Here’s a crucial question to ask yourself and your team while you’re trying to figure out how to better define your niche and serve your customers:
Did you choose your niche yourself, or did your customers force you into it?
There’s no right or wrong answer. But figuring out how you got to where you are now and how you built your current brand can reveal a lot about where to direct future efforts to increase your customer base and loyalty.
Dr. Joe Webb writes about this challenge for the printing industry. His conclusion: Pursuing a niche market is rarely deliberate. Instead, external factors shape your customer base.
Did your niche choose you?
Again, changing your business and services to reflect what your customers want is almost never a bad thing. It shows you can be reactive to customers’ needs and can survive changes in the marketplace.
But take that mindset too far, and you may end up spending too much time and effort pleasing and luring customers who aren’t likely to make up a sizeable chunk of your base while missing opportunities to change your business to attract loyal, long-term buyers.
If your business is based around one of more of these attributes, it could be a sign you’re niche picked you, rather than the other way around:
- Geography. If your business services a specific area or region, you will undoubtedly be more concerned with the demographics and preferences of your selling area, and you’ll want to adjust your products and services accordingly.
- Collaboration. If your products or services are dependent on what other people and businesses are doing, you’re going to have to adapt with those businesses and their customers. For example, if you’re a car mechanic specializing in a specific brand of car, your customer base is largely determined by the demographics of who’s buying that brand.
Reclaiming a say in your niche
Even if your business, like the examples above, forces you to react to shifts in your niche rather than driving those changes yourself, there are things you can do to set yourself apart and lure the customers you want to your business.
- Become an expert. If your niche is driven by innovators and tastemakers in that market, become one of those leaders. Use your know-how and connections to push for changes in your industry and give your customers the information they need to make informed purchasing decisions.
- Look at competitors. The good thing about market-driven niches is that your competitors are probably all facing the same challenges. Look at the micro niches they’ve carved out for themselves in your market, then decide if you want to compete with them or attract different customers.
Not mutually exclusive
It’s important to note that this distinction — choosing a niche vs. being forced into one — is a more of a generality than a hard-and-fast rule. In practice, most companies have some say in who their customers are but are still forced into particular niches due to location, market concerns and competition.
The key is to look at when going with the flow of customers will benefit your business and when it pays to take a step back and figure out the best way to recruit buyers who will be loyal — and stay that way.
If you would like to find out more about defining your niche
I invite you to contact me. I have been helping professional service providers such as CPAs, attorneys, and financial services providers focus their business development efforts on profitable micro-niches for over 10 years. Email me at firstname.lastname@example.org.