How to start with niche marketing?

There is a lot of talk on small business websites about the importance of creating your own niche.  So what is that all about?

What is niche marketing?

A niche is a focused, targetable part of the market.  You are a specialist providing a product or service that focuses on specific client group’s needs, which cannot or are not addressed in such detail by mainstream providers.

However, it is important to understand that there is a difference between your niche and your target market.  Your target market is the specific group of people you work for, i.e. young unemployed women in Liverpool, organic farmers in Kent, yoga teachers in the UK.  Your niche is the service you specialise in offering to your target market.  For example there will be various organisations working with young unemployed women in Liverpool, but they offer different services i.e. drop-in career services and support, online ITC training, peer-to-peer coffee mornings.

Why is it important to have a niche?

• Instead of spreading yourself too thin, and say that ‘everybody’ is your potential client niche marketing will help you to focus on a specific group of people, and what their specific needs and wants are.  You will soon find out what is important to them, what magazines or blogs they read, how they talk and dress, who the main people in that network are.  You can develop products or services specifically for this group, based on your increasingly thorough knowledge and understanding of what they are interested in.
• It will be easier to identify potential clients and partners to work with as you can be more targeted with your marketing efforts.  Especially if you run a small business you need to be efficient and effective with how you spend your time and money.
• It will be easier for others to understand ‘what you do’ and ‘for whom’, which will make you an expert in a certain field.  As this group is more targeted and smaller you will be quicker well known within this group of people. Others will therefore refer more and better clients to you, as you have build up trust and got more visibility and credibility, and it is clear what you specialise in.
• There will be less competition, as you do specific things, for specific people, in a specific way.  The BIG advantage of that is that it can’t be easily replicated!
• It will really help with your marketing, positioning and branding as you will attract the ‘right people’ easier.  People with similar interests behave and are attracted to similar things.  You can also identify specific potential clients easier (especially if your clients are other businesses), so make the communication from the start more personal and unique, instead of mass marketing or advertising.
• As you can provide an increasingly better service or product, based on your client’s needs, the chance is that you will get more repeat business – people will come back for more, and often will start spending more with you as the relationship grows.

Niche marketing really comes down to this: Who would you rather be: A small fish in a big pond or a big fish in a small pond?

But if I focus on a small group of people, won’t I miss out?

You might like to be everything to everybody, but that’s just not possible in terms of your time, money and energy.  Also, it might not make you very attractive!  Why?  Imagine that you have just started dating, and your friends ask ‘Who are you looking for?’, and you respond ‘Any wife will do’.  I bet you won’t get that much actual interest!

If you narrow your focus and market you will be able to serve your clients much better, and you can focus on those people who need your products or services the most and get the most benefits of what you have got to offer.

And I don’t like to be labeled either!

Some soletraders are worried that they will only be known ‘as the person who does x’.  Actually, think about it, that doesn’t need to be a negative!  And don’t worry, for any of these two worries about creating your niche there is one simple solution: Once you are known in a specific target market and niche, and have lots of clients, you can grow from there.

You can either offer additional services or products based on the actual needs of your client groups. For example to the above mentioned target group of unemployed women in Liverpool you can offer subsidised childcare or debt counseling services. In fact you can ask your clients or users to help you design new services or products with you.  (And by the way, you don’t have to do this all by yourself! You can work with partners who deliver these other services, and who will like to work with you as they know you have the clients already.)

Or, if you have a really good product or service you might provide that to other client groups too.  So, for example offer drop-in career services to NEETs or young men in Liverpool, or to unemployed young women in Manchester.

I have only just started, and I don’t really know what I want or what I am good at!

In the first 3 years or so of any business startup it is hard to identify what your particular strengths or talents are, where there is a profitable market for your product or what your clients really need (they often say something else than what is really on their mind!).  Also, you need some really practical experience, because sometimes you need to find out the hard way what works and doesn’t work for you, and your clients.

Niche marketing, developing your understanding of your market and improving your skills is an ongoing process!  Niche marketing is not a fixed approach, so stay flexible for opportunities and listen to client feedback, and then fine tune to discover more and more about what you are passionate about and the best at.

Niche marketing is really about ENERGY.  Especially as a small business owner you can’t be everything to all people, and there are only 24 hours in the day.  Niche marketing will help you to focus on two things:

Where and with whom do I want to spend my energy?

Where and from whom do I get my energy?

If you liked this, you might like to learn more about how to identify your own niche in this related article.