It’s so easy to confuse your target market with your niche, but it’s one of those things that once you get it straight in your own head, it will be so much easier to develop a message that resonates with your target audience. Many entrepreneurs make the mistake of targeting too broad a pool of potential customers. If everybody can use your service, it’s likely no one will.
Remember, you have limited time and limited resources when starting out in business. If you narrow your focus, you can target customers who are most likely to use your product or service. According to Jennifer Sander, co-author of Niche and Grow Rich, “Niche businesses have a 25 percent better chance of surviving over ten years than more general types of companies.”
What are the three things that make a good niche?
1. Your target customers have a strong desire for what you offer.
2. The customer pool is big enough to produce the volume of business you need.
3. The customer pool is small enough that your competition is likely to overlook it.
Think about your business this way to keep things straight in terms of your target market vs. niche:
I provide (X) to (Y) who does (Z).
X = Your solution. What is the result to generate for your client? It could be more time to focus on being the talent, more time to develop a new business venture, more family time, get the dog taken care of, etc.
Y= Your target market. Who is your target customer? Be as specific as possible. Professional women 35+, Stay at home moms, Under 30 entrepreneurs, Single dads, Baby boomers, C – level executives, etc.
Z= Your niche focus. You must narrow-down the piece of the market you want capture. What do you do that helps you stand out in the marketplace? People want to hire specialists.
Here are some examples: If you have a graphic design company how about you focus on doing work for educational institutions? If you are a virtual assistant, why not focus on professional speakers and thought leaders who are often overwhelmed with the constant need to develop content and handle logistics? If you are an accountant, how about focusing on providing services, exclusively to restaurants?
Here’s mine: I’m a small business coach who specializes in helping people transition from a job to small business ownership
X= My solution. Small Business Coach
Y= My target market. People in Transition
Z= My niche focus. Go from Corporate to Entrepreneurship
To find your niche, look at the customers you already have. Is there a common customer? What work fills you up the most of your time and what work IS the most profitable? Figure that out and then define your niche around that. Then, develop a killer sales message that speaks to the specific interests and needs of that niche market. You’ll see an immediate increase in your sales and repeat business. You will build your riches in the niches.
Melinda F. Emerson, known to many as SmallBizLady is one of America’s leading small business experts. As a seasoned entrepreneur, professional speaker, and small business coach, she develops audio, video and written content to fulfill her mission to end small business failure. As CEO of MFE Consulting LLC, Melinda educates entrepreneurs and Fortune 500 companies on subjects including small business start-up, business development and social media marketing. She has been featured on NBC Nightly News, in Forbes, the Wall Street Journal and Black Enterprise Magazine. Melinda is also the author of the national bestseller Become Your Own Boss in 12 Months; A Month-by-Month Guide to a Business That Works. (Adams Media 2010)
Thanks Melinda. This really is helping me to truly define my focus on my new business. I needed this exact article to read while I’m strategizing.
Melinda, thank you for this article. I had already been working on this but this article made my definition of my niche even clearer. X (My Solution) – Internet Marketing Coach Y (My Target Market) = People in Corporate American who want to get out Z=(Your Niche Focus) Go From Corporate America to Internet Marketer
I am not clear on the Y part. So I provide training to midlevel exec women who…….(are trying to lead ?) so my niche is those aspiring to leadership ?
Thanks for reposting. Apparently I was confused, thanks for clarifying.