Targeting Versus Niching

There are certain conversations strategists have over and over with their clients. One that I've had with almost every marketer I've worked with is around whether we are in danger of "niching" their brand. To simplify a bit, the common concern is that a given strategy might artificially limit the brand's market opportunity.

Of course, the counter to this objection is that a lack of focus might theoretically maximize the brand's potential market, but such a nebulous strategy makes it much more likely that no one will really understand why they should care about the brand. By way of example, I once was asked to help a brand redo their failing strategy after they were forced to admit that their previous campaign - a literal list of a dozen or so reasons oncologists should consider using the product - was an abject failure.

In that case, as in several others, I navigated around the objection that we risked niching the brand by insisting that what we were actually doing was targeting. And while that answer often seems to suffice, it could be alleged that targeting is merely dressing up niching in finer clothing. So I'm going to try and clearly distinguish between the two, and explain why niching is a strategic mistake while targeting is an essential part of sound strategy for almost every brand.

Let's start with definitions: niching is when a brand only gets business from a small percentage of its potential opportunity, usually by being too tightly associated with a narrow slice of the market. Targeting, in contrast, is when a brand clearly defines its potential customer or opportunity in a way that helps it maximize its potential. In other words, niching wins a brand low hanging fruit while separating it from the majority of the market, while targeting clarifies the problem the brand can solve, and for whom it solves it.

Imagine a brand that treats osteoarthritis pain. In theory, it could be used broadly for any patient with that pain. However, let's stipulate that a large percentage of these patients do not consider their pain significant enough to manage medically, or are already satisfied with over the counter pain treatments. A positioning that helps the brand target its best market opportunity might be, "A new option for people who don't want arthritis to get in the way of their passions." However, if the marketing team discovers at launch that doctors like prescribing it for patients over 75 with difficulty walking, and pursues that positioning, the brand would be niched in a subset of patients that represents a fraction of its total potential.

Conversely, if the brand team insisted that they have to pursue the broadest possible positioning, meaning all people with osteoarthritis pain, what is likely to happen is that the unfocused brand will wind up niched anyway, as a small subset of potential customers will discover the brand and it will become known as being best suited for that group's needs.

So the task of marketers is to identify the largest opportunity the brand is able to achieve with the tools and budget at its disposal, over a reasonable time horizon. (As a rough rule of thumb, positioning ought to guide the brand for between three and five years before it is reconsidered.) Being too conservative is to actively niche the brand, and being too broad fails to differentiate the brand or attract a target customer, and will lead to low adoption and probably passive niching as customers define your brand for you.

To be sure, there often there needs to be both a short-term and a long-term target. To go back to our osteoarthritis example above, if the brand wants to eventually target and convert active people who are slowed down by their arthritis pain, it might start out by appealing to "weekend warrior" athletes who are most aware of the limitations their pain puts on them. In selecting the near-term target, it is key that they are seen as a representative part of the larger group, not distinct from it or in opposition to other members of it.

Of course, in the background of this entire discussion is the question of how to identify that ideal targeting opportunity. The only way to answer it is to dig in to really understand the market and your customers, to find the common truth or need that a brand can tap into.