Advanced Tactics for Executing a B2B Niche Strategy

How to bring together an array of executive perspectives to drive growth

While PayPal is widely recognized today as an online payments service, it didn’t gain mainstream adoption via a broad-based go-to-market approach. Instead, adoption spread in a niche market—high-volume eBay sellers who needed a way to receive payment online—with an approach some industry observers believed came about more by luck than with a well-thought-out niche strategy.

Whether deliberately or by accident, PayPal’s success—and the success of nearly all leading software and SaaS companies—can be traced back to a niche strategy in their early days. From Adobe Photoshop to ServiceNow, Autodesk, Tableau and more, industry leaders have found that a strategy focused on going niche can be just as—or even more—powerful as one focused on driving broad growth.

That’s because going niche is a key step in crossing the chasm from early adopters to mainstream customers. In fact, Geoffrey Moore argues that products can only cross the chasm by targeting a specific niche: “Cross the chasm by targeting a very specific niche market where you can dominate from the outset, drive your competitors out of that market niche, and then use it as a base for broader operations.”(1) Even more so than in other industries, most tech products don’t succeed because they fail to transition from a customer market dominated by innovators and early adopters to one comprised of the early majority. It’s generally accepted that once you’ve bridged that chasm, the innovation is accepted and will take off.

What You Need for an Advanced Niche Approach

While many leaders know about a niche strategy as a concept (and may already be pursuing one), execution requires depth and sophistication. You also need an approach that’s more granular than the standard segmentation and targeting niche strategy. To ensure an integrated approach that drives growth, you need to bring together an array of executive perspectives:

Think like a behavioral psychologist.

In selecting your niche, consider different types of niches. Evaluate their behaviors (e.g., whether they are early, middle or late adopters) and gauge their levels of relative pain. There are different types of niches, for example geographic niches (like a specific city), end user niches (like accountants or contact center agents), and vertical market niches (e.g., construction or public transportation). It’s more about the amount of pain the target population is experiencing than the size of that population. Other considerations include the niche’s tendency to adopt new technology. For a company offering document-signing software, for example, it may make sense to target a niche that is more receptive to new technology.

Think like an empire-builder.

A sufficiently developed niche can also create momentum in an adjacent niche. Evaluate whether it makes sense to target a niche in a broader business “ecosystem,” where groups cooperate for mutual gain and share common characteristics. A CRM solution targeted at civil engineers, for example, could potentially be expanded easily to structural engineers or architects. You can also consider adjacent use cases within the same niche instead of an adjacent niche. For example, a technology for video ads could first target a CPG’s ad division before repurposing the technology for customer retention programs and moving on to its customer support division.

Think like a caretaker.

Gaining a deep understanding of the target market—and creating a product and marketing that meets its unique needs—requires that you surround yourself with people familiar with that market. You can do this by finding team members with extensive prior experience in the niche. Alternatively, you can find a customer willing to partner to develop or refine the new offering with you. You can offer hands-on support—and of course early access to the innovation—in exchange for their input.

Think like a relationship broker.

References and relationships are incredibly important to tech adoption, so consider cultivating named references in your target niche. You first need to understand how acting as a reference will be most meaningful to the customer. An executive, for example, may want to cite their early adoption of your product as a testament to their commitment to driving innovation, while another customer may find value in gaining an insider view into your product roadmap. In all cases, you’ll want to ensure that your messaging reflects all of the audiences within your niche. For example, a company marketing a niche accounting application should ensure that the language it uses reflects not only the concerns of the decision-maker (e.g., avoiding revenue leakage or audits) as well as end users (e.g., managing accruals and true-ups).

Think like an event promoter.

Be resourceful and creative in how you use references. You’ll need to strike a balance that optimizes for your GTM strategy while staying in your reference’s comfort zone. That includes personal preferences as well as company standards. For example, using a reference for classic content marketing could take the form of a case study of the product or perhaps a joint press release about the results they’ve seen. If your reference works for a large corporation, consider connecting with its PR or marketing teams—they may be open to pushing content out via their own channels. Don’t overlook the need for growth marketing mechanisms, even for a niche market. Tactics like ABM, automation tools (e.g., Mailchimp) or targeted ads can help you build loyalty and strong customer relationships.

Think like a Kaizen quality control manager.

Enforce messaging discipline to the niche, from your value prop to messaging in pitch decks, sales scripts, web copy and user adoption programs. Attention to detail and thoroughness are imperative—both in the words you use and the imagery you select. Make sure to conduct a thorough audit on the brand and all materials in use.

Whether due to strategy or luck, PayPal started small, earning the trust and loyalty of eBay power sellers before expanding its reach and becoming “a catalyst for the entire fintech industry.”(2) Don’t leave your company’s success to chance. Learn more about how you can travel the proven path to more efficient, accelerated growth with a deliberate niche strategy.

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(1) Moore, G. A. (1991). Crossing the Chasm: Marketing and Selling High-Tech Goods to Mainstream Customers. New York Harper Business.

(2) https://fintechmagazine.com/digital-payments/story-paypal-worlds-most-valuable-fintech-firm

About the Author

Adam Aftergut

Adam Aftergut is the principal of West97 Marketing, which provides on-demand product marketing and sales enablement for industry-leading B2B SaaS enterprises and startups that market and sell their products to Citibank, Disney, General Motors, Kaiser Permanente and many other market leaders. Adam’s unique approach brings together value-based messaging and consultative sales methodologies with high-impact, enterprise-class deliverables tailored for each client’s needs, goals and strategic context.

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