When I first started offering digital services through my design studio, Happily Hedy, I was totally a generalist. From email marketing to logos, websites to Pinterest management, I was doing everything. And while this brought in tons of leads—especially since my services were dirt cheap—it was ultimately unsustainable as a business.
People who were serious about hiring a good designer weren't likely to hire me: they wanted someone who specialized in design, not every possible virtual service. It was also hard to align my messaging for a specific audience and figure out where to best market my services since I was so spread out.
People are willing to pay for certain products or services for a reason: it solves a specific pain point for a specific audience. The verdict: I needed to niche down and figure out who exactly I wanted to target.
Finding your target audience
The first thing I did was figure out which projects I actually enjoyed doing and which ones felt tedious. This helped eliminate some of the services, but it still didn't solve my messaging issue. In order to do that, I decided to break down my general group of potential customers into segments, to figure out which one made the most sense to focus on.
Let's look at the different ways you can segment your potential customers. You'll want to use a mix of these to find the most effective target audience.
Demographics
When you segment by demographics, you're looking at your audience based on age, income, race, gender, education, and a few other factors. It's a good starting point because it's usually easy to measure, and the way people use a certain product or service is often correlated with demographic factors.
Here's the question you're asking when segmenting by demographics:
Is your product more applicable to people of a certain age group [or other demographic factor]?
For me, the answer to this question was clear: I realized I should focus on female entrepreneurs, as their tastes tended to match my style most closely. I also found some other patterns among the different clients that had booked me in the past (in terms of things like age), so I was able to tailor my messaging and service offerings accordingly.
For example, when I highlight past projects, I include a picture of my client along with their testimonial. This can further convince prospects to convert, since they can "see themselves" in my past clients.
Geographics
When you segment based on geographics, you're dividing the market based on where your customers are located.
Here's what you're asking:
Is it best to only offer your products to people who live in [specific city]?
Are your products only applicable to people who live near [a certain type of geography]?
This is a good spot to mention that not all methods of segmentation are equally valuable for every company. Take mine, for example: I don't personally target people from a specific location, since digital services can be offered to anyone around the world, and the use and demand for them aren't really dependent on geographic location.
Psychographics
Psychographic segmentation is where you divide the market based on lifestyle, personality, goals, and things like that. You're asking questions like:
How much does your customer favor quality over economy?
What are their values? What does your customer care a lot about?
How does your customer view themselves?
As an example: I cater my messaging to people who'd describe themselves as ambitious and creative—entrepreneurs with high hopes for themselves.
Overall, psychographics is definitely a harder one to identify and segment by, but if you can nail it down, it really helps you speak to the customer on a personal level.
Behavioral attitudes
You also want to look at the market in terms of their product-related behaviors (versus just their personal behaviors). Ask yourself:
What are different ways that different people might use your product or service?
Would a certain group use it more than others, and could you create a unique offering for those people?
What are these people's purchasing habits?
In a design business like mine, one way to potentially segment by product-related behaviors is to narrow by industry. People in the same industry will be more likely to use your product or service similarly, which allows you to focus more.
How niching down can increase sales
At the end of the day, you're interested in getting more sales, right? Going through the process of defining your target audience and niching down is going to help you do exactly that. Here's why.
It builds authority
When you narrow into one target audience, you can focus on serving them really well. This not only improves your product or service, but more people will come to you and be willing to pay more for what you're offering. Of course, once your business has grown big enough, you can start expanding. By then, your name will be out there, and you'll have more flexibility to expand your product suite or target another segment.
For example, I've had many subscription box businesses come to me for branding or website design, so I'm able to really build my expertise and offer it as an area that I specialize in. Not only can I offer advice and experience in this area that other designers can't, but I can also tailor my marketing to attract these types of customers.
It allows you to speak to your ideal customer
I touched on this earlier, but the main reason why finding your target audience is so important is that you'll get to know them really well, which means you can tailor your messaging to speak directly to their needs, wants, and desires. It will make them feel seen and heard—and if they know that you "get them," they'll be more likely to make the purchase, and even come back for more.
You get an SEO boost on Google
When you choose a target audience you want to serve, Google is going to reward you too. That's because you'll have targeted keywords that you've been building on your website, and Google will see you building your authority in that area. This will help boost your search rankings when someone searches for keywords related to your business.
As an example, I wrote a blog post called "Shopping For An E-Commerce Website Design Package? Here Are 7 Things To Look For," and it got traction on Google pretty quickly because Google can see from my other website content that I'm an authority in this area.
It helps you avoid marketing myopia
Marketing myopia is essentially when you fail to provide something that caters to the needs of your customers and instead just churn out products or services. Doing all this research and going through the process of niching down helps you avoid this. Why? Because you know before you launch a new product or service that there's a market for it—and specifically who that market is.
You've heard the words, now hear it again: niche down
It's not an easy process. Happily Hedy has evolved quite a bit, with some speed bumps along the road that could have been avoided had I found a target audience sooner. But once you do your research and find your audience, you'll reap the long-term benefits of niching down.
