If you don’t already have a winning niche strategy, it’s not that difficult to create one. The biggest roadblock is probably your mind-set because the best niche strategy may mean disrupting your current business model. You may need to think outside of the box and leverage ideas outside of your current industry or geography.
To create your winning niche strategy, you may find it helpful to:
The Absence of a Niche Strategy
- Identify challenges in your industry and target market. Evaluate the best solutions to solve these challenges. If you have the resources and expertise to solve this challenge, you have likely found your niche.
- Travel to different cities and explore how companies in your industry are competing and marketing their service or product.
- Attend trade shows and conferences. Remove yourself from day-to-day operations and take time to strategically think about your business.
- Explore new trends in different industries and brainstorm ways that these trends can be applied to your business, industry and target market.
- Test market potential niche strategies. If you can easily sell the solution or product, you are on to something.
- Re-invent your business model using the latest technology or resources (if you don’t do it, a competitor likely will).
- Create a mastermind group or join a Peer Advisory Board offered through organizations like The Alternative Board®. Get input from others outside of your business as you may be too close to the problem.
- Facilitate brainstorming sessions with your employees and customers. Your best idea may come from someone inside your company or a customer you currently serve.
- Be open to failure. Some of the best-known entrepreneurs have tried a dozen different business ideas before being successful.
- Execute on your ideas and stay committed during the test pilot. In many cases the problem isn’t the idea; it is poor leadership, or lack of accountability or planning.
- Explore ways to differentiate your current product or service. This may include a customer service commitment (such as 30 minutes or less or your pizza is free), a warranty (such as a 10-year warranty or free follow-up service calls) or a differentiated product or service feature.
Without a Unique Value Proposition (UVP), you will have to put forth more effort to grow revenue. This will include developing better relationships, implementing the best marketing and advertising programs, building your brand (reputation), delivering excellent customer service and increasing operational efficiency (price competitiveness). If you are well capitalized and have solid management practices, this may be doable. Community banks and independent insurance agencies are a perfect example on how this can be done. It’s very difficult to differentiate your company on interest rates, insurance rates or service fees. Small banks and insurance agencies win market share through relationships, individual sales skills and customer service.
If you don’t have an effective niche strategy, you will need the best people, culture and management systems to win in the marketplace. The goal of this column and our Cornerstone Business Advisors coaching program is to help you develop a competitive advantage (niche strategy) combined with the best execution (people and process).
Cornerstone Business Advisors provides access to experts in business strategy, management, process and finance. The Cornerstone team includes former C-Level executives, successful entrepreneurs and advisors who offer unmatched experience in delivering advanced, custom-tailored, results-oriented solutions for business leaders. Cornerstone has worked with hundreds of companies that range from fast-growth start-ups to Fortune 500 corporations. It developed the Performance Culture System™ to help clients implement best practices and drive high performance throughout their organization. For more information, visit www.launchgrowexit.com, call 910-681-1420, or email [email protected].