How To Find The Most Profitable Niche For Your Business | 3 Simple Steps
Should you work with a huge market?
Should you work with a small market?
Should you care if your market has money?
What if there is a lot of competition in that market?
The first thing we need to do is define what a niche is.
Of course, there are thousands of definitions online, but I’ve distilled it down to something simple yet powerful.
“Targeted group of people with a specific current situation and specific problem.”
Okay, Ravi, that sounds great and all, but how do I actually apply that to myself.
Well, let’s break it down, the first place I usually like to start is identifying the group of people.
I’ve created and scaled two companies to 7-figures and I niched down one and not the other, in this video you’ll figure out why.
I’m curious, do you think you’re missing out on business if you niche down?
Become The Entrepreneur You Always Wanted To Be
[00:00:09] Should you work with a small market? Should you care if your market has any money? What are there’s a lot of competition in that market. What’s going on everyone, I’m Ravi Abuvala, founder of Scaling With Systems and look, I have scaled two companies to seven figures in under two years. And one of them I niched down and the other one I didn’t. In this video, I’m going to walk through why, if you stay until the end, you’re going to get access to a brand new training I just put together totally free on how you can scale a company from zero to seven figures in under six months while retaining a 50 percent profit margin. And as usual, if you guys like this video, take two seconds out of your day, two seconds out of your day and click the like button. Almelo Or you can alternatively smash the like button down below, as I do think that’s more powerful and lets the YouTube gods know to show this video. More people want to smash it. So without further ado, how to find the most profitable niche for your business. The first thing we need to do here is define what a niche is.
[00:01:03] Now, if you Google that online, there are going to be thousands of definitions out there. But I have boiled it down to something really simple that we tell our clients and scaling with systems and which is a hyper targeted group of people in a specific current situation that all have a specific problem. OK, I know that sounds like some high word stuff, so how can I actually apply this to myself and my business? Well, let me show you how. So we find the most profitable niche for your business. The first place I like to start in the definition above is finding the specific group of people you’re going after. Now, whenever I ask someone what the group of people they’re targeting is, they usually just yell real estate or doctors or home buyers. And while that may be just simple to say and reality, you’re going after such a large market that when you’re just starting out or even if you’ve established yourself as a great business, you’re going to be competing with some businesses that are doing tens, if not hundreds of billions of dollars. And they’re going to stomp you into the ground because you’re trying to steal their market share. So let’s try to do a little more specific, not just real estate, but real estate brokers, not just real estate brokers, but real estate brokers who closed at least five transactions last month, not just real estate brokers who closed five transactions last month, but real estate brokers who closed five transactions last month and live or work in a transient market. And obviously, we can go on and on and on and get more specific.
[00:02:24] So once we have this hyper targeted group of people, the second thing we need to look for is what is their current situation? This is incredibly important because even with this specific group we talked about above, we’re still going to be targeting a lot of people that aren’t really our ideal customers or don’t have the problems that we can solve. Instead, we want to find people who are in a current situation that maximizes the effectiveness of our solution. We’re going to present to them later on. For example, let’s talk about the real estate brokers. We said in the earlier example who are closing at least five transactions a month and live in mostly transient markets. Well, the current situation that they’re in is that maybe they are paying for leads from one of the largely generation sources like Zillow or Realtor Dotcom or Trulia. But they’re not really seeing any consistent deal flow coming in. Or it could be the same real estate brokers who are just consistently posting online on social media. Or maybe you’ve identified that they’re running ads currently by just going one step further and figuring out what current situation is most ideal to your solution. You can shy away from the people that you don’t want to be targeting, like trying to convince real estate brokers that have never posted content online or don’t believe in purchasing leads that they need to be buying leads from you. All of a sudden, what do you think will be the easier sell? Selling a real estate broker who buys leads already and offer them a better solution or try to convince a real estate broker was never bought leads ever only relies on referrals to that. They should start changing their business model and buying leads from you. Obviously, it’s much easier to sell the person that’s already doing what you do and you’re going to offer them something that’s better, faster or cheaper.
[00:03:52] The final step in defining the most profitable niche for your business is defining the problem that your solution is going to solve for your clients. This is essentially what every entrepreneur is paid to do. This is what a business is for. And this, I would argue, is the most important step of all three of these. You see, we are paid in direct proportion to the value that we bring to the marketplace. That’s why a janitor is paid minimum wage and a lawyer is paid five hundred dollars an hour. It’s not that the lawyer is a better person than the janitor. It’s that the lawyer provides more value to their customers than the janitor does. The more value you can create with your solution, the less competition you’re going to have and the more profitable you’re going to be in the long term. So let’s talk about the same example we’ve been using here. So we’ve identified the broker five transactions a month or in a transient market, and they’re posting on social media online every single day. Well, maybe I wanted to come up with a solution that allowed them to post easier or post faster. And I was like, hey, I can save you 30 minutes a day by allowing you to post one time the week and I’ll drip it out for you over the next few days. Not sure you’re saving them. Maybe thirty. Minutes or an hour, but how valuable really is that solution? I mean, ask yourself, why are they even posting in the first place? Most likely they’re posting so they can get more exposure, so they can get more appointments or leads, so they can close more deals for their business. What if instead of the problem that we’re solving, being that they’re spending an extra hour a week posting, the problem that we solve is that we’re able to give them more closings every single month on autopilot.
[00:05:24] Now, that’s obviously going to be worth a lot more to them, which means that I can charge more because I’m adding more value and I can scale my business much faster. Another example is even my company and scaling with systems. We don’t just help entrepreneurs by saying, hey, here’s a fully trained virtual assistant. Sure, that would be great, but that’s not really that urgent of a problem. And that value that we give them is still nice, but it’s not as immense as it could be. Instead, what we do is we work with our clients to systemize their backend and their front end. We give them the systems and tools and automation in order to fill their calendars every single day. And then we have the virtual assistant come in, fully trained and execute all of that for them. Do you see how much more valuable that is? And I know your head may be reeling right now with what you should be choosing or what initiatives you’re going after. I want to address the one question a lot of you are going to have. But but but. But, Bhairavi, if I nitsch down, are not going to lose out on business. Actually, no, it’s the exact opposite. You’re going to be capturing a lot more of it if we’re going after a hyper targeted group of people with a very specific current situation and a very specific problem that they’re having, you are going to slice through the noise in the marketplace. You’re going to be able to get to your target market, to your individual consumers. Your business is a lot easier, a lot faster. And they’re going to buy from you at a faster rate and paying more money than they would anybody else because they feel that, you know, their problem and you have their solution. You get more responses, lower cost per click, lower cost for acquisition and a higher retention rate. Once you’ve captured 40 to 50 percent of your hyper specific market, then you can think about expanding into adjacent markets.
[00:07:00] So that’s it, everyone. How to find the most profitable niche for your business so that you can scale fast enough that I’ve answered that question. I’m curious, do you think you’re missing out on business by niching down comment down below your thoughts on that question? I’m going to be sure to respond. Also, now that we’ve identified the niche, the current situation and the problem that you have, do you know how you should be reaching out to these people? In order to get your counterfoil, I want to invite you to a totally free training that I just put together. It’s brand new on how you can start and scale a business using the same niche model I gave you here and scale it to seven figures in six months while retaining a 50 percent profit margin. The link to that is going to be in the description below. As usual, everyone, please do me a favor and just click the like button. It does so much for myself and my channel. Comment down below what you think about niching down or not niching down and be sure to subscribe so you can get access to some of the similar videos that we do just like this. Thanks. I’ll see you guys in the next one.