Crafting a niche in your business will leave both you and your clients happier. You will build quicker rapport, understand client issues on a deeper level, provide a better service, and achieve better outcomes. Many small business owners avoid “niching” because they fear they will lose business opportunities outside their niche. They have incorrectly assumed that fishing for a variety of fish will produce more than focusing intensely on one kind of fish.
It’s understandable that when a small business owner opens shop, they will take any opportunity that comes their way. I know when I first started, I was on the lookout for anyone who could fog a mirror. I found some terrific clients who are still with me to this day! I also found a few clients and prospects who made me less enthusiastic than normal.
I first started to think about niching as I was struggling to stand out from a sea of financial advisors all offering nearly the exact same thing. There are only so many ways to pitch investment advice, and without the name recognition of a big corporate sponsor, it was hard for me to gain traction. I could see that if I “specialized” in a particular area or type of client, I would be able to stand out. But I had my reservations.
Why People are Afraid of Having a Niche in Their Business
First of all, I was afraid of alienating my existing clients who are spread widely across the socioeconomic and demographic spectrums. I was afraid that if they saw me writing and speaking about serving a particular type of client, they may not want to stay as my client. That fear turned out to be completely unfounded; I haven’t had a client who is not a “less-than-40-y/o-professional” leave me because I had decided to focus on working with that group.
Secondly, I was afraid that I would be unnecessarily turning away fantastic opportunities that happen to fall outside my niche. But that hasn’t occurred yet either. I still get inquiries from all kinds of prospective clients. Even though there is a particular type of client that I am passionate about serving, most people view me as an investment advisor.
The Advantages of Having a Niche in Your Business
The upsides to having a niche to focus on are fantastic. When you are viewed as an expert who focuses on the frustrations of a select group of people, you can hone services that are more pin-pointed and thus effective. By focusing on young professionals under the age of 40, I can get really really good at analyzing student loan debt, or working through budgeting issues, for example.
I can also build rapport more quickly with my clients. It’s not as if they are just speaking with an investment advisor or financial planner, but they are speaking with one that also has expertise in their particular issues. This leads to more consistent “buy-in” from the client which in turn leads to better client outcomes.
Lastly, probably the biggest advantage of niching is by choosing the type of client or service you are most passionate about, you will be happier in your business. I get the most joy out of working with people who are similar to me in age and temperament. That means I very rarely have meetings with clients that I dread. This translates to better service.
How to Pick a Niche for Your Business
Probably the hardest thing about niching is picking one that works for you. The key is finding one that isn’t so broad as to be nearly meaningless but also not so narrow that your pool will be too small.
Think about who your existing clients are; which ones are your favorite to work with? Is there a particular kind of service you really enjoy giving? Do many of your clients come from a specific industry or geographic area? What are the hobbies of your favorite clients? All of these questions (and many more) can help you hone in on a niche market.
Examples of Niches for Your Business
Picking a niche is hard. The way I was able to pick mine was through a combination of evaluating my existing clients and reading about other advisors’ niches. I will leave you with an example list of 15 niches to spark your imagination for your own niche!
- Realtors (or any other specific industry)
- New parents
- Military personnel
- Under-40 professionals (my niche)
- Pet lovers
- Social media influencers
- Digital nomads
- Union members
- Parents with special needs children
- Divorced men/women
- Medical professionals
- Non-profit organization
Erik Goodge is a CERTIFIED FINANCIAL PLANNER™ and the President of uVest Advisory Group. He holds a B.S. in Economics and Cognitive Science from the University of Evansville. Erik is a Marine Corps veteran of the Afghanistan campaign and Purple Heart recipient. He is from Evansville, Indiana, and currently lives in near-by Newburgh with his wife and daughter.