Niching – Why it Matters for your Business

This is part 1 of a 2-part series on a core topic.  One that a surprisingly large number of small businesses struggle with: Niching.

“One size fits all.”

We’ve all heard that…

It feels a bit like this.

Yes, it fits.

If by that you mean “it sort of nearly partially comes close to fitting some people some of the time.”

 

Not a recipe for easy sales conversations – nor for repeat sales.

Narrowing your target market is the first step to improving the accuracy of your marketing strategy  – which is often the real key to the success of most businesses.

 

Niching and Standing Out

A “niche” refers to a much smaller and very specific area within a greater market. While niching – focusing on that niche – does not guarantee success, it’s easy to see how the smaller the market for a particular business, the less competitors you’ll need need to compete with. Niche businesses are more likely to gain traction and interest from customers than those with a broad target market.

And even more importantly, if your niche is clear, then it’s much easier to understand who will buy your product – and why.

This may sound a little obvious, but most new businesses fail to realise the great disadvantage of initiating an idea without a defined target market. In the eyes of an entrepreneur, targeting a large market is sometimes a means of attracting greater interest but it’s often frustrating to realise that this only makes it more challenging for you to stand out.

 

The Benefits of Niching

Savvy business owners recognise the true value of niching and how choosing a defined market can greatly enhance their visibility and chances of success. After all, focusing on a specific area of the market usually demonstrates a certain degree of authority in a less saturated domain.

If your farm was struggling, which of these would you approach:

“High Street Accountants: Specialists in all areas of person, family, trust, small business and corporate taxation, including retirement funds, SMSF, insurance and bookkeeping.”

(Yes, I’m paraphrasing a real advert.)

“Regional Accounting Co.: We help small business and farmers grow your business and increase business value, including managing seasonal cashflow, taxation, and point you to relevant government grants that may help.”

No prize for guessing who our farmer will call first!

 

Niching simplifies your marketing

Instead of trying to craft messages to explain your services to many different types of clients, you can more easily target.  And, niche products and services are a lot easier to describe to potential customers.  Instead of outlining various features which apply to different needs or interests, businesses can simply state the very precise nature of their product which will ideally cater to their entire niche target market.  (Of course, no amount of thinking about a niche will help if you built a product for someone else entirely!)

In advertising anywhere, targeting a small subgroup is usually more effective and this is certainly the case online. For example, businesses can identify keywords with low search competition which are more likely to capture the interest of people searching for that particular product. That is to say; targeting a niche is likely to result in more traffic, genuine interested and increased sales.

 

Your marketing should always be based around a unique selling point of some kind.  And yet so many small businesses make the same mistake – focusing on offering something to everyone, rather than appealing to a particular niche.

Ultimately, niching offers the best opportunity to reach a very defined target market while common sense and the law of averages ensures this traffic is more genuine and more likely to generate sales.

In part 2 of this series, we’ll look at the obvious question I get asked next: Ok, that’s great, but where do I start?