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Abstract Allen, Ronald Maurice ABSTRACT ALLEN, RONALD MAURICE. Increasing the Economic Competitiveness of the U.S. Textile Industry: An Investigation of Niche Market Strategies. (Under the direction of Dr. Nancy Cassill and Dr. William Oxenham.) The purpose of this research was to examine companies in the bottomweights market who have identified niche products/markets for use in testing the Parrish Niche Strategy Model (2003). Another purpose of this research study was to analyze factors that contribute to the establishment of niche marketing strategies within the bottomweights market, as well as issues that arise when implementing a niche strategy. The conceptual model for this research is the Parrish Niche Strategy Model (2003). The Parrish Niche Strategy Model (2003) is the only niche model that is specific to the textile and apparel industries. This model encompasses the sectors within the textile complex (fiber and yarn producers, mill producers, sewn goods producers, and auxiliary companies) and identifies two approaches to a niche strategy: product (push marketing) and market (pull marketing). The Parrish Niche Strategy Model (2003) was developed utilizing trade theories that predict specialization as a result of trade. In addition, Parrish utilized Porter’s (1980) Generic Competitive Strategies – Differentiation Strategy – in developing the Parrish Niche Strategy Model (2003). One aspect of Porter’s premise is that a differentiation strategy serves as a way to increase competitiveness. This research used a two-phase methodology. The first phase was exploratory in nature and identified niche bottomweight markets and companies competing in these markets with niche bottomweight products. Secondary data were used conduct competitive analyses on the companies to develop an understanding of the current state of the companies and to assess current strategies used by the companies. The second phase of the research used a concurrent triangulation strategy to gather primary qualitative and quantitative data through an interview methodology. The interview was conducted using a researcher developed interview instrument which focused on five areas: current state of the company, factors that influence the development of niche strategies, market potential strategies, issues that arise during the implementation of niche strategies, and success variables for niche strategies. Information collected during Phases I and II was used to refine the Parrish Niche Strategy Model (2003). Results indicated that the Parrish Niche Strategy Model (2003) was useful for guiding the development of niche strategies, in terms of both product and market. In addition, the model was useful in assessing variables that are important to the success of a niche strategy, in terms of both product and market. The research added to the previous findings of Parrish (2003) by identifying factors that influence the development of niche strategies and issues that arise during the implementation of niche strategies. Sector specific niche strategy models were tested and refined, in addition to an overall industry model. The Parrish Allen Niche Strategy Model can be used by industry as a benchmarking tool in order to determine strategies that can be used to serve niche markets or develop niche products. INCREASING THE ECONOMIC COMPETITIVENESS OF THE U.S. TEXTILE INDUSTRY: AN INVESTIGATION OF NICHE MARKET STRATEGIES by Ronald Maurice Allen A thesis submitted to the Graduate Faculty of North Carolina State University in partial fulfillment of the requirements for the Degree of Master of Science TEXTILES RALEIGH 2006 Approved by: ___________________________ ___________________________ Dr. Nancy L. Cassill Dr. William Oxenham Co-Chair of Advisory Committee Co-Chair of Advisory Committee ___________________________ Dr. Michelle R. Jones Committee Member BIOGRAPHY Ronald M. “Reece” Allen was born in Lumberton, NC on January 5, 1979. He is the son of Ronald J. Allen and Faye P. Allen. Reece grew up in Bladenboro, NC and moved to Durham, NC in August, 1995 to attend the North Carolina School of Science and Mathematics. After graduating from NCSSM, he briefly attended the University of North Carolina at Chapel Hill. Before entering the College of Textiles at North Carolina State University, Reece worked at Foster’s Market in Durham as a retail manager. During his undergraduate studies, he worked as a baker for Whole Foods Market in Raleigh and performed in various locations as a member of the Wolfpack Clogging Team. Reece received a Bachelor of Science from the College of Textiles in December, 2003. After completing the requirements for the Masters of Science in Textiles, he plans on pursuing a PhD in Textile Technology Management from NCSU. ii ACKOWLEDGEMENTS I would like to extend my deepest thanks to my co-chairs, Dr. Nancy Cassill and Dr. William Oxenham. Their support, guidance, and patience had been invaluable through this research process. I would also like to thank Dr. Michelle Jones for her support throughout my college career. In addition, I would like to thank the membership and staff of the Institute of Textile Technology for funding my research and fellowship. I would like to extend my gratitude to my friends, both in and out of school. I appreciate their support, love, and friendship. To the friends I made at NCSSM – we continue to push each other to greatness and I cannot thank you enough for being by my side through the best and the worst. To my friends from NCSU – your support and encouragement inspire me to be the best I can be. To all my girls (you know who you are) you keep me sane, happy, and crazy every day – I cannot express my gratitude in words – I love you all. To everyone I met along the way – I appreciate the way each of you has touched my life and shaped it in ways I never thought possible. Life is about what we make it, and my friends have helped make mine amazing. Lastly, I would like to express the deepest of thanks to my family. Through your constant encouragement, support, love, and laughter, I am able to achieve my goals. I thank you for always pushing me to be greater than I am and for accepting from me nothing less than the best. iii TABLE OF CONTENTS List of Figures.....................................................................................................................xii List of Tables .....................................................................................................................xiv Chapter I ...............................................................................................................................1 Introduction...........................................................................................................................1 Purpose of the Research.....................................................................................................5 Research Objectives ..........................................................................................................7 Significance of Study.........................................................................................................8 Limitations of Study..........................................................................................................9 Definition of Relevant Terms ............................................................................................9 Chapter II............................................................................................................................12 Review of Literature............................................................................................................12 Conceptual Framework....................................................................................................12 Niche Marketing..............................................................................................................14 Factors Causing Niched Markets..................................................................................16 Niche Marketing as a Competitive Strategy .................................................................17 “Guerillas Against Gorillas” ....................................................................................19 Niche Definitions.........................................................................................................21 Pull vs. Push Marketing ...........................................................................................21 Niche Characteristics ...............................................................................................23 Need Identification ......................................................................................................25 Trend Prediction ......................................................................................................26 Strategy Development..................................................................................................26 “Specialness-ation”......................................................................................................27 Advantages of Niche Marketing...................................................................................30 Disadvantages of Niche Marketing ..............................................................................30 Marketing Strategies....................................................................................................31 Bottomweights Market Analysis......................................................................................32 iv Classification
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