When starting a business, it might feel like the best thing to do is to appeal to as many people as possible. After all, the more potential customers, the more potential revenue, right?
Unfortunately that's not the case, and I think this is where the majority of entrepreneurs fail. By trying to appeal to the masses, your business will become diluted and the raving fan base that will keep you afloat through the slower fiscal quarters won't have any loyalty to you.
Think about Walmart. They're successful, there's no doubt about that. But are they successful because they have a raving fan base that loves their products? Not really. Instead they're successful because they have the lowest prices on most items, and that's what drives their sales. If that's what you're looking for in your business, then you already know what your plan needs to be for success: beating everyone else's prices.
If, however, you prefer to run a business that is successful because you have a loyal fanbase that follows you, shows up for product launches, does your social media for you (by tagging you in their posts that feature your products), then the quickest way to achieve that success is by niching your business down to a select, rabid few.
But what if you think your niche is too small? Maybe you feel there isn't enough of a customer base for flamboyant makeup with a punk/rave vibe? Think again. What about your idea to combine your love of making soap and your obsession with science? CleanerScience followed that dream and does very well making soaps that look like petri dish cultures.
From selling bouquets of rotting flowers to providing curious genealogy searchers with a custom DNA test, whatever idea you've come up with, the smaller the niche, the more rabid the fanbase; the more rabid the fanbase, the more steady sales; the more steady sales, the less time you'll have to read articles like this. So how do you determine the best way to niche down?
Start Keyword Searching
Before Google got rid of the ability to use their Keyword Planning Tool for free, finding highly searched for keywords and phrases was an easy task that gave you incredible insight on the viability of a new product. Now there are still ways to find out what folks are searching for, but it might set you back a little if you use apps like SEM Rush or Long Tail Pro, but the time they'll save you helping to find your crowd is well worth the investment. Also start looking up relevant hashtags on Twitter and Instagram to find out if it's an area with a dedicated fanbase already, or if you need to rework your business idea a little.
Check Out Reddit
Much like Rule 34, whatever you can think of, most likely there's a subreddit for that. Do a little digging to see what pain points your potential customers are going through, and use that info to help better tailor your product for a profitable launch.
Pay Attention to the Market (Literally, If You Can)
If your business is going to be product-based, there's nothing better than getting out there and physically showing it to customers. Red Bull did this by giving away thousands of their drinks for free and I bet received a ton of great data on where their customers were the most, what questions were being asked, and how they could best position their product in the market for success. While it might feel intimidating, getting out there and talking to your potential base will give you more insight than hiding behind data ever could.
Remember that the key to success is making sure your customer base is steady, so finding that rabid fan base will make sure your new business hits the ground running in the best way possible. If you need help, check out this branding guide I made to help you figure out the best avatar for your business in only 1 day.