Ever heard the term “A jack of all trades is a master of none”? I learned the hard way a while ago that this is especially true with small business marketing. I spent a lot of money advertising to market segments that were clearly dominated by large corporate competitors — my complete investment was a drop in the bucket for them. I was especially de-motivated when marketing firms told me that my entire advertising budget was almost a reasonable “testing” budget! The better strategy would have been to focus my limited resources on a more specific market niche.
The first question, then, is: What is a market niche? It’s simply a subset or segment of a product or service’s market, taking into account the product or service’s features, quality, demographics and price range. For example, most attorneys don’t practice all types of law; they choose a niche such as family law or criminal defense. This reduces competition and allow the attorney to become an expert in a particular segment.
The second question is: How do I find my marketing niche? This question can be answered in two ways. One is to rely on your feelings and instincts, informed by your personal style and your goals for yourself and business. Another is to use more objective or data-driven approaches to find evidence of the market niche that best suits you. Here are three data-driven ways to find your marketing niche.
When you segment your market, you divide your existing and potential customers into sub-groups (segments) based on shared characteristics. You can use free advertising tools such as Facebook Business Manager to segment your market, which allows you to see the sizes of the segments and adjust them if they are too small or too large, or determine how many segments you need. This also allows you to see useful features of your demographics that you may not have previously taken into consideration, such as what locations will do well, or if location is more important than industry, for example.
Once you have segmented your market, you can use demographic data and attributes from advertising platforms such as Facebook to reach out to a cross-section of potential customers and gauge their interest in your product or services. Surveys let you talk directly to prospective clients, getting valuable one-on-one time with prospects, and offering a small token such as a gift card is a popular incentive for participation.
Trial and Error or “Testing”
Another method is to review your demographic and behavorial market segments in order to identify an “anchor contract” to pursue for testing purposes. You may offer heavily discounted or free products or services to this anchor customer in order to track core demographic data and build marketing “personas” to use in future marketing. Be careful, though, because free may not be considered “credible” in your target market. Partner marketing or referrals are very effective here if you can get them.
Niche marketing is a powerful tool for small, underfunded or bootstrapped startups, and using data helps focus your limited resources in the most suitable areas. Whatever your niche, let us help you succeed within it.