Many social network startups and other consumer companies have big dreams of reaching the kind of success of a Facebook or Meetup.com, but few actually understand how they got there. Rather than focusing on a broad and vague target like “nonprofits” or “college students,” Meetup made the smart move to think small. Early on, they focused their efforts on a very small and specific type of fragmented community–hobbyist enthusiasts. Meetup targeted hobbyists by infiltrating everything hobbyist, online and offline, in the New York area. After owning every online hobbyist blog community, getting the members to gather and connect under Meetup’s platform, Meetup was able to begin to see its organic growth.
While everyone wants fast growth and a big user base, blasting wide targeted ads across the internet and mobile isn’t effective. It’s too competitive for early stage companies to win with their ROI. Coming up with creative strategies and picking the right niche to focus on isn’t as easy as buying a bunch of ads, but there’s no shortcut for sustainable growth (The same lessons apply for B2B companies as well as B2C!).
Making a Decision is Half the Game
Sales are the lifeblood of your business, but mastering selling can be a complicated maze for new startups. With a thousand different things going on and everything constantly changing, it’s hard for many founders and early startup hires to pick what to focus on and know where to start.
What you choose is less important than the fact that you do choose, and make that decision quickly. You can change your course over time as needed, but having too wide of a target is a sure way to fail. Don’t forget to continue A/B testing!
Focus on One Niche or Fail
Ever wonder how to achieve high organic growth? As much as virality has been hyped up as a magic bullet, the secret to high growth is simple. All you have to do is pick your niche and focus all your efforts on dominating it. It’s crucial to target a single narrow audience because you want your content to be effective. The best way to craft powerful content is to create it with your target customer in mind. An unfocused message is a diluted message.
How to Pick Your Niche
Choosing the niche that’s right for you takes some critical thinking and research, but here’s a good place to start thinking about who you want to target.
- Show me the money! As an economist, I’m always thinking about margins and monetization, but this is crucial for every startup. Whenever possible, pick the targeted audiences that have bigger margins. This way, smaller wins result in bigger windfalls. Good places for B2B to look for companies that have higher profit margins themselves. These may either be older industries with deep pockets, or companies that have high priced products or services.
- Who’s the most underserved? Pick the low hanging fruit when you can, and make sure to fully consider why the low hanging fruit aren’t already served. You don’t want to make the same mistakes others have or accidentally pick the wrong group. Maybe the underserved group doesn’t monetize well, or perhaps the existing method of monetization for this group doesn’t work. (Sometimes the underserved group hasn’t established the habit of paying for products like yours. Example: many people still won’t pay to download apps.) If you can find a way to monetize this group, you’re on to something that could make big money, but be careful with your confidence until you have tested and validated this.
- Who do you excite the most? This one is obvious, but important to think about. When you do market research and talk to prospects, who gets the most excited about your product or service? Why is this? How could you serve them even better? Think about who has been the most enthusiastic about your business, and see what they all have in common. Narrow this down to one very targeted group or criterium.
Just Do It, or Fail
Picking your niche is an important decision, but don’t let analysis paralysis stop you from making that choice quickly. Not focusing leaves you running around in every direction like a chicken with its head cut off.
It’s okay to change your game plan if it’s not working out, but rather than battling yourself (in your head) or your co-founders, put your gut feelings and guesses into action as quickly as possible. It’s better to A/B test and fail fast than to go nowhere.
I hope this article was helpful for you. I regularly help startups with content marketing. If you’d like to talk to me about that or enjoyed this article, feel free to reach out to me at Heather (at) salesfolk.com.