Choosing a Niche for Your Business: Part Two

In Part One of this series, we discussed the importance of establishing a niche. Here we will discuss how to identify your niche and then make the transition to serving that target audience.

If you’re a selling to businesses (B2), it will likely be a matter of targeting a specific industry or people within a specific industry. If you’re selling to consumers (B2C), different factors may be involved such as who can afford your services, how old they are, where they live, or what they do for work or fun.

Choosing the right path for your business is something that takes some careful thought and exploration. Take time to answer the following questions. Consider engaging your staff in this process since they might see things from a different perspective.

1. Are there any specific industries or demographics that we currently serve on a regular basis? If so, what are the future opportunities like there?

2. Do we have a primary service that has special appeal to a certain industry or demographic?

3. Are there specific industries or demographics that sound intriguing? If so, what additional research is required to determine if this track makes sense?

4. What does the competitive landscape look like for the niche we want to focus on? Is the market saturated or is the field wide open?

5. What are our opportunities to make an impact in the chosen niche? What can we do differently from everyone else?

Making the Decision to Shift Your Focus

As you make the transition to focus on a specific niche, know that you don’t have to turn away other business completely. If you’re worried that narrowing your focus could create a cash crunch, then gradually make the change. Begin to focus your marketing efforts on reaching your newly-defined audience while you continue to accept other work. Eventually your marketing should catch up and you will discover how much easier it is to generate business when your target audience is clearly defined and your services align with their needs.

In fact, you might even get to a point where you are too busy with your niche work to even accept other jobs. If this happens, it’s time to expand your business and hire some additional help! Growing pains like this can be a good problem to have, but don’t let high demand have an adverse affect on your ability to deliver great service or accept new clients. Do your best to stay one step ahead of the growth.

Eventually you may want to develop strategic relationships with companies that provide the services you no longer offer. For example, if you’re a consultant who specializes in working with technology companies and you receive an opportunity to work with a retail business, align with someone else who works with retailers and whom you can confidently recommend. Ideally you form an alliance so that you can refer business to each other.