If I searched through your house, would I find Asics sneakers, 1000 mile socks, and Runner’s World magazines? Honest Company cleaner, Plum Organics fruit snacks, and Natural Baby Magazines? Or brochures for Eldertreks and Road Scholar, AARP magazine, and Orthofeet shoes?
The brands you use tell me a lot about who you are. As a consumer, many companies actively target people like you — and sometimes, even you, specifically.
But as a business owner, you should know what this means to your business.
Riches at the Edges – Death in the Middle
We live in a world of hyper-specialization. With very few exceptions (Amazon comes to mind), general just doesn’t cut it. Instead, businesses today need to define a highly specific niche, and then provide that narrow audience with precisely what they want.
In the world of products, Michael Silverstein’s Treasure Hunt and Trading Up describe the success of both ends of the spectrum — super-broad and cheap on one side (think Costco) and super-narrow boutiques on the other (like Tiffany). Businesses that offer neither, on the other hand, tend to experience what he terms “death in the middle.”
In the world of services, nobody wants a generalist. Everyone wants the expert who specializes in their specific need or issue. Why bother with a jack-of-all-trades if he’s actually the master of none?
Take the healthcare business. In generations past, if you were sick, you went to a family doctor or general practitioner (GP). Today, if you have an eye problem, whose diagnosis would you trust – your GP, or an eye doctor? And if you had diabetes-related eye issues, would you prefer to go to a general eye doctor, or a diabetes eyecare specialist, like the doctor who put out this video?
It’s the same in every medical subspecialty — and beyond healthcare, as well. No matter your industry, your business can grow in leaps and bounds when you go deep and narrow.
Why Get Niched?
Usually, you can’t be the biggest or the cheapest provider in saturated general business. But you can be the best provider for your market, in your specialty, in your geographic area.
In today’s marketplace, tightly defining your niche can be the key to company growth. But why does niche marketing work so well? Sticking to a niche can help you…
1. Become an Expert
Once you’ve focused on a specific area, you can find-tune your skills and grow your experience in that niche. Buyers usually want to know, “do you have experience with my particular issue or need?” This is true both of consumers and in the business-to-business arena. Think about it. If you just bought a beautiful historic property and needed renovations done, would you rather hire a general contractor? Or a contractor known for fixing up hundreds of historical properties in your neighborhood — like this one?
2. Gain Exposure
Generalists blend in with the crowd. Being an expert in a narrow market segment enables you to be “known” as the go-to resource. And isn’t “being known” one of your company’s main marketing goals?
3. Improve Your Service
Narrow your target audience allows you to understand their needs better. No business is perfect; working with the same niche forces you to spot what you’re doing wrong and develop better systems and protocols — which in turn make you stronger and better. For example, general IT companies can fall short when it comes to highly specific requests. Think about a parent with concerns about her teen’s computer use, or an elderly and technophobic client. An IT company that specializes in family cybersecurity or baby boomers already knows what their market needs — and how to deliver it.
4. Enhance Your Word-of-Mouth Marketing
When you service a niche, your current clients are able to easily provide word-of-mouth referrals. For example, if your physical therapy practice decides to specialize in children on the autistic spectrum, your satisfied clients (parents of a child with autism) likely know dozens of other parents in the same situation. In the same way, most niche audiences — graduating seniors, marathon runners, foodies, small business owners, caregivers to family members with Alzheimers — typically have circles of friends or business associates who belong to the same niche audiences that you serve.
5. Limit Your Marketing Efforts
Knowing your audience is key to creating a successful marketing campaign. With less audience fragmentation, your message will ring true to the segment or segments that are your focus.
6. Stand out from the crowd
Now that you no longer blend into the crowd, your business will be more likely to get attention from traditional and social media. Talk shows and newspapers find niche businesses intriguing, which can lead to free marketing opportunities. Niche businesses can also more easily create trending material that members of their target audience will be motivated to share with each other on social media.
Getting Your Company Niched
So how can you find the perfect niche for your company?
Realistically, there are two ways that businesses usually end up becoming experts in a particular specialty: accidentally and intentionally.
Some companies stumble into their “niche” without even meaning to. For example, a bakery owner might fill a few orders for gluten-free products that garner rave reviews, or a law firm might be involved in a well-publicized case involving zoning laws. Either of these can lay the groundwork for a niche that the business can begin to specialize in. Similarly, Jay Goscinski of Michigan went through the difficult experience of a personal foreclosure on his home, prompting him to go into real estate sales with a specialty in foreclosures. From his own painful ordeal, he already understood the market of homeowners going through foreclosure.
Other companies intentionally choose their niche market. If you don’t currently have a niche, now’s the time to sit down and hone your marketing strategy so that it includes one. Think about different segments of your audience, and consider which of them would be the most lucrative as a niche. Once you have determined the exact demographics and interests of your target audience, you can begin tailor your service or products as precisely as you can for them. For example, the accounting firm Tauber and Balser PC in Atlanta underwent a marketing audit in 2003. They discovered many potential niche markets that they could target, including not-for-profit organizations, public companies, and forensic accounting. They created niche teams, as well as a leader, or “champion,” who is dedicated to each specific niche. They credit these changes with the tremendous company growth that followed the audit.
So whether you are falling into a niche or intentionally climbing into one, remember that you can’t to be everything to everybody. Instead, provide your specific niche with specialized products and services that deliver exactly what your target audience needs.
It’s time to get niched!
This article is part of the series, So You Think You Know Marketing? These article shed new light on marketing fundamentals, with examples and tips to help you apply these concepts to your own business.