All over America, this week people observe “Small Business Week.” They’ll toast the huge contributions small businesses and entrepreneurs make to the American economy. Small companies will rightly be in the spotlight.
But when USAToday turned to me to create a special, five-day, series for Small Business Week – kicking off today – I wanted to do something more than just celebrate small businesses. I wanted to help you grow YOUR business – right now. That’s why I’ve chosen the theme “Make this Your Year to Grow.”
Each day, I’ll zero in on key strategies fundamental to small business growth, providing you with advice, inspiration, an action checklist and a free downloadable worksheet. Follow along daily – and join us on social media – to get use-it-now help for your business.
Today, I’m focusing on one of the most effective growth strategies for small companies – finding a niche, concentrating on a clearly-defined market or other specialty. Ironically, by narrowing your customer base, you can attract more customers.
Megan Driscoll certainly knows how specializing contributes to her company’s growth.
When Driscoll launched her public relations agency in September, 2014, she could have provided services to any type of company. Instead, she focused exclusively on two industries she knew well: aesthetics and dermatology. That decision led to the Ferrari-like speed with which her new agency, EvolveMKD, in New York, grew. (http://evolvemkd.com/)
“It’s been crazy,” said Driscoll. “I opened my doors with three clients; now we have seven. I opened my door with zero employees, now we have 9. We just won another client this week; I have another employee starting next week.”
As a small business, it’s tough, if not impossible, to compete against much bigger competitors on other factors, such as:
- Price: big competitors have greater buying power than you.
- Quality: a hard standard to measure and difficult for shoppers to discern.
- Convenience: expensive to offer, reducing profit margins.
Choosing a strategy of focusing in on a specialized niche gives you many advantages. It:
- Sets you apart from competitors
- Focuses your marketing efforts
- Gives you credibility
- Makes you memorable
- Helps attract higher-quality employees
- Enables you to charge higher prices
Focusing on a niche makes it easier and less expensive to reach potential customers. If you specialize in a specific industry, you can join industry associations, exhibit at trade shows, get active in their LinkedIn groups. Serving specific demographic groups, you can choose to advertise through highly-targeted Facebook posts or specialized websites.
“When you’re a generalist, you think you need to be everywhere,” Driscoll explained. “When you’re targeted, you’re better able to figure out how to market, where to speak, which writing opportunities to take. It’s much better use of your time and you have more success.”
Being focused also enables you to attract higher-quality employees. “One of the main reasons I joined EvolveMKD was I knew their focus on Aesthetic Health would enable me to provide clients with world-class service and take best advantage of my expertise and contacts,” said Adeena Fried, former Director of Public Relations of the American Society for Aesthetic Plastic Surgery. Fried chose to come to EvolveMKD after receiving more than a half dozen job offers.
What kinds of specialties can you choose? Start with assets and interests you already have. Driscoll had deep knowledge of, and contacts in, the health care and beauty industries. For her, it was a no brainer.
Some types of niches you can choose:
- Industry: If you sell to other businesses, identifying specific industries to specialize in is one of the most effective, straight-forward ways to distinguish yourself
- Demographics: Serving a specific demographic group gives you an immediately recognizable way to attract customers, especially in consumer businesses, such as hair salons for children, tours for seniors.
- Geographic: In certain businesses, honing in on one area or location differentiates you from competitors, such as realtors who specialize in a specific neighborhood.
- Unique knowledge or expertise: Emphasizing areas in which you have in-depth expertise gives you a strong competitive edge. My friend Kenneth Allen was an arborist specializing in palm trees.
- Clearly-differentiated style: Specializing a specific style of product or service, such as an organic nail salon, vegan restaurant, made-in-America furniture.
Does selecting a niche mean turning down other work that comes your way? Not necessarily. It does mean concentrating your marketing – including sections of your website – on your area of specialty.
If you’re seriously focused on growth, stay highly focused, strategically deflecting other prospects.
“It was hard,” said Driscoll. “As a new business, it’s counter-intuitive to turn business away. But I referred them (potential clients) to other agencies, who’ve already referred business back to me.”
Choosing to focus in on a niche and narrow your marketing can be scary – you naturally feel like you want every customer you can attract.
“Since I’ve started my business, I’ve met many other small business owners,” said Driscoll. “It seems like the ones who don’t specialize are driven by fear. They’re afraid they’re cutting off potential business – but no, you’re not. By specializing you’re better able to achieve business that’s more stable. I’ve been able to gain clients who are going to be long-term partners.”
Small Business Week Do-It-Now Action Items:
- Use the free downloadable worksheet to list three potential niche markets you could serve. <https://planningshop.com/solution-center/>
- Rate, and choose, target markets for the most potential: easiest to reach and highest likely income.
- Create at least one separate landing page of your website dedicated solely to the target market you choose.
- Identify the best social media sites and online groups for reaching your niche market.
- Join an industry association or other group that caters to your niche’s target audience.
Copyright, Rhonda Abrams, 2015
This article originally ran in USA Today on May 4, 2015