We stress the importance of niching down when it comes to creating your own marketing or consulting agency, especially in such a crowded industry, but we've never gone into how to pick your niche.
Granted, niching down isn't for everyone -- but if it is for you, then you'll want to hear what we have to say regarding picking your niche.
Too often we see people default to the same few niches (real-estate, roofing, dentists/medical, other agencies), but you need to be more creative than that. There are also other factors you should consider when picking your niche that you might not be thinking of:
- Are you familiar with the niche? If not, you have a lot of learning to do.
- Does the niche have a high market cap in your area? If there isn't a lot of money in the niche, you can spend years working only to cap out in a small market (small gym owners)
- Do forums and publications exist for business owners exist in this niche? If not, you'll have to figure out how you're going to get in front of these people.
- What does the competition look like? This is my least favorite thing to look at but if you see a lot of competition, then it could be too saturated, especially based on the market cap. If you don't see any competition it good either be really good or really bad. It's really bad if there is no competition for a reason (as in no money in that niche).
- What is the best way to promote to business owners in the niche and does it match your skillset?
- Do you even like the niche? If you don't inherently like the niche, you won't like your life after you pursue it. Creating a successful agency takes time and hard work. You're not going to flip it in a year -- your niche will become your career for the next 5-10 years or more.
It's also important to remember to not spend too much time overthinking. You can do multiple niches at once and figure out what you like along the way, but some preliminary research will go a long way.
Here's some homework for you:
- Find 5 niches you're interested in.
- Find online forums or groups for business owners in this niche.
- Find magazines/publications specifically for business owners in this niche.
- List strengths and weaknesses for working with these niches (Example: high average profit for businesses and high market cap versus no online forums or publications for business owners in the niche)
- List barriers of entry for business owners in these niches
Once you do this, you'll help narrow down which niche(s) you should start with.
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The Agency Growth Podcast