“Being niche made our brand unique, but we want to go mainstream.” Over the past twenty-one years in this business, I've heard it time and again. “Being a ‘specialty brand’ limits our potential and we want to grow.”

At first glance, placing your brand in the ocean with the other fish may appear to be self defeating, as being niche is key to building a distinctive, upmarket brand. It also flies in the face of what so many marketing gurus seem to be saying: “You can’t be all things to all people.” But if staying niche won’t satisfy your appetite, you have to contemplate going beyond your current realm to find growth.

Does this mean you have to abandon your “unique specialization” to broaden your market? No. It is possible to take the equity you have built and find ways to leverage it with potential customers outside your core niche. However, this will likely require reevaluating your messaging strategy, reexamining your target audience and exploring new channel strategies — particularly if your point of differentiation is not based on a high-order emotional promise.

Talking the talk doesn’t mean consumers will walk the walk

Many niche brands have a lexicon spawned from their particular product arena. For example, in the active outdoor category, “tech talk” is part of a common language used by many brands in the attempt to differentiate. This is due, in part, to the fact that “tech talk” is the language of the product inventor or designer, and that same person is often the driving force behind brand communications at the early stages.

While using “tech talk” can convince an internal audience into thinking they have successfully differentiated their brand, the consumer will not buy into it if competitors match the brand’s “tech talk” with theirs. “Will I stay drier with this brand’s BETTER THAN GORTEX® MEGA-MEMBRANE WATERPROOF SYSTEM™ or that brand’s FUSED-ON GORTEX®-LIKE RAINPROOF PROTECTION LAYER™?” Neither brand has communicated what makes it distinctive and upmarket, nor given a clear reason why the consumer should make a purchase.

Clearly the challenge is to communicate with the current customer, while reaching out to a wider audience, without creating a perception that the brand has become a commodity. The trick is to avoid standing in a circle and chatting with each other in tech talk. Instead, turn around and invite those from outside the niche to participate.

Coming to a neighborhood near you

A clearly defined niche audience, through years of experience serving them in a distinctive manner, are loyal customers to a particular brand. Knowing this, how can the target audience be redefined while remaining true to the brand’s core values? Lets take a lesson from Apple Computer…

Armed with innovation, style and a customer-friendly personality, they are, after twenty years of struggle, the most distinctive, upmarket brand in their niche. Despite having an extremely loyal core customer following and being very profitable, their market share has gradually dropped from a high of 29% in the late 1970s to a measly 3% in 2004. How can the target audience be redefined while remaining true to the brand’s core values?

Along comes Microsoft, which steals Apple’s innovation, has no style to speak of and is far from customer friendly. They carve out a de-facto monopoly within a broader market — and lure away more than a few of Apple’s loyal core consumers in the process. Apple carries on but refuses to lose its distinctiveness.

Then Apple discovers another, more mainstream niche of consumers who look a lot like their core consumers – only they’re with Sony. As a group, they are distinctive and seek out brands that offer innovation, style and personality. But when buying in this category, they purchase computers with Microsoft’s operating system.

What do you do? You redefine your target audience, turn your frame of reference away from Microsoft and introduce Sony’s consumers to iPod. In the process, Apple throttles Sony, capturing a 76% share of the portable music player market virtually overnight. And then a ripple effect begins: some of the consumers shared by both Sony and Microsoft begin to turn away from Microsoft, too.

In just one year, Apple’s share in the personal computer market rises a whopping 34%. People started thinking again about the day they will be able to upgrade to an Apple Macintosh. Apple, as it turns out, is even more distinctive and upmarket than ever before. A fairy tale? We think not. Bricks and mortar or the Internet…

Let’s go shopping

A number of years ago, the CEO of a centuries-old upscale consumer brand confided to us that their market niche was shrinking dramatically. The evidence? Their sales had been cut in half in just a decade. New technologies had replaced the need for their core products. The future was bleak. He was considering closing the consumer division of the company and eliminating the jobs of nearly 500 people.

The only problem was that he wasn’t entirely right. Something had indeed changed. Contrary to this CEO’s thinking, it turned out consumers were still spending billions of dollars on the kinds of products his company produces. In fact, the market was likely growing, not shrinking.

His problem was that consumers were shopping for these products differently than before. Since his brand wasn’t available where today's consumer shops, he lost share as his competitors gained. In the past, distinctive, upmarket consumer brands were almost always sold by “specialty” retailers. In these stores, the employees had some level of knowledge about the brand’s point of difference.

Today, however, you find less informed employees who, more often than not, have little idea what makes these brands either distinctive or upmarket. Moreover, with the advent of big box, big box specialty, catalog and the Internet, there is a clear danger that these brands will become commodities unless something is done to protect their brand equity.

It is the marketer's responsibility to find new ways to communicate their brand’s point of differentiation in an increasingly competitive marketplace.

Why is all of this worth contemplating?

Take the super-premium Vodka category. There are 400-plus brands on the market and more being launched all the time, all competing for the same shelf space. The same could be said for brands of ski jackets, functional beverages, specialty cheeses, the list goes on. The competition is fierce and the stakes are high.

Marketers of distinctive, upmarket brands need to be prepared…and creative. If a company doesn’t have the energy or the resources to do what it takes to go outside their niche, then they will need to learn to live with the growth possibilities, or impossibilities that exist right where they are.