A niche is a group of people who are clustered together with similar attributes and these people can be clustered in any way, shape, or form. This is key because every dollar that you spend on marketing is based on how well you know your niche. It’s how well you understand people’s problems and the way that they think their problems are.
Niche is not something general, it’s choosing a group of people that have similar demographics– might be similar types of work, similar age range, gender, interests, relationships, marital status, or even similar problems. They might also have a similar dream situation which means they have similar ideal solutions.
If I’m working with someone for weight loss and their top problem is that they don’t like the body they have, my solution is to help them lose weight. That’s an example of a one-problem solution for a niche.
So, here’s the five niche formulas:
1. Choose a similar demographic. The current situation of one person must be similar to the others. Therefore, they’ve got similar problems that they want to solve. Now, your goal is to help them get to that desired situation, whatever it may be. Additionally, there’s a certain level of how painful this problem is for them– probably on a scale of zero to 10–zero being the lowest pain and 10 being the highest.
So, if I’ve got a broken arm and I can’t move, the level of pain for me to see a doctor or get it fixed is likely 10. But, if I just got a scratch on my arm, the level of my pain is a lot less.
You need someone who’s got a high level of pain. But you should know that most people would do far more to avoid pain than they will to move towards pleasure.
2. Spend time with your clients. An important thing you also need to decide what your niche is your willingness to spend time with them. You have to love and enjoy spending time with them.
3. Be passionate. Being passionate about doing whatever it is you’re doing would create a really big impact. If you’re selling your service where you paint houses, then maybe you’d done that before. You surely knew how that works. Even so, if you’re not passionate about it, it’s not the ideal thing for you.
4. Look at the fabric of your past clients. Sometimes it helps to look who you’ve worked with in the past because that helps you to come up with one now.
5. Make sure you are paid. You might be super passionate about helping homeless people at the front of a bus shelter, you might love to spend time with them, and they might have a problem that you solve– getting rid of their anxiety, but if they don’t have the money to pay you to run your business long term, then the business is going to go down.
When that’s the case, it’s better to make some money from your other ideal clients, than just handing money out to homeless people or donating to charity.
Know that you also need to have a big enough market for what you sell. Kodak went out of business because of Instagram. If it was still selling, we had to come to the shop to develop our photos. But Instagram popped up and they have a very good market.