By Michael Bollinger, Founder & CEO

One of the most crucial factors in long-term profitability and growth is market share. In an effort to penetrate a market and make an impact, many companies try to cast a wide net with their marketing messaging to attract as many prospective customers as possible.

This can backfire quickly. You’re not only competing with industry giants with brand reputation and recognition, but you may be missing out on untapped potential in the underserved markets — the individuals and companies that still haven’t found great solutions to their problems.

If you focus more attention on these underserved markets and cater to their needs, you can create tailored, highly engaging products that truly satisfy your customers (and boost your profits in the process).

1. Understanding the New Audience

Whether you’re targeting broad or niche audiences, you have to know what your customers want and need before you can deliver their ideal solutions. With a larger, competitive market, this often means multiple segments that are more difficult to pin down.

However, when you focus that effort on an underserved market, you’re working with a much narrower audience — streamlining your market research process. It’s less intensive to conduct consumer research and identify the demographics you’re working with, their pain points, and the products or solutions they need to make their lives easier. Plus, it’s much less daunting to reach out to a smaller group with surveys or focus groups.

The rules of understanding your audience are similar, however. You have to know their problems and pain points to create a product that offers real value. For example, if you were developing a software product designed to streamline HOA management, you have to understand the day-to-day tasks of board members, what they’re juggling, and what processes could be helped with a digital platform and automation.

2. Prioritizing Accessibility and Affordability

Underserved markets can be an unrealized gold mine, but don’t be too quick to dive in. There may be a reason that other brands — especially large, reputable brands — haven’t offered a suitable solution yet.

It’s possible that the niche needs of the underserved market don’t offer a return on investment for bigger brands with large audiences and multiple segments, which you may be able to help. For example, a smaller company may need additional accessibility features that large brands don’t offer, such as multiple language options or integration with assistive technologies.

Price points are another common barrier with underserved markets. As the big brands get bigger, they often price out the little guys that need budget-friendly solutions with functional, but less flashy, features. Providing the highest-quality products with extensive purpose-built feature sets can give you a competitive edge – especially if you can offer affordability with tiered subscriptions or pay-as-you-go plans that help them keep costs down.

3. Establishing Credibility

Gaining trust is an important part of penetrating any market, but it can be more difficult when you’re speaking to underserved markets. They may be wary of new companies that don’t have the brand recognition, even if the product seems to fit their needs.

Transparency is your greatest asset. Use your marketing campaigns to clearly communicate your company’s intentions and tell them how you can help. Your product should speak for itself with free trials or product demos — as well as some customer success stories – but you can nudge it along with strong marketing messaging and branding.

4. Planning Product Marketing and Distribution

Reaching the underserved market can present challenges in itself. When you’re speaking to these prospective customers, you need to be strategic with your marketing and meet them where they want to be.

Usually, this isn’t a traditional channel. Niche markets are more likely to be reached on digital channels or through word-of-mouth referrals, so a robust referral program can help you get the word out through strategic partners and complementary businesses

With distribution, you have to plan how you’ll target the market. Niche audiences may have limited access to transportation or technology, so traditional retail distribution channels may lead to more barriers. Think about alternative distribution models that are most accessible to them.

5. Focusing on Sustainability

Sustainable business models are essential when you’re developing a product and planning to market to a niche audience. It takes a little more than diligent accounting and a profit margin.

All businesses want to grow and become more profitable in the short and long term, but it can’t come at the cost of pricing your underserved markets out and delivering little long-term value. Focus on creating products that have real-world benefits for your audience, Think about sustainability in every aspect of the product life cycle, from the raw materials to minimal impact in production and distribution.

6. Identifying Your Competitors

You may think you have lower competition in an underserved market. While that may be true initially, it could change once you make some headway. You may even find that there are existing solutions out there, which is an opportunity to get a leg up.

Research your competitors’ solutions and their strengths and weaknesses. With your audience research and your own instincts, consider why the market isn’t adequately served by the existing products, features, pricing, or marketing. Where are they going wrong? That’s what you need to do better.

This is a great way to differentiate your brand and products while ensuring that you have value to offer the niche audience. For example, you may find that the niche audience is simply priced out, so you know you need to refine your strategy to keep the solution affordable without sacrificing its benefits.

Gain a Competitive Edge with Underserved Markets

Delivering products to underserved markets offers a unique opportunity for your brand to focus on a niche and gain sustainable growth. With a small and specific audience, you can gain in-depth insights to deliver products that feel tailor made for them in terms of accessibility, affordability, functionality, price, and more.

About author

Michael Bollinger, a Lexington, Kentucky-based entrepreneur, has left a lasting mark on the tech and software landscape. As the founder of LegFi and File990, Michael launched PayHOA.com in 2018 after Togetherwork acquired his first two ventures.

PayHOA is an affordable community management software for homeowner associations that streamlines payments, communication, and vendor management. Beyond his entrepreneurial pursuits, Michael finds fulfillment as a devoted husband and a loving father to his three children.