Niches are at the heart of every successful business, product or service. A niche market is the subset of the market on which a specific product is focusing. So the market niche defines the specific product features aimed at satisfying specific market needs, as well as the price range, production quality and the demographics that is intended to impact.
Whether your business is mature, in a start-up mode or you are just contemplating, you need to identify specific customer needs (NOT wants) that have been ignored, overlooked or neglected by others. Identifying a niche is not a destination, however. It is and must continue to be a work in progress. The reason for this is that the marketplace and consumers continue to change before our very eyes. You and your business, your product mix, your menu of services must be capable of changing with the times. You need to think sideways, backwards and outside-in about your present or potential customers and how they are currently being served in your local marketplace. When you do, you are bound to come up with a good niche concept.
Here are 4 compelling reasons why every small business needs a niche:
1. A niche increases the effectiveness of your advertising, allowing you to concentrate on a clearly defined audience instead of aimlessly prattling on to everyone.
2. You will experience less competition because a niche will position you as a leader in your chosen area and not as just another business.
3. Your business will be more profitable because you will have better control of your pricing and your promotional expenditures.
4. You will be able to build your business faster by making fewer mistakes as regards who you are, who your customers are and how you can cost effectively reach them.