As a small business owner you’ll hear many remarks about others having a preference for niche marketing, but is it right for yours, or not? Find out with my checklist 9 things you should know about niche marketing”.
You should keep these in mind to ensure that you remain strong and don’t become vulnerable to extinction like pandas.
First, you should know the definition of niche marketing: it is a strategic Marketing approach for finding and satisfying the needs of customers when a supplier decides to dedicate its effort to a particular segment of customers within the marketplace which is identifiable, accessible and profitable, and whose needs you can meet. The niche stems from the customers. It is independent from your own skills. Here’s my list to help you to decide whether it’s right for your business.
9 things you need to know about niche marketing
- it is a UNIQUE SOLUTION The decision to follow a niche marketing strategy for your business should only be taken after you’ve completed a full analysis of your competitive context. Read my blog on an introduction to competitor analysis. Pandas only eat bamboo. It is thought that’s because it’s abundant and they have no rivals for the tough stems and leaves. Only pursue this route if you’re certain that it’s the correct strategy for you. These 9 things which you should know about niche-marketing will inform you to build a resilient business, if it’s the right route for you to take.
- Niche marketing is an alternative name for a Focus Strategy; it takes intense concentration and effort to make it work well.
- GIANT. Niche does not mean small, it means finding a distinct area in which you can develop a platform from which to grow large. Pandas grow large on their restricted diet.
- SPECIFIC. Your product range should probably be quite narrow and deep, so that you can offer choice to a restricted part of the marketplace.
- You must actively avoid and turn down business which falls outside your chosen segment
- DANGER. It carries the risk of placing all your eggs in one basket, which might leave your business exposed if there’s a fundamental shift in the marketplace. Pandas have suffered greatly as a result of deforestation, which has damaged their habitat and food source, making them a species which is vulnerable to extinction. A successful focus strategy may lead to take-over by a larger competitor.
- POPULARITY In the West, from the 1980’s onwards, rising disposable incomes and a tendency towards individualism led to the rise of many niche players in several markets which sought to serve the needs of identifiable, profitable segments. For example, the coffee market evolved to meet the needs of coffee connoisseurs, which led to a proliferation of brands within large dominant organisations like Nescafe and Kenco. As each type of coffee drinker could find a type which met their taste, this trend moved onto the high street when cafes sought to attract distinct groups of coffee drinker. This tendency is seen by the contrast between chain and independent coffee shops. This evolution towards personalisation might explain the impression that finding your niche is promoted by all marketers. The popularity of pandas has been explained by Ron Swaisgood, Director of Applied Animal Ecology, San Diego Zoo Institue for Conservation Research, as attributable to the fact that they remind humans of ourselves. A preference towards niche marketing might also be explained by each business owners’ desire for individualised solutions for their needs.
- REPUTATION. The business must be seen to be a specialist by its market segment.
- TOUGH. It’s a brave choice for a business owner to pursue a niche marketing strategy and requires more effort than addressing the needs of a broad market definition. It’s as tough as the bamboo stems favoured by pandas.
Only pursue this route if you’re certain that it’s the correct strategy for you. These 9 things which you should know about niche-marketing should equip you to help your business to grow strong.