How a Smaller Audience Can Make You More Money

There's a common belief that to succeed in business, you need to appeal to the largest possible market. But the truth is, there are riches in niches. Consider the Amalgamated Order of Real Bearded Santas, which held a convention for over 300 professional Santas—a niche within the already specific Santa niche. Every industry association, from national speaking groups to local chapters, represents a focused market ripe with opportunity for someone.

Take the story of James Perez-Foster. After his employer showed no interest, he left his job at Bainbridge Advisors to focus specifically on the Hispanic market. He identified an underserved community with huge potential and started Solera National Bank to serve Colorado’s Hispanic and minority-owned businesses. Research backs up his bet: a ShareThis study found that U.S. Latinos are far more likely to share content, click on shared links, and purchase products they share, showing incredible brand loyalty. The lesson is clear: every market contains specialized opportunities. Finding yours is the first step toward building a successful .

Pick a Smaller Haystack with More Needles

We all know the “needle in a haystack” metaphor. In business, it’s far better to choose a small, well-defined haystack where you can easily find lots of needles than a massive one with only a few scattered about. This means it's more effective to find a small, dedicated audience that loves what you do than to get lost shouting into the void of a huge, indifferent market. This is a foundational concept for any .

If you're already in business, you can carve out an even smaller niche through specialization. You simply redefine what you do to attract a smaller group seeking specific services. Experts do this all the time, continually narrowing their focus to serve a more defined audience. To discover your unique space, just ask yourself a few questions:

1. Who is the exact person you want to reach? Define their characteristics, understand their behaviors, and get to know them inside and out.
2. Why is this work important? What is your motivation for serving this specific group?
3. What problem are you solving for them? What specific need are you fulfilling with your product or service?

When you’re just getting started with a , targeting a very specific niche is a much safer bet than going after the masses. Trying to sell to the general public requires a massive marketing budget for ads, direct mail, and internet campaigns. Instead, why not focus your efforts on a smaller market where you can actually make an impact?

Be a Magnet for Your Ideal Customer

Kari Voutilainen, a Finnish watchmaker, sells only about 50 timepieces a year, and he's perfectly happy with that. He specializes in a platinum Vingt-8 wristwatch with a hand-fabricated movement, and the prices start at $86,000. He doesn't try to appeal to everyone; he focuses diligently on his niche. Even if the market for luxury watches shrinks by 10%, he says, that's only five fewer buyers for him. He’s confident he can find five more people who appreciate his craft. At 50 watches per year, that’s a $4.3 million business.

Building a business that attracts the right people isn't about guesswork or wishful thinking. It requires a blueprint. A simple framework to follow is the “M.O.M. Method”:

• This is how you get your target market to notice you and feel drawn to your brand. It’s not your final product, but the hook that captures their attention—like the free food samples at the mall. The goal is to make them stop and listen.
• Once you have their attention, you need to get their contact information. Building an email list is crucial because social media platforms can disappear, but your list is an asset you own.
• With an engaged list, you can sell your own products and services or promote others you recommend. Your audience will be eager to buy from you because you’ve already built trust.

I learned the importance of focus the hard way. I used to run my company as a “full-service marketing agency,” which sounds impressive but really meant we had no niche. We attracted all sorts of local small businesses, most of whom had no marketing funnel, no email list, and no budget. They were also terrible at paying on time, creating a constant cash-flow crisis. I spent my days anxiously waiting for the mail carrier, hoping a check would arrive before our internet got shut off or I couldn't make payroll. Being everything to everyone gave me no control. A without a focus is a recipe for disaster.

Find the People Who Will Pay You What You're Worth

When you narrow your focus, you can attract the exact type of person who values your work. It's better to have 500 raving fans than 10,000 lukewarm followers. The money for your next sale already exists in someone else's bank account; your job is to figure out who that person is and why they should give it to you.

Start by looking at the top 10% of your customers by profit. List them out and search for common threads. Then, try the “whose vacation do you want to go on?” test. Imagine all your clients invited you to a conference filled with thousands of people just like them. Whose conference would you actually want to attend? If you enjoy working with that type of person and they are profitable, you've found your niche. This is how you start building a business you love.

Once you know who your ideal customer is, you can use that data to find more of them. For example, instead of targeting broad demographics on Facebook, you can create Look-Alike audiences based on the people who have already spent the most money with you. When my agency stopped targeting anyone and everyone and instead focused on people who resembled our best clients, our sales improved dramatically.

Go Deeper Than Demographics

Before you craft any message, you must know your market intimately by creating a perfect prospect “avatar.” This includes basics like age, profession, and income, but also digs into their interests, frustrations, and media habits. We went beyond targeting “entrepreneurs” and drilled down to find our most successful clients were business owners of at least three years who relied on referrals. We went even further and realized our best clients were action-takers. One non-obvious trait we found? They were frequent fliers. Targeting this group—movers and shakers who travel for business or pleasure—allowed us to directly reach our ideal coaching client and achieve a 300% return on ad spend.

Your competitors will likely target the obvious demographics. These hidden golden nuggets are where your real advantage lies. It’s important to analyze your , not just your website traffic or email list subscribers. Your buyers often have different characteristics than people who just opted in for a freebie.

To see what’s working for others in your space, you can use Facebook's Ads Library for free. Just type in the name of a competitor or a business that serves your target market. You can see all their ads, landing pages, and offers. Don't copy them—model what works. This research is invaluable inspiration, whether you're or another .

Finally, one of the best ways to understand your market is to simply ask them. A simple one-question survey can provide incredible insights. Ask things like, “What’s the number-one question you have about [your industry]?” Their answers, in their own words, give you the exact copy for your emails, ads, and content. This research isn't just about data; it’s a way to generate leads, uncover new opportunities, and build a that truly serves its audience.