The Benefits of Niching
As a small business owner, it is very tempting to try to please all our potential customers. It’s especially tempting if we are not getting as much business as we’d like.
We often take inspiration from our customers requests and increase our ranges. But, this can leave us with a large list of products and services, each with different benefits, values, and customers. Trying to fit into too many markets is confusing to our customers, so every now and then it pays to stop and streamline our offering. In fact, it might be the most important thing we do.
When we niche in business, we look at our golden customer, the problems we are solving for them, what we are doing well, what the market needs, and our core values. We use all that information to scale back the products and services we offer to a core product offering.
Create Your own Space
When you niche you get to create your own space within a market. Your competition will be trying to cover several bases, but specialising in a small area helps you stand out ahead of those companies. In fact, the more you niche, the less direct competition you will have. Imagine a company that provides gardening services. They are in competition with all the local gardening service providers. But if you specialised in one aspect of gardening service such as lawn care, wild gardening, food gardens, ponds, hedges you would become the expert in that area.
Google loves companies that niche too. When people search for a service, they search for the specific service they need. For example, if someone wanted a pond, they wouldn’t search for gardening services. A big company might also offer those services, but because your website is specific and knowledgeable in that area you will rank beside them, if not higher.
Google knows exactly what you do, you only talk about ponds, and so it knows exactly who to show your page to. A general gardening company will have to work hard to rank for such specific keywords as they may only have one paragraph dedicated to pond creation on their website. And, the even better news is that the more specific the keyword, the cheaper it is to advertise.
People like companies that niche too. Imagine you owned a Lamborghini and needed insurance. You could use a big, general car insurance company, or you could go to one that specialises in Lamborghinis! I know which one I’d choose! Would you prefer to buy decking from a decking specialist, or a garden landscaper? Or a birthday cake from a bakery or cake decorator?
How might you create your own space within your industry?
Niche your Market
When you create your own niche market, it is much harder for others to copy what you do. They don’t know what you know, they don’t have the same values as you, or your expertise, or the same style. Your competition might also niche but it’ll be in a different way, because they can’t copy you!
You become the expert when you niche, this is because you are focussing on one element of your industry so you’ll quickly become better at it. You’ll have better quality equipment because you are focussed on achieving one goal, you’ll be able to follow trends better, be better educated and be able to be more creative within your area.
For example, a hair dresser might carry a wide selection of generalised products, but niching to specific types of hair types will mean you can carry a more specific selection of high quality products and tools that suit the market you are in.
An interesting thing to note is that when you niche within an industry, the businesses that used to be your competition are now your colleagues and collaborators. You can start networking within your industry as you are no longer in direct competition, you might also start getting recommendations from your previous competition when they come across a problem that needs a specialist! You can also find other local experts to collaborate with which is a great for your marketing.
It’s also worth mentioning that, when you are the expert at something, you can charge more for what you do – it’s like giving yourself a promotion!
Once you focus on specific areas everything becomes cheaper for you. One big advert budget will do more for your business than the same amount spread out to cover different business areas. It’ll be easier to manage too as there will be less to monitor; you’ll have one audience and one campaign at a time. Long key word phrases are cheaper on google too, compared to short or one word phrases.
It’s also worth noting that it’s much cheaper to create lots of the same thing, compared to a few different products. Stock levels can be more easily managed, staff can be better trained for specific things, it’s easy to recruit for specific functions, so all in all, everything becomes much more streamlined and economical to run.
What do you Stand For
Your products and services must align with your core values and brand. When you keep adding products and services it’s because you are trying to please others, which means they often don’t quite fit with your core values.
Add ons and up sells are ok, but they must support and strengthen your main offering, not detract from it. Having a consistent and clear value makes it easier for you to shout about what you stand for, and who you do.
What do you stand for?
Are you all about high quality ingredients, do you offer a fun experience, the fastest service, do you care about manicured lawns, or packing in the tech, or making the best macarons?
One product, One Customer
When you are trying to appeal to many different sets of needs you run the risk of diluting the message and missing everyone.
But other companies sell loads of different things?
That’s true, many do. Shops have full ranges of things, but they are not selling individual products as such. They are selling budget groceries, for example, or vegan products. Would you think it weird if they started selling summer hats? You certainly wouldn’t go there specifically to find one if you were in the market for one. Coca Cola sell a selection of different drinks, but they do so under different brands, so the marketing message for each brand is simple and clear. Those that truly do manage it successfully, will be making use of big budgets and very skilled marketing teams. Not many of us can say we are in that lucky position.
My Personal Experience
This happened to me in my afternoon tea business. I was getting requests for all kinds of products and ended up with a vegan option, a gluten free option, a date night option, a mystery box. I sold cupcake boxes, birthday cakes, did party catering, buffet boxes, dessert cups, gift boxes – the list went on and on… It was exhausting.
The reality was that I needed more staff to cover all the different options. We had different delivery and collection times to suit the different needs, we did less of each thing so it was expensive and time consuming. The packaging requirements were diverse. And trying to market a luxury afternoon tea treat experience, when some of your customers only wanted budget munchy boxes, or birthday cakes. Vegans don’t want to hear about the corn fed chickens we use in our chicken and ham filling, and likewise, the ones that want munchy boxes don’t care about the intricate process that goes into creating macarons, and my luxury afternoon tea customers will be put off by a pizza box full of cheap treats and buns! You can see the dilemma!
My website was large, difficult to navigate and made no sense, and neither did my social media. It took a real low point in sales, and staffing issues, to force me to look at what we were doing and see that changes needed to be made.
So I stopped all of it and just sold luxury afternoon tea in original and vegetarian options. I rebranded, jazzed up my website and in a matter of months me, and one other member of staff, had our busiest month ever. We were able to outsource deliveries, as they were all going out at the same time. And between us all, we easily served more people that ever, and more profitably.
We can help you get on the right path and find your niche!
Whether scaling your business is right for you or not. Get support with us now and we’ll help you figure this all out and make a strategy that is perfect for you!