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The Importance of Understanding Your Niche & How to Define It

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Most successful businesses have something in common: they’re unique. Sounds like an oxymoron, right? Yet, these businesses have discovered how to serve their customers in a way only they can by defining their niche. In a world where hundreds of business owners are marketing similar services, your niche sets you apart.

What Is a Niche?

A niche is a position or a place. When it comes to your business, your niche is the place you fit best in the market. The niche you choose should perfectly define what it is you offer, as well as who you offer it to and why. Plus, it should be profitable for your business.

There’s a common belief out there that you must “find” your niche, like it’s hiding under a rock somewhere, ready for you to uncover it. Believe it or not, your unique niche doesn’t exist yet. You must define it.

Define Your Business Niche Using These Tips

Defining your niche doesn’t pigeonhole your business. In fact, it helps you stand out from the competition to those who need you the most. To help you start carving out a unique niche for your business, use these tips.

1. Know Your Target Audience

First things first, you must understand your target customer. Start by asking yourself: who do I want to help? It’s best to create a customer avatar or persona to help you clearly define who they are. This helps you understand your customer’s needs and desires so you can find their pain points. These areas of pain are where you’ll focus your services.

For example, an accountant’s customers may experience the overwhelming stress of dealing with bookkeeping on their own time. In response, the accountant offers bookkeeping services to alleviate that stress. As you think of your customers in this way, you’ll start to see your services take shape.

2. Define the Specifics of Your Services

Now that you understand who your customer is and what they need, it’s time to get down to the nitty-gritty of the services you offer. You must define exactly what it is you do to meet customer needs, down to your area of focus.

The accountant may know that they want to offer bookkeeping services to help their customers, but what services do they need to offer specifically? Now is the time to conduct some competitive research, looking at what others are offering in your business area.

As you look at your competitors, consider what’s missing by asking these questions:

  • Is there an obvious hole in the market that could benefit your customers?
  • Is there a customer need you know you can meet that’s not met elsewhere?
  • Is there a specific type of customer that needs even more?

As you consider these possibilities, you’ll begin to carve out a unique niche for your business.

3. Harness Your Superpowers

What makes you different from your competitors? As you start to define your niche, you’ll need to harness these superpowers (your competitive advantage) to help your business stand out from the rest. Ask yourself: what do I do better than anyone else? These superpowers can range from service quality to pricing and beyond.

Now that you understand your target customer, your service specifics and your superpowers, put it all together to form the backbone of your niche. To help, fill in the blanks of this quick statement:

I’m a/an ___________________________ who helps ________________________________ with __________________________________________ by _________________________________________ in order to ___________________________________________.

Example: I’m a/an accountant who helps business owners with their bookkeeping and taxes by providing monthly bookkeeping packages and tax prep in order to alleviate the stress of doing it alone.

It’s Time to Set Your Business Apart From the Rest

A niche can help you separate your business from others in your market, allowing you to serve more of the customers that need you the most. To learn more about defining your niche, or for answers to your questions, send us a message.

Erin Larson