One way firms can create better experiences for their clients is through niche services. The success of a niche, however, depends on whether firms have identified a genuine niche or a commodity pretending to be a niche, says BKR International. BKR outlines what is and what isn’t a niche — and what your firm should know to grow the right ones. Before you declare a niche or invest in it further, review these criteria.
You have a real niche if:
- You offer more than one expert to clients.
Firms will often have one person who is so good at a certain thing that leadership starts calling his or her service area a niche. The problem with one star service provider is that your star can leave or retire. One trusted advisor is not a niche. To have a true niche, you need to train and develop several people to serve it for the foreseeable future.
- Your team “gets” it.
You don’t have a niche if your entire firm is not aware of it. Everyone — from administration to leadership — can talk about why you are the best in this area. Develop competitive differentiators around this niche to train staff on selling your firm as the best provider of this service or the best advisor for this industry.
- You will invest real time and dollars for its growth.
If you are fearful of growing a niche because of budget constraints or small potential client base, it is not a good niche. You need to commit to staff development and leadership in this niche, invest time in your sales process, promote it in your marketing and speak about it publicity. Will you promote it on your website? If the answer is no, then don’t call it a niche.
- Pricing isn’t a concern.
We’ve seen firms who want to call a commoditized service a niche when in reality they’ll get little return for their efforts. Niches attract premium fees from ‘A’ clients. Your clients choose you for your knowledge, not because you offer the lowest price among several very good firms. If other firms don’t view you as one of the best (if not the best), then you don’t have a niche and can’t hope to have one in the future.
- Your goals are measurable.
If you can see the profit potential in this niche based on past client experiences, then you can set new measurable goals. If you are just entering a new industry, make sure the client and profit potential are there by researching competitors and analyzing trends that point toward a growth area. If you can develop a niche based on a merger or acquisition, this is another way of analyzing potential by looking at the target’s past success.
- Recruits are attracted to it.
Niche-focused firms also consider the potential to attract great talent because they own a strong market position. By promoting your top status in an industry or service, you set your firm apart from competitors to attract new graduates and experienced hires who want to help you grow your niche.
Sensing a trend? If your firm can prove you have the best team, the best expertise and the best ROI for clients, then you just might have a profitable niche. Be willing to invest real time and dollars into your niche to sustain it as part of an enviable market position for future new business and recruitment.