January 1 2009

Strategic Niching for 2009

It’s 5:27am on Dec. 31st; I’ve been up since 4:12am.  I’m getting ready for our 2009 company kickoff event.  An idea – concept – whatever you want to call it has been rattling around in my head for several weeks.  The concept is niching.  As I write down the word ‘niching’, my MS Word is giving it a red underline, which means I have misspelled a word.  So I right click on niching to find alternative spellings and Word offers ‘Inching’ and ‘Nicking’.  So I do the next logical thing to make sure I don’t look careless or incompetent in this blog post - I Google it.  Much to my relief, I did not spell niching wrong. http://www.thefreedictionary.com/niching, defines niching, a transitive verb, as “to place in a niche”. So I right click on niching and add the word to my Word dictionary.

The Internet is the medium that first opened my eyes to the strategic niching concept.  Strategic niching is placing your ads where your audience is looking. The success I had differentiating myself by using the Internet when I was a rookie real estate agent showed me that by being an expert on a small and underserved topic, I could make a very good living. 

There is ever growing evidence that, more than ever, strategic niching is critical to a successful business strategy.  On TV, my Direct TV channels, not including the duplicate HD channels (which are also growing), range from 2 to 879. Then the channels begin at 9560 (XM for Business) and go to 9926 (on demand games).  The Internet has grown to over 100 billion web pages with several million added daily.  

It was only 30 years ago that my TV options were ABC, CBS, NBC, PBS, and maybe one other channel.  Now the channels are approaching 1000 and it looks like there is a foundation to support up to 10,000 in the future.  Can you imagine the marketing challenges of 10,000 TV channels?  We’ll come back to this at a later date.

Media today is completely different.  And yet how different is the way in which we reach out (market) to consumers?  Technology has taken us from 5 options on the TV and maybe a few more options on the radio to literally billions of options when you account for all media.  And of course, the Internet accounts for the vast majority of those options.

The overwhelming numbers of options aside, as marketing professionals, what we need to wake up to is that the massive increase in options is not because of technology.  It’s because of consumer demand.  Technology is only the vehicle.  Consumers dictate what stays in the marketplace, and niche options are what consumers demand.  

There is a reason that mass media is failing.  It’s because of niche markets.  There is no more ‘one size fits all’.  You can’t be all things to all people.  Mass media, aka broadcast media, worked great when there were only a handful of options.  You have a product, you advertise on one of three TV channels, or the only newspaper in the city, and voila – more customers.

The world of advertising is not the same today. Consumers are not the same today.  The clutter is growing exponentially to a point where we can’t put order to all the chaos and so we block it out.  Until we want something that is.  When we want something, we go hunting for it.  Maybe we look for it on the Home Garden TV channel; maybe we look for it in Bon Appétit magazine; maybe we look for it through typing in a phrase into that magic Google search box. 

Mass media (TV, Radio, Billboards, Newspapers), for many companies, has become the equivalent of the ‘Hail Mary’ in football.  You send everyone deep, and throw up a prayer.  You literally just chuck the ball downfield with the hopes that chance may smile upon you and bring you the points you need.  That’s what you’re doing by putting up a billboard, or advertising in the newspaper.  You know there’s a potential of reaching thousands or maybe millions of consumers, but it’s a long shot.  On top of that, just like the ‘Hail Mary’, you know you can’t count on it working the vast majority of the time.  Yet so many continue to spend the sick amount of money broadcast media charges.  Stop doing what doesn’t work.

The ‘West Coast Offense’ in football is arguably the most effective offensive strategy in recent football’s history.  Given birth by one of the greatest NFL coaches to ever coach the game, Bill Walsh (80’s SF 49’ers), theorized that short incremental pass plays would create opportunities for receivers to run the ball for additional yards after the catch (YAC).  Prior to the West Coast Offense, teams would either run the ball, or throw the ball down field.  Today the ‘West Coast Offense’ may be the most popular offense in football.

Consumers want what they want, when they want it, where they want it.  Anything else is an unwanted interruption.  Not sure you’re on board?  How many of you enjoy being called by a telemarketer?  Zero. Why do we not like it?  They may have something of benefit to you.  It’s the interruption.  It’s impolite - it’s unthoughtful - it’s uncouth.   We don’t trust someone barging in on us, getting all up in our grill, and self promoting.  

It’s the same for TV, radio, and the Internet.  TV commercials are times for using the restroom, getting a snack, or hitting the fast forward button on our TiVo.  No one goes to the radio looking for anything but music.  O.K. maybe you like the morning show, but if you weren’t driving to or from work, you probably wouldn’t be listening to it at all.  A recent Internet study by Starcom USA and comScore showed that the vast majority of Internet users do NOT click on the banner ads.

Strategic niching is the new way to plan your marketing tactics.  Getting in the niche space where your consumers are looking is the strategy you need to employ.  It’s ironic that professional marketers have always believed in target audience, and yet at the same time believe that more is always better, compared to a smaller, more quality audience.  It goes back to the hope of the ‘Hail Mary’.  Today, the two rarely overlap.

Strategic niching is reaching consumers that are ready to buy, or are planning to buy, regardless of how small the number.  Is being in front of thousands or millions of consumers who could care less about your product really that important?  It is time to cut the umbilical cord of the false sense of hope that mass media promises.  It is time marketing professionals stop fearing the change from the old ways of mass media.  Just because others you know are still doing it doesn’t mean you should be doing it.  Can you hear your mother saying right now, ‘if your friend jumped off the bridge, would you do it?’  

The trends are clear.  Consumer preferences are clear.  Performance metrics are clear.  Media niches work best.  Find the media niches and give consumers what they want.  You will make your consumers happy while at the same time producing some of the most effective marketing possible.

Finally, a caution I bring to you all.  If you deploy the same in your face, interruption marketing, in these niches – especially social media niches – while at the same time, not giving consumers what they want, you will cause the same ambivalence and numbness that consumers have grown accustomed to with mass media.  Don’t use mass media techniques in the new media – they won’t work.

Old media is mass media.  New media is niche media.  Old media is a one-way street.  New media is a two-way street.  Old media is shouting.  New media is conversation.  Let’s all join the conversation.

Jim Adams - CEO


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