Riches Aren't Always in NichesNov 11, 2022
Business coaches and experts will often tell you that there are "riches in niches." They also say that you can charge more by specifying the type of client avatar your product or service serves. What often goes unmentioned, however, is the importance of selecting a viable niche. The niche you serve should have three core traits; buying power, a high risk of inaction and respect for your credibility and experience. We will unpack these below.
First, the niche you choose to serve should be able to afford your product or service. If you are selling a high-end coaching program, for example, you will want to make sure that your target market can actually afford what you're offering. Imagine selling a $10,000 offer to a room of business owners who make $5,000 per month. That is going to be a much tougher sell than to business owners making $50,000/month. I love the example Alex Hormozi uses in his videos where he mentions a resume coach who wants to help unemployed people find jobs by reviewing their resumes. The problem is that he can only review so many so he needs to charge a significant price to do a review, but his customer is unemployed! Despite the theory making sense, there is no point in trying to sell to a niche that doesn't have the buying power to support your business.
Second, the niche you choose should be one where the risk of inaction is high. This means that your target market should be facing a problem that they desperately need to solve. If they don't see the urgency of solving this problem, they are unlikely to take any action, and your sales will suffer as a result. If you sell something perceived to be a luxury item or something unnecessary, then making a sale will be much harder, even if you serve a very specific niche. For example, someone who has gained a few pounds recently and cannot fit in their jeans is likely to be more open to buying a weight loss program than someone who is happy with their weight. The former sees the urgency in solving their problem and will be more likely to take action, while the latter does not see the same urgency and is therefore less likely to spend money on a solution.
Lastly, you need to make sure that the niche you choose has respect for your credibility and experience. If you are trying to sell consulting services for seven and eight-figure businesses, but you have no certifications or experience building or working with these businesses, then this may not be the right niche for you right now. You want to align the clients you are targeting with your actual skill set to ensure you can deliver value to these clients and build your book of business. While I believe in striving for higher level clients where possible, I would much rather over-deliver and have a success story with a smaller client than bite off more than I can chew jumping into a higher level client pool.
Identifying the niche you serve is pivotal to the success of any business. Understanding your niche, however, is the primary driver of success in implementing this. It is not enough just to have a niche, but you need to make sure that it is a viable one with buying power, a high risk of inaction and respect for your credibility. Only then can you truly say that you have found the riches in your niche!