In an abundant market saturated with sales opportunities, yet plagued with supply chain and labor shortages, finding your niche is paramount. Hear me out.
Being able to zero in on a niche target market (or even better, a target persona) and the products they want is a superpower of ultra successful companies. Trying to be everything to everyone is a good way to be mediocre and please no one. The old adage “Jack of all trades, master of none” sums it up nicely.
Consider this example: Five Guys Burgers and Fries. They know who they are, what they’re masters of, and completely ignore everything else. They don’t do drive-ups, they don’t do coffee, actually the list of things they don’t do is too long to write (and part of my point). The time saved not doing things allows them to be masters in their space.
Try to imagine a world in which Five Guys cared about vegan Santa Monica frappa-latte moms on their way back from goat yoga in Lululemon tights. Hopefully you can’t. It wouldn’t work, or at least it wouldn’t work without seriously crippling their business. Let me challenge you in your business: Do you consider both groups your customers? Are you chasing two cars heading in different directions?
In our industry, we tend to divide ourselves into only a few categories (high-end custom, residential, architectural, etc…) and then the whole population fits into those groups. So, you almost certainly are trying to sell to burger guys and latte moms. That’s tough.
There’s a real cost to not knowing, having, and executing on your target persona. Let’s discuss 3 for now:
In our industry, having a boring brand is almost a right of passage. I’m guilty of this. My company was named “Lewis Cabinet Specialties”, and our logo had a raised panel door on it. How boring is that? Being everything to everyone forces you to have a boring brand because it has to generally appeal to everyone. Trader Joes can have fun with their brand (and their profits). Their employees wear Hawaiian shirts because they know who they are and know who their customer is. What is the Hawaiian shirt equivalent to make your brand stronger?
Consider the different outcomes you have in the following two experiences. In the first scenario, you ask a Home Depot “associate” if they have self-tapping, flush-finish, hex-head wood screws (hint: just look for them yourself, it’ll be faster). It’s almost impossible for Home Depot to hire and train their employees to be experts on the low-margin, high volume products and sell to the masses in an expert fashion.
In the second scenario, you ask a genius bar expert at the Apple store to fix your phone (hint: they’ll fix it and you leave the store after happily spending too much on a new case as well). Apple can hire, train, and retain experts who love their jobs because the products are specialized, niche, and high-margin. When everyone is your customer, it’s hard to be an expert and profitable. How can your products be more like Apple? How can your workforce be less like Home Depot?
In another food analogy, think of the difference between Five Guys and Cheesecake Factory in the amount of raw goods they have to research, source, store, and deploy. When a supplier runs out of basil tomato paste for a menu item on page 14, think of the cost to Cheesecake. There are meetings to discuss alternatives, more meetings with other suppliers, trips to taste samples, negotiations on pricing, and time spent on forming new relationships. All a waste, because as it turns out, the new supplier also reports they can’t deliver either. What follows are more meetings to discuss the discontinuation of the menu item. Freezers have to be reorganized. The menus have to be re-designed, reprinted, redistributed, all at a cost. The waiters have to be re-trained, and there’s more, but you get the picture. Five Guys shrugs and pours another bag of Idaho potatoes into the fryer. Cha-ching. Selling everything to everyone makes you vulnerable to supply chain disruptions. What is your Tomato basil, and what are your potatoes?
Once you decide to become more niche, more… you, it’s time to take action. If you haven’t had anything come to mind in the previous paragraphs, let’s dig in a little as to how to find your niche. In my opinion, finding your niche as a business is a lot like finding yourself as a person. As kids, we began exploring the world and trying out all manner of experiments to begin to find ourselves. We experimented with different voices, ways of moving, and ways of thinking. As teens, we began taking our selections as kids and adding higher level choices. We began to experiment by socializing with different groups of people, trying different interests, and listening to different kinds of music. Sometimes the process can take a lifetime, and sometimes it comes quickly. We know it when it happens because we hold on to some things, and discard others. We know it when we feel it.
So let’s do an exercise. I’m going to ask some questions, and you’re going to just write. Write without any reservation. Just let your subconscious mind speak. You don’t have to take action on anything you write down and nobody will ever see it. Let my prompts discover other questions and off chutes. As adults; and especially as business owners, this exercise is hard to do, because there’s a reason things are happening how they are happening right now, maybe even a good reason. Put all that aside and just let yourself feel and be honest. Here are the prompts:
What kinds of things are happening in your business that don’t feel right?
What things cause stress in your company?
What kinds of things are happening that you want to repeat over and over?
Which type of customers do you struggle with, and which ones do you thrive with?
Which of your products feel second nature, and which ones feel foreign?
Which products and services have a fulfilling effect on your customers and your employees?
Which machines and processes give you stress?
Which kind of employees and suppliers create angst?
Take your honest evaluation and sleep on it. Start thinking about what your business would look like if you could eliminate the things that don’t fit, for more of the things that do. What would your business, products, and customers look like if you took action on (some of) those things? Would you have to change your name? Would it require adding or eliminating product lines/options? Would you have to expand into or leave a region or market?
It’s worth the effort to take the time to think through and find your target customers and the products they want, and then specialize. In the next article, we’ll talk about how to take it further and create a caricature of these customers. Then, in another article, we’ll use the caricature to develop some very effective marketing campaigns.
Have something to say? Share your thoughts with us in the comments below.