focuses on selling to one specific group. This can make it faster for a business to analyze and improve its marketing campaigns or tactics.

Concentrated marketing vs. differentiated marketing

Differentiated marketing refers to a marketing strategy targeting two or more market segments. Companies that use differentiated marketing offer a single product or service while targeting multiple types of consumers. The primary difference between concentrated marketing and differentiated marketing is that concentrated marketing focuses on developing advertisements and strategies for a single audience segment. Businesses using differentiated marketing, however, target multiple types of consumers.

For example, an orange juice manufacturer using a concentrated marketing strategy might target its advertising efforts exclusively toward children. If a different orange juice manufacturer uses a differentiated marketing strategy instead, some of their advertisements might target children, while others may target customers who are interested in nutrition.

Concentrated marketing vs. undifferentiated marketing

Undifferentiated marketing refers to a marketing strategy in which marketing teams target all of their audience segments using the same advertising messages. Here are some differences between concentrated marketing and undifferentiated marketing:

Target audience

Undifferentiated marketing strategies aim to reach as many potential customers as possible. Even if a marketing team has multiple types of target consumers, their advertisements attempt to appeal to their entire consumer base when using an undifferentiated marketing strategy. Companies using a concentrated marketing strategy, however, focus on advertising to one specific type of consumer.

Advertising channels

Companies using undifferentiated marketing often use more marketing channels, such as broadcast media and digital ads. In contrast, concentrated marketing typically focuses on one or two advertising channels deemed most effective for a company's target audience. For example, if a company knows that its target consumer most frequently engages with social media, the company might concentrate most or all of its marketing campaign posts, conversations and ads on social media.

Costs

An undifferentiated marketing strategy typically costs more than a concentrated marketing strategy. Undifferentiated marketing plans are often more expensive because they're targeting a wider audience using more types of marketing channels. Businesses that use a concentrated marketing strategy can typically save on these costs by only targeting one type of consumer through fewer marketing channels.

Examples of concentrated marketing

Concentrated marketing can be a successful strategy for many companies. If a company has a unique product or service customized for a specific group of customers, concentrated marketing is often worth trying. Below are examples of fictional companies that use concentrated marketing effectively:

Watch manufacturer example

Spacemode is a successful watch manufacturer focused on creating luxury timepieces. Spacemode's advertisements feature actors, athletes and other famous people wearing Spacemode watches. Advertisements depict these people on tropical islands and inside luxury homes, creating the impression that Spacemode watches are a symbol of wealth and status. By focusing on these themes, Spacemode hopes to appeal specifically to consumers who are interested in luxury goods or lifestyles.

Yoga studio example

DreamerYoga is an expanding yoga studio focused on meeting the needs of urban professionals. DreamerYoga doesn't advertise on television or radio because of a limited budget, and their surveys show that urban professionals rarely watch television or listen to the radio. Instead, DreamerYoga places advertisements on subways, trains, buses and billboards in busy areas. Many urban professionals use mass transit or work in areas with these visible billboards, so DreamerYoga believes their advertisements can reach their target audience effectively.

Cafe example

Cafe Chantigra is a small coffee chain that wants to change its advertising strategy. Through an analysis of sales, the company realizes that its most profitable demographic is young professionals. Cafe Chantigra develops an advertising strategy that highlights its affordable and sustainable coffee, hoping to appeal to young professionals through its low prices and environmentally friendly practices.