Did you just Google “niche marketing” while in a meeting and end up on this page? If so, you’ve come to the right place.
Marketing Concepts is a series that we’ve started on IdealPath to help our marketing cohorts (and, let’s be honest, ourselves) stay on top of the ever-expanding universe of marketing buzzwords and acronyms.
Today’s topic: niche marketing.
We’re going to use the good, old-fashioned journalistic approach and look at what this approach really is, what it’s not when to use this type of marketing, and then close with some suggestions for how to make it work for you.
What is Niche Marketing Anyway?
Niche (rhymes with “quiche”) marketing is essentially focusing your marketing efforts on a small portion of the population that shares a large number of characteristics.
There are a few conflicting approaches to identifying a profitable niche to target, but majority opinion is squarely in the “discovery” camp. These experts declare that niches must be discovered.
Nichehacks.com, for example, argues that “There are no unknown niches. They are just unknown to you.”
But regardless of whether you subscribe to the “find it” or “build it” school of thought, niche marketing ultimately works the same way: you target a hyper-specific subset of people with a product tailor-made for them.
Niche Marketing vs. Other Marketing Terms
This might sound quite a lot like several other marketing terms that you’ve heard bandied about, and there’s a very good reason for that: niche marketing is, in fact, a lot like other marketing approaches.
Audience segmentation, for example, is a crucial part of “regular” marketing and also forms the basis for most niche campaigns too.
You just need to segment on a much more granular level to support a niche marketing effort.
Segmentation is crucial to defining a smaller target market for a niche business. It’s not enough to know the basics — age range, income, marital status — with a deeper understanding of more granular attributes your target markets might have. The smaller your market, the better you have to know your customers.
Vertical marketing is another tactic that offers a very similar approach, though again the subset of people being targeted is typically larger than those used for niche marketing. Companies that use vertical marketing tactics, “either create products intended for a specific type of consumer, or attempt to make existing product appealing to those consumers.”
“Micromarketing” can be used interchangeably with niche marketing. They are identical approaches; one is just much easier to pronounce.
When Niche Marketing Might Work For You
There are three common situations when it’s worth your time to find/create a niche market and target it aggressively:
- Big companies looking for smaller markets: Oftentimes large companies will use this approach to repurpose existing offerings to appeal to niche audiences. Segway, for example, created a version of their product to market to law enforcement departments. Only the paint was changed on the product, but the whole marketing strategy shifted to a niche marketing approach.
- Startups or newcomers: New products or startups looking to carve out a profitable place for themselves in a competitive landscape can use niches to get started. Vermont Wooden Toys, for example, has created a specialized place for itself in the hyper-competitive toy market by exclusively creating handmade wooden toys for parents who aren’t interested in mass-produced plastic options.
- Those working on a very tight budget. If your company doesn’t have much of a marketing budget, you’ll almost certainly have better luck aggressively focusing on a small group instead of spreading your efforts too thin across a bigger population.
Why It Could Payoff to Target A Niche
It may sound counter-intuitive to try and sell to just a handful of people, but if you can find a group that exists at the intersection of high demand, high potential profits, and low competition, niche marketing to them can pay off in a big way.
TrackMaven does a good job making the case for giving untargeted niches some marketing attention:
Providing goods and services to a market segment that has gone unserved reduces barriers to entry, such as competition. Niches usually go un-targeted because smaller companies are unaware that the niche exist, and larger companies do not think targeting a small niche is worth their time. Companies that target these niches will be endowed with first mover advantages that will give the company better positioning against new competitors that may arise.
How to Get Niche Marketing Right
Unfortunately, “niche marketing isn’t like ‘regular’ marketing, only smaller.” It requires that you become hyper-critical of each channel you adopt. You’ll also need to come up with an entirely new approach to marketing for each niche you target; no two audiences are totally alike, after all.
Testing Niches First
Although starting a new niche marketing campaign may not be too expensive up front, it’s important to test your potential niche(s) with low cost and low-risk experiments before you devote too many resources to them.
Some niches simply won’t prove to be profitable, and the earlier you can find that out, the better.
Falkenstein suggests offering something that your niche can actually engage with, preferably something they can buy. Whether it’s a free mini-seminar or a sample copy of your newsletter, create a low-cost way to see how interested your new niche might be in your offering.
Marketing to Your Chosen Niche(s)
Once you’ve identified a good niche, it’s time to pick channels and start doing some actual marketing.
You’ll need to evaluate each of these suggestions in light of your own highly specific niche audience, but these are often cited as go-to tactics for niche marketing:
- Social media advertising. There are few things better than social media for connecting with your audience, and there are very few niches you can’t access on one network or another.
- Adwords and other PPC. When you combine the specific targeting capabilities of social media advertising with some highly specific PPC campaigns, you’ll be surprised at what types of audiences you can reach. Shewan reminds PPC marketers that niche campaigns should include, “long-tail queries as well as high commercial intent keywords,” and that they should be optimized for mobile to reach the most people.
- Word of mouth marketing. If your niche is marketing-averse, word of mouth can be one of your best options. These campaigns are longer-term efforts, but the payoff can be huge. They typically feature low key and subtle brand exposure, “such as sponsorship or giveaways at events or establishment frequented by the niche market.”
- Influencer marketing. If you can’t readily market to your niche, you may want to try marketing to their influencers. Keep in mind that your chosen influencer(s) need to be highly credible and be able to deliver an endorsement with sincerity to make these types of efforts successful.
- Content marketing. Creating highly valuable content aimed at a small audience is basically the definition of content marketing, so this tactic should be go-to for just about any niche marketing campaign. Remember to keep the focus on your audience and provide value in each piece you produce.
Do You Specialize in Niche Marketing?
Share your lessons and insights with other marketers looking to cut through the buzzwords and figure out how to be a little better at their jobs! We’d love to hear from you in the comments.