Find your niche and stick to it, says Dave Jones, director of Mobility Nationwide, a family-run business dedicated to helping people find the right wheelchair accessible vehicle for their lifestyle.
Small businesses shouldn’t try to be all things to all people. Whether you are in the automotive industry or a retailer, it pays in this day and age to carve out a niche and stick with it. The businesses or consumers you supply can explore alternatives at the click of a button, so making sure you’re the only business providing your product, or the very best at providing a particular service is more important now than it ever was.
Here are six reasons that you should find and stick to what you’re best at, and delve deeper into your niche rather than expanding your range of services:
1) Because you own that gap in the market
The first thing many niche businesses start with is an idea that fills a gap in the market. This could be a known business that isn’t provided in the local area, or a brand new idea that you’re bringing to the market. If you’re lucky enough to have found that gap, you need to work hard to ensure that you either continue to be the only business to fill that gap in the market, or, once competitors start to pop up, that you are the best in the business at filling that gap.
2) Because you are the best at providing your specialist service
Another route into a niche business area is through the belief that you can provide a service or product better than all the competition. Perhaps the competition is in broader businesses, and you wish to take over one part of the market that is otherwise only covered by generalist retailers or service providers.
If this is the case, it is worth remembering that as a small business, you might not be able to charge as low a price as the bigger retailers or service providers. However, people are often willing to pay more for a specialist service, and will trust a niche company to sell only the best, and so an increased price is often justified in the eyes of the customer.
3) The internet means you can trump bigger competition
It may be that as a small company you cannot compete with bigger competition on price, but you may offer something different or more in depth. Small firms can still focus on their niche product but their audience can grow exponentially with a clear, dynamic website and a sensible marketing strategy.
A good example of the potential of online growth of niche products sold by small, independent retailers is seen in the role of outlets like Bandcamp and Big Cartel, which are often used by musicians who are not signed to a record label. Nowadays, you don’t need the backing of EMI or Universal to make waves in the music industry.
Not only this, just by being a niche business, your online visibility in general should grow. Google and other search engines will recognise a website with lots of content in a highly specific area as having greater ‘authority’ than generalist company websites. This means that potential customers that search online for your service are more likely to stumble across your website, as you’ll appear higher on Google searches.
4) Your expansion can be organic and logical
Once you’ve established yourself as a reputable niche business, it can be tempting to expand. Expanding your market by offering other services or offering your services to more people becomes easier once you have a foothold in your area of expertise. It becomes much easier to spot ‘easy wins’ within your niche if you are already an expert, and it is always simpler to expand into areas that have something in common with your current business than to start to offer something brand new.
5) Your expert knowledge won’t go unnoticed
As a niche business, you are seen as a specialist source of knowledge in your chosen area. This can mean greater visibility online when marketing your services, and customers will see you as an authority on whatever you do. Spreading yourself more thinly often means losing that specialist status in the eyes of the consumer.
Larger companies may only have detailed knowledge of their best-selling products or services, but as a specialist you’ll understand your business area better than the bigger but broader hitters.
6) The personal touch has all sorts of benefits
It’s a simple fact that people do business with companies they like. For your customers, this means that it’s important to feel rewarded by the company you do business with. Staying true to your founding principles will mean your customers stay loyal to you, and a niche business means there’s a personal touch that consumers are likely to notice.
The higher prices that you may charge due to the niche nature of your business and lack of the financial clout of a bigger company also means greater profitability. This means that niche businesses are better ‘lifestyle businesses’, as they can be defined by the employees or owners themselves, incorporating the personal interests of staff more than bigger companies. This means going to work is far more rewarding for an employee or owner of a niche business.