The Truth About Niches
I can’t tell you how many times a sales person comes to me after a speech and asks me about the viability and advisability of marketing within a certain niche. The niche could be immigrants from a certain country or those purchasing million-dollar properties. Should I focus in these areas?
In order to deliver a valid answer to these inquiries, we need to take a step back and make some important points about niches. What are these?
First, yes you should have a niche. Having a niche will help you establish your business in several ways–
•You must differentiate yourself from your competition. If you are trying to be all things to all people, you will simply be copying what your competition does. It is tough to present yourself as different when you are in fact not being different.
•Typically, market leaders are known as experts. Once again, you can’t be an expert in everything. By identifying a niche, it is both easier to gain expertise as well as easier to spread the word about that expertise.
Marketing to the world is very expensive. Identifying a niche makes it easier to focus your marketing plan so it can be more effective. For example, if you live in a metropolitan area of two million people, but your niche is comprised of seniors looking to downsize their homes, the number may be more like 200,000. It is easier and cheaper to reach this market segment through others who serve seniors.
Second, there are no bad and no good market niches. Some may be hotter at particular times or in certain areas of the country. For example, there is no doubt that the most recent and projected growth of the immigrant population has created an opportunity to focus on particular segments of home buyers. While it is important whether a niche is “hot,” such as helping people with foreclosure situations when the real estate market slows down, it is just as important to make sure–
•The niche is sustainable in the long-run. You don’t want to expend the effort to conquer a niche while achieving solely short-term gains. True market leaders are in the game for the long-haul. Get rich quick schemes almost never pay off as all worthy goals are achieved one step at a time.
•You fit well within this niche. Your “fit” is more important than the niche itself. For example, if you are a 23-year old rookie in some segment of real estate, why would you be focusing upon seniors? Do you even know many seniors?
It is this last point which is the most important. Niches can be based upon property types, locations, purchaser characteristics, transaction types and more. But in each case the key is a fit. How should the niche fit your profile?
•Do you have experience or skills within this segment? For example, do you speak the language of a particular immigrant group? Or are you an experienced real estate investor if you are focusing on that aspect of real estate?
•Do you have an interest in servicing this segment? Not everyone is interested in serving a certain sector of transactions or people. If you are not really interested in this type of work, it is easy to see why you will not be able to sustain the drive needed to succeed in the long-run.
•Is your sphere of influence packed with prospects? If your sphere is full of blue collar first-time buyers and you want to service rich doctors, does that make sense? If you are changing your sphere, how easily could you integrate this change?
You are achieving something greater than selecting a niche. You are focusing upon a part of your life. If you must change your life in order to serve this niche, you are much less likely to be successful. Not unless you are very driven to make this change. Your marketing plan may have to include the steps necessary to gain expertise such as learning languages or studying taxes. It may mean joining different organizations.
This is why your interest level must be high. Any changes to your life require a high level of energy and if you are not driven to make these changes, you are much less likely to be successful implementing the changes. In other words, the niche should come from within you instead of you finding a good niche and asking–is this a good one?