MBA1788 Guest Teacher – Michael Redman – How to Leverage the Power of a Super Niche

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Hey O. Welcome to the $100 MBA show. Because a better you means a better business. That's why we deliver daily 10 minute business lessons for the real world. I'm your host, your coach, your teacher Omar Zenholm. I'm also the co founder of Webinar Ninja, an independent software company I started back in 2014 with my partner and today's episode is a guest teacher episode. On our guest teacher episodes we bring on an expert to teach their area of expertise. Today's guest teacher is Michael Redman, the co founder of Half a Bubble Out, a marketing and business consulting firm and the co author of Fulfilled the Passion and Provision Strategy for Building a Business with Profit, Purpose and Legacy. And he will be teaching you how to leverage the power of a super niche. So many entrepreneurs don't niche down. They're in a crowded market, a red ocean so to speak. And they can't compete. They go out of business. This is one of the biggest mistakes I see in new entrepreneurs. That's why I brought on today's guest teacher, Michael Redmond to show you what exactly is a super niche. How to identify one, how to create one, how to leverage its power and more. We got a lot to cover, so let's get into it. Let's get down to business.

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Today's guest teacher, Michael Redmond is an expert at building super niche businesses. He actually shares in today's episode how he built a business around a super niche and how you can do the same. So without further ado, I'm going to pass it on to Michael, but I'll be back to wrap up today's episode and give my takeaways. But for now, take it away, Michael.

Hi, I'm Michael Redmond and today I want to talk to you about the power of building businesses in niche or super niche industries. Before we make any assumptions, let's define what a niche is. Have you ever seen a cubby hole in an old house that held flowers? Or an old style phone on a small shelf cut into a wall? Turns out that's what a niche really is. By definition, the niche is in the wall, but it's a small part of the wall with its own unique function. We use this concept in business to describe a small segment of business or a small market. A super niche is an even smaller sliver of that market with a unique small group of people with a specific need. For example, can you remember a time when someone told you what they do or who they serve in their business and your response was wow, I didn't even know that was a thing. That's a niche in business. Niches are small and unique, so it's counterintuitive that they exist and and that they're extremely profitable. They hide on us. They're small, but there's so much opportunity. I want to teach you today why niches are so powerful and how to identify a niche or a super niche. So let's dive in. First of all, the reason niches are so valuable and stand out is that if you find a niche, it can be easier to get into the market. There are less competitors in a niche, there's more opportunity to grow your company at a faster rate in a niche, and you can quickly become the big fish in a small pond. In a niche business, you actually get to create a company that stands out and becomes well known within that niche. You can own a niche faster. Bottom line is that niches create more opportunities. Niches even lead to other niches. When you start to learn how to identify them and take advantage of them, it all builds upon itself. So how do you find or see a new niche that could be a great opportunity? It's one thing to know they exist or read a book about them, but when you start to focus on niches like we have, you start to see them in places you wouldn't expect. It's like when you buy a new car, let's say a red Jeep. And as soon as you buy that new red Jeep, everywhere you go you see red Jeeps, but you never noticed them before. It turns out that our brains have this cool thing called a reticular activating system, or ras. And the RAS in your brain says, hey, here's a new piece of information that wasn't relevant before. It's relevant to you now. So now I want to show it to you all the time. And you start to see red Jeeps. When you turn your attention and tune it into the idea of niches, get familiar, more familiar with them. Then you understand how to see niches more. And that gives you a better chance of taking advantage of them. So how do you identify a good niche or a super niche? Well, I'm glad you asked. I want you to go back a few years in your mind to childhood and think about Goldilocks and the three bears. In Goldilocks and the Three Bears, Goldilocks gets lost in the woods and she wanders into this house and there is nobody home. The first thing she finds is three bowls of porridge. She tries the first one, it's too hot. She tries the second one, it's too cold. She tries the third one, it's just right. And cheats it all up. Then after she's done eating it all, she gets tired. She wants to go looking for a bed. The first bed she gets in is too hard. The second bed is too soft. The third bed. Yep, you guessed it. It's just right. So we have this concept of too big, too small, and just right. And the first thing I want you to think about that's not so obvious, but it's right in front of you, is that the bears that own the home, they were part of a big family. And that's what happens in niches. A niche is part of a bigger market or industry, just like the niche in the wall, like with Goldilocks. A really good niche is not too big by nature. Niches are small enough to not be covered with competitors and not be commoditized yet. A really good niche is not too small. There has to be enough customers with a need that you can meet or a problem you can solve. A really good niche is just right. It has enough people looking to solve a big enough problem. It has few competitors, it isn't commoditized yet, and it has a stable or a growing demand. Let me give you an example. One of my first experiences with discovering a niche was in the medical laser industry. In 2008, our agency got a call about marketing a laser treatment for toenail fungus. The manufacturer of the laser was trying to break into this market, and they called us. They had two doctors working in Sacramento, and they thought, hey, let's help them out, do a little marketing as they're trying out our new product. They were getting great results with their patients, so we took them on. We did a newspaper ad and a radio ad in September of 2008. It was just another customer for us in our agency, and they were happy with the results of the advertising. So all was well. Then along comes February 2009, and I was on holiday in Lake Tahoe with my wife, who is also my business partner, and our daughter. We got a phone call that said, hey, I'm a doctor in Milwaukee and I'd love to talk to you about this laser. I just met the doctor in Sacramento, and he told me about you. So we took an hour, we had a conversation, we put a proposal together, and the next thing we knew, we. We were doing radio and newspaper advertising for toenail fungus treatment for this doctor in Milwaukee. Over the next year, we moved into over 20 cities coast to coast, and we crossed the pond with a client, London. We had over 20 podiatrists as clients that came in within 18 months of starting with that first doctor. We grew phenomenally the results of this weird niche. I mean, come on, it's toenail fungus. We grew 4, 100% in 18 months, let that settle in. 400% in 18 months. That was huge for us as a company. I mean, we weren't tiny, but we weren't huge. And this bizarre niche pushed us well over seven figures. Now there's a warning here. Kind of like on pack of cigarettes. This kind of growth can be hazardous to your health and your business. It almost killed us, but instead it turned out to become the opening story in our new book, Fulfilled, which goes into way more detail about growing companies that give you life and don't suck it out of you. We survived, but you have to be careful with this kind of thing. It can really kill you. That kind of growth can kill you, but it shows you the power of niches. A second example is another super niche business called Rabbit Hole Hay. You can find it@rabbitholehey.com all spelled out. Rabbit Hole Hay sells specialty premium hay to people who own pet rabbits, guinea pigs and chinchillas. That's right, we take hay, specialty hay, we put it in a box, we brand it and we sell it. We stumbled across this niche on February 6, 2012 and we saw it as a potentially interesting test business for e commerce. Now remember, our ras had been highlighted or activated because of the toenail fungus treatment. We actually bought a bale of hay, brought it back to the office, built a website and started selling it. And we had it in our office, then we moved to a storage unit, then we got a second partner and now we export to nine countries. We sell our product on Walmart.com, chewy.com, Amazon and our own Shopify store. We've bought almost no ads up to this point and we are now a seven figure company with a minimum growth rate that has been at 50% a year or higher some years. This is the power of super niches. So what have we talked about today? Well, I've introduced you to super niches. Not just a niche, but super niches. We've defined it more by saying a niche is part of a larger market. A super niche is a drill down a sliver of that market to a very unique small group of people. It's not too big because it doesn't have the competitors and the commoditization. It's not too small because we know that it has enough customers and enough demand. It actually has the perfect amount where you can get in and have an amazing opportunity to grow, to charge a premium price, to become the big fish in a little pond and to establish the foundation of a company so you can grow much more effectively and create much more profit. Now you know how to describe niches more effectively and I've introduced you to super niches. I've talked to you about what a super niche is and how to identify it. And I've given you these examples so that you can start to activate your raz, your reticular activating system and start to notice them more for yourself. Look, I believe that the more you notice, the more you have an opportunity to take advantages of niches. As you think about starting or growing your business, the more you can see niches and opportunities, the more you can find what's right for you. Because not all super niches are right for every business or for every person. If you find your super niche, it'll give you more opportunity to build a company that gives you more profit, it gives you more purpose, it gives you the ability to leave the legacy in your life that you want to leave. And isn't that what all of us entrepreneurs are all about? If you want to connect with me and learn more about niches or what it takes to build a passionate provision company, Visit our website halfabubbleout.com that's halfabubbleout.com and you'll find great information about growing a healthy company. I'm Michael Redman wishing you the best as you find your niches and build and grow your business.

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It may be tempting to say to yourself, if I make my market broader, I'll serve more customers and make more money. This is a big mistake. You have to resist this urge. One of the best ways to overcome this is to say to yourself, hey, I'm gonna start out in a niche, very specific and get all the customers in that market. And if I run out of customers, I can always widen up little bit later I can offer more products, more services and widen my niche. Of course, because you're going to be resonating so strongly with that market, you may not have to and you probably won't, but you have to get started and tell yourself a story so you can niche down. Thank you so much for listening to the $100 MBA show. If you have not subscribed to the podcast yet, go ahead and hit subscribe on whatever podcast app you use, whether it's Apple Podcasts, Stitcher Radio, Spotify, Himalaya. We're on every single podcast platform. By hitting subscribe, which is absolutely free, you get access to over 1700 business lessons in our archives and instant access to our next episode. Before I go, I want to leave you with this no matter how broad you think a business is, they have a target market. They niche down. As broad as McDonald's is, they're not for everyone. There are plenty of people around the world that will never step foot in a McDonald's, either because they can't for health reasons or they won't because they don't like it. They can afford higher quality food. And by the way, McDonald's started out with just burgers, fries and shakes. That's it. No chicken, no nothing. So take today's lessons advice and narrow down your market. Thank you so much for listening to the $100 MBA show. I'll check you in tomorrow's episode. Until then, take care.

SA.

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