The monopolistic condition is a market condition in which many small operators exist in the market selling competitive(similar but not identical) products. Product differentiation is a primary characteristic of the monopolistic industry. Many sellers make independent decisions regarding price and output based on the market and the cost of production. Knowledge is widely spread among customers, but it is not likely to be perfect.
Grocery stores or supermarkets are one of the classic examples of imperfect competition. There are a plethora of products available for different brands, different packaging, and different customer loyalty. Among available items are also the products that have some specific targets as women or children. Maggie noodles, bingo's tangles, bingo's Madangles, small pack juices, chocolates, cookies, and candies are some of the items that enjoy the benefits of 'niche' market. Likewise, handmade Vega products, make-over items are specifically targeted to women.
As most of the products do have competitors, the personal experience reveals that Nestle commands brand image in noodles. Though its brand loyalty was hit because of the recent controversy over Maggie noodle, its much-loved product is back and finding its place in people's bag. Its close competitors include Top Ramen and Ramen Rater. However, almost all instant noodles products are similar, and there are only subtle differences in the taste or tastemakers.
Likewise, Lakme, Mac, Lancome, Urban Decay, Artistry are some global brands vying to fetch the market share. Though prices vary sharply, satisfaction in make-over products come from personal experience only. Still, Mac enjoys trustworthiness and loyalty among customers and a more common name than others. It is the least expensive than other brands; it is probably one of the reasons for popularity.
In most of the store settings, all products of one category are placed together. For example, there are separate sections for noodles and pasta, others including cookies and biscuits are placed in a different section. Likewise, one separate row is devoted for chips, wafers and the like. The same setting holds good for all products. This setting provides an easy shopping experience to customers. While products of different brands are easily available in a single section, customers can also compare the prices and other features. It helps them have a happy and satisfied shopping experience.
Nevertheless, each store subtly divides the shelves for different items while trying to catch the attention with the best selling brands. So, it is natural that top-selling brands get the place right in the line of sight. Hardly you will find the lowest-priced item in the most effective spot. Thus, top shelves in a section are usually reserved for smaller and regional brands. Second and third shelves from the top, also called Bull's-Eye-Zone or the best placement, are placed with items of the highest mark-ups. Below it is often the kids' shelf so that they can themselves reach out to different products.
Bottom shelves are reserved for private-label brands and bulk items. It is the place for products that are almost similar to leaders' in quality but price less. More often than not, the same manufacturer who produces high-priced product also manufactures its low-cost variation. So, it is always preferable to hunt in these shelves for low cost and bulk items.
References
Nikaido, Hukukane. Monopolistic Competition and Effective Demand. New Jeresy: Princeton University, 2015.
Ramaswamy. Marketing Management. Tata McGraw-Hill, 2013.
