In the early 2010s, online screening company Tenant Magic promoted its services to real estate agents, who in the wake of a poor housing market became de facto property managers for homeowners wanting to rent out their residences.
Though effective enough for the Cleveland background-check provider, it wasn’t completely efficient, as only 20% of agents at the time dealt with renters. In response, Tenant Magic co-founders Jay Apple and Wayne Rothman pivoted to landlords, who were in dire need of candidate screenings for primarily paper-based rental applications.
“Most real estate agents aren’t working with rentals, but this is what landlords do, and it’s a significant pain point for them,” said Apple. “If we can provide them qualified applicants, that’s one less thing they have to worry about.”
Targeting a specific subsector facilitated Tenant Magic’s expanding its offerings to all 50 states plus Washington, D.C., and Puerto Rico. Tailoring messaging to a discrete audience also allowed the company to better define its services, an issue for firms both new and established.
Branding and marketing experts view this type of “niche marketing” as a means to establish customer relationships and stay abreast of what they’re saying about your business.
“The best way to look at it is targeting your marketing to an individual or unique need,” said Eddie Rice, a freelance speechwriter and content marketing manager for a B2B technology firm. “Instead of trying to spend on an advertising campaign to a general group, you’d have a set of Facebook ads that target an industry or people within a particular job title.”
As segmentation divides a target market into approachable groups, a niche approach serves as a one-size-fits-all solution for any business. Rice, former marketing manager at Cleveland co-working organization LaunchHouse, noted Procter & Gamble positions individual brands to specific audiences so its products secure unique positions in the market.
Niche marketing for all businesses: Even though small businesses and startups have much smaller margins than giant corporations, they can still apply the big dogs’ principles of tailoring messaging to a discrete audience in order to better define their products or services and establish stronger customer relationships.
While startups naturally have much smaller margins than a giant corporation, they can still apply the basic principles of niche marketing. In the seminal marketing book “Positioning: The Battle for Your Mind,” authors Al Ries and Jack Trout said most brands chase the market leader rather than define their niche, with the end result often being irrelevancy.
“Small businesses that can’t play in multiple verticals should be pursuing this out of the box,” Rice said. “Staying hyperfocused on delivering a great product to an ideal customer allows you to fine-tune with one group before making the product available to multiple audiences.”
Tenant Magic initially concentrated on landlords, expanding that focus into areas such as mobile-home parks and marinas that also require background screening services. The company now has 7,000 registrants in its database.
Laura Sheridan, president of Viva La Brand, a Cleveland-based brand and marketing strategy firm, said capturing consumer attention begins with a business knowing precisely what differentiates it from its competitors. Thorough market research analysis will keep executive fingers on the industry pulse. Meanwhile, purchaser comments on individual products can be tracked across social media and online forums.
“Current customers are your best brand ambassadors,” Sheridan said. “The goal is to get more of these loyalists: people who live your brand and talk about it.”
Traditional advertising campaigns that provide potential patrons a general message are too expensive for small companies to run, observed Sheridan. What’s more, a “shotgun approach” is an antiquated concept from a byone era when brands controlled the message.
“Advertisers threw it out there and people couldn’t skip over the ad or block it from their magazine,” Sheridan said. “The model has flipped. Consumers have the control now in terms of the ads that they see.”
All industries can benefit from a niche approach, said Cathy McPhillips, senior marketing director at Content Marketing Institute. Big retailers like Target personalize their marketing based on buyer habits, whether it’s 20-somethings furnishing their first apartment or busy parents shopping for toys. Smaller companies already have a specialized audience, so further centering on that core is logical.
“Small businesses should focus where they excel and only go broader if they have more products or services that appeal to a new niche,” McPhillips said in an email. “Look at content, design, distribution channels and microinfluencers. How can you get the right message in front of the right audience? Once you answer that question, test, test, test, especially if you’re doing email or paid media.”
Rice advised marketers to look at everything as a big experiment. The best, he said, “are always trying something new.”
Author: Douglas J. Guth