Magazine article Management Today

Why the Middle Ground Is Feeling the Squeeze

Magazine article Management Today

Why the Middle Ground Is Feeling the Squeeze

Article excerpt

Big beasts are struggling, so if you want to succeed in business you need your own specialism. Jamie Collinson agrees.

I run a small record label that specialises in leftfield black music, a product the word 'niche' describes precisely. So I began reading former marketer and futurologist James Harkin's book with keen interest, and finished it hoping he was right.

The premise, which I'll simplify, is appealing. Harkin argues that the heyday of the 'big beasts' behind mainstream products is over; that their fevered, market research-driven desire to be all things to all consumers left them ill prepared for the internet age.

Now, he says, our natural need to feel different has been facilitated by the web, allowing us to zoom in on the niche that interests us. As a result, companies that do one thing well are in the ascendancy.

The 'middle', Harkin argues, is now missing and companies that try to do everything have found themselves 'known by everyone but loved by none'.

Picking struggling high street clothing giant Gap as one example, Harkin explains how in the late 1990s, ever more detailed market research enabled companies to slice up their customer base into increasingly outlandish segments. Like the politicians' 'soccer moms' and 'Mondeo men', they excitedly came up with myriad sub-species of customer and hastily created products that they believed would allow them to cover all bases.

Harkin argues that the middle ground these companies attempted to serve collapsed for several reasons: the social convulsions of the 1960s, the fading of traditional institutions, the rise of rich teenagers born in the late seventies and onwards and finally, of course, the onslaught of the internet. Using case studies such as Maxwell House and General Motors, Harkin describes how a twin approach of cost-cutting and detailed market analysis became toxic for the big beasts, leaving the market open for more nimble competitors.

In part, the argument is convincing. The companies that adorn the cover of the book are examined as niche success stories. HBO, the US subscription TV channel, is rightly lauded for its bravery in broadcasting dramas such as The Wire and The Sopranos. Viewers of HBO feel that they're part of something, and that they're making an intelligent choice. Harkin argues enticingly that the niche-age encourages these bold approaches, and thereby enriches culture. …

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