By Michel Fortin
In the competitive marketplace of the new millennium,
the demand for specialized products or services will
increase. If your site sells everything or to everyone,
chances are that your audience will not perceive any
greater value in shopping from you than anyone else.
The more generic you become, the greater your
competition will be, since you’ve placed your offering
in the same ring as the Wal-Marts, Targets and eBays of
the world.
In other words, cast a wider net, and the likelihood
that more competitors who are trying to go after the
same “fish” will occupy the same marketspace.
Unless you are trying to be another Wal-Mart, there’s
no use competing with them. The sheer size of such
Goliaths gives them a sizeable competitive advantage —
purchasing power.
That is, they can buy their stock at considerable bulk
discounts, giving them the low price advantage with
which most small businesses cannot compete.
Keep in mind that price is never an issue — what’s
important is the value behind the price.
Price is an arbitrary figure that merely represents the
value of an offering. Here’s an example: you walk to
your local home furnishings store. You ask the sales
clerk, “How much for that washer?” to which he
responds, “$600.” “Wow! That’s a lot of money,” you
exclaim. “The price is way too high for me. I just
cannot afford that.”
This is a typical knee-jerk response.
Moments later, you walk by a car dealership and notice
that favorite new car you’ve been itching to buy for
the last month and a half. You walk in. “It’s $25,000,”
says the salesperson. “Wow! That’s great!”
You drive it off the lot that same day.
If you could not afford the $600 washer, why could you
afford the $25,000 car? So, price is never an issue. In
the case of the car, the perceived value matched or
surpassed the price, which wasn’t the case with the
washer — i.e., the washer was too pricey based on its
perceived value.
Therefore, if your value is perceived as equal to that
of others, naturally the cheapest alternative will win.
Price is only a metric — a currency to which most
people can relate.
Take the weather, for example. When you meet someone
for the first time, the weather will likely be a topic
of discussion. In terms of degrees or temperature, the
weather is the same for everyone. But “hot” and “cold,”
however, are different.
Similarly, price is only used when there’s nothing to
which one can compare your value. (Of course, price is
not the only metric, but it is the most common one.
Most people easily understand units of dollars rather
than value. Value is more subjective and personal. It
cannot be measured.)
Therefore, if you’re too similar to your competition,
price will always then be (or become) an issue.
However, the more unique you are, the less competition
you will have. And the less competition you will have,
the less substitutable you are (or your product is).
And the less substitutable you are, the less elastic
the demand for your product will be (i.e., the less
important price becomes, in this case).
So, if you try to copy your competition, or trying to
promote your offering as one that’s better than your
competition, like it or not you’re only reminding
people of that which you are better: your competition!
It’s better to be different than it is to be better.
Being all things to all people will likely help you to
stumble onto some people who will visit your site and
respond to your offer — it’s the law of averages.
Increase your hits and you will increase your sales.
But that’s not the problem. The problem, with such an
approach, is the fact that you must generate a large
quantity of hits in order to produce a certain result.
It is absolutely true that, if you want a lot of hits,
you want your site (or access to it) to be in front of
as many eyeballs as possible. But what about quality?
Would it matter if your site generates an incredible
quantity of uninterested visitors that will simply
never buy from you?
Would you prefer less than 1% of 10,000 visitors? Or
10% of 500?
For those who wish to find more effective and cost-
efficient ways of selling online, then attracting a
higher quality stream of website visitors — that is,
attracting interested, pre-qualified visitors that are
genuinely interested in the website’s offer and ready
to buy — is definitely a better alternative.
The more general or broad you are, the more you will
need to paint your website or content with broad
brushstrokes in order to appeal to everyone. In the
end, the traffic you do generate will be just as
general or broad.
Even if your product is a perfect fit for some
visitors, it will only be a fit for a small percentage.
Additionally, the broad nature of your offer and the
image you project will likely convey that your value is
equal to that of others and that there’s no added value
in buying from you than in buying from others.
This is when price becomes the metric with which people
will measure your value.
Additionally, out of the small handful of qualified
prospects that hopefully hit your site, a large number
of them — if not all of them — will likely leave due to
your apparent lack of understanding of their specific
needs, goals and concerns. In short, the more general
you are, the more you are compared to others and
therefore the more you dilute your value.
In other words, the more general you are, the less
value you have.
However, the sales you generate will increase
dramatically if your site is narrowly centered on a
specific theme, product, audience or outcome. And niche
marketing has an added benefit: the need to produce a
sufficient quantity of visitors to produce similar
results will lessen considerably.
Offline, being everything to everyone is understandable
to a certain degree since, geographically, a niche will
likely be small. Online, however, niche marketing can
work since a market will expand, even if it is a small
niche.
But it’s a double-edged sword.
Since the web increases your target market, it also
increases the competition as a byproduct. Again, cast a
wider net, and the likelihood that your net will fall
into someone else’s waters will be higher.
Offline, location is important. And a competitor next
door can be your biggest headache. But online,
thousands of competitors have instantly become your
neighbors.
Thus, niche marketing is even more important online
since, by narrowing your focus, you both increase your
niche AND decrease your competition!
Here’s an illustration: let’s say that your best client
is the corporate executive earning $50,000 annually or
more, and that your site receives approximately 200,000
hits per month.
If your site’s message aims for the public at large,
you have a problem. There will only be a small
percentage of that ideal market (i.e., corporate execs
earning $50,000) that will hit your site. (And an even
smaller percentage will genuinely be qualified for, and
interested in, your offering).
For the sake of example, let’s say that this percentage
is around 0.1%. That means that, out of 200,000 monthly
visitors, only 200 will fit your perfect customer
profile (and that’s a very optimistic figure).
Since your site is too general or too vague, an even
smaller percentage of those 200 executives — let’s say
about 0.5% — will be truly interested in your offer
and eventually buy. In this case, 0.5% (of 200
qualified visitors) would equal to a mere client for
an entire month.
(Following me so far?)
Looking at it in reverse it means that, if you want to
achieve at least a single sale per month from this
ideal market, your site will thus require at least
200,000 visitors on a monthly basis. So, based on the
law of averages your marketing efforts will need to
multiply exponentially in order to create a high enough
quantity of traffic to yield acceptable results.
Now, take the example of another website dedicated
exclusively to corporate executives earning over
$50,000.
However, this site receives a meager 5,000 visitors per
month — admittedly, it’s not a lot, especially when
compared to the other. But in this case, the percentage
of those 5,000 that fall into that site’s target market
will be 100% — if my math is correct, that’s a 10,000%
improvement.
Furthermore, the percentage of interested leads that
are in a much better position to buy will be far higher
by virtue of the fact that the site centers on their
specific needs, goals and concerns. The perceived value
of the site, in other words, will be greater in the
mind of those specific prospects.
To be conservative, let’s say that this percentage is
only 5%. It means that out of 5,000 visitors per month,
one can achieve 250 sales — that’s 249 more sales than
the other (and, on top of that, with only a quarter of
the traffic).
But let’s be a little more conservative for a moment.
Let’s say that only 1% buys. It’s still a remarkable
400% improvement over the other, as 1% of 5,000
visitors equals to 5 sales per month (4 more than the
other).
Of course, the above example is when all things
considered are equal — I agree that there are many
variables, here. But the spirit of this illustration is
clear: it took an equal if not lesser investment of
time, effort and money to achieve 250 sales per month
than it did to achieve a single one.
So, there is much truth to the statement that you will
get more with less. And online, where there is so much
more of nothing, less is indeed more.
Therefore, the paradox is true on the Internet: by
narrowing your focus, you will likely broaden your
chances of online success.
Although most business owners are aware of clear,
target marketing strategies to achieve results that
could be far more effective and cost-efficient, the
ideology remains: to be successful one must be
everywhere. That statement may be true to some degree
and should not be discounted…
… But it is far better to be everywhere that matters.
In other words, your message should appear in front of
those people who will likely read your ad and take
action. If you promote your online business in places
in which your target market is likely to congregate, it
is fair to admit that your immediate costs will likely
be higher.
Targeted marketing is not cheap. However, the bottom-
line is the fact that your visitor value will increase
substantially as a result. That’s more important.
In essence, it will certainly be cheaper for you to
spend the money in these targeted areas than it would
be in trying to find those ideal clients any other way.
Remember that your goal should be to attract people to
your site who have a genuine interest in what you have
to offer. Targeting as many people as possible
particularly with a message that appeals to only a
portion of them may produce a fair amount of hits. But
it will mostly consist of people who will never be your
clients anyway — you will attract the curious and not
the serious.
With all things being equivalent, if your ad appears on
a site that caters to your ideal market, you may get
less hits but you will certainly get more sales.
Nevertheless, combining targeted and niche-based
marketing strategies can make substantial improvements
over general, non-focused marketing. By lessening your
market as well as the market to which you advertise,
you will proportionately increase your sales.
Jim Banks started selling carpets online in 1998. He
admits that, at the time, he knew nothing about it.
Says Banks: “I thought that it would be a non-
competitive market (’who would want to sell carpet
online?’ I asked myself) and it would allow me to learn
about this whole new Internet thing.”
But at first, Jim floundered.
“I showed carpet on the website, sent out samples, and
used a wholesaler in Georgia to deliver the goods. I
made some money, but it was a lot of hard work. In
fact, a lot of hand-holding of customers was required,
and my time was a limiting factor in how much money I
could make.”
But then, Jim had an idea. He adds:
“I had read one or two of your articles at the time
where you stressed the importance of niche marketing.
And after thinking about that, and applying it to my
industry, I came up with the idea of selling carpets
and area rugs with children’s designs (e.g., animals,
letters, game boards, etc). Today, things are going
very well!”
(By the way, see Jim’s site at KidCarpet.com.)
In conclusion, here’s my advice: if you’re looking at
starting a business online, first find a niche and fill
it. But if you already are doing business online, then
narrow your focus to a specific outcome, audience or
product.
And finally, if you do sell everything to everyone
already, I suggest breaking your business down by
developing several sites, which sell the same things
but targeted towards different segments of your market.
Don’t be the best. Be the first. As Earl Nightingale
once said, “Don’t copy. Create!”
In other words, don’t duplicate. Differentiate.
— About the Author —
Michel Fortin is a direct
response copywriter, marketing strategy consultant, and
instrumental in some of the most lucrative online
businesses and wildly successful marketing campaigns to
ever hit the web. For more articles like this one,
please visit his blog at http://www.michelfortin.com/
and subscribe to his RSS feed.
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