One of the challenges in business is aiming our products or services at the right target market. It can be tempting to position our business towards a very broad market.
People falling into this trap think that because what they offer can be used by most anyone, they’ll be limiting their income if they focus in on a segment of the market. And it seems to make sense. Maximize profits by marketing to as broad an audience as possible.
The trouble is, it doesn’t work that way.
The trouble with trying to market to “everyone” is that the overwhelming majority of small businesses don’t have the resources to market to the entire broad marketplace effectively. As a result, they end up marketing ineffectively.
Typically they become a “Me Too!” organization that blends in with everyone else selling what they sell.
By trying to reach everyone they give no one a compelling reason to do business with them. Not only that, but their marketing costs end up being proportionally higher because their marketing efforts have smaller conversion rates.
Less is More
Even though it seems counter intuitive, the reality is a classic case of “Less is More.”
By focusing down on a segment of the marketplace and targeting your business at a specific niche you become the go-to resource in that target market. When you do that you can tailor your marketing to appeal directly to that niche.
That will reduce your costs because you can set aside anything that doesn’t appeal directly to your niche.
Even beyond the reduced costs, you will likely see increased income too. Because over time your business will break out and become the obvious choice for customers in that niche. Think about it. Look at the picture there.
The bulls eye in the center is worth more points than the outer rings of the target. Becoming the experts in servicing a specific niche might even allow you to charge more for the same service. If so, you’ll be earning more for the same volume of work.
Either way, when you lower costs while increasing revenue your business becomes much more profitable!
So how can you refine your target market to increase your bottom line?