October 30, 2009, Newsletter Issue #234: Tighten Your Niche and Improve Your Bottom Line

Tip of the Week

Too many beginning entrepreneurs have a vague or too broad definition of their target market. So many answer, "Who is your target market?" with "Everyone!" And this is why so many of them fail. Remember, as someone wise once said, "If you market to everyone, you market to no one."

So, before you create your sales page, your product, even your business, you need to be very clear on who -- exactly -- you will be marketing to. You need to understand your niche.

Now, niches come in all sizes. For example, "fishing enthusiasts" is a niche, but a very broad one that might be difficult to market to. However, "fly fishing enthusiasts" is a much more targeted niche. So, what is a niche and how do you define one?

First, what is a niche? A niche, within the context of business, is a tightly targeted market comprised of people who hold specific characteristics in common that are related to buying behavior.

There are several ways to define a niche. But your first step needs to come from within. Who do you want to spend your time working with? What kinds of people do you enjoy helping? What kinds of people do you care deeply about and want to help grow and prosper?

Remember, you'll be building your business around your niche, so you don't want to build it around a niche you don't like. For example, I'm not too keen on working with arachnocologists (people who study spiders, scorpions, ticks and other eight-legged bugs) -- not to say they aren't nice people, it's just that spiders and other arachnids make my skin crawl. So, I'm not going to build a business for that niche.

This little exercise might not give you a very narrow niche, but it is a good start. For example, lets say you love working with fishing hobbysts. That's good! Now you need to narrow that down a bit, at least for your first line of products and services.

So, how do you do that? Well, how can you divide fishing hobbysts into smaller groups?

    * How about geographically: fishing enthusiasts in the upper Northwest U.S.
    * How about by gender: men who love to fish
    * How about by age: fishing hobbysts between the ages of 25 and 55
    * How about demographically: fishing enthusiasts with an income of at least $85,000
    * How about psychographically: fishing hobbysts who favor a particular technique, like fly fishing

Do you see what I'm getting at? By using several different criteria, you could come up with a very targeted niche, such as middle-aged fly-fishing enthusiasts from the midwest. Now you've got a niche that should be easy to communicate with. You can understand their needs and desires and can market to them in a way that they can identify with.

This is the key to improving your bottom line. Better sales copy that is targeted to your niche will convert at a higher rate. If you product or service is niched enough, you might even be able to charge more for it!

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