It is important to understand how niche markets evolve; how adaptive change is addressed through the adoption of niche marketing activities; and how firms strategically manage the niche marketing process. The research addresses the issue of why firms seek out niche markets and what leads these firms to success. Niche characteristics that are attractive to small and medium sized firms are examined to increase our understanding of how firms become specialized (highly adapted) for their chosen niche and thereby lessen the competition. Research propositions based on the following study objectives provide a framework to discuss findings: 1. Identify the characteristics of an attractive niche market. 2. Develop a normative model of the strategic planning process of small and medium sized enterprises. 3. Outline a conceptual framework for comparing the normative model developed with the actual strategic planning practices of agricultural niche marketers. a) Develop a set of propositions that enable the comparison of the actual practices of study participants with those expected based on the literature. b) Identify the key activities that are related to the actions of niche marketers. 4. In light of the findings, to restate three key concepts: the characteristics of an attractive niche; the archetypal niche marketer; and the process by which niche marketers conduct strategic planning. A multiple-case holistic design was selected and data was collected from case studies and analyzed. The principal analytical technique used was pattern matching. Explanation building was applied in order to draw conclusions about the correspondence between what was expected (based on the literature) and reflected in the normative model, and the actual decision making practices of the study population. Although niche marketing is an accepted strategy in the marketing literature as a means of adaptive change, the research suggests that selecting a niche market was not a iii planned strategy by the agricultural niche marketers studied, but rather one that came about through serendipity. However, once it became clear the firm was involved in a niche marketing activity, management engaged in strategic planning. Furthermore, the firm did not commit to producing a single niche product but rather a portfolio of products to cover several markets. The findings of this research contribute to the conceptual development of niche marketing and the theory of niche markets and to a better understanding of the decision making process of small and medium sized firms producing agricultural products for niche markets. Findings confirm that limiting competition by establishing and maintaining barriers to entry are important for a sustainable niche market. Results indicate that among the strategies employed by successful niche marketers, the forming of alliances and the development of horizontal and vertical networks are among the most common and most important strategies. Horizontal alliances provide a means for small and medium sized firms to share resources, while vertical alliances shorten the distance between the firm and the final consumer, and provide an economical means of market research and customer relations management.
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