There are 28.8 million small businesses in the United States, the US Small Business Administration reveals. Roughly two-thirds of small businesses survive for two years, while only half are still going after five years. While there are many mistakes small businesses make, failing to identify and fulfill a niche is one of the most common. Niche marketing involves marketing your business to a unique target audience in order to stand out and build a stronger following of loyal and distinct customers.
Benefits of niche marketing
Niche marketing can prevent your business from being overlooked and losing out to the competition. In fact, the smaller your target market is, the less you’ll have to compete for their business. Choosing a niche sets your business clearly apart from the rest and helps you make a stronger connection with your select audience. You focus on growing a loyal following and fostering a stronger and longer-lasting relationship with them. By positioning yourself as a unique industry authority, your customers will trust your expertise and appreciate you for having a better understanding of them than the competition does.
Targeting a neglected market
The easiest way to identify your niche is to hone in on your most obvious and easily-identifiable ideal customers. However, you can go a step further by picking out an audience that is typically ignored or under-served. For example, Divvies is a vegan, nut-free and gluten-free bakery that targets a highly under-served market — people with serious food allergies and restrictions. Numerous brands specialize in sweet treats, but the choice is limited for people looking for non-allergenic food. Divvies successfully targets this neglected and poorly-served market, and is therefore able to stand out in a highly-saturated industry and build a loyal customer base.
Establishing a sense of belonging
Effective niche marketing should give your target market a defined identity that makes them feel good about being your customer. Just take a look at Budweiser’s #NotBackingDown Super Bowl ad. Budweiser is “not small,” “not sipped,” and “not a hobby” — they’re telling Bud drinkers they’re not only different to craft beer fans, but should be proud of it. Niche marketing campaigns should highlight the target audience’s unique qualities to boost their self-esteem and build community. Even the name of your business can be used to do this. For example, effective CBD company names typically paint their customers as mavericks willing to buck the stigma surrounding the product. However, also consider how your industry may change in the future. CBD may be a niche market now, but it’s set to become an increasingly mainstream method of pain-relief as support for legalization grows. Your chosen brand name should fit your target audience in both the short and long-term.
Niche marketing is a surefire way for your small business to appear more valuable to customers and secure their long-term loyalty. By honing in on a specific and typically neglected market, you’ll find it easier to grow a following of passionate and committed customers.