The downsides of going niche
All your eggs in one basket
And if that baskets falls off the face of the earth, well, that’s a lot of smashed up messy eggs nobody wants. A health scare, an industry scandal, a change in behaviour - they all leave niche agencies vulnerable to the mood of the market, and less in less control of their destiny.
Boredom through repetition
Many agency folk, especially on the creative end, worry about doing the same thing day in, day out. Commercially, a niche can be the best way to scale. But creatively the work could become samey and start to lack the variety and challenge that most agency people enjoy.
The pace of technology
If your niche is a specific bit of software or technology, then you need to think about how long the shelf-life is. There are always new challengers and someone looking to break the old ways down. If your agency is all in on a SaaS product, how long until something better pops up and people want that instead.
Okay, that’s the worst case scenarios out of the way. Here’s the argument for the other side…
The benefits of niching down
Look, you can’t please everyone. Better to have ten lovely, loyal and lucrative clients who see you as experts than hundreds of clients who don’t value your know-how.
Because being niche means you’re seen as the experts. And that means a fundamental power shift in the agency/client relationship. As a generalist agency, your point of difference can end up being price or turnaround time, and that’s a commoditised downward spiral.
Better to go narrow, but go deep. You’ll know what’s happening in your industry, you’ll meet the movers and shakers and you’ll get recommendations - because it’s easier to pass leads on to a specialist agency.
Outbound new business
Once you have a niche it’s easier to market to them. You can quickly create a custom audience on social and start running some ads to them. And your ad has more chance of resonating because it’s about them; their specific problems, their language.
As an agency, this means you can influence your pipeline. You’re not waiting for the phone to ring. Instead, you can proactively find the right clients and reach out to them. They’re more likely to give you the time of day because you’re in the same world. It doesn’t feel as cold to reach out to them.
Inbound new business
Blogs, videos, how-to guides, e-books, checklists, social posts etc. are all much easier to create once you have a niche. No more vague blogs about general topics that are hard to rank for. Instead you can put out focused content that solves specific problems for your ideal clients.
And this kind of industry content is more likely to get shared in the right circles. And you can always hang out in the right online groups and share this content directly. Something you can’t do when you’re a generalist - where would your ideal client be?
Now you’ve got a niche it’s much easier to carve out your corner of the market. The more niche you are, the more ownable your area is. So if you’re a food and drinks marketing agency, that’s a strong niche. If you only work with beer brands, that’s very clear positioning.
It’s normal to feel fearful when niching. Inherently, it means saying no to certain clients. But after a short dip you’ll start to attract the right clients by gravitation.
You’ll be known as the X agency, the guys who specialise in X. Not just another agency blending strategy and creativity, partnering with clients, focusing on results etc. This isn’t enough any more. You can’t be known for these nowadays.
You could get a copywriter to polish your website copy and it might sound a bit slicker. But it won’t convert any better. Why? Because it’s general, vague stuff about your process, people, passion etc. but it’s probably not solving any specific problems.
A niche means you can be specific. You don’t have to waffle on about ‘results’ our ‘outcomes’. You can talk about the specific benefits that your ideal client wants; more shoe sales, their beer brand flying off the shelf, more bookings for the hotel, whatever it is.
You’ll build rapport and empathy with clients because you can show you understand them, and your shared industry. They’ll instantly feel like they’re in safer hands. They’ll want to talk shop with you and share musings about the state of the market. You’re on the same side, and that’s a better place to start a relationship.
You can use speak with confidence and clarity because you know your audience; their industry, their specific problems, their loves and hates, their language, their in-jokes and their habits. The stronger you lean in to your niche, the clearer your message and the more compelling it becomes.
Forget trying to game Google, you just end up with a shit website that reads like you bought the copy off Fiverr. When you have a niche, you’ll naturally use the keywords you want to rank for. You’ll start to inch up the rankings AND have copy that’s compelling and relevant for your target clients. Because there’s no point spending time and money getting on the first page, just for visitors to think that your agency’s site isn’t really for them.
How to niche your agency
Once you’ve realised it’s smarter to niche, you’ll need to commit. Being niched into 5 things isn’t really a niche. There are a few things you can niche into;
1 . an industry (cakes, sports, property etc.)
2. a service or specialist skill (email, web design, SEO etc.)
3. a location (Edinburgh, Henley-on-Thames etc.)
4. an outcome or result (lead generation, XXX)
Once you’ve picked a winner, you’ll need to be strategic about the process of niching. Here are a few starting points to get you thinking...
First, look through your client list. The sweet spot is the intersection of these three circles:
1. clients or industries we like working with
2. clients or industries have a need for our work
3. clients or industries that pay enough for our services
You’ll all need to be happy to be working on these clients day in, day out. Ideally you’ll already have some pedigree in a certain niche. If not, do a few bits of discounted work to get your portfolio beefed-up. Yep, it’s hard turning down new work, but existing clients outside of your niche will probably stay anyway - you just don’t need to tell the world.
Set up a sister agency
Rather than reposition your whole agency, you could set up an offshoot for your new niche. This is great because it leaves the parent brand in tact, but it means building a new agency from scratch - with zero reputation to leverage. Plus if clients find out that you have a general agency as well, it might weaken your claim to niche expertise.
It’s an investment in time and resources to get a second agency off the ground. But it makes for a cleaner proposition and means you can carry on with business as usual with your general agency.
Working from your master web domain, you can have infinite subdomains that can be niche-specific. For example, you might run a generalist design agency called www.designagency.com. You could setup niche subdomains with tailored messaging and design for that industry, for example estateagents.designagency.com or drinksbrand.designagency.com.
The beauty of subdomains is that it’s an easy and effective way to test different niches and see what wins. Sure, you’ll need to adjust your site for each niche, but it’s a smart first step. You can then run targeted ads and traffic to the subdomain and evaluate the best market to move into.
Niche landing pages
Set up a web page specifically about the niche you service. Over time, the messaging from this page can start to be reflected across the whole site. This makes the niching more of a process than a switch. That’s good for nervous nichers, but can end in a messy message that lacks the kind of clarity and confidence that clients like.
Agency niche FAQs
We hear these questions a lot, so here’s what we usually say...
Q: Won’t we get bored working on the same kind of clients?
A: You’ll still get variety in the depth of work you do in your niche. Plus you also get work outside your niche, you just won’t shout about it as much. Clients of all kinds tend to be attracted to your clearer positioning and messaging.
Q: Will we lose business as we transition into a niche?
A: Yep, possibly. But you’ll be aware of the dip in advance so you can plan strategically to get through it.
Q: Do we have to be the only agency in that niche?
A: It’ll be more lucrative if you are, but most niches go deep enough to support agencies of all shapes and sizes.
Q: Do we have to be experts in the niche already?
A: Not necessarily, you’ll become experts by going niche. You’ll know what to read, what to watch and who to follow. It won’t take long for you to know your niche inside out.
Q: What about non-compete clauses?
A: Some sectors have stricter non-competes, but most will understand that you’ll work with other similar clients. In fact, many will see it as a selling point. They want you to know how the industry is zigging so you can zag. If they insist on it, you’ll have to push back.
Q: What if the bottom falls out of our niche market?
A: You’ll know well in advance because you’ll be deep in that world. At that point, you’ll already have an exit plan. And if it happens suddenly, you’ll know how to reposition quickly.
Q: Will being niche limit the range of services we can sell?
A: You can up and cross sell clients all kinds of services. If it doesn’t fit into your niche, just don’t publicise it. Your niche is for the front end. Do whatever for whoever on the back end, if it’s win-win.
Going niche is scary. You’ll worry that all your eggs are in the wrong basket. At first you’ll feel like you're about to limit yourself. But the opposite is true.
A niche is liberating. You know what you do, for who, and why you’re the right agency. Your messaging and marketing will come easier. You’ll control the flow of ideal clients into your agency. You’ll build a reputation as experts, and command the respect and revenue you deserve.
Getting there takes steel, strategy and sometimes an outsider’s view. So if you’re thinking about going niche, or need the messaging to tell the world - we’re here for you agency owners - and you only.