Business Opportunity Success Tip #3

Guest Post:

Don’t Just Jump In… Find Your Niche

If you were lucky enough to find out that there is truly a need for the business opportunity in front of you, it’s time to refine it and choose an appropriate strategy. A particular product may be in high demand in a given area, but if too many companies are already catering to it, you won’t find riches in an oversaturated market. Knowing your competition is pivotal in sound business planning.

Admittedly, there are many ways to overcome competitors, the most popular being cutting prices at more competitive levels. Another strategy is to provide more services or products at the same cost. Both strategies aim to increase the value proposition to potential customers. This is good if you cater to a market that is price-sensitive. However, this strategy is not very successful in some markets.

Brand loyalty is hard to overcome, especially if you are dealing with more financially successful clients. These are satisfied customers who need a great deal of convincing in order to switch over. Marketing is often expensive, and the value-proposition sometimes needs to be so high that revenues are actually too low. A great deal of planning is needed.

Knowing the strength and limits of your competitors is also a must. If you are dealing with a fairly strong competitor, they can easily outclass your offerings and still maintain a high rate of profitability which you can’t achieve. However, if they seem to have lower market capitalization or if you feel their services are substandard, then entering the market can be a good move.

Also, a common mistake that many beginning entrepreneurs make is not catering to a specific niche market. By not focusing on a specific clientele, their services often miss the mark and become overly broad to appeal to any particular segment. Identifying a niche market or modifying an existing business idea to suit a more specific target market that is underserved is an excellent strategy.

The best way to plan your niche market strategy is to make a profile of the customer. What are their purchasing habits? Who is currently fulfilling its requirements? What else do they want and are they satisfied with the price at which it is currently offered? By learning as much about your target market, you can devise a much sounder business plan.

Also, because building your business solely around a niche market will enable you to concentrate solely on their specialized needs; you will more easily get customer loyalty. Moreover, by focusing on a specific group of clients, you may find it much easier to conduct and operate your business.