Once a target audience has been clearly defined, niche marketing can be extremely cost-efficient. However, it is crucial to stay nimble in order to take advantage of evolving advertising platforms.
Lance Gordon, DBA and assistant professor at Woodbury University, predicts that as technology progresses, it will become even harder to reach fragmented audiences. “Consumers are going to be media independent,” he says. “They’re going to be wired and receiving media messages that they have total control over.”
Smart Business spoke with Gordon about how to maximize marketing budgets, the changes he expects in niche marketing and the importance of adapting to these changes.
How should business owners define the right niche market for their businesses?
First you must develop a strategic platform for the company — get control of how you’re going to manage strategic thinking and how you’re going to spend your money on marketing. You can’t identify niche as a term and make it stand alone as a concept when it comes to developing strategy. You have to have other terms working and blending with that concept. One of those, of course, would be positioning.
What are some of the obstacles that a company faces when positioning its brand?
One of the important things that business owners need to realize is that everything is in flux, everything changes. Markets are in perpetual motion and target audiences are continually migrating and driven by trends. You have to change with the times.
When targeting a niche audience, how can a business best maximize its marketing budget?
Opportunities abound in this area. When I define niche to my students, I say niche is the better-than factor. What that means is ‘What are you doing better than your media competitors?’ You don’t have to go and spend an awful lot of money, just take advantage of the consumers that do visit your establishment and make sure that they are getting your promotional materials.
Also, there are wonderful new opportunities that have come along in Internet advertising. A company called SpotRunner offers television commercials to small and mid-sized businesses for $500 to $2,000. These are prepackaged television commercials — you simply drop your logo and marketing message into a spot that has already been created. You can pretty much cherry pick where you want to be in the market. It has the potential for taking off when you consider that there are (more than) 10 million local businesses in the United States.
What other trends do you see in niche marketing over the next few years?
It’s wide open. You have a whole Game Boy population that has never read a newspaper in their life and these people are going to grow up and become media-savvy adults. It’s considered a disgrace, if when the phone rings, you have to jump up off the couch and run to get the landline. You have to start looking at product placement and making your product available where people are on the Internet.
The other thing that is going to happen is that after an entire generation of millennials gets to the point where they’ve had encroachment into their personal lives by identity theft, they’re going to become super-resistant to marketing messages. It will become more and more difficult to reach them.
How does niche marketing translate globally?
I had an interesting experience where I addressed about 35 Chinese businessman who were all entrepreneurs. I did a presentation to them, through an interpreter, about how they should be thinking about marketing and the new global economy.
I warned them that the core concepts that their sons and daughters were going to be getting at most major universities and colleges are concepts that are no long applicable to the present-day world. They are going to have to pretty much reinvent it themselves.
Some of the research that I’ve done shows that the Internet era doesn’t really start until the year 2010. What happens in the future with broadband will so incredibly change the media arena that the entire area of marketing is in flux.
New emerging economies that are starting from scratch are probably going to have the competitive advantage in the near term unless people who have the willingness and ability to do research start getting smart and really understanding what sort of change is out there and letting their students benefit from that.
Lance Gordon, DBA, is an assistant professor at Woodbury University. Reach him at (818) 252-5153 or [email protected].
