How to niche your agency for a lifestyle that fits YOU!
A coaching student and I were talking the other day and as we were talking she mentioned how frustrated she was at some recent items slowing her agency growth down. As I do with a lot of students, I like to cheer them up and remind them of the progress they have made.
Here is what I told her:
“Stephanie, listen to me, let’s look at where we are today compared to where we were 6 months ago. You know exactly where your agency is going, how to get more leads, you used to put out 1 proposal a month, and you have 7 due TODAY. You have a centralized message for your brand, you have a product line that your prospects love, and you are enjoying what YOU ARE DOING AGAIN!!”
She responded with:
“I know, I know, I know, but I still get frustrated with the day to day grind.”
When she said that it reminded me of how I felt when I was getting started. It reminded me of how I would have given anything to know exactly where/how to get new leads, how to have a sales pipeline full of prospects waiting for proposals and how I could love what I was doing in the beginning days of my agency.
You see, for the first 5 years of my agency, I did not like what I did. I almost stumbled into my agency by accident (if that makes any sense).
After 5 years of trying to figure out how to get leads and drive revenue, I made THE critical decision that propelled my agency into another level, a level that allowed me to crush the 7-figure mark and remove myself from the day to day agency operations 100%.
It did not happen overnight though. It took a lot of hard work, good decisions, and leadership, but looking back on my personal experience it all boiled down to me making the very hard decision to niche my agency out into an industry that I enjoyed. It fulfilled my higher purpose and provided my agency with a clear direction for messaging, products, value propositions, etc…
That decision was to get out of the web programming side of the industry and niche out into a specific CRM community. That single decision is what allowed me to break through the glass ceiling and FINALLY stop doing all of the work myself (graduate from freelancer to CEO of a legit digital agency).
In my case, a niche pretty much fell in my lap. Now, I had to make the final decision on which direction to go and it was still a nerve wracking decision. I mean, that one decision would determine how much time I could spend with my family, how much money my family would have, and the overall stability of my family.
So it is a huge decision and unlike me, you should have a thorough process that guides you through the process of selecting the perfect niche for you, your family, and your agency.
The 10-step process I am going to introduce you to is the same process I have guided my students through with amazing success. I hope it helps you like it has for me and my students.
10 Step Niche Down Process for a Digital Agency
1. Digital Friendly
Is the industry digitally friendly?
A lot of industries have done as little as possible to embrace the digital world – believe it or not they still exist!
Make sure the industry you’re going to target doesn’t intentionally run from digital marketing services.
If you pick an industry that avoids digital marketing then every day will be an uphill battle (and it doesn’t have to be!)
2. Competitive Analysis
Who else is doing it?
You’re probably not the first person to consider this niche so you need to find out what you’re up against.
Research the top 3 competitors and compare what they’re offering to what your agency is capable of. See where their strengths and weaknesses lie and make sure your agency can stack up to the competition.
Remember, NEVER let your competition dictate how or what you do. You’re here to be unique and it’s ok to blaze a new trail and change an industry, just make sure the industry is ready for it.
In my online niche course and group coaching program, I provide an in-depth spreadsheet that guarantees you get the proper competitive analysis and more.
Here are a couple of questions to get you started down the process of critically thinking through the competitive landscape for your potential niche.
- Harvest the top 4 competitors in your niche
- List out their product lines, list them in order of popularity
3. Target Audience Definition
You can’t refine your messaging if you don’t know who you’re speaking to. Start by defining your Ideal Customer Avatar.
Who is the perfect client? What do they look like? Where do they look for answers? What keeps them up at night?
Give your Customer Avatar a name, a story, and a personality. The better understanding you have of who they are, the easier it will be to reach them and connect with them.
A few indicators to get you started:
- Clear demand on Google for growth agencies
- ROI is possible for client and average order over $2,500 a client
- Easy to reach…networks, public forums and word of mouth
Do not forget that you can niche the niche. This means that the more you can focus your messaging, the better.
This means that if you target the medical industry, it is a good idea to take that one step further and target Orthopedic Surgeons or Chiropractors.
Do not target a niche that is so large you cannot hyper focus your messaging and products to solve very specific pain points they face on a daily basis.
4. Niche/Target Audience Financial Analysis
A need and desire for your services aren’t enough… unless you plan on working for free. You need to make sure your target audience has enough money to pay for premium marketing services.
Some industries are booming, but their profit margins are so small that they don’t have the budget to spend 10-12% on marketing initiatives. Unless you’re okay with slim margins too, think very hard before entering into this type of niche!
Do they make enough money to pay for high-end digital marketing products?
5. Niche Opportunity Scope
Is the niche so new that no one knows it exists? Is it so popular that it would cost a fortune to break through?
There might be a lot of opportunities but if you’re up against large established agencies you might never stand a chance.
Alternatively, you might pick such an obscure and narrow niche that people just don’t need your services that much. Make sure there are viable opportunities right now.
What is the current opportunity, have the competitors been growing, are there new competitors?
6. Long-Term Growth Potential
You need businesses now but you’re also going to need it in 6 months and in 6 years. Do your research and make sure your niche will provide a healthy flow of opportunities long-term.
Ideally, there will be more opportunity long term because the niche is trending and growing. If you want to grow and scale your agency, the industry needs to be growing too.
7. Genuine Care
No research for this one, just some soul-searching.
Do you genuinely care about the industry, products, people, etc.?
Of course, this is not an absolute or hard-core requirement, but it definitely makes life easier. You won’t always be motivated to work so hard, but if you genuinely care about the industry and enjoy the work you’re doing, it will be easier to push through the tough times.
8. How do you get in front of your prospects?
One of the benefits with focusing on a niche is the fact you can build a reputation in a specific industry, leading to speaking opportunities, guest posts, backlinks and of course you can define in advance where you go to find your ideal prospects.
In this step, you should have at least 4 – 6 events you can attend each year, research and find at least 3 – 4 possible referral partners (who is already marketing to your target audience), directories, associations, and of course paid media channels like Facebook and Google.
If you cannot list at least 5 events, publications, etc… that already promote to your target audience, it is most likely not a good niche.
9. Understand Their Pain Points
Can you really relate to the pain points of the niche? 90% of all digital marketing services are identical across industries.
Videos are videos, blogs are blogs, ads are ads. It’s the remaining 10% that makes agencies and industries so vastly different. This 10% stems from understanding your target audiences pain points.
Does their pain come from spending money they don’t have? Then they’re looking for cheap services.
Does their pain come from crappy agency’s screwing them over? Then they’re looking for someone to get the job done right.
Does their pain come from being spread too thin? Then they’re looking for an agency that feels like an extension of their business.
Find their pain and you’ll find success.
10. Hire a Coach
At the end of the day, there is no substitute for having someone who has actually built a successful agency in your corner. I’ve seen the good and bad side of picking niches. I’ve experienced all the highs and all the lows. Owning and running an agency is one of the loneliest places I have ever been.
Get an experienced sounding board and stop living on that island yourself! It’s astonishing the difference it will make in both your professional and personal quality of life.
In closing, I would like to strongly advise you to bite the bullet and pick a niche.
A lot of times agency owners tell themselves they will lose opportunities or they do not want to stop servicing the clients they already have.
Both of these myths are completely false, the exact opposite happens.
When you focus your efforts in one direction, you get more leads, you charge more, and as a coach I would NEVER advise you to stop working with your existing clients (until that revenue is replaced with higher profit margin niche based clients).
Thank you for taking the time to invest in your future and for reading my blog article. We have hundreds of resources and more located on our site, www.marketingagencycoach.com
About the Author:
Lee Goff, CEO of MarketingAgencyCoach.com
Since founding GetUWired in 2003 in Lee’s upstairs bedroom, GetUWired has helped thousands of business owners around the world break through the glass ceiling and live the lives they deserve — making more money with less work and having more time for all the things they love. Lee is living proof that his formula works.
At GetUWired Lee and his leadership team won the following Awards: 2012 Technology Partner of the Year, 2013 Infusionsoft Innovator of the Year, Top Company Culture – Entrepreneur Magazine in 2015, and Infusionsoft Elite Business of the Year Finalist in 2015. Some of GetUWired’s top clients also were the Ultimate Marketer of the Year Winners in 2012 and a finalist in 2014.
In 2013, using Jim Collins and the Infusionsofts leadership team as his inspiration he began handing off leadership responsibilities, eventually leading to his retirement from that company in May 2015. In May 2016 he sold out his remaining shares to his long time partners to pursue his life long passion of mentoring small businesses. His motto is “Success using vision, leadership and shared knowledge”. He shares everything he learned while building GetUWired. His new venture is LeeGoff.com and is in business to help small businesses grow faster and more profitable than they could have ever imagined.