A niche strategy can have a dramatic impact on the growth of your Acumatica practice.
Every week, I talk with Acumatica partners about the need to focus on a niche.
Any small business will benefit from targeting niches, and this is especially true for Acumatica partners. But most of partners worry that a niche focus will limit them, and they’ll miss sales opportunities. In reality, however, a niche isn’t limiting. In fact, it’s usually the key to growth.
An Example of Large Growth in a Small Niche
For example, several years ago, I was asked to help a data center provider grow their business. At the time, their revenue was about $500M and they had about 1,400 employees. They served 4 verticals, and I was engaged to help them build their financial vertical. This division had about 25 dedicated sales people. Their plan was to target “BSFI” (banking, financial services, and insurance). But this was just too broad. So we developed a niche strategy.
I helped them target a very specific audience in the electronic trading space. We started with a single asset class and focused on attracting broker/dealers that trade equities. This is a very tight niche within the financial markets. We researched this target audience and trained the sales team on the target audiences’ business and technical problems. In the course of about 12 months, the team was able to attract enough clients that they created a sort of ecosystem where these firms connected with their counterparties. We targeted that one asset class until they had acquired roughly 25% of the available business. Then we started adding other asset classes one at a time. But we still focused exclusively on electronic securities trading – not on other banking sectors.
The firm grew this niche segment of their business very quickly. Within 18 months, the financial vertical constituted more than 25% of their client base and more than 35% of their revenue. It was their most profitable sector by a strong margin. They soon surpassed $1B in revenue. Their financial services sector was a key part of that growth, generating more than $350M annually, still within that targeted niche.
A Niche Strategy Is Essential to Growth
So if a $1B company can benefit from a niche strategy and not run out of opportunities for growth, I guarantee it can work for your firm too.
In my opinion, a niche strategy is essential to becoming a successful Acumatica partner. You’re selling business results that derive from ERP implementations. If the implementation is less than stellar, the client won’t gain the expected benefits. But when you repeatedly serve the same market, your team gets better and better over time, ensuring better outcomes for your clients.
A niche strategy can deliver several important business impacts for your firm:
1. Improve Your Marketing Messaging
If you target a narrow niche, it’s much easier and cheaper to do qualitative buyer research. That buyer research is how you gain a deep understanding of customer pain points. You can interview buyers about their needs, buying process, common questions and objections. This allows you to create content that is useful and relevant to their business.
But you can only develop this deep understanding of your buyers if the niche is narrow enough and you’ve done qualitative buyer research.
2. Align Your Website to the Customer Buying Process
When you have deep customer insight, you can create content that is directly relevant to customer pain points. The insight also gives you the ability to align your site and email content directly with the customers’ buying process. This helps convert visitors into qualified leads and facilitate the buying process.
3. Improve Your Marketing ROI
A niche strategy eliminates much of the guesswork from marketing. Consequently, it makes marketing significantly less expensive and more effective. When you have a focused niche and detailed insight into your target audience, you’ll know exactly what kinds of content to create. You’ll know who to target and what messaging they need to hear. You’ll also know exactly where to publish it so it gets found. This means you’ll get a better return on your marketing and advertising investment.
4. Improve Sales Results
When you develop that deep understanding of your target customers, you can train your sales team to be more customer-centric. They can use the research to know what questions to ask in order to uncover business needs and quantify value. Instead of just pitching Acumatica features, they can pitch solutions to business problems. They’ll also gain customer stories that help illustrate your value proposition. This will improve their ability to convert leads into opportunities and increase their close ratios.
5. Hire Salespeople with Deep Domain Knowledge
When you know exactly who you’re targeting, it becomes easier to decide which salespeople to hire. You can attract candidates who have deep domain knowledge in your target niche. This will speed up their learning curve and shorten the time to revenue. A salesperson with domain knowledge can improve the customer’s perception of your firm, elevating your brand and improving close ratios.
6. Build Domain Expertise in Your Consulting Team
Specializing in a niche also helps your consultants to develop deep domain knowledge and skills. Your team will gradually become more and more proficient at solving common customer problems. They’ll learn to recognize issues and proactively propose solutions that improve the value clients gain from Acumatica and your services.
7. Improve Implementation Margins
As your consulting team’s proficiency grows, they’ll become more proficient with Acumatica implementations. This will add more precision to your pricing. If you charge a fixed price, you’ll see margins improve steadily over time. The more effective your team becomes at solving customer problems, the more customers will engage you for additional services. This generates more revenue over time and positions you to sell subscription services.
8. Build a Brand and Reputation
The better you get at serving your niche, the more your reputation will grow. Word will spread among the niche, and prospects will start to seek you out. Eventually, most of your growth will come from word of mouth. Referral leads are always easier and cheaper to close. So this also improves your margins.
Want to learn more about how to apply a niche strategy to your business?
- Here is a resource center with loads of free content to help market your Acumatica practice.
- Here’s an article about how a niche focus will prevent you from wasting your marketing investment.
- If you’d like to discuss how to apply these strategies to your business, please reach out, and we can schedule time to talk.