How to Define Your Niche for Your New Business
Sometimes it seems as if the “to do” list never ends when you’re starting up a new business. You’ve figured out who your niche market is, what their pressing problem is, how your product or service provides the perfect solution, and you’re still not done. Now you need to put all that into a niche statement.
Why? Because you want to make sure your business stands head and shoulders above the competition.
A good niche statement highlights what’s special about your business. It expresses your unique selling position to the world and lets your target niche know what you can deliver.
Want to make sure you, not someone else, gets the lion’s share of your niche’s attention? Just follow these guidelines, fill out the niche statement formula at the end of this article, and you will!
Two Things to Do and Not to Do when Writing your Niche Statement
In a good niche statement, do:
- clearly state who your target niche is, and
- specifically name the problem people in your niche have that you will solve.
The key to clearly stating your target niche is to describe your niche so explicitly that they readily recognize themselves. For this reason, it’s important that you clearly and concisely name your niche using their language.
When you specifically name the problem they’re having, they don’t have to wonder if you can help them or not. They’ll know you can.
“The beauty of this is that probably 95% of your marketing is done right there,” says Samantha Hartley of Enlightened Marketing. “Because, if you tell people you understand their problem and you say it in such a way that they get that you do, then they immediately perceive and assume that you can solve their problem.”
In your niche statement, don’t:
- talk about your niche. Name it. Clearly and concisely.
- try to be all things to all people. The whole point of a niche is to include only certain people and leave others out.
Niche Statement Formula for Success
There are just four things you need to include in your niche statement:
- Your niche
- Their problem
- Your solution
- Your promise
Stated simply, the niche statement formula: niche + problem + solution + promise = success.
Here’s what it looks like in more detail:
I/we work with __________________________(your niche),
who haven’t/need to ____________________ (their problem).
If you’re ready to/it’s time to _____________ (your solution),
I/we can/will ___________________________ (your promise).
Here’s what it looks like when it’s fleshed-out:
“I work with women starting up home-based businesses for the very first time (niche) who are feeling both excited and overwhelmed at the prospect and haven’t a clue where to begin (problem). If you are ready to take the first steps toward owning your own business (solution), I can help you decide what business would be best for you, identify your target niche, and get your business ready to launch (promise).”
There are so many things to do when starting up a new business. The “to do” list is endless. Don’t sabotage your new business start-up by neglecting to write your niche statement. Follow these guidelines, and use the niche statement formula to announce your unique selling position to the world. Then get your target niche’s attention, and get ahead of the competition.
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About: Dr. Susan L. Reid helps entrepreneurial women worldwide become successful small business owners. Get a jump on figuring out what business would be perfect for you to live and work anywhere in the world with “Doing What You Love: Multiple Streams of Passion” free PDF at http://www.SuccessfulSmallBizOwners.com.
September 28th, 2008 at 8:17 pm
This is a wonderful exercise for anyone starting a business. It is much more focused than the basic “elevator speech” — and doesn’t drown the neophyte business owner in all the complexity of a business plan. It is just the right level of detail. Superb! I’ve passed it on to several colleagues.
September 28th, 2008 at 8:33 pm
Susan thank you so very much for writing this article. It made realize that I strayed from the purpose of my business concept because I took the advice of a well meaning business associate who thought my niche was too narrow.
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September 28th, 2008 at 9:57 pm
Thank you Susan and Jennifer for your feedback. When writing your niche statement, there a fine line between being too detailed and too narrow.
September 28th, 2008 at 10:47 pm
Nice practical advice. I like the inclusion of the template in the article! Nice touch! I’ll be sure to include a niche statement in my new business plan.
September 29th, 2008 at 2:57 am
YFNCG is correct and I agree. One practical advice from Susan. Thanks again, Susan!
September 29th, 2008 at 4:20 am
Dr. Susan L. Reid,
Is this another way of doing a SWOT (Strengths, Weaknesses, Opportunities, Threats) analysis?
September 29th, 2008 at 5:14 am
it`s a veryy good execise indeed, more young entrepreneurs should try it too
September 29th, 2008 at 8:55 am
Hi Susan - this isn’t just valuable for STARTING a business - it’s even MORE valuable for owners and CEOs of more mature businesses. Markets change so quickly and we get so busy working with what we THOUGHT was a target niche - and when business changes or declines we wonder what happened. Following your FANTASTIC outline for a niche statement is an exercise businesses should do and review more often - maybe even annually (is that too often?)
September 29th, 2008 at 9:20 am
Susan,
Interesting exercise to get businesspeople thinking. I would add one measurement as a followup to your ideas..
- How often does your business refer someone to your “competitors”* ?
Referring a customer to a competitor shows that you are aware of the choices that your customers have and you are willing to help them find the right solution for their problem.
Being aware of your competitors will help you better define your unique niche and if a customer leaves with a good feeling about your business (along with the knowledge of exactly what you do), the odds are that they will either come back when they have a problem you can solve or they will refer someone who does.
(I put competitors in “quotes” for a reason… if you own your niche, you have no real competitors.)
Keep up the good work !
September 29th, 2008 at 10:37 am
Very interesting article that has left me with lots to think of. Thank you for giving us a simple way of carrying out this lesson.
September 29th, 2008 at 12:54 pm
Wow, what a great exercise to use to help define your niche. And going back to the basics like this exercise does can be useful for those seasoned business owners as well. Sometimes we all veer off the beaten track and loose focus . . . the basics, the foundation must always be in place, however, and be maintained in order for stability to exist.
September 30th, 2008 at 2:38 am
Hi Martin, regarding the SWOT, I believe it should be within the bounds of it.
September 30th, 2008 at 12:40 pm
Mary Grace Ignacio: Thanks for your comment. I am interested to hear more about your “InternetBiznez” and how you use your blog to write about your ideas. Where is Davao City in Philippines?
October 2nd, 2008 at 3:25 am
Hi Martin.
Davao City is part of Mindanao, southern part of Philippines and is the largest city in Mindanao.