By George Joseph
As any visitor to Australia will tell you, the great land “down under” is a hot, dry, rugged place. Yet even in harsh high country, you will see towering eucalypt trees thrusting their way between boulders or sprouting from the face of sheer rocky cliffs.
Why do eucalypts survive when lesser trees turn up their leaves and die? One secret of their success is the ability to push their roots into any nook or cranny— any niche in the rock—and tap into nutrients that other trees fail to find.
Painting contractors can learn a lot from eucalypt trees. The business environment that many painting contractors operate in can change like the weather and often is as unforgiving as the Australian sun. Even so, your business can thrive even in the toughest of times if you find a niche market, sink down your roots, and tap into customers that less astute contractors have failed to connect with.
Tapping Into Niche Markets
What do you need to do to tap the potential of niche markets in your area? Much of the advice offered by marketing experts can be distilled into the following four steps:
Step One: Know your market.
Talk to your customers—not only those you now care for—but also those whose business you hope to win. Ask them what products and services they most want from the contractors they hire. Identify products or services that they say are difficult to find.
Step Two: Know your competition.
In the movie The Godfather Part II, Michael Corleone masterfully summed up what is really the spirit of this step: “Keep your friends close, but your enemies closer.” The point? Unless you know the types of goods and services that your competition is offering, you are likely to miss opportunities. Or worse, you will get squeezed out—or in gangster parlance, “rubbed out”—of the market.
Step Three: Review the products and services that you are currently offering to your customers.
Look for ways that you can adapt your services to satisfy the unmet needs of your customers. A word of warning, though: If no body else is offering a service that your customers seem to want, it might be because you are the first person to identify this niche market. If so, lucky you! A more likely reason, though, is that other companies have tried to grow in this market only to find the soil very poor. So proceed with caution.
Step Four: Focus your efforts.
Once you have identified a potentially fertile niche market, find ways to make yourself irresistible to those customers. When pitching your services to them, use language that they will understand and can relate to. Promise only what you can deliver, and deliver on your promises.
From Theory to Practice
The above principles may sound good, but do they work in real life? To find out, DECO interviewed painting contractor Nick Sabelhaus, whose company (Sabelhaus West, in Silverdale, Washington) has continued to grow even in tough times. One of this company’s secrets to surviving in a competitive market has been identifying and then tapping into niche markets. Consider what he has to say in answer to the following questions:
DECO: In our June/July 2007 issue, there was an article entitled “Market Diversification—a Strategy for Success, and in that article you said that you were working to find niche markets. How has your company tapped into these markets?
NS: “By seeking work opportunities in market places other than the ‘traditional’ interior or exterior painting for the residential and commercial markets. We are creating a service oriented company that is more consumer conscious, offering services for a market place and customer base that is more interested in a creative and less disruptive painting process. We have found this to be a market that is not overloaded with other painting and coating companies.”
DECO: Why, do you think, it’s important for your company to develop these markets?
NS: “This approach differentiates us from the competition, and as a result, it narrows the playing field.”
DECO: What steps did you take to execute your marketing strategy?
NS: “We took the following three steps: First, we looked for the opportunity. Second, we asked questions about how we tap into this niche, and how we could spur growth in this area in a way that would benefit both our company and the customer. Third, we marketed our strengths and then followed through on our promises.”
DECO: Specifically, what have you done to adapt to meet the needs of the niche markets that you identified?
NS: “We are educating ourselves in the painting of other media, such as epoxy staining of floors, decorative finishes, concrete and steel coatings. We have enhanced our ability to provide painting/ staining services at our shop; limiting or eliminating disruption in the day to day business process of our customers.”
DECO: In your opinion, what traps should contractors be aware of when attempting to diversify the services that they offer?
NS: “Too wide of a focus or using a “shotgun” approach can be detrimental to any contractor. Providing a “one-stop shopping service” never works, because you can’t be an expert at anything by trying to do everything. Putting all of your eggs in one basket is not a good idea. Also, you need to separate your revenue so you can track the profitability in the market you have chosen.”
DECO: How has developing niche markets affected your company’s image, revenue, and employee morale?
NS: “We have become the experts in our markets and are now trusted to get involved in the project in the early stages and write a comprehensive specification to complete the job properly. The employees also feel that they have been trained well and have a wealth of support behind them. Revenue is steady in these types of markets.”
DECO: What other advice would you give to a contractor hoping to understand and to develop niche markets for his business?
NS: “Look for the opportunities and put yourself in the customer’s shoes to really understand their needs. Continue to educate yourself and your employees; establishing the quality standard for the industry. Think outside of the box and go above and beyond to get your job completed. You will be assisting your customer to get his job done as a result.”
Now, that’s the type of advice that can help your company to remain as evergreen as a eucalypt tree—even in the rockiest of markets.