When starting a small business, choosing the right level of focus can make or break your chances of success. On one hand, you want to focus on a relatively narrow market as a way to minimize your marketing costs and develop a strong customer following. On the other hand, too narrow of a focus can result in lost opportunity and revenue, which can be especially troubling for cash strapped small businesses operating on a shoestring budget without access to small business loans.
For example, let’s suppose that you are opening a retail clothing outlet. There are a myriad of different ways you could focus your business: you could focus on one target market, such as millennial women, baby boomer men, or children. Or, you could focus on one product line: outerwear, shoes, business attire, or casual clothing. Or, you could pursue a combination. The strategies you do and don’t pursue will have a big impact on how successful your company becomes.
Clearly, finding the right level of focus is important to achieving your small business goals and success. Here are four things to keep in mind when determining the right level of focus for your small business:
Understand the difference between product focus and customer focus. As outlined in the example above, there is a difference between focusing on one particular customer type versus one product type. Plenty of companies pursuing either strategy have gone on to become wildly successful. The key is to pick one and stick with it. This will help reinforce a consistent message to your market, make it more likely that your customers will perceive you to be a go-to source in that one area, and ensure that you aren’t spreading your company’s limited resources too thinly. At the same time, it will also ensure that you are not focusing so narrowly that you are leaving potential profits on the table.
Experiment with different products or markets. The popular Lean Startup movement coined the concept of experimenting and “pivoting” when a particular idea or business model isn’t working, which can be particularly helpful when determining the right level of focus for your business. When targeting a specific target market of customers, for example, it can be a lot easier to pivot away from products or services that aren’t resonating toward more feasible approaches. They key is to measure your results from various strategies and hone in on the ones that deliver the best results to your business as part of your overall small business marketing plan.
Look for opportunities to expand your focus in a measured way. In order to continue growing your small business, you constantly need to find ways to fuel revenue and profit growth. Often times, a narrow focus will help establish some critical mass in the market, but that same focus can limit your growth in the future. With that in mind, it is important to continuously pursue opportunities to incrementally expand your offering to include complementary solutions to what you already provide. In general, selling additional products or services to your existing target market is the easiest way to expand focus without undermining what made you successful in the first place.
Seek to eventually take your product or service mainstream. Aiming for mainstream acceptance of your product or service is a good way to set your small business on a growth-oriented trajectory. You may need a narrow focus to establish yourself and build credibility early on, but aiming for something bigger in the long-term will help provide direction when seeking ways to grow your customer and revenue base.
Limited time, startup capital, and a need to gain a foothold in the market often necessitate a narrow focus for early-stage startups and small businesses. In order to fuel growth, however, expanding that narrow focus becomes more important over time. No matter where you fall on the spectrum, there are tradeoffs and risks associated for the different approaches, so it is a matter of finding what’s best for you and your small business.
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