Do you know who your target markets are? If you’re marketing to everyone, then you’re missing out on a big opportunity to grow your business and your profits.
Sure, you can offer products to a wide base. But zeroing-in on niche markets can provide you with a steady stream of clients, and it can also help build your business’ reputation, which means it can be easier to expand to other niche markets later on.
The first step in targeting a niche market is understanding what a niche really is — and how to go about finding yours.
What is a niche market?
A niche market is a market that focuses on a specific industry or interest group. Building contractors, retailers and restaurants are all good examples of niche markets; each market has its own specific purpose and its own specific insurance needs.
There are a few reasons why niche marketing is so important for your insurance business:
- By focusing on the members of a specific niche, it’s easier to determine which insurance products they’ll be interested in — and that makes your marketing efforts a lot easier.
- As you become established in a niche, you become the go-to authority, which means you’ll have less competition and you’ll garner a lot more word-of-mouth referrals within the niche itself. Essentially, each niche member becomes a warm lead, with a lot of the groundwork already done before you even begin the sales process.
- Once you’re established in one niche market, those clients will be more likely to refer you to related markets or even to their own clients.
- Specializing in a niche market helps you develop a deep familiarity with those clients’ needs, as well as the industry in general. That means it’s easier to build trust more quickly, and it also means you’ll be able to spot trends that can translate into increased opportunity for sales.
- All these added benefits mean agencies that focus on niche markets can enjoy higher profit margins compared to agencies that consider themselves “generalists.”
Identifying your niche markets
You could cast your net far and wide, but usually, it’s a better idea to focus on your local or regional area first. That’s because people tend to trust local service providers more than those whose businesses are outside their area. Plus, it’s just easier to engage in face-to-face marketing when your prospects are close by.
To find your potential niche markets, take a good look at your local area. Is there one industry that stands out or one that’s really common? Is there an affluent community that might have special insurance needs?
Next, focus on the people you know. Your kid’s softball coach, your mechanic or plumber, that couple you see at church — even your current clients and people you “know” via social media are all potential leads who may have “insider” knowledge of an industry in your area.
Once you’ve identified a few potential targets, look closely at each market and refine it further. First, does the niche have enough members to make pursuing it worthwhile? If your target market has maybe five or six members, it’s probably not worth the effort (or the cost) to pull together a specialized mix of products and marketing materials. What are the specific insurance needs of this group? Do your partner insurance companies offer these products and do these products compare favorably with competing products?
Sometimes, no single company provides all the products your niche market needs. If that’s the case, you may have a unique opportunity to create a custom package of products that helps set you far above the competition. Maybe you can you combine a product from company A with another product from company B to provide your market with a “package” of products that offers just the type of coverage they need. That type of customization can really help set your agency apart and establish its authority within the niche.
Now, start marketing
Once you’ve got your niche refined, it’s time to start marketing. Depending on the niche you’ve selected, focusing on member associations can be a lucrative approach. But there is a caveat: Before linking your services and products with any established group, you want to do some homework to make sure the association and its reputation is solid and reflects your own agency’s goals and policies. And if you enter into a formal provider agreement with an association, you’ll also want to work out the details with an attorney to make sure your interests are protected.
Often though, associations aren’t an option. No worries: When you know your niche, you can develop marketing products specifically suited to that group’s interests. Build your on-site SEO to feature niche-related products on a dedicated landing page. Use paid ads to direct clients to your niche-specific page when they use a search engine. Blog about the topic and post occasional niche-related posts on your social media pages. Host free seminars targeted to your niche, and market those seminars via email, social media, and good old-fashioned postal mail.
One of the advantages of marketing to a niche market is that your marketing efforts also become much more streamlined. That means it’s not only easier to identify potential leads — it’s easier to strike the right tone and messaging, simply because you’re focusing on specific needs rather than taking a more general (and far more common) approach.
Niche marketing can be a real boon to your sales and to your business’ future growth. And the fact is, it’s a lot easier than you think. Set aside some time this week to figure out your potential niches and select one (for now) to target. Then focus your efforts and start marketing.