Why tour operators focusing on a niche market are thriving
The concept of a niche market is not a new one, in fact, companies have been honing in on small market segments as a part of their business strategies for hundreds of years. However, business is evolving and a simple market segment no longer holds the same strategic impact than it once did. In today’s competitive climate a niche market looks a lot more specific; it seems the question is no longer ‘is this niche broad enough for my tour operator business to profit’, and instead, ‘can this niche be even more focused?’
Niche markets 101
Before we dive into the nitty gritty, let’s quickly go back to basics. Understanding why and how businesses decide on, and target, a niche market segment will ultimately help us understand why the definition of niche marketing in tourism is shifting so swiftly.
Wikipedia describes a niche market as the subset of the market on which a specific product is focused. A niche market will ultimately help a business tailor their messaging, branding, pricing and promotional activities to the people that fit the market they’re targeting.
When answering the question “Why are they so impactful?” we ultimately find ourselves looking at the psychology behind target marketing. Simply put, humans like to feel special, and when a product or service is seemingly made for YOU, the decision to buy becomes more compelling. For a business owner this means easier sales conversations, more bang for your marketing spend, and a much simpler, more specific storytelling process.
The new age of niche
Niche marketing as we once knew it is no longer a strategic business tactic – it’s status quo. Everyone is targeting a specific demographic in one way or another. That’s why we’re seeing an emergence of hyper targeted niches; what was once a ‘tour operator that specialises in women’s tours’ is now a ‘tour operator that specialises in christian woman, over 50, with an interest in photography and hiking’.
For many tour operators the desire to sell tours crafted for a specific subset of travellers is not a new one; the idea of selling something as specific as ‘Halal friendly Cape Town itineraries’ simply seemed to be far too narrow to be a viable business strategy. Today, we have reached a point where travel is more accessible, the world is more connected and the ability for a tour operator to profit by selling to an extremely specific niche is finally possible.
So, now that we understand what makes up the building blocks of a niche market, here’s why your tour operator business should take notice and think about refining the segments you’re targeting.
Reason 1: Stand out from the crowd
Finding and focussing on a niche for your tour operator business will ultimately set you apart from other travel businesses with a similar offering. As the accessibility of travel increases and costs go down, the demographic of people wanting to travel just continues to grow wider. As a tour operator it’s impossible to offer something for everyone and if you try to, your competition is every tour operator, travel agent or DMC worldwide – making it very hard to stand out.
Creating a unique, niche offering will mean that your business will be memorable and stick in the minds of people who fit your target demographic. Although narrowing your offering to fit a niche will reduce your potential pool of customers, with the population of people seeking to travel nowadays, this is not necessarily a bad thing. Your lead pool may be smaller but it will also be more targeted; the people who hear about your tour operator business will know what they are looking for and are most likely to more primed to buy whatever it is that you’ve crafted for them.
Your job is to help them realise that your tour operator business can offer them exactly what they are searching for! Not only does this make travel an easier process for the customer, but it will save you time and resources, reducing your cost per lead and increasing your profitability!
Reason 2: Less competition – higher visibility
A niche tour operator will also have more business visibility, from both a digital perspective and via word of mouth. Google’s search engine uses keywords to determine what the user is looking for and shows them the key results – the process of enhancing your digital presence on Google is commonly referred to as Search Engine Optimisation, or SEO.
When it comes to SEO, the broader the keyword the less likely your offering will appear anywhere near Google’s front page. For example, a quick search for the term ‘tour operator’ returns 233,000,000 results. Having a niche means the keywords that potential customers are using to search for your business are more narrow and there is less competition. Searching the keywords “Tour Operator Safari South Africa” returns 26,400,000 results and “Tour Operator Safari South Africa Women” returns 9,960,000 in comparison. This reduces the pool of results by 23 times, meaning your website is 23 times more likely to appear on Google’s front page, especially if you optimise your site for those specific keywords.
Reason 3: Referrals
Humans are social creatures, and that is all too true for groups and communities that share common interests and passions, particularly when those passions intersect with travel. People who are drawn to a very specific niche are often highly connected to other people who share the same interests (often belong to clubs or online networks).
An avid cyclist who was delighted by their recent tailor made cycling tour will no doubt leap at the opportunity to rave about their fabulous travel experience at their next local cycling meet. Customer referrals are the most powerful way to promote your business.
Reason 4: Marketing Focus
The more defined your niche market becomes, the more refined your marketing can become. As mentioned earlier, your tour operator business can be much more visible when marketing a niche effectively, than when trying to compete with a multitude of competitors. This means that your messaging can be more specific and directed to a highly targeted demographic. Communicating with potential customers also becomes much more meaningful.
Reason 5: Be Impactful
Mass marketing to a broad group is notoriously expensive. The few good examples of brands that have favoured a mass market approach as opposed to niche include the Olympic games, the Superbowl and American Idol. Similarly, all of these brands that have succeeded with a mass market approach have enormous budgets.
Targeting a niche, however, allows you to funnel your marketing budget to a specific group that is already more likely to be receptive to your messaging from the get-go. Focussing on a specific segment means your approach to marketing will be influenced by the demographics and buying behaviour of the people you are targeting. Taking time to understand what advertising mechanisms work (and more importantly, which ones don’t work) for your niche will mean less of your budget is wasted on advertising with less impactful methods.
Reason 6: Tailor made travel
Take the opportunity to specialise your tour operator business offering and become a leader in your niche field. We all know that it is impossible to be good at everything, and to this end a tour operator business claiming to be an expert in all things travel would simply be unrealistic. Instead, hone your expertise and ensure you are able to tell your potential customers, with complete confidence, that you and your team are experts in what you do. Not only will you gain customer trust but you will strengthen your brand perception by consistently crafting tailor made itineraries and delivering your customers meaningful travel experiences.
Reason 7: People love working with experts
It’s not often in life that people get to follow their passion and turn it into a career! So why pass up the opportunity to specialise in something that you truly enjoy? Whether it be wine tasting in the Bordeaux region, dog sledding in Scandinavia or motorbiking through India, chances are there are people out there wanting to share your passion and more specifically your expert knowledge.
Fancy some inspiration?
We’ve been exploring a few emerging niche markets in the tourism industry. Take a look.