With the specialty-market strategy the innovator must create a small but profitable new market.
The final niche strategy is to establish a specialty-market niche big enough to be profitable but small enough not to make it worthwhile for potential competitors to invade it. For example, the most profitable financial product for twenty or more years, from 1919 until World War II and even a decade beyond, was the American Express Travelers Cheque—a specialty-market niche. The Travelers Cheque was much safer than carrying a lot of cash and usable everywhere—they were accepted, for instance, by every European hotel. Banks sold the Cheques and got a small fee for each transaction. This not only kept ...
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