A niche strategy means focusing on a subset of the market – a smaller segment that you are able to better serve than companies targeting a mass market. This can be an attractive strategy because you can potentially meet the needs of this smaller market segment better than firms that are targeting a wider audience. This article explores different niches that you can target.
Niche 1: Customer segment
The first way of defining a nice is a particular audience segment – identifying a group of the market that are similar. there may for example be an industry that you can focus on, really understanding the needs of that industry. This may allow you to offer a product that is focused on this market segment – potentially better meeting their needs than a more mass-market alternative.
Niche 2: Product features
Another way of defining your niche is around a particular set of features that you will provide. Potentially there is a group of customers that value particular dimensions not offered by existing companies. There may be opportunities to develop products focused specifically on this underserved segment of the market.
Niche 3: Geographic focus
A final niche opportunity is to focus on a particular geographic segment – especially if it is overlooked by existing companies. A particular region may be relatively isolated from the broader market (potentially because it is more remote or isolated) – potentially providing an opportunity for you to target this market segment.
Final thoughts: Make sure that you are able to better serve the needs of your niche compared to broader targeted firms
While the niche strategy can be an effective way of competing, it is important that you are able to better meet the needs of this niche relative to broader-focused companies. Unless you are able to offer unique advantages that derive from you focusing on a particular audience, then you will have a hard time convincing customers to use your firm relative to the broader focused alternatives.