How to Determine Whether You've Chosen a Good Niche

How to Determine Whether You've Chosen a Good Niche
Choosing a niche-a small, focused target market-for your
services can be very beneficial to your business. It will
help your clients to focus on and identify the services
that you offer, and it will help you to develop deep
expertise in a single area-and "niching" will help you to
raise your rates and create a successful business.

But to maximize the benefits you'll get, you want to make
sure that you choose a good niche. To niche well, there are
several questions to consider:

- Can potential customers in your target market afford your
services? If you're offering a high-ticket item to a target
audience that doesn't have much money, then you can run
into trouble. Or if your target audience doesn't control
the buying decision or isn't authorized to meet the cost of
your product or service, that can also lead to trouble. In
these cases, you might explore packaging your services in a
more affordable way, creating payment options, or choosing
a new targeted niche market that will be easier to sell to.

- Do they put value on your services, and will they be
willing to buy? Do they think that they your services? Even
if your target audience is able to afford your services,
they have to also feel that your services have value to
them and that they need those services. If they think that
your services would not improve their lives or businesses,
then they're unlikely to make the purchase. Likewise, if
your customers think that they can do it themselves, or
that they don't have a need that your services will fill,
then they won't make a purchase.

- Do they understand your services? If your target audience
doesn't understand what you do-if it's too technical or
esoteric for them to even understand what you're selling or
why they might want or need it-then you'll have a very
tough time making any sales at all. Make sure that your
target audience can at least be taught to understand your
products or services and the benefits they provide.

- How hard is it to find the people who are in your target
market? If you can't find the people who will make up your
target audience, then they likely cannot find you and your
offering. For example, the easier it is to find networking
groups or mailing lists that have large populations of
people in your target market, the easier it will be to
market to them by speaking at events and sending out direct
mails.

- Are there a lot of other competing providers in your
niche? If so, is there enough market for you? If the target
you're marketing to is served by many other providers, then
it might be difficult to capture enough market share to
sustain your business.

- Is this niche within your abilities to deliver, and are
you credible in it? Do you have experience serving this
niche... or can you get that initial experience easily?
Some ways to do this include through pro-bono work,
discounts, or aligning with a professional organization to
offer discounts to its members. You might also be able to
read about the industry you're planning to market to, to
learn more about the specific problems and challenges they
face.

- Is the niche big enough to sustain your business? Are
there enough potential customer companies or enough need in
that industry that you plan to serve? If you choose a very
specific niche, you might find that there are just a few
companies that you could serve. If that's the case, you
might want to widen your niche.

If your niche fits these criteria, then it's likely that
you've created a great niche, one in which you will make
more sales and grow your business.

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Erin Ferree is a brand identity designer who creates big
visibility for small businesses. As the owner of elf
design, Erin is passionate about helping her clients stand
out in front of their competition and attract more clients.
Her workbook, "Stand Out! Differentiate Your Business to
Build a Solid Foundation for Your Brand", will help you to
define your difference and find your best niche.
http://www.elf-design.com/products-stand-out.html