Mass Market: Characteristics, Examples, Advantages, Disadvantages - Penpoin. [2023] (2024)

Updated on December 11, 2020 by Ahmad Nasrudin

What’s it:A mass market is a large market with little or no difference in tastes and needs between consumers, at least in companies’ eyes. The company targets many end consumers and assumes they need the same product and marketing mix. Therefore, to market products, they do not segment the market.

Difference between mass market and niche market

To reach the mass market, companies develop the same and standardized products for everyone. They adopt another uniform marketing mix (mass marketing). The same price, promotion, and distribution is used for all consumers in the market. They sell products at affordable prices, so they are attractive to many consumers. They also take advantage of the mass media to promote products. Also, they rely on mass production methods to achieve higher economies of scale and profits.

A mass market contrasts with a differentiated market or a niche market. Like the mass market, a differentiated market consists of many consumers. We call both the main markets.

It’s just that, in a differentiated market, companies highlight uniqueness (differentiated products). Thus, they can achieve higher profit margins than mass marketing because consumers are willing to pay a higher price. They also acknowledge consumers in the market have different needs and tastes. Hence, they divide the market into several market segments. They then select target segments and differentiate the marketing mix accordingly. That way, they better satisfy consumers.

Furthermore, a niche market is a small part of the main market with specific needs. For example, most consumers need clothes. However, some companies focus on niche markets, such as top fashion houses. They target several groups, such as artists and politicians. They customize their products according to the tastes of individual customers instead of mass-producing products.

Mass market examples

Many of your daily products, such as soap, shampoo, and detergent, are examples of mass products. Paper towels, petrol, electricity, gas, and news sites are other examples. Manufacturers design them in relatively similar ways. Besides, their prices (or subscription fees) are relatively similar.

Another example of a product on the mass market isCoca Cola. The company sells it at high volumes all over the world with a standard taste. Besides targeting the mass market, the company also offers differentiation through several brands and flavors such as Caffeine-Free Coca-Cola, Coca-Cola Zero Sugar, Coca-Cola Cherry, and Coca-Cola Vanilla.

Ready-to-wear clothes are another example. Manufacturers produce them in bulk, are standardized, and rely on machines. They contrast with products from well-known designers who rely more on product customization and often use their hands to produce them.

Mass market characteristics

The mass market has the following characteristics:

The market covers many consumers.That’s because their needs and wants are more general and less specific. For example, consumers buy original Coca Cola for drinks while they are relaxing. Of course, they outnumber consumers who buy Coca-Cola Zero Sugar for health reasons.

Products are relatively standard and hom*ogeneous.Products provide relatively similar satisfaction. So, it does not make consumers loyal to a product. As a result, switching costs are relatively low.

Price is the basis of competition.Mass products usually have a similar price. The difference is insignificant. Low loyalty and high switching costs encourage companies to offer lower prices to attract customers. It is a weapon to steal customers from competitors and increase market share.

Companies rely on mass production.They improve profits by achieving higher economies of scale. With a lower cost structure, companies can offer lower prices and attract more purchases. Ultimately, higher sales volumes serve to increase production capacity further.

Mass marketing mix is the mainstay.Companies strive to expand their distribution channels to reach as many consumers as possible. They also rely on mass promotions to encourage consumers to buy products. Advertising messages appear through mass media such as television and can reach millions of viewers in one broadcast.

Mass market advantages

Marketing products in the mass market has some advantages, including:

• The market size is large, and its growth prospects are also high as it comprises a large portion of the population.
• Companies also benefit from cost-efficiency through higher economies of scale, whether in production, marketing, promotion, or other business functions.
• Consumers get low prices to satisfy their needs.
• Considerable revenue due to high sales volume compensates for low prices.
• Barriers to entry may be high mainly from investing in expensive machinery for mass production and achieving economies of scale.
• Demand is less susceptible to changes in consumers’ buying habits or tastes than in niche markets because it is considered hom*ogeneous.

Mass market disadvantages

The mass market also contains some disadvantages and challenges, including:

• The profit margin per unit is low due to low prices, so companies rely on volume to improve total profits.
• Low product variety because the product is standardized and relatively uniform.
• The competition is high because many companies are present in the market and usually they are big companies.
• Small companies find it challenging to enter or survive in the market because of the more limited economies of scale.
• The potential for high price wars due to low differentiation, low loyalty, and price becomes the basis of competition.