It was the last stop for gas until we reached the Oregon coast - we were in the small town of Philomath, population of 4100. As I was pumping gas, I looked across the street and the sign "Fitness Over 50" made me smile. Now there's someone who knows how to define a niche!
In conversation I mentioned the name of the fitness club to the cashier. She went on to tell me that the owner was almost ready to shutdown the business but instead he renamed it and started offering programs for the 'over 50' crowd. Within just a few months the business has flourished and is now financially successful.
This is a great example of how narrowly defining your niche or target customer can bring a huge windfall to your business. In coaching business owners this conversation comes up a lot. It can seem counter-intuitive to have a narrow target.... after all 'won't we be eliminating a lot of business?' The short answer is no, you'll be gaining more.
How is that possible? Well, when we're specific about who our customers are a few things happen.
We do better work. Being specific about who we service makes it easier to refine our process and services and thus helping us to become an expert. When we' stop trying to be all things to all people we have more resources to invest on what we truly are great at and thoroughly enjoy doing
Our target customers seek us out. People like dealing with specialists and experts. After all, would you take your BMW to someone who fixes lawn mowers, blenders and well, actually anything with a motor? Wouldn't you rather take it to someone who specializes in BMW's and knows the car inside and out?
We stand out in the crowd. Being specific about who our ideal customers are makes us memorable - think back to the "Fitness over 50" example.
We get more referrals. Our referral partners find it easier to refer us. Because we're more specific, we're easier to remember, harder to forget and the positioning of an expert helps them refer us with confidence. People who aren't in our niche seem to more readily talk with us at networking events. I suppose they don't feel like there's a target on their chest. This more expansive conversation can often yield a referral.
So if you haven't tackled the work of defining your niche what's stopping you?
Here's a few questions to get you thinking. Take a few minutes and write out your answers - you may be surprised by what comes of it.
1. What types of customers do you most enjoy working with?
2. What types of customers are most profitable for you to service?
3. What types of customers are easiest to service?
4. What types of customers are you most successful in servicing?
5. What unique skills, industry experience or expertise do you have that aligns with your customers?
Finally, consider your values and overall goals of having a business and you'll be a step closer to your niche.