How do I find a niche?
How do I find a niche?
That age old question small business owners encounter at parties is really at the crux of a lot of my clients’ key business issues. They have no clarity around what specific product or service best represents what they actually do or sell.
Some people are so conflicted about which product or service to focus on that incredibly, they’ve built two separate businesses, complete with multiple business cards, and even some with multiple websites.
Imagine the energy of maintaining two separate businesses..no wonder the first step of any coaching relationship is to achieve clarity of objectives.
Why do people do this, you ask? Is it because they thrill to joining 3 different types of associations and thrive on meeting strangers every day? Is it because they feel the warm glow of joy working long hours trying to meet different industry needs? Or is it because they are just plain scared that if they define their product or service too narrowly, that they won’t have enough business to survive on.
I was very fortunate to sit in on a teleclass by a coach named Sue Rasmussen earlier this year. She very eloquently enunciated what I had been telling my clients for a long time—that laser focusing in business is the soundest marketing strategy there is!
I want to share with you, her tool of finding a niche:
1. Step 1: Draw 4 shapes: a square, a triangle, an upside down triangle and a vertical line
2. Step 2: Populate the top with possible CUSTOMER targets (ie. bankers, single moms, small businesses, big corporations, etc.)
a. On top of the square as well as on top of the upside down triangle, you write all your different possible target markets (up to 5 )
b. Similarly, on top of the point of a triangle, as well as at the top of the vertical line you write only 1 of those target markets. Pick the one that you think is the lowest hanging fruit, ie. The easiest sell you can get at this stage of your business, at the highest profit.
3. Step 3: As in the previous step, populate the bottom of the shapes with possible SERVICES or PRODUCTS you can offer (ie. Consulting, Public Speaking, Coaching, Accounting software etc.) Writing in up to 5 different options on the bottom of the square and triangle, and only 1 the best single option on the bottom of the upside down triangle and the vertical line.
4. Step 4: Bring it all together to reveal your target niche product or service as well as your niche market.
Top 10 benefits of picking a narrow niche are the following:
1. Increase credibility as an expert in the chosen product/service offered:
The surefire way to make yourself an expert in what you offer is to live and breathe the single subject matter. For example, if your niche (as in the above example) is Strategy Development and your target is Food Companies, when you build your marketing and sales efforts to reflect your chosen niche, every time a Food Company manager sees your advice column or hears you speak at a conference, it will be about the same topic. You will automatically be perceived as an expert in that field.
2. Increase your perceived value:
Experts get paid more. Generalists do everything and sadly aren’t as valued because they’ve diluted their value by refusing to focus on one product or service. If I had a leaky roof, would I feel more comfortable paying $2K to a general contractor or to a roofing company specialist? Experts are the wave of the future. Niche is a word you’ll be hearing much more of in the coming years.
3. Competition becomes colleagues and referrals:
When I ask my clients to do some research about their niche by calling their competition, they are appalled and surprised. “Why would anyone help me take business away from them by giving me information?” they say. When you pick a niche that’s distinctly different than theirs, you are no longer the enemy who’ll take money out of their pockets but the guy they can refer their clients who are looking for experts in the field, in order to provide added value to them. This happens in coaching all the time; I refer many clients to Relationship Coaches or Lifestyle Coaches. Similarly, they refer their business leader clients who wish to reach a business goal faster to me.
4. Attract higher quality clients:
People who are looking for experts are cognizant of the fact that experts are different than businesses who deal in all things. When you increase the quality of what you offer in terms of value (and experts offer more value) the clients you attract will be of the same quality. It’s the law of attraction. You are what you attract. One of my most successful clients has recently changed the way she does business to reflect her niche better. Not only did she get more clients but she got higher revenues per client versus a year ago. She credits becoming more focused around her niche with her double digit growth.
5. Facilitate marketing decisions:
When you have two products you want to market. Which one do you talk about first on your website? When you serve two target markets, whose trade show do you invest the very limited marketing funds you have for this year? These are very real questions that small businesses face and it’s exhausting. There aren’t enough hours in the day, or money in the bank for any business to be able to afford to have a multitude of products, services as well as target markets to wow. Picking one just makes economical sense.
6. Increase marketing effectiveness:
When you’re always in your niche customers’ world and you’re always talking about the same thing, it just follows that they begin to get to know you. In brand marketing, there’s something called ‘mind real estate’. This is how brands carve out a space in the mind of their consumer. That’s what picking a narrow niche does, you begin to start immediately coming to their minds when the need for your specific product or service arises.
7. Decrease time on marketing:
Similar to facilitating the marketing decisions, picking a niche allows you to be more effective in how you spend your precious resource of time. Most small business are flying by the seat of their pants, coming up with ad hock ideas on visibility and going on gut feeling to decide their marketing initiatives at any given time. Having a niche allows you to make a more formalized annual marketing plan, full of details of where and when to find your niche target and how to most effectively reach them.
8. Simplify your business:
I cannot begin to tell you the clarity of focus that picking a niche brings to a business. I am not advocating that you refuse to take on business that comes from other niches than the one picked as a result of the above exercise. I’m only suggesting that picking one simplifies how you market it.
9. Command higher fees:
Experts command more because they have spent more time and invested in education about the said subject matter. The price of a product on any retail shelf is perhaps the most telling indicator about its value. Your expertise in the niche will give you the confidence to raise your prices which in turn will increase your clients’ perception of the value of your offering.
10. Generate more referrals:
When people can refer you as the ‘guy who coaches micro businesses to get to a million dollar client base’ that’s a much stronger testimonial than ‘I know a guy who does some business development work’. If you’re having trouble deciding what exactly it is that you do or sell, how do you expect your peers to understand it or better yet, to describe it to others. People talk about what they understand. They steer clear of what confuses them. Give them the clarity and you’ll be rewarded with more referrals.
These are my golden rules around building a successful business. Pick a niche in both product/service and target market and only move on to a new one if you’ve saturated the first one. It has proven to be a great model for all my clients as well as my own business.
Plus, now you know what to say to the next person who asks you what you do at a party.
With kindness as always,
Chala Dincoy
How do I find a niche - To learn more about this author, visit Chala Dincoy's Website.
Like this article? Share it with your friends
“What exactly is it that you do?”
That age old question small business owners encounter at parties is really at the crux of a lot of my clients’ key business issues. They have no clarity around what specific product or service best represents what they actually do or sell.
Some people are so conflicted about which product or service to focus on that incredibly, they’ve built two separate businesses, complete with multiple business cards, and even some with multiple websites.
Imagine the energy of maintaining two separate businesses..no wonder the first step of any coaching relationship is to achieve clarity of objectives.
Why do people do this, you ask? Is it because they thrill to joining 3 different types of associations and thrive on meeting strangers every day? Is it because they feel the warm glow of joy working long hours trying to meet different industry needs? Or is it because they are just plain scared that if they define their product or service too narrowly, that they won’t have enough business to survive on.
I was very fortunate to sit in on a teleclass by a coach named Sue Rasmussen earlier this year. She very eloquently enunciated what I had been telling my clients for a long time—that laser focusing in business is the soundest marketing strategy there is!
I want to share with you, her tool of finding a niche:
1. Step 1: Draw 4 shapes: a square, a triangle, an upside down triangle and a vertical line
2. Step 2: Populate the top with possible CUSTOMER targets (ie. bankers, single moms, small businesses, big corporations, etc.)
a. On top of the square as well as on top of the upside down triangle, you write all your different possible target markets (up to 5 )
b. Similarly, on top of the point of a triangle, as well as at the top of the vertical line you write only 1 of those target markets. Pick the one that you think is the lowest hanging fruit, ie. The easiest sell you can get at this stage of your business, at the highest profit.
3. Step 3: As in the previous step, populate the bottom of the shapes with possible SERVICES or PRODUCTS you can offer (ie. Consulting, Public Speaking, Coaching, Accounting software etc.) Writing in up to 5 different options on the bottom of the square and triangle, and only 1 the best single option on the bottom of the upside down triangle and the vertical line.
4. Step 4: Bring it all together to reveal your target niche product or service as well as your niche market.
Top 10 benefits of picking a narrow niche are the following:
1. Increase credibility as an expert in the chosen product/service offered:
The surefire way to make yourself an expert in what you offer is to live and breathe the single subject matter. For example, if your niche (as in the above example) is Strategy Development and your target is Food Companies, when you build your marketing and sales efforts to reflect your chosen niche, every time a Food Company manager sees your advice column or hears you speak at a conference, it will be about the same topic. You will automatically be perceived as an expert in that field.
2. Increase your perceived value:
Experts get paid more. Generalists do everything and sadly aren’t as valued because they’ve diluted their value by refusing to focus on one product or service. If I had a leaky roof, would I feel more comfortable paying $2K to a general contractor or to a roofing company specialist? Experts are the wave of the future. Niche is a word you’ll be hearing much more of in the coming years.
3. Competition becomes colleagues and referrals:
When I ask my clients to do some research about their niche by calling their competition, they are appalled and surprised. “Why would anyone help me take business away from them by giving me information?” they say. When you pick a niche that’s distinctly different than theirs, you are no longer the enemy who’ll take money out of their pockets but the guy they can refer their clients who are looking for experts in the field, in order to provide added value to them. This happens in coaching all the time; I refer many clients to Relationship Coaches or Lifestyle Coaches. Similarly, they refer their business leader clients who wish to reach a business goal faster to me.
4. Attract higher quality clients:
People who are looking for experts are cognizant of the fact that experts are different than businesses who deal in all things. When you increase the quality of what you offer in terms of value (and experts offer more value) the clients you attract will be of the same quality. It’s the law of attraction. You are what you attract. One of my most successful clients has recently changed the way she does business to reflect her niche better. Not only did she get more clients but she got higher revenues per client versus a year ago. She credits becoming more focused around her niche with her double digit growth.
5. Facilitate marketing decisions:
When you have two products you want to market. Which one do you talk about first on your website? When you serve two target markets, whose trade show do you invest the very limited marketing funds you have for this year? These are very real questions that small businesses face and it’s exhausting. There aren’t enough hours in the day, or money in the bank for any business to be able to afford to have a multitude of products, services as well as target markets to wow. Picking one just makes economical sense.
6. Increase marketing effectiveness:
When you’re always in your niche customers’ world and you’re always talking about the same thing, it just follows that they begin to get to know you. In brand marketing, there’s something called ‘mind real estate’. This is how brands carve out a space in the mind of their consumer. That’s what picking a narrow niche does, you begin to start immediately coming to their minds when the need for your specific product or service arises.
7. Decrease time on marketing:
Similar to facilitating the marketing decisions, picking a niche allows you to be more effective in how you spend your precious resource of time. Most small business are flying by the seat of their pants, coming up with ad hock ideas on visibility and going on gut feeling to decide their marketing initiatives at any given time. Having a niche allows you to make a more formalized annual marketing plan, full of details of where and when to find your niche target and how to most effectively reach them.
8. Simplify your business:
I cannot begin to tell you the clarity of focus that picking a niche brings to a business. I am not advocating that you refuse to take on business that comes from other niches than the one picked as a result of the above exercise. I’m only suggesting that picking one simplifies how you market it.
9. Command higher fees:
Experts command more because they have spent more time and invested in education about the said subject matter. The price of a product on any retail shelf is perhaps the most telling indicator about its value. Your expertise in the niche will give you the confidence to raise your prices which in turn will increase your clients’ perception of the value of your offering.
10. Generate more referrals:
When people can refer you as the ‘guy who coaches micro businesses to get to a million dollar client base’ that’s a much stronger testimonial than ‘I know a guy who does some business development work’. If you’re having trouble deciding what exactly it is that you do or sell, how do you expect your peers to understand it or better yet, to describe it to others. People talk about what they understand. They steer clear of what confuses them. Give them the clarity and you’ll be rewarded with more referrals.
These are my golden rules around building a successful business. Pick a niche in both product/service and target market and only move on to a new one if you’ve saturated the first one. It has proven to be a great model for all my clients as well as my own business.
Plus, now you know what to say to the next person who asks you what you do at a party.
With kindness as always,
Chala Dincoy
How do I find a niche - To learn more about this author, visit Chala Dincoy's Website.
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Leanne Hoagland-SmithAre your sales where you want them to be? Will you be one of the few who achieves sales or business success or one of the many who have failed to change? Are you tired of being told you are like everyone else? Then you may find my first book on sales of interest. Be the Red Jacket in the Sea of Gray Suits, The Keys to Unlocking Sales available at Amazon or at http://www.processspecialist.com/red-jacket.htm. This book is a reflection of my no-nonsense approach to improving sales to overall business results. If you are truly committed to making sustainable changes, then I can help you secure a positive return on your investment because I focus on executable solutions not telling you the problems you already know you have. From training to corporate (group) coaching to executive one on one coaching, my approach is to assess, create awareness, build a goal driven action plan and then execute. The bottom line question is "Not do you or your employees know it, but do you or they want to do it?" Please call for a free strategy session at 219.759.5601. - Visit Leanne Hoagland-Smith's Website |
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Anne BarrAnne Barr has over 26 years experience in sales and marketing, six years as a franchisee. She has assisted over 367 business owners and purchasers to achieve their goals in career change, transition and exit strategy. She holds the designation of Certified Franchise Executive from the International Franchise Association, Certified Business Intermediary from the International Business Brokers Association and Board Certified Broker from the Texas Association of Business Brokers. Anne is active in professional organizations, networking groups and volunteers for non-profit entities. As owner/operator of four successful businesses, Anne has proven people skills and enjoys helping clients find the right "fit" in business ownership. Visit www.FranchiseOpportunitySpecialist.com for more information about me and my company. - Visit Anne Barr's Website |
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Cheryl MatthynssensCheryl is a life skills coach, licensed Chemical Dependency Counselor and a 20 year entrepreneur. Cheryl's dedication to achieving a life of balance led to her expanding her teaching from the simple managing of life's daily challenges to adding financial well being as well. A direct marketer with DrinkACT, she is gaining ground in the online community with her concepts of making sure business owners, entreprenuers and employees have well rounded life styles. She opened up a small affiliate site - The Balance Guide- to help others find resources for mental and emotional well being. Visit Cheryl's blog to see more of the diversity beyond business she has began offering online at www.thebalanceguide.blogspot.com - Visit Cheryl Matthynssens's Website |
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