How Niche Marketing Can Be A Successful Strategy
Differentiation, the most common, and most difficult marketing issue for professional services firms. Competition within the professional services space is fierce, and many industries are incredibly analogous—which makes differentiation that much more difficult. Read on to discover if niche marketing is right for you. Here are 5 questions to help you evaluate the fit of niche marketing:
What’s going on in your industry? Take an unbiased look at your industry. See how competition saturation, economic or political volatility, and trends and challenges affect your position.
Who are your target audiences (and what do they want)? The critical rule here: Don’t guess. Internally generated client surveys and client service programs only go so far. What your clients and prospects say and do varies greatly depending on a variety of factors. Third-party research can help. Once you know the pain points and perceptions, make sure you have a solid plan on what to do with that vital information.
What is—and is not—working with your current business model? This tends to be the one of the most difficult questions to ask, as the answers can be very nuanced. For example, are you engaging in reactionary marketing (or is marketing more of an afterthought in your organization)? Are your technical professionals spread too thin? If you don’t have a dedicated sales team, does your staff have adequate business development skills and training? Answers to these and other questions lead to the ultimate one: Can you afford (financially and organizationally) to make sweeping changes to your model or strategy? If something isn’t benefiting your employees or clients, you much be willing to let it go.
Do you have the resources to focus your efforts? This involves all of your firm’s professionals, including technical, business development and marketing-focused. Technical professionals aside, is your marketing department at capacity? Do your business development and marketing teams have the right skills and roles in place? Once you make changes or revise your strategy, do you have individuals that can champion the efforts and see things to fruition?
Do you have the time to see your niche marketing efforts pay off? Niche marketing will not solve all of your problems. Content development will be critical to help increase awareness and education among your targets. But it takes time. If you’re lucky, you may start to see initial results in as little as 3-4 months, but a significant message change can take up to a year to really gain traction. If your organization’s key stakeholders are not bought into the fact that niche marketing is a long-term play, you will set yourself up for failure.
Take your time and be thoughtful about your responses to these five questions. While the answers may seem straightforward at first, know they involve a lot more consideration (and likely a larger conversation within your organization’s leadership teams) to make the ultimate decision to modify your approach. Niche marketing is not for every organization, but it can be leveraged as one way to make you rise above your competition.
Advantage of Niche Marketing
Even when you’re a middle-market professional services firm, niche marketing can offer certain advantages. In fact, in our annual High Growth Study we found that high-growth firms (at least 20% growth year over year) are more likely to embrace niche marketing than their peers.
Firms that niche are also more likely to:
- Spend less on marketing. They focus on the most appropriate tactics for greater return
- Enjoy greater margins. Honing a service allows them to perform well in their target market and be more profitable
- Have a greater competitive advantage. Specialization (and communicating this appropriately to target audiences) is a tenet of differentiation.
There are definite advantages to being a large and diversified organization. If you can offer everything and anything a potential client could ever want, your firm is more likely to stay busy and continue to employ a diverse group of talented employees. But this sets the firm up as a “jack of all trades, master of none.
Larger organizations often grow by diversifying their portfolio, adding of client-requested services and locations or even through selective mergers and acquisitions. There is nothing wrong with a varied growth strategy, but it’s important to review this strategy often.
It’s also important to be aware of the symptoms of less-than-strategic growth, too. Here are a few symptoms to be alert to:
- A large perception gap. Regularly explore both external (customer) and internal (employee) perceptions to reveal any gaps between the two. Clients may have a very narrow understanding of what you do and make assumptions based on that perception.
- An identity crisis. Your positioning can be difficult to define, especially with multiple stakeholders and newer employees who may not be as in-tune with your firm’s history and growth over the years.
- Organizational silos. Decreased interaction among departments, verticals or markets often leads to a lack of camaraderie and the non-existence of cross-selling—the bane of many larger organizations.
Your prospects and clients should always feel like they’re the sole focus of your attention. Niche marketing can address this and help ensure your message hits its targets.
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