Many B2B firms, such as accounting and law firms, target niche industries like construction, biotech and real estate with their marketing efforts. What is the primary reason that firms create industry niches and invest resources in communicating their areas of specialty?
All things being equal, sophisticated buyers will choose firms that have knowledge of their particular industry. Those firms that are “jacks of all trades and masters of none” are typically left to compete with similar firms on price. And to quote brilliant content marketer, Marcus Sheridan, “When it comes to running a successful business price ain’t nice.” So, if you pick a niche and market it, they will come, pay your standard or even premium rates and your firm’s growth rate will rock, right?
Why You’ll Want to Ditch Your Niche Strategy
Unfortunately, many partners or senior-level marketers don’t approach niche market strategy from a strategic standpoint and make decisions on a random basis. When this happens, niches don’t necessarily translate into riches. Here are three common ways B2B firms choose target markets:
- Partner / Owner preferences: Choosing a niche is a snap because it’s simply a matter of picking which industry the owner(s) prefers.
- Your existing client roster: Your firm services one or more companies within that industry, and that is a good enough reason to justify investing substantial marketing resources.
- What you’ve done in the past: Once a niche market, always a niche market. Your firm sticks to the same plan year over year just because it’s familiar.
There’s a BIG problem with all of these approaches, and while your firm may get lucky, it likely will only be disappointed by a low marketing ROI!
Why is this the case? Here are two potential reasons: (1) Your competitors are choosing their niche markets based on a strategic criterion; and (2) the markets you select may be slow growth and/or in decline. So, let’s make you the next rainmaker of your firm by simply choosing the right niche based on smart strategy. Here’s how…
The Secrets to Becoming Rich with Your Niche
- Industry Outlook: Ideally, when selecting a new marketing niche, you should consider the industry forecast. It’s easier to pick up clients when industries are growing and you aren’t fighting for a declining pool of companies and opportunities. If you or your firm’s brand is associated with a niche that is stagnant, it’s never too soon to begin the strategic planning process to look at maintaining your presence in the industry while beginning to invest in faster growth areas.
- Low Competition: It’s better to be one of the few fish in a smaller pond than one of millions in an overcrowded, bigger pond. Instead of targeting a broadly defined, large market, look to find a sub-sector that has distinct needs. The firm Rusk O’Brien Gido + Partners is an investment banking firm that targets engineering, architectural and environmental consulting firms only. Given this niche laser focus, it has built high brand recognition and marketing traction within a relatively short period of time.
- Core Strength: You need to select a niche that you know not only well but better than most of your competitors. Ten years ago, a firm was able to put up a web page saying they specialize in a market, and that was really good enough. In today’s modern marketing world, online thought leadership in the form of content is required. If you randomly select a niche and it’s not necessarily a true core strength, savvy B2B purchasers will see through your fluff – and so will Google. Work on developing your skills and focus on being the best service or product provider within a niche before starting the marketing process.
If you’ve selected a niche based on a solid strategy and are ready to develop your plan, check out our guide on strategic marketing planning.
Check out these recent insights from our subject matter experts.