Many people believe the broader the audience you market to, the more successful your marketing efforts will be. That is usually not the case. The cost of marketing tends to rise when you try to sell products to a wide audience. For one thing, you are likely to have more competition and your competitors will have products that are like yours. In a crowded market, price will be the main point of comparison for consumers who are comparing similar products. If price is your only differentiating factor, you’ll have a hard time making your brand successful. By focusing on a niche market, you avoid these problems and allow your business to stand out. The big question is how do you choose the right niche?
The first thing you will need to do is to define the term “niche market.” A niche market is a segment of the market that you have identified has having a need for the products or services that you offer. Niche marketing involves focusing all your efforts on that small defined group of prospects.
Look for a group with the following characteristics:
- It has a unique set of needs.
Each of its members should have the same need and that need should differentiate the group from the rest of the market. Your company should be able to meet these needs.
- You should be able to meet their needs better than your competition.
Your products must be more appealing to the customers in your niche than the products offered by your competitors. The benefits you provide can come in the form of specific features of your product or they may be in other areas such your excellent customer service.
- Marketing to your niche is affordable.
To get a return on your investment, your niche should be easy to identify and easy for you to reach. Whichever route you choose to reach potential customers, be sure to target your audience. You want qualified prospects.
- Your niche market is large enough to be profitable.
The smaller the niche market, the lower the returns you will get from it. Make sure that your niche is able to provide enough revenue.
- No one is targeting that niche, or they are not targeting it as well as you can.
Look for a niche where you will face little or no competition. You want to find the niche that no one else has found, not the crowded one.
Finding the right niche means discovering who the most likely users of your product or service will be. You will also need to identify the factors that differentiate your brand from others in your industry.