I’m a huge fan of entrepreneurs who choose a niche marketplace for one big reason: they are relentlessly and authentically focused on product-market fit.
By that, I mean that every touchpoint in their brand experience is created, illuminated, and guided by the customer experience. Understanding your audience at the deepest level — the things that keep them up at night — awakens possibilities for your brand.
I recently became inspired by the founder of the infused tequila brand 21 Seeds, Kat Hantas. Kat had a problem that literally kept her up at night: her evening habit of a glass or two of wine was giving her insomnia. Advised by a doctor to switch to a distilled, not fermented, “clear” drink, she was drawn to blanco tequila. But Kat didn’t want an overly boozy experience, so she found herself experimenting with infusing tequila with fruits and veggies for a light, fresh taste.
At the same time, Kat noticed that all of her friends were naturally moving away from sweeter drinks and gravitating towards “skinny” cocktails, especially tequila. Her infusions gained her loads of party invitations, and a big idea: infused tequila for female drinkers.
Conventional marketing wisdom says there are riches in the niches, and what Kat did beautifully was pay attention to the three primary niches as she staked her claim: Problem. People. Product.
And in the process, she’s learning to beat the paradox of choice by becoming a cult favorite of women and men who are looking for a better tequila experience.
The niche problem
There’s another bit of conventional marketing wisdom that says, “you are not your audience.” In many ways, that’s true — how you position your brand has to be inclusive. But the problem you’re solving for can and often is a direct response to a personal issue that has bigger implications.
There are countless examples of founders like Kat, who have used a stumbling block as a springboard to create an ingenious product. Away co-founder Jen Rubio’s suitcase broke when she was traveling in Zurich, and not one of her 2,600 Facebook friends had a decent replacement recommendation. So, she started her company with one SKU: the perfect travel suitcase.
OXO’s “Good Grips” utensils were created by inventor Sam Farber, whose wife Betsey had arthritis and couldn’t use a traditional vegetable peeler when making an apple tart. He started by designing a comfortable, super-graspable handle made for a peeler, and the revolutionary housewares brand rolled out from there.
The perfect solution for a niche problem can have big pay-offs with multi-million dollar results. The next step is to be sure you have a small but mighty market.
The niche people
The funny thing about conventional marketing is that its “4 Ps” (product, price, promotion, place) never included people until the advent of digital marketing over the last decade or so. Today’s savvy marketers understand that a niche audience of 1,000 or even 100 true fans can help you make a healthy living.
Earning that dedication, trust, and commitment involves a deep commitment to putting yourself in your audience’s shoes. As product strategy thought leader Indi Young advises, it takes a bit of creativity, along with a solid dose of design thinking to connect with people’s deep, unarticulated needs:
“The deepest form of understanding another person is empathy…[which] involves a shift from…observing how you seem on the outside, to… imagining.”
(Need help with empathizing with your customers? Here’s an easy yet powerful mapping exercise for you to use.)
One great way to do that is to once again, think small. While big data gets all the attention for unearthing user patterns, habits, and preferences, it’s small data, like smart customer surveys and deep listening, that can give you more nuanced, valuable insight into what your customers really want and need.
So, for example, the early stage OXO vegetable peeler got first-hand feedback from volunteers from the American Arthritis Foundation. Kat had multiple informal focus groups just by speaking to her friends, who loved her early infusion experimentations.
Bottom line: When you serve your people, you also serve your product. As Seth Godin points out, “the best way to make a hit is to build something for the smallest viable audience and make it so good that people tell their peers.”
The niche product
Creating a niche product doesn’t mean inventing something that nobody’s ever seen before. On the contrary — it’s usually something that people know quite well, like tequila, a suitcase, or a vegetable peeler. And it’s not making a better product as much as it is coming up with a better articulation of the product.
This means looking at the product from every possible angle, from the user experience to the design experience. This is where niches come in once again — it can be the smallest details that make the biggest impact. For example, to make the first Away suitcase, Jen and her co-founder, Steph Korey, spoke to thousands of people to understand what today’s travelers want most. They found a carry-on with four durable double wheels topped the list, and that detail alone took 20 design iterations.
That level of commitment to serve your audience — your niche — is what’s required to find success in today’s crowded marketplaces. It goes beyond a single SKU to take a much more inclusive, broader view. This is why Kat says that she never set out to just make a product. She was always focused on creating a brand.
Because in the end, it’s the human stories that define the product and forge the essential connections. So whether you’re rolling out one initial product or reimagining your line, the DNA of your brand is the essential foundation for product development. It infuses your offerings with the beliefs, values, and messaging that build community with your customers and your employees — creating support for your product(s)/service(s) and your success.
So, yes, there are riches in the niches. But it’s no small task to carve out your spot. Or, like Kat, take your shot.
I’m curious about what niche audiences and products you love and why? Hit me up in the comments.