Do you need to find a niche?

I believe that most brokers should find themselves a niche. The benefit of having a niche is that you can tailor your marketing and sales process specifically for that niche thereby being way more effective. The tighter the niche, the better it will work. Conversely, if you don’t have a niche, your marketing and sales process will have to be “all things to all people”. The problem with that approach is that it’s too watered down to be hugely successful/efficient – it will probably just be “ok”. However, you’ll just look like and feel like every other brokers and bank in Australia – not remarkable (which by definition is, worthy of remark). However, if I’m an airline pilot and you’re a mortgage broker that specialises in helping pilots, I’m probably going to tell all my colleagues about you – because it’s remarkable. Also, you can tailor your approach around me – e.g. advertise that you can meet them at the airport and take care of everything in less than an hour.

So how do you pick a niche?

I believe there are two main considerations being your skill set and experience and the industries characteristics.

1. Your experience & skills

Firstly, be realistic about your skill set. What are you good at? What types of people do you enough helping? For me, I’m good at developing systems and processes to make my work easier. This meant that preparing a report (with my credit advice) for high-end clients wasn’t going to be a problem. If you’ve played footy at the local club, hang out at the pub and so on – perhaps tradies might be a good niche for you (sorry for the generalisations). Also, think about your experience. Have you worked in a particular industry before? If so, it will be an advantage because you’ll know what they like, don’t like, need help with, etc. Plus they’ll immediately like you – because you are one of them.

1. Industry characteristics

There are a number of things you’ll be looking for in an industry to translate into profitable clients. The top 4 in order of importance are:

• Earning capacity and more importantly, earning stability. Actors probably won’t make a good niche because their earnings probably vary a lot making finance more difficult. Surgeons have a high and very stable earning capacity.
• Is the industry easy to get in front of? Do they have one or two widely read publications? Industry groups/bodies? Events? Websites? Concentrated in a certain geographical location? There’s no point picking a niche of you can’t find a way to market to them.
• Size of niche – probably looking for a niche with at least 2,000 people but probably not more than 10,000 (otherwise it’s not focused enough).
• Do they have a problem that needs a solution? For example, IT contractors can sometimes run into trouble with some lenders because they might (for example) be on a rolling 3 month contract. So having a good broker that knows how to put the deal together and which lenders to deal with is important. The problem doesn’t necessarily need to be specifically about lending.

There are two ways you’ll get the above information: 1. The internet and 2. Talking to as many people in your target industry as possible. The better the understanding you have, the more successful you’ll be.

Do you have a niche? I’d love to hear your success stories.