If you’re anything like many of the consultancy owners I work with, they have at least 99 things in their consultancy that they want to fix or improve. They often ask - "What is the one thing that I should fix before I work on anything else?". If they’re having problems like not generating enough leads, not generating the right leads, or they have a slow or unpredictable sales pipeline, I always recommend that they start with their niche audience.
I usually get the response that they know who they are targeting. The thing is that if they have any lead generation, or pipeline problems there is no point in looking at anything else until they’ve started with their niche audience.
You can’t generate the leads that you need to grow and scale your consultancy until you know exactly who you are targeting.
I’m sure you’re familiar with the concept of niching. You’re probably also torn between serving a few different types of customers and not wanting to limit the business that you can take on. I was torn in a similar way for years. I thought that targeting small and medium sized businesses was a sufficiently narrow target audience for my consultancy.
We had generated huge growth and amazing results for the customers who were referred to us, but we really struggled to win cold customers directly from our marketing activities.
The trouble was we were working in a highly competitive industry and our target audience was almost every business. We were trying to market to everyone.
As soon as you try to target too wide an audience with your message, you effectively target no one. So if you’re struggling to generate leads from your marketing or website, is it because your target audience is too wide?
Until we started to target a well-defined niche audience, most of the work that we put into improving our website and marketing was wasted. I wasted a huge amount of time and money on marketing that went nowhere.
It was only when we identified that our ideal customers are owner-managed consultancy businesses experiencing the same challenges that we experienced with not generating enough leads, meaning they are riding the feast and famine roller coaster from an unpredictable pipeline of new business.
How do you define a niche audience to target?
The first thing is to put aside any reservations that you have about the strategy. It is natural to have reservations, and it is important to mitigate risks in business. The way to do this is to treat it as a marketing and sales campaign. Campaigns focus on an activity and give you the scope to change if it doesn’t work as well as you expect. If the campaign is highly successful, you can choose to increase your investment in it and focus further. If the campaign isn’t successful, you can learn from it and use those lessons to improve the results of your next campaign.
Taking the campaign approach, you can identify the outcomes you can deliver consistently for your customers. Which outcome is most valuable to your customers? Who can you deliver it for consistently, and who values it the most? If you have a few different outcomes and customer categories to decide between. Which of them energises the most to work with? If you’re particularly passionate about working with a specific category of customer, you’ll convey that energy. Make the most of it, don’t suppress it.
There are many different ways that you can categorise customers, it’s common to use industry sector, however, there are plenty of alternatives. Examples include size, mindset, structure, and ownership. Identify what works best for you.
When you’ve identified your niche audience, you need to research it to ensure it is sufficiently large to meet your goals. You also want to understand the competitors targeting the same market with a similar proposition to you. If the market is too narrow, too wide or too competitive, these could all limit your chances of success in your chosen niche.
When you’ve selected and researched your niche, it’s time to design your campaign and set your performance targets. Identify staged performance targets so that you can measure your progress at the early stages of the campaign and refine it if required.
The top three objections that consultancy owners have with focusing on a niche are:
They are worried it will limit their growth because they already work with a variety of businesses in different sectors. We’ve already addressed this by treating your target audience as a marketing and sales campaign. You don’t need to turn down opportunities or stop working with opportunities outside of your campaign audience, you’re just focusing your efforts on a specific audience.
Other times they have previously tried niching, and it didn’t work. This may have been because they went too narrow or remained too wide, or they didn’t research the market sufficiently. Consultancy owners also often underestimate the time it takes to get traction in a niche. It typically takes 18 months to make real headway in a niche audience. Many consultancies that give up on a niche do it after 9 or 12 months, not appreciating that they still have 6 to 9 months left before reaching the breakthrough point in their chosen market.
The third most common is that they are committed to the idea but fail to take sufficient action. They stick with what they are currently doing, like relying on referrals and recommendations from their existing customer base and network. Without sufficient focused action to develop the niche they have identified, they don’t achieve their targets and eventually give up.
If you want to develop a niche campaign for your consultancy, we have developed a free lead generation planning pack that contains a set of handy templates to help you plan your campaign. You can download it here.
All of today’s most successful businesses like Amazon, Facebook and Nike all started from a highly targeted niche audience. When you break down the world’s largest consultancies, you’ll find they are an ecosystem of teams and business units targeting specific niche audiences.
Your consultancy solves a highly valuable problem for your ideal customers, just think of the impact you can have when you solve that problem for those customers at scale. That is the value of investing in developing your niche audience.
Solving the big challenges in your consultancy makes the other 98 problems much easier to fix.