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October 1, 2015

Niche marketing…where do I start?

Posted by under Business Advice

Niche marketing…where do I start?

Some people think that narrowing a target market will make them less profitable because they are marketing to fewer consumers. For most, it actually helps them cut through the clutter, focus limited resources, and pinpoint their message to a market segment with whom it will resonate.

A good example of niche marketing is radio. There are a wide variety of stations out there such as Howard Stern

radio, NPR, and alternative college radio. These stations design their programming to reach a targeted market segment, or niche, with targeted content. By doing this they differentiate themselves from the mass of stations out there, build brand identity, develop a loyal fan base, and ultimately attract advertisers or sponsors who are also trying to reach the same niche. You can bet that advertisers on Howard Stern radio will differ from those on classical music stations.

When large consumer companies define their market niche, they often use multi-million dollar databases that segment the population by demographics and psychographics. Yet, without a big marketing budget or sophisticated database, smaller companies can still target market. When I work with clients on identifying a target market, I often suggest they start at the grassroots level and answer the following:

  • Who are the current consumers and what do they have in common?
  • What other company in the market is reaching this same set of consumers?
  • How does their brand differ from the competition?
  • How can their brand provide added value?

As evidenced in today’s video, the way Chris and Brenda Lynch at Mutt Lynch winery apply target marketing is brilliant. When The Lynchs first launched their business in 1995, there were primarily two camps; wineries that produced great wine and wineries that were “critter focused” and offered average wine. The Lynches have been able to move beyond these two categories by overlaying solid marketing tactics with a targeted approach. By offering great award-winning wine at a fair price and with a whimsical, dog theme, they have been able to carve out their own niche. Chris and Brenda are their target audience – wine lovers who love dogs, so they not only understand this market’s behaviors, but also their values. This authenticity resonates within their niche.

One of my personal experiences with target marketing occurred when I worked for Louis Roederer. Louis Roederer wanted to reach American drinkers of French Champagne. What we knew about this niche market was that they were primarily baby boomers; very brand- loyal; knew the difference between Champagne and sparkling wine; had discretionary income; and liked to associate themselves with the “finer things in life.” Understanding our audience and who else was reaching them drove our marketing strategy and tactics. Consequently, in order to reinforce the high-end image of our wines, it was priced in the premium category, placed in the top restaurants in major cities, and aligned with premium brands, such as with the Four Seasons, Chanel, and Hermes.

So, narrow your focus and expand your reach. Unless you are trying to promote tap water, it will serve you better to segment your audience beyond all drinkers.

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