A niche strategy can be particularly effective when the target segment is too small to appeal to larger competitors or when the smaller firm can establish a strong differential advantage or brand preference in the segment.

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This statement is true. Niche strategies are often used by smaller firms to target a specific segment that may not be large enough to attract larger competitors. By establishing a strong differential advantage or brand preference in the segment, the smaller firm can be very effective in serving the needs of this specific market.

A Niche Strategy Can Be Particularly Effective When the Target