What is Niche Marketing?
Niche marketing is a marketing segmentation strategy that is focused on defining a niche, target market. These markets are smaller parts of a larger market with their own unique characteristics. To put it simply, it’s knowing what you are selling, and who you are selling it to.
If what you are selling doesn’t work for everyone, you have to define your niche.
For instance, the market for cars is massive, but the market for Ferraris is positioned toward very specific, high-net-worth individuals. Does Ferrari target all car owners? No way. Fire the marketing person that says yes. Do they target all high-net-worth individuals? No. Also, fire that marketing person. In my opinion, if you want to get specific, Ferrari is targeted toward high-net-worth, males in their 50’s, who love sports cars, crave luxury, and value performance. The more specific you get, the more you “niche down” to further define your niche market.
Beyond Demographics
The Intersection of Appeal, Ability, and Motivation
So how and why do they do this? To understand why you need to understand the difference between appeal and ability to buy. Does Ferrari appeal to people outside of their target audience? Absolutely. I remember having the Testarossa poster on my wall as a kid. I’ve been to the Ferrari dealership and museum at the Wynn in Las Vegas. It’s a cool brand. Am I their target audience? If so, Ferrari has got problems. Even if I could afford a Ferrari, would I buy one? Probably not.
Why not? Let’s say I had the ability. The brand obviously appeals to me. However, there are certain psychographics that impact my motivation. Psychographics is just a fancy word that describes a way to study people’s personality, attitudes, lifestyles, interests, and values. Although I like the brand, it’s pretty low on my priority list. I work from home so I really don’t go anywhere. I have a kid. Where am I going to put the car seat? When I do get away, I like to go camping or to the beach. Although it would be cool to drive a Ferrari up to a campsite or to the beach, am I going to just show up without any gear? Probably not. Ferrari should probably not waste any more time on me. I know they exist. If my motivations change in the future, who knows, maybe I would be a target. Right now though, I should not be considered part of their niche.
What Are You Selling and Who’s Buying? A Good Place to Start.
Although it is really basic, many marketers lose sight of the fundamentals of knowing the product and understanding the buyer. Do you really know how you stand out? Do you know what your customers want? Have you ever asked them? What research have you done? When you start this process, some thought-starter questions could be:
- What do you sell that is unique?
- Who are the buyers?
- Where do they buy your product?
- Where can you find them and market to them?
- What motivates them to buy?
- Why do they buy your product?
- Is it a certain feature?
- What do they like about your product?
- What do they like about competitive products?
- Do they get an emotional benefit from your brand?
- What else could satisfy their needs?
- Who is your competition?
- What do you offer that they don’t?
- What do they offer that you don’t?
- What is their media strategy?
- Is your niche as clearly defined as theirs?
- Do customers recognize a difference between your brand and theirs?
- If your niche doesn’t completely overlap, is there an opportunity in the market for new products or services?
Reverse Engineering the Product
One successful product development strategy that I’ve used in the past is to reverse-engineer this process. Start with the customer’s need in mind and develop a product that fits that need. This helps bridge the gap between the product development team and the marketing and commercialization teams known as the “valley of death”. This gap is a fundamental disconnect that many companies face by not providing the right product to the right audience.
Defining Your Target Marketing
Marketing to a niche audience is different than the mass marketing strategies that many consumers are familiar with. Instead of spending all of your budget on a mass media strategy, the way you define, target, and communicate with your audience is critical. Back to the Ferrari example, should they spend all of their budget on a Super Bowl commercial? Probably not. Why? Tons of people would see the ad, and that would probably increase their perception and interest in the brand. Well, they would have a ton of waste. Again, although they may drive appeal, a good proportion (I’m guessing 99%) of the people watching lack the ability and/or the motivation to make a purchase.
So, what should they do instead? They should clearly define their target market with a combination of demographics and psychographics. Building a customer profile can be incredibly helpful in understanding your buyers. This profile should include items like their income, age, attitudes, personality type, values, interests, lifestyles, opinions, and beliefs. If you don’t know any of this information, you may be able to find it with secondary research but you’re better off getting primary research. You could put together an online survey with something like Survey Monkey and send it to your customers via email (just google Psychographic Survey Questions) to help get you started.
Once you have completed the profile of the buyer, a good next step would be to map their journey engaging with your product.
Mapping the Customer Journey
A Customer Journey Map can help you think about each step that one of your customers or potential customers may take when they engage with your product or your brand. At a minimum, you should be able to map their awareness, information search, purchasing, and post-purchasing experiences. For each one of these stages, map the activities they go through. This includes tracking their motivations, the questions they may have, and any barriers they might find in engaging with your products.
Targeting Your Advertising
If you’ve clearly defined what you are selling and who you are selling to, it’s time to define your targeted advertising strategy. This will include your messaging and your media plan. In the past, you could focus on one at a time, but today it takes a solid understanding of how a customer engages with the media to make your message be heard by customers. For instance, you have character limits on some platforms. Sometimes Twitter cuts off certain corners of photos in their feed preview, so what displays fine in Facebook and LinkedIn gets cut off in your Twitter post. It’s annoying, I know. Instagram posts can’t have links unless you are promoting the posts (I usually just say “link in bio” and change the link in my IG profile). Print advertising has limited trackability unless you are looking to create a separate URL or landing page. Your advertising needs to account for all of these variables and it’s a fluid process of understanding how everything works in real-time.
Create Your Ad
This is the fun part. It’s the part where you actually get to create your ad. Using all of the information you’ve found out about your product and your customer, you can get started on your ad campaign. Don’t forget the basics: a compelling image with stopping power, a powerful headline, clever ad copy, and a call to action. A good ad also has an emotional appeal, a rational appeal, or ideally both.
About Those Online Ads…
One of the great things about online advertising is the relatively low cost and ability to make adjustments throughout the process. You can also test between messages and audiences (commonly referred to as A/B testing) to see where you have the best performance and increase the budget for the better performing ads. In addition to common advertising targeting platforms like social media and AdWords, check with any applicable trade publications or niche publications. They may have some advertising options like a regular e-newsletter that can get your message in front of the perfect audience.
From a trackability standpoint, the great thing about online ads is that you can create a tracking URL for just about anything. Want to add it to your opt-in newsletter? You can do that. Want to add it to a Facebook post? You can do that too. This can be a great way to show you where to use your time and resources. I would caution though, too much analysis can lead to inaction. Use this information to make better decisions, don’t use it to stop yourself from making a decision.
For some niches, but not all, social media targeting is pretty good. Think about it, social media’s value lies in their data, and consumers regularly give their data to these social media providers. The pages they like, the groups they are in, the posts they engage with, they all build a profile that social media companies can slice and dice, then sell back to advertisers for $10 a day. This data allows me to target vegans, aged 20-24, in Pennsylvania who are also interested in shoes. Bingo, my vegan shoe company that doesn’t have to pay sales tax in Pennsylvania can now be advertised to my hyper-targeted audience.
You can also start to build your own email list. This is a long-term approach as it involves several steps. The basic steps involve creating content, offering a place to sign up, sending an automated email thank you to people that sign up, and giving them regular emails. One of the most popular platforms for many companies is Mailchimp, due to their really amazing free platform and several seamless integrations into platforms like WordPress.
How About the Podcasts?
Podcasts can be a great option. There are podcasts about just about everything you can think of. If you are selling resume writing services, there are job search podcasts. If you are selling special baking measuring cups, there are shows about baking. If it’s not a huge show like Joe Rogan or Serial, the rates to advertise could be very reasonable for your business. In the marketing world, we call the owners of these types of shows “micro-influencers” because they have a small but dedicated following (note that the same thought process of micro-influencers applies to anyone – who can be bought – with a niche social media following). One niche show I really love is Ultra Runner Podcast. Check it out if you’re a weirdo like me that thinks it’s a good idea to run ultras.
The Creepy Factor
So you know all of those ads that follow you around once you visit a website? You know you look at a new drill on Ace Hardware, then you get nothing but ads for that drill for the next year and a half. Well, that’s called retargeting and it can be done with not just the site you visit, but from other companies piggy-backing off of their traffic. Let’s say I own a media site and I get a ton of traffic. I know that segment XYZ has been reading a lot of content about drills. Ace Hardware or whoever is selling drills can target those people with online ads much like retargeting.
Want to get creepier? Do you know about Geo Fencing?
Geo-fencing sets up a “fence” using your cell phone data. So let’s say that you went into the Ace hardware and walked by the drills. You didn’t even look at them, maybe you thought about them, I don’t know. A drill manufacturer can buy each Ace hardware location’s “geo-fence” data and for the people that entered that “fence”. Now, when you are checking your local news site, voila! There’s that damn drill again!
And creepier still. Do you know about the special tone that your smart TV plays that talks to your cell phone? No? Um…okay. Google that. It’s been happening since at least 2015.
How about those super creepy Twitter and IG ads that seem to show up after you’ve just had a conversation about the product. Is Facebook, Instagram, and Twitter using your microphone to spy on you to sell you stuff? Well, they’ve repeatedly denied doing this. Are they doing this? My opinion is, probably.
So you can go a little overboard when targeting. You don’t want to be creepy, do you? I’m guessing you said now. But is it effective? Fortunately and unfortunately, yes. The prevailing data suggests that retargeting ads alone are 10 times more effective than traditional display ads. The one thing that has always concerned me about pay per click campaigns are bots and ad fraud. You obviously want real buyers clicking on your ads and all major advertisers, including Facebook, Google, and Newsweek have admitted fraudulent traffic.
Let’s Get Old-Fashioned
There are so many perks to online ads but let’s remember, this is niche marketing. Sometimes there’s more that comes into play than finding your customer online that will motivate them to buy. If you can find an excellent mailing list, sometimes good old fashioned direct mail can deliver the staying power that an online ad can’t. If you are selling a luxury product, there are some special coatings, like a good combination of soft-touch and high-gloss UV that can make your printed materials have a luxurious feeling. I’ve even done scented direct mail to help engage the senses. A direct mail piece advertising aircraft interior refurbishment I was creating needed an extra something. I made the seats feel soft, the trays feel smooth, but it just wasn’t quite there so…I made it smell like leather. I’ll admit, it was a bit gimmicky, but it sure stood out, and led to a 3,700% ROI.
A Sample Media and Messaging Strategy
Let’s go over a sample niche marketing media strategy so you can get an idea of how this all works together. Let’s take expensive truck CB radio antennas as an example. With over 3.5 million truck drivers, should we target all of them? If you said yes, I’ve failed you. Hell no! Let’s look at the product we’re selling and what we know about it from the one sentence I used to describe it. Okay, they’re expensive. They’re for trucks. They’re CB antennas.
For illustrative purposes and without all of the fancy research that you should totally do, we’re going to create a profile of the buyer. The typical buyer of this type of antenna is a man, from 30-60, who owns and operates their own truck. They are a long-haul driver, meaning they spend a bunch of time away from home. They like the expensive antennas because they get a greater range on their radio. The competitive products are garbage and don’t work very well. They typically buy these antennas at a truck stop. They like CB radios because it gives them a sense of connection to other drivers on the road. They love their jobs and love meeting and talking to other people on the road.
Messaging Strategy
In this example, the umbrella message for this type of product would involve the amazing range and clarity that you can achieve by using this type of antenna. You could use a mix of facts about the enhanced range vs. competitive products and a list of rational and emotional benefits you could receive by using this type of antenna.
Some sample headlines include:
Rational Appeal:
- XX More Range Guaranteed
- Get XX More Range with Our Amazing Antennas
- Better Clarity for XX More Miles
Emotional Appeal:
- 10 Years With this Antenna, Zero Speeding Tickets
- A Small Price to Pay to Avoid a Two Hour Traffic Jam
Content Creation
This type of product could really benefit from some direct comparisons of the product vs. a competitive product. A great way to do this would be a video showing a provable difference in range and clarity. Comparison blogs from neutral, third parties could also benefit the company, given they have enough traffic. Testimonial advertisements from the target end-user (owner operator truck drivers), could be another really powerful way to portray the message.
Another thing to consider for this type of product is how to be helpful after the sale. Offering easy installation guides, or instructional videos on how to install and adjust the antenna for maximum clarity and product life could give the customer a greater feeling of satisfaction with their purchase.
Media Strategy
Marketing can be targeted to owner-operators on social media channels like Facebook, Twitter, and Instagram. Since this product is purchased mainly at truck stops, a good niche marketer would invest in a good point-of-sale strategy. This could include audio or video advertisements played at the pump, pump topper signs, advertisements at the displays, bathrooms, and floor graphics.
As with most industries, there is a niche media outlet for truck owner-operators. One of the big players in this arena is a company called Overdrive. They have a print publication, e-newsletter, website, and producer of documentary podcasts like “Over the Road”. Speaking of podcasts, there are some other pretty popular trucking podcasts like “The Trucking Podcast”, “Trucker Dump”, and “TalkCDL Trucking Podcast”.
Wrapping Up
Niche marketing is all about understanding what you are selling and who you are selling to. It goes well beyond demographics to really understand how your customers behave and why. This will help you know what their problems are and how you can solve them, how they feel about your brand in comparison to others, where and how they consume media, where they shop, and more. Your advertising strategy should be focused on what motivates them to buy, either rationally, emotionally, or both. Your media strategy can be very targeted, regardless if you are using online advertising, print advertising, location-based advertising. Now, what are you waiting for? Get started on defining your niche market and become a niche marketer!