Building a niche practice can give you the opportunity to focus on using your time, skills and energy to serve a unique group of clients – such as teachers, doctors or farmers – who have a common set of characteristics and needs.
To be successful, you must become a recognizable specialist or expert in the market you are serving, says Darren Gazdag, senior vice president, business development at Excel Funds Management Inc. in Mississauga, Ont. This means knowing the characteristics of your niche inside-out, and knowing your competitors.
Choosing a niche strategy places limits on the number of clients you can target because there is a finite number of potential clients within any particular niche. Therefore, you must excel in whatever you do if you are to attract sufficient clients.
On the other side of the coin, by targeting a niche, you have the opportunity to differentiate yourself by being a specialist or a "subject matter expert," Gazdag says.
Here are some tips for becoming a specialist in your niche:
> Choose a niche that interests you
You must be passionate about working with your niche, Gazdag says. You cannot simply pretend that you like a particular group of people because they represent an opportunity to grow your practice. In fact, clients prefer working with advisors who understand their unique circumstances, lifestyle and challenges.
You also will have to stay abreast of trends and developments that affect your niche, and be able to demonstrate that you know them intimately. "This will enhance your reputation as an expert," Gazdag says.
> Know your niche
You must familiarize yourself with the characteristics of your target market, including its size, wealth, needs, values and whatever makes it tick. You must also know your competitors in that space.
Gazdag recommends conducting a SWOT (strengths, weaknesses, opportunities and threats) analysis to get a thorough picture of what you're up against. Once you've researched your niche, you can then develop strategies to position yourself as an expert and differentiate yourself from your competitors.
> Participate in niche activities
You can present yourself as a specialist by hosting or participating in events that appeal to members of your target market, Gazdag says. He recommends joining local associations and community groups that members of your niche frequent, giving you an opportunity to meet new prospects.
"Ask current clients what groups they belong to," he says. "Find out about their networking habits."
You may also offer to speak on subjects that are relevant to members of your target market at various events. However, you must not be seen as pushing products or promoting your service.
> Focus your marketing efforts
Your marketing message must focus on providing solutions for your niche.
"Show how you can add value," Gazdag says.
You can also partner with centers of influence such as lawyers and accountants who can assist with your positioning as a specialist. Publishing articles in newspapers as well as publications and online media read by members of your niche can also build your reputation as a specialist.
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