Niching Down: The Fastest Path To Success

Here’s why niching down is so powerful and how to choose the right niche.

As they say, “The riches are in the niches.”

Niche down to scale up, like most clichés, has earned its spot on the merry-go-round of entrepreneurial advice.

Facebook was specifically for Harvard students, Amazon was just a bookstore, Steve Jobs killed almost all of Apple’s products and niched down into a single major offering (the iMac).

Niching down solves so many of the hardest problems in business.

It helps you understand exactly who your customers are, it allows you to define your offering specifically, it streamlines your operations, and (most of all) it allows you to focus and ruthlessly eliminate distractions.

Niching also enables hyper-focused targeting in your marketing, less (or no) competition, a much higher quality offering, far greater margins, faster positioning as a market leader, easier talent acquisition, and much clearer ascension opportunities.

There are two axes of analysis when it comes to niching down: the industry and the offering.

The industry refers to the specific group of people you’re serving (e.g., cosmetic dentists or mothers of children with autism) while the offering refers to the product(s) and/or service(s) you offer.

Unless you already have inroads with a specific industry, I recommend niching down on your offering first.

Otherwise, you’re still stuck in the trap of trying to offer too much. Even if it’s to a specific target audience, not having a niched offering dilutes the value of niching down.

When you niche down on your offering, you start with what you’re good at (or find a great fulfillment partner).

Honing your craft and getting really good at something specific makes sure quality and fulfillment aren’t an issue.

This also allows you to test multiple targets and see which one might be the best fit for you long term. This opportunity to kiss some frogs can save you from committing to a niche too soon. There are often issues with industries you may not see until you’re already in the weeds.

When choosing industry niches, ask yourself, Who are my most successful customers? Who do I enjoy serving the most? Where do I see the most opportunity? Where do I already have inroads? What industry is underserved?

Some tips when choosing a niche

Be open-minded. The niche doesn’t have to be sexy. Everyone wants to target doctors and lawyers. Get more creative than that and look for industries that are being ignored.

This doesn’t need to be forever. You can niche down into a specific industry, crack the code on scaling within that industry, and then put it on auto-pilot and do it again. I call this the hourglass: Start broad, taper down, then go broad again.

There’s no such thing as too small when it comes to niching down. I have a very successful agency that serves nothing but Montessori schools. There are fewer than 5,000 Montessori schools in North America. You’ll be hard pressed to find a niche smaller than that.

Don’t be afraid to try out a few different niches and make some mistakes. You’re not going to get it right the first time. I had a ton of failed at-bats before I started seeing success. Even then, I was only getting base hits but that was good enough to build on.

What niche do you think would be interesting to explore?

Share your favorite niche success story!