This episode is in response to a question from a listener. I asked listeners what their marketing challenges were and this issue came out really strongly for a lot of people. People worry about niching, whether they should and how they should and what happens if they do.
So if you have questions, please get in touch. I can create the episode that helps improve your business marketing.
Mass marketing to segmentation
The last century or so have been dominated by mass marketing. That is providing the same product, same promotion and distribution to everyone. In 1909 Henry Ford said about his model T car, you can have any colour as long as it’s black. This is classic mass marketing. The advantages are that it is really efficient to produce everything in the same colour so it’s quicker and keeps costs down.
But customers don’t always want the same as everyone else. They are different demographically, they also have different needs, perceptions and pain points. It’s really hard to be competitive if you treat everyone the same. Brands start to divide up customers into segments and make different products for different groups.
Marketing to different groups
There is a difference between a Ford Fiesta and a Galaxy. When I bought my Ford Fiesta the brochure was absolutely targeted at young female buyers. The brochure had a pink car on the front and pink luggage in the pictures. The Ford Galaxy marketing images show several children in the back and everyone using their tech.
Think about businesses that try to serve everyone – it’s tough to compete and you end up looking bland. I always think about British Home Stores, and sometimes Marks and Spencer – trying to be everything to everyone.
That’s how the big brands do it. But we are small businesses, how do we take this idea and make it work for us?
What is a niche?
A niche market is a small segment of the whole market. Marketing theory says by defining your customer in that niche really well and understanding their needs, you can create the perfect product or service that serves them.
Let’s think of some examples. As an accountancy practice, you can serve every type of company. Or you can target start up businesses. Or you could niche into female led start ups.
As an architects practice, you could do all kinds of commercial and domestic work. Or you could target domestic extensions. Or you could niche into extensions for historic properties.
A photographer could take commissions for any type of work. Or you could just do weddings. Or you could really niche into brides wanting a very natural and informal style at their country wedding.
A designer could do all kinds of design for all businesses. Or they could just work with small businesses. Or they could niche into standard website designs for small businesses, which are straightforward to create – keeping the costs down for that target market, but easy to customise for their client.
Small businesses are well placed to take one niche and really serve it well.
To work on finding your niche, book your Power Hour – including a bonus hour and detailed action plan for podcast listeners – and I can help you work out what your niche is and how to serve it successfully!
What are the benefits of niching?
Serving a niche really well offers small businesses the chance to become the expert in serving that customer. In the architects example, you have a high understanding of the types of properties you are working with and you know in detail the types of restrictions around listed buildings. You can help your clients through the planning legislation and you know what will be and won’t be permitted.
You can also be very specific about where you look for those types of business owner, so your marketing messages are much more targeted. The accountant can focus on women only networking communities and images of women in their social media posts.
You become known for serving that niche and get recommendations as a result – brides are delighted with your offer so they recommend you to their friends planning a similar type of wedding.
You build up a portfolio of customers in that niche so it starts to generate other similar work. And importantly, you can potentially charge a higher price.
How do you niche successfully?
I think you can do this in 2 ways. The first way is before you start the business, you can define the whole market, identify the segments, research your competitors, you can see which niches are underserved or potentially most profitable. This is how the big brands would do it.
But if you are already listening to this podcast, chances are you are already trading. You’ve got a business, you have the expertise and what you want is some help on ow to niche in order to be more successful and more profitable. So in that case, start with your ideal customer. Episode one of this podcast is about who is your ideal customer, and there’s a blog post and a download that goes with that, so I’ll pop the links in the show notes.
Are you already serving a niche?
Look at what work you are already doing, look at the best work, or the most profitable work or the work that gives you the most satisfaction, the customers that give you the best feedback and come back to you time after time. So you may already be working in your niche without having thought about it. Or a percentage of your work may already come from a particular type of work or client and by working to define that in more detail, you have the starting point of your niche.
So analyse your customers, look at where your sales are coming from. Perhaps you already know and work with the ideal customer but your product offer isn’t yet fully meeting their needs, so in order to niche you need to tweak your offer.
The designer may already be working with small businesses, but needs to focus on creating and defining the web design offer. The architect finds that she is already working on domestic extensions for listed properties but just hasn’t updated the website and marketing materials so she only gets enquiries about this type of work.
If you are thinking that niching means doing something different for a completely different audience, do just stop and ask yourself why? Because if you are running a successful small business maybe your niche is hiding in your existing client work.
Why do people find it hard?
Because saying yes to one niche means potentially saying no to another and that is challenging as a small business.
It can be hard to be dispassionate about your work and make an honest assessment, sometimes we are too close. We talk about our business as being our baby so it’s no wonder it’s tough to make difficult decisions.
We all have favourite clients that really don’t fit with our niche and we don’t want to give them up.
Niching isn’t compulsory, it is intended as a strategy to help you develop your business. The aim is to serve a niche so well that you make a great profit doing work you love with people you like.
And put like that who wouldn’t want to niche!
To work on finding your niche, book your Power Hour – including a bonus hour and detailed action plan for podcast listeners – and I can help you work out what your niche is and how to serve it successfully!
