Value of a Niche
We find that those businesses who find and target a niche get better results than those who market to a broader church. How do you tap into the value of a niche? This article reveals all.
Here's what we will cover...
- Why niche marketing makes sense
- Converting to a niche strategy
- Finding a shiny new niche
- The role of keyword research
- Evergreen versus short-term niche markets
- Sub-niches and micro-niches
- Targeting a niche: an example
Why niche marketing makes sense
There is a common misconception held by business owners that by offering a broad range of services to a wide pool of potential customers they are most likely to drive enough business to turn a decent profit.
In reality, the more broad your strategy, the tougher you will find it to run an appealing campaign because your audience has such a wide range of pain points and priorities. In addition, you will face more competition, both from big players with meaty marketing budgets and hyper-focused specialists.
When you focus on a smaller section of your market – a niche – your audience comes into clearer view and you can start building a realistic persona to represent them. You can then more easily fine-tune your offering to their needs and your marketing campaigns will become more efficient and effective.
You may have chosen to go after a smaller pie but you have a much greater chance of coming away with a satisfying portion.
Converting to a niche strategy
Don’t worry. If you already run a business, you won’t have to rip up your business plan and start from square one.
If you want to see how niche marketing can revitalise an existing business, watch a few episodes of Gordon Ramsay’s Kitchen Nightmares. Part of Gordon’s formula for success invariably involves throwing out the bloated ‘generic’ menu and replacing it with a slimmed down version, usually based on a specific food niche (Steakhouse, Italian, Mexican, etc.)
When choosing a niche for your business, consider focusing on a specific type of client or an area within your field. To help decide, ask yourself the following questions:
- Where does your heart lie? Do you love pitching to lawyers but dread speaking to consultants? Then specialise in serving the legal profession. Do you sell shoes in the week and don your football boots on a Saturday? Consider specialising in sports footwear. Not only will this open up the power of niche marketing but you will also be able to draw on your passion to inspire your customers.
- What are you experienced in? Similarly, if you know your industry area or product spec you are going to find it much easier to communicate with your audience and potentially become a thought leader in your field.
- Who values your business now? What service or product sells better than others? If you look back at your testimonials is there a certain type of job, service or product that attracts the best feedback? Does your cleaning team always get a 5* rating and positive comments about the state of customers’ ovens? Perhaps this could be a clue to finding your niche.
Finding a shiny new niche
If you have yet to start a business, there are countless niches out there waiting to be tapped into.
One way to identify a popular niche is by looking at what is trending now and look for variations on the same theme. You can take advantage of sites such as Amazon and Flippa to achieve this
By selecting ‘Best Sellers’ from the main Amazon menu you will see a list of categories on the left hand side of the page. Clicking a category of interest will bring up an ordered list of top selling products in that category.
If you visit the Flippa home page, select ‘Featured’ from the ‘Websites’ dropdown on the main menu and adjust the profit slider to the maximum values ($10,000 to $20,000 per month), you will be presented with a list of profitable websites including the amount of money the owners are making each month. By creating a free account, you will get access to more detailed analytics and financials. This should provide you with some inspiration about where to start digging for your niche. We found a website selling retro gaming cases and another selling bridal jewellery.
The role of keyword research
Another way to discover what’s popular among buyers is to use a keyword research tool, preferably one which provides information on potential competitors (e.g. KWFinder, Keyword Revealer, etc.)
Enter a keyword related to your area of interest and order the results by search volume. You can then dig into the results and find out what niches the competition are targeting.
Evergreen v short-term niche markets
Niches can be subdivided into evergreen and short-term niche markets. Evergreen niche markets are those which can always be relied upon to have a sizeable audience base. They include relationships, weight loss and personal finance.
Short-term niche markets are more of a gamble. They offer the potential of making a lot of profit quickly but they could also fizzle out quickly with changes. Examples include virtual reality technology and subscription boxes.
Sub-niches and micro-niches
Niches are amazing in their own right but if you really want to see the competition fall away and your marketing ROI soar, sub-niches and micro-niches are the way to go.
Although the terms are sometimes used interchangeably, a sub-niche is generally considered to be an even more specialised segment than a niche. So if your chosen niche is self-help, a sub niche might be time management, stress relief or managing phobias.
A micro-niche is an even more specific category. A handy way to generate micro-niche ideas is to simply type your sub-niche into a Google search bar and hit the space button. Google will then create suggestions based on popular searches.
By using this method with ‘stress relief,’ we got:
- Stress relief music
- Stress relief the office
- Stress relief gifts
These are all micro-niches.
Quora is another good website for generating ideas for micro-niches. By searching ‘Stress Relief’ we found the following reader-generated questions:
- What natural remedies are effective for stress relief?
- What is the best stress relief you know?
- Stress Relief: What is the way to think nothing?
- How is yoga a stress remover?
- What are the best stretches for stress relief?
In addition to generating ideas for micro-niches, this method can help generate topic ideas for blog posts and articles.
When marketing to a micro-niche, you will need to optimise your website for more specific ‘long-tail’ keywords. This will bring in less traffic than broader keywords but you will find your conversion rate increasing as you are targeting a more clearly defined market.
Niall Roche of Niche Pursuits summarises the process of finding a micro-niche perfectly: “You dig one inch wide and one mile down.”
Targeting a niche: an example
Rather than presenting a list of potential niches, we thought it would be more helpful to use an example of how a business owner might identify a lucrative niche based on the guidance above.
Alison runs a business selling gift cards and associated products. In her spare time, she is a passionate environmentalist with campaign experience. One of her best selling products is wrapping paper.
While searching the Amazon Best Seller list, she found that bees wax wrapping paper was a top seller. This is a micro-niche related to a sub-niche of biodegradable wrapping paper.
On Quora, Alison found some great topics to help her with her content marketing and in her mission to become a thought leader. Questions people were asking included:
- Is bees wax mostly fat?
- How is bee gel and bee wax made?
- What’s the difference between bee wax and paraffin wax?
Not only is Alison now targeting a highly specific market with a proven product, she also loves what she’s doing and can connect with her customers in a personal, authentic way that even the biggest gift card retailers won’t be able to match.
Alison has found her niche or, as we like to put it, has discovered her story.