When you narrow your focus on a niche market, you are more likely to increase referrals and build a stronger business.
“You’re going to get more referrals with a defined target market,” says Kevin Toney, marketing coach with Primetime Promotions in Winnipeg. “You’re going to be seen as the expert in that niche and, as a result of that, people are going to come to you instead of you having to chase them.”
To make sure you get those referrals, avoid these five mistakes when choosing a target market:
1. Forgetting your past
Find the niche that’s right for you by taking a look at your own experience and interests.
Sometimes advisors try to build a niche through people they have difficulty relating to, Toney says. Instead, take a look at your past work experience and community connections for common characteristics you could use to create a target market.
For example, if in a previous life you were a dentist, you might be able to best serve people in the dental community. Or if your were in technology sales, you might focus on IT professionals.
2. Not doing your homework
Always do research before deciding on a niche.
Take a look at the market potential in your area and consider the type of revenue clients in that group would typically generate, says April-Lynn Levitt, a coach with the Personal Coach in Calgary.
As well, you can get a sense of whether a target market is right for you by speaking with some insiders in that field, says Levitt. You can also clarify the type of services you will offer that group.
3. Waiting too long
Don’t be afraid to make mistakes when crafting a marketing strategy for a target market.
Sometimes advisors wait too long to start prospecting for a niche because they want everything to be perfect, Levitt says.
Instead, you should “jump right in,” she says — after some basic research. You can learn from your mistakes and make any necessary changes to your marketing plan and services as you go along.
4. Fearing the competition
Sometimes advisors don’t want to define a target market because they think there’s already too much competition in that area, Levitt says.
Don’t worry about the competition. If a niche fits your business, you’ll find a way to stand out.
Before you jump to any conclusions, she says, research your competition to see if it’s as tough as you thought. Find out what services your competition offers — and what they don’t offer.
5. Abandoning current clients
You don’t need to forget about your current clients if you decide on a target market.
Some advisors believe they have to give up all their old clients when they define a niche market, Levitt says. But that’s not true. Instead, you are simply creating a new focus for future clients.
This is the second instalment in a two-part series on building a niche practice.