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The Freelancer’s Guide To Niching Your Business


Key Takeaways

  • What does it really mean to niche?
  • Why many freelancers fear niching
  • Why you don’t need to go “all-in” on a niche
  • How to think of niching as a marketing strategy
  • Why niching is a framework, not a phase

“Choosing a niche,” or coming up with strong business positioning, is one of the most difficult exercises for many of the freelancers I’ve worked with over the years.

I think they point to a big disconnect between what niching actually is and what niching is thought to be.

What does it mean to niche?

Every transaction requires an application.

If I’m going to buy a new computer, justifying the purchase requires me to think about how I’ll use the laptop to better my business or my life. Why I end up buying a laptop is different than why you might buy that same laptop.

Likewise, hiring a freelancer (for the sake of argument, let’s say a freelance web designer) requires the business owner to rationalize how they’ll use the web designer to achieve the end they have in mind.

Consider for a moment the lifecycle that goes into hiring somebody like you:

  1. A business becomes aware of a problem that they have
  2. They realize that this problem can be solved
  3. They then determine someone like you can solve the problem
  4. They seek out people like you

That flow carries a lot of risk.

Companies that could benefit from working with you easily fall out of that funnel. Most businesses never realize that they even have a problem, or that it can be solved. And the ones who do realize that they have a solvable problem don’t know that finding someone like you is the best way to solve it.

For every one business that makes it to the end of that funnel, dozens or hundreds self-select out of it.

So to plant your flag and say “I’m a web designer, hire me!” you’re excluding a large part of the available market from ever finding you because they…

  • Don’t know they have a problem that you can help them solve
  • If they are aware of the problem, don’t know it can be solved
  • Don’t know that a provider like you can solve their problem

Generalization and not niching means that you’re getting client candidates who know they have a solvable problem, know a way of solving it, and are seeking out “vendors” who can solve their problem.

This immediately commoditizes you: it’s now you vs. the world. You against every other provider who offers a service similar to you.

But say someone does seek you out and you get to the point of furnishing a proposal.

At this point, you’re forced to niche. You take your skills and your experience and apply it to them.

You explain how you’ll help them, and you explain it in a way that’s specific to them.

Every proposal you write is an example of you niching your services. Most of us just don’t think about it that way.

Why niching is regularly met with resistance

If every proposal is an exercise in niching, you’re probably thinking that rarely do you write identical, or even similar, proposals.

Right?

Many generalists often fear niching because they think it requires backing themselves into a corner. They feel forced to select a target market and think that if they choose the wrong audience, they’ll fall flat on their face.

They also feel like they’re intentionally sabotaging their own business.

If you choose one path, one type of customer, or one problem that you decide to go all-in on, you’re bypassing opportunity.

If you (again, as a web designer) are just going to serve dog groomers who aren’t getting enough online customers, you’re missing out on a very wide market of people who could benefit from your ability to create websites.

The above are easy-to-make assumptions that often keep people from ever making an effort to niche their business.

They often think the upside is dubious and the risk is great.

Niching is more about marketing than the product

When companies build products, especially products that require a lot of research and development overhead, it’s expensive to come up with versions of their products that target each key demographic that could use the product.

What’s comparatively less expensive is marketing differently per each demographic.

Consider the core demographics that buy MacBooks:

  • Creatives. Historically, Mac OS has been the friendliest operating system for photographers, videographers, and designers and the available software reflects that.
    Certain types of developers. Because Mac OS is built off UNIX, the OS easily allows developers to write software in an environment that’ll be similar to their production environments.
    Students. Apple has always done a good job at getting their equipment on college campuses and in classrooms.
    Brand snobs. Let’s face it: Apple, as a brand, is a lot sexier than most other hardware manufacturers, and many of us still feel an air of superiority when we’re sitting next to someone sporting a clunky Dell laptop.

Each of these groups has different reasons for buying. And Apple does a good job at tailoring the way they communicate their products to each of these different groups.

WWDC, the annual Apple conference targeting developers, touts operating system improvements and hardware specs that tell developers that they’ll be using best-in-class equipment.

The famous keynotes that the company gives tout their software, ease-of-use, and 3rd party ecosystem to appeal to creatives and brand snobs.

There’s also distinct marketing in place for students, educators, and other key demographics.

But all of these roads lead back to the same product, the MacBook.

If you recognize that positioning is more about how you communicate what you offer rather than a reflection of what you do, it’s a much easier pill to swallow.

How I niche my own marketing

My best-selling product is Double Your Freelancing Rate. Over 8,000 people have bought it.

It’s a self-study course on how to price and pitch your services. It helps any freelancer or agency who sells their services to other businesses.

However, I’m used to hearing the following objections:

  • “I’m a writer, and most of the case studies listed are from web developers and designers. This can’t work for me.”
  • “I own an agency. What works for freelancers can’t help us.”
  • Some permutation of: “I’m X, therefore Y.”

By marketing a general course on pricing and proposal creation with general sales and marketing copy, I’m leaving it up to the prospective customer to figure out if it’s right for them.

And any time you’re leaving it up to someone to determine if hiring or buying from you will help them, you’re guaranteed to be losing out on sales.

I could niche the product by creating a bunch of new courses: “Double Your Freelance Design Rate”, “Double Your Freelance Web Development Rate, “Double Your Agency Design Rate”, and so on.

Being that specific is actually a really good way to create your first product because you can laser focus both your marketing and your product to a specific need that someone has.

But it wouldn’t work for me because my course is designed to help so many different types of freelancers and agencies.

So what did I do?

I simply changed the sales page and the communication that leads people to that sales page depending on who someone is.

If I know you’re a designer and I know that you run an agency, the headline, body copy, and soon the testimonials will change to speak directly to people like you.

DYFRate Headline For Designers

And if you’re going through my email course, Charge What You’re Worth, and tell me that you’re struggling to close more proposals (as opposed to figuring out what to charge or upping your prices), I’m going to position how I sell the course to laser focus on how it helps with proposal writing.

Charge What You're Worth on the fly niching example

The course stays the same, but the way I describe the course changes.

That’s all you need to do when it comes to positioning your own business. You don’t need to necessarily go all-in on one type of customer, but you do need to start with one.

Instead of thinking “this is the only type of customer I’ll work with,” think: “How can I reach people who fit this demographic and likely have this problem? And then how can I speak directly to them?”

And then setup a funnel for that group. Develop an acquisition strategy (online or offline), put in place an automated nurturing sequence or website/subsite that speaks directly to them, and create a compelling pitch that explains how you can help them.

This doesn’t need to replace everything you do. Rather, this can be just a branch. And over time, you can create more branches that all lead to you (or cull your branches to better focus in on the channels that are working well.)

Can you go all-in and exclusively work with one type of customer?

Sure. You’ll definitely want to start considering doing this as you begin developing more repeatable, more productized services that allow you to focus your attention on really owning that space.

But it’s by no means a requirement. And because people think that they need to give up their existing portfolio of clients in order to niche correctly, they often flounder.

Niching is a framework, not a phase

As you consider “choosing a niche,” think less about squeezing into some arbitrary amount of time the activities that go into niching, and more about a framework that you can establish that lets you:

  • Identify unfair advantages that you have—combined expertise (like knowing how to write sales copy and write code), experience (e.g. working with a few clients in the natural gas space), and other interests you might have.
  • Extrapolate how you can apply this expertise and experience to actual business problems that a demographic has. The single best way to do this is to talk to people. Keep your ear to the floor and listen to what people are saying, and use Socratic Questioning to determine how your skill set can satisfy their needs.
  • Normalize what you learn doing this and put together a marketing funnel, which is a fancy way of saying a set of processes, both internal and external (a sales page, email course, Facebook ad, etc.), that lead someone from first contact to the end goal of becoming a client.
  • Make a habit of looking at how this funnel is performing, noting what clients and prospects are telling you, and ruthlessly test and optimize this funnel.

The funnel is your niche. It’s taking what happens at the time of writing a proposal and putting it in front of someone—possibly even before they’ve realized they need someone like you.

The best business owners are those who know how to capture, analyze, and act on data.

They aren’t looking for a magic pill.

They aren’t waiting for someone to tell them what they should niche in, what they should say in their marketing, and so on.

Instead, they listen.

They determine what people are saying (what “the market needs”, to channel Adam Smith.)

They look at what they’re able to offer and come up with a way to advertise that to people who are the type who could benefit from what they have to offer but aren’t necessarily seeking out someone who can give them what they need.

They develop a conveyor belt… a marketing funnel, whose sole purpose is to get people to be aware of the problem they have, realize it can be solved, teach them how they could solve it, and then present a way of solving it.

Unlike freelancers who haven’t gone beyond “I’m an X for hire,” they’ve realized that they’re missing out on a lot of opportunities by only helping people who have already figured out how to solve the problems they have.

Closing thoughts

Remember the typical lifecycle of a client that I mapped out earlier in this article?

  1. A business becomes aware of a problem that they have
  2. They realize that this problem can be solved
  3. They then determine someone like you can solve the problem
  4. They seek out people like you

When you’ve created a niched funnel (or a series of niched funnels), the lifecycle starts to look like this:

  1. You make first contact with a business who has a problem (via an advertisement, blog article, a talk you give at an event, etc.)
  2. You offer to teach them more about how their problem can be solved, and why it’s important that they solve it.
  3. You then present a service that exactly solves their problem.

Instead of waiting for someone to make it through the gauntlet of doubts and hesitations that come when walking the path of identifying a problem, realizing it’s solvability, and learning about how it can be solved, you should be casting a wider net and looking for the type of businesses who fit the description of who your niched marketing funnel serves.

Because if you think telling the world that you’re a web designer is going to help, you’re right… but you’re only going to help companies who already know they need a web designer.

But if you decide to share with the world that you specialize in helping online stores increase sales by creating human-centered designs, you’re now speaking to anyone who runs an online store. (And you can then educate them about how design, done right, can help increase sales.)

That’s all niching is.

It doesn’t require you to cut off the way you’re getting work now. Niching adds, it never subtracts.

Many freelancers, however, end up becoming super successful in a particular niche and then decide to only work with those types of clients. That’s admirable, smart, but it’s their prerogative. It’s by no means a requirement.

Take a few minutes now to ask yourself:

  • “What unfair advantages do I have?”
  • “What kind of companies can benefit from what I’m able to offer?”
  • “What frame of mind are they typically in before they go down the path that ends with working with someone like me?”
  • “How can I reliably reach these people and help them down that path?”

Much of what goes into automating your funnel is beyond the scope of this article but is the subject of what I’ll be writing about over the next few weeks. (Topics like building an audience, educating them at scale, leading them to a service offering, etc.)

However, niching can start with you meeting someone who suffers from X, emailing them with a plan of how you could help solve X, learning more about what X means for their business, and then slowly building up a portfolio of material, like a sales page, that you can leverage the next time you meet someone suffering from X.

So if you’ve ever resisted or feared niching, you should now know you have zero to worry about.

Remember: niching doesn’t mean that you need to change or eliminate anything that you’re doing now. It’s not a restriction. It’s not a limitation. It’s simply a way of speaking to a group of people who all share a problem, and leading them (in your case) to you.

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