Should You Really “Niche Down?"
Before I talk about the who, when, why, and how, I want to talk about what it really means to “niche down." For starters, let’s look at the definition of “niche” because there are two that I think are applicable here.
What is a “niche?"
Courtesy of the Oxford Dictionary:
“A comfortable or suitable position in life or employment.”
“A specialized segment of the market for a particular kind of product or service.”
I think it is important to consider both definitions because together they make up the concept of “niching down.”
As business women creating and building our own businesses, we are seeking more than just the control of working without a boss watching our every move. We are seeking freedom to work the hours we most prefer, to take time off to spend with family, and to impact the world in a way we feel truly matters.
Niching down allows you to better achieve those business and personal goals, because you are choosing the smallest most narrow corner from which to conduct business and make a name for yourself, from which you can grow your company into any size you like.
Real Life Example
Louis Vuitton is a world-renowned couture fashion house with a global reach and a valuation of well over a billion dollars. But it started with only suitcases. One man turned a freelance operation of making travel trunks for wealthy Parisians into a single brick-and-mortar store selling luggage, which became a global luxury brand.
But for over 100 years luggage was all that Louis Vuitton sold. It wasn’t until nearly 150 years later that the company expanded into women’s clothing and accessories, followed shortly by menswear.
Louis began his business in the luxury suitcase niche. He created unique designs using quality materials exclusively for discerning, high-end clients on a custom-order basis. That was his niche and his name became synonymous with luggage. With success and popularity, the company expanded to continue providing unique designs using quality materials for a variety of products, always with an air of exclusivity. You can do the same thing with your business, but you need to niche down.
Why should you niche down?
You cannot sell your products or services to everyone. Even global brands like Starbucks and Google don’t. In fact, although it seems counterintuitive, the more you narrow who you sell to (or work with) the more success you have.
If you’re thinking that doesn’t make any sense, you’re not alone. A client of mine, Chaya, had the exact same response. It was only recently, after attending the Sheer Impact Annual Conference, that it began to click, so (with her permission) I’ll share her story:
In our first session, we nailed down that my demographic was older adults and anyone dealing with the challenges that come with aging — the people themselves, their families, caregivers and healthcare providers.
But I still had a fear that I would miss out on business by being so narrow focused. Why not all healthcare providers? Why not work with young moms, too? Or teens? Etc.
The turning point was when I attended your Sheer Impact Conference on top of your guidance. I felt so confused and insecure about my business, but you encouraged me, you supported me, you believed in me. You were able to really listen to me describe my passions, strengths, goals, etc, and then translate that into a direction.
I saw that being afraid of missing out on business by keeping my niche too broad would likely actually cause me to lose business since my efforts would be spread too thin and would not allow me to develop an expertise.
As Chaya found, trying to build your business with a broad focus will spread your energy and resources too thin. When you niche down, you can attend just the events that are in that small subset of the industry, connect primarily with the colleagues you can collaborate with, and spend all of your marketing time and resources getting directly in front of your target audience.
When you don’t niche down, you’ll need to double, triple, etc. your efforts. Every hour of your time spent on marketing your business will be less effective by 2x, 3x, or much more. In fact, the more broad your business’ focus is, the less effective your marketing will be, the longer it will take to find success, and the harder it will be to make a name for yourself.
Who should niche down?
Everybody! At least, initially.
If you are just getting started on your entrepreneur journey, you should niche down. If you haven’t considered narrowing your focus before, you should absolutely do so. If you think you’ve already found your niche, you should take another look at it. More often than not, you can narrow even more.
But there is a growing group of entrepreneurs and business owners who need to niche down more so than any other group. And that is service-based businesses. The number of businesses starting up has exploded; technology has made starting a new business more accessible than ever, which means there’s more competition than ever before
Niching down is how you become known (like Louis Vuitton) and if you are offering a service, there are likely a thousand other people in your city, if not more, who are offering that exact same (or very similar) service. You absolutely need to niche down to distinguish yourself from the crowd.
Likewise, if you are starting a business to share a message with the world or make an impact, like my client, Chaya, you need to niche as well. If you feel the desire to help everyone — that’s a great thing! But the best way for you to make that impact you so want to see in the world is to niche down, so you can make a bigger impact in that niche, and grow your efforts as you grow your business.
When should you niche down?
The sooner you niche, the more successful you’ll be. I whole-heartedly believe in this because I’ve seen it happen, both for myself and for my clients. It’s a scary thing to do, because it will feel like you’re missing out on business.
Niching down means you’ll have to say no to potential clients who aren’t a good fit for your niche. It means you’ll have to decline networking events that don’t put you in front of your target audience. It means you’ll have to tell people you don’t offer that service, but you can refer them to someone else.
Often, it feels like you’re turning down money, but I want you to know that’s simply not true! That feeling that you’re leaving money on the table is fear, not reality. The reality is that the faster you niche down — and own that niche — the faster you’ll be able to get in front of the right people to share your offer and grow your business.
When you niche down, it will become easier to make the bigger decisions you need to make in your business. When my client, Chaya, realized her niche and the message she wanted to share with the world, here’s what she said:
I realized I had a very important message to share with the world, and the ideas started pouring out of my head.
A name for my blog popped in my head while taking a walk with my husband a few days after the conference. I wasn't even trying to come up with a name! It simply fell in my head! It’s such a great name!
And the content is so needed by so many people, that I simply cannot type fast enough! What I started out with that day in Sojourners many months ago, and what we are about to launch, are worlds apart.
Your process allowed my best self to come to the surface. You took good to great!
Before Chaya niched down, she struggled to come up with content. She couldn’t think of ideas, and didn’t know what to say to people. She wasn’t sure how to launch her business when she couldn’t sum it up into an elevator pitch.
Once she niched down, the ideas flowed readily. She was clear on her purpose and therefore her message, so she was able to decide that she did want to start a blog, what to call it, and what content to share — all with ease.
How do you niche down?
In order to figure out how to niche down, we’ll need to return to our definitions again.
“A comfortable or suitable position in life or employment.”
“A specialized segment of the market for a particular kind of product or service.”
When you decide to niche down, you are looking to fulfill both of these conditions. You’re looking for a narrow slice of your industry, but you also want to determine the product(s) or service(s) that is comfortable and enjoyable for you to provide.
You’ll know you’re getting close to identifying your niche when you can answer “yes” to all of these questions:
Do I like doing this work?
Am I good at performing this work?
Are there people who have a need for this product/service?
Is there a void or lack of businesses already doing this?
Does this work allow me the lifestyle I want my business to provide me?
Unless you’re working with a business coach, much of the niching down process is a quiet, solitary one. Mostly, it’s a cycle of internal reflection, external research, and analysis of the findings of those two.
You will need to reflect on the things that you most enjoy and are good at doing.
You’ll need to research the industry to determine who is already in the space you want to carve your niche in.
You’ll need to analyze whether there is a genuine need for the product or service you wish to provide.
And you’ll need to do all of this for each and every individual niche that you’re considering. When you think you’ve found one, I don’t recommend running to printers to get new business cards made up. Instead, test out the niche you chose. Here are a few different ways to do this:
Collect surveys from members of your target audience to ensure they really do want this product/service and find out how much they’d pay for it
Create a portfolio of the work you want to be known for and ask for honest feedback from a colleague or veteran in the industry to ensure you’re good at it
Volunteer your services with a non-profit organization (or give away your product) to get experience (and testimonials) and ensure you genuinely enjoy doing the work
Set up a pre-order for an offer that you haven’t yet created to determine interest and gauge willingness to pay — then be sure to deliver on your promise!
Conduct informational interviews with colleagues or industry veterans to learn about their work-life balance to discover if it aligns with your desired lifestyle
Once you have discovered your niche, you’ll likely feel like Chaya did: “I feel really at peace with my plan. I feel confident that it will serve a great need and the word will travel fast.” Keep checking in with yourself to see if you need to niche a little bit deeper, and you’ll stay on track!