How To Choose Your Niche
Great companies, great consultancies, and great coaching practices aren’t built by serving everyone. They succeed by serving a targeted group with a specific issue very well.
Paypal started just by focusing on eBay’s power users.
Allan Weiss started by monitoring residential real estate prices.
Tony Robbins’ studied neuro-linguistic programming to launch his career.
The difference between sustainable high growth and mediocre chugging along is choosing the right niche to focus on. I’ve met marketing agency owners who have seen sales double or even triple from focusing their business into exclusively social media or web design. Why? Their audience knows their exact field of expertise, and recognizes them as an authority as a result.
Why Choose A Niche?
Choosing a niche helps you save time, money, and effort by offering a related group of services to a specific market. As you continue to hone your craft, you’ll find yourself discovering new tricks and efficiencies that you simply cannot gain by remaining a generalist. A well-chosen niche makes it easier to generate authority, meaning you’ll more quickly become known as an expert. Furthermore, your new authority means your clients will be quicker and more likely to refer those that fit your niche.
Choosing a niche means focusing your business on what you excel at and love to do. If you’re taking on work outside your area of expertise, you’re risking your authority every time. Even if you do a great job, you still risk losing your hard-earned expert brand by muddling your messaging with work outside your core. Choosing the right niche is core to positioning yourself as an authority, which is why we’ve developed a series of five simple steps to choose your niche for authority positioning.
Step 1: Make a List of Potential Areas
We use the following questions when helping our clients discover where they have deep enough expertise to position themselves as authorities. We consider deep expertise as equivalent to having several years of experience in a specific field and subset of skills along with a track record of success.
In what do you consider yourself an expert?
What do you speak on most often at conferences and in seminars?
What do you love doing at work?
What do you want to be “the guy” in?
What sorts of clients have you had the most success working with?
If there is any part of your work that you love doing more than anything else, add it to the list as well. Try to get your list up to at least seven potential niches before moving on to the next step. We recommend a combination of topics like social media lead generation as well as more general areas with a specific client type like life coaching for entrepreneurs or marketing for accounting firms.
Step 2: The Talk Test
At this point, every niche on your list must pass what we call “the talk test” of expertise. Are you comfortable preparing a half day workshop or giving the keynote address at a conference on each niche? If the answer is no, take it off the list. We use this test to make sure you have the confidence, passion, and experience to create authoritative content in each field.
Step 3: Mapping the Competition
Now that you’ve got your initial list together it’s time to take a look at the competition. First off, put down any major or household names like Tony Robbins, Tim Ferris, or Gary V next to the niche they’re in.
Second, write down anyone you know personally who specialize in one of your listed areas. The goal of mapping the competition for each niche is to figure out where each one can be tweaked to differentiate you from the pack. Social media marketing may become social listening and lead generation. Life coaching for business owners may become life coaching for family business owners planning for a transition to the next generation. Even after tweaking your niches, you may find that a few of your fields are highly saturated. That’s OK, it just means the market is big. Usually, it means it’s big enough for one more.
Step 4: Ranking
At this point, rank your top five favorite options with one as your first choice and five as your last. If you don’t have five left, rank however many you have. The point here is to eliminate any options that you aren’t passionate about. We recommend ranking on a combination of your level of expertise and your enjoyment of the work, but that should never stop you from excluding an option you simply don’t want to choose. Once you’ve got your top five, mark down any that overlap with each other.
Step 5: Tallying The Results
If you haven’t written anything down yet, you’re going to want pen and paper for this last step.
For any niches with overlapping areas, subtract one from their rank since you can probably speak to both.
If there were more than 3 household or major names in any niche, add one to their rank since your audience will most likely compare you to them.
If you personally know 4 or people in a niche, add one to its rank since you’ll have more competition in your network.
If more than half of them are local, add another one since you’re less likely to get referrals with a lot of local competition.
Final Rule: Go With Your Gut
We recommend moving forward with your lowest score, but we maintain “The One” Exception for those people who are head over heels in love with a higher scoring option. This usually happens when their favorite was bumped from 1st due to additional competition. The extra confidence and passion will come through in everything you do, which means better content and more authority as a result.