Niche Marketing in the Hospitality Industry
Welcome to our glorious capitalist society, where every entrepreneur can stay busy in any industry he likes for as long as he wants to be industrious. Just look at those busy wheels of the market spin please! It’s beautiful to see how everything turns, but when you dive in, you’ll notice that you have this one small factor that you must fight against in order for your business to succeed: the competition.
Yeah, it’s kind of a killjoy that so many of your customers have the option of taking their business elsewhere. Particularly in the field of hospitality, where restaurants, bars, hotels, and casinos are commonly found everywhere. You can compete head on, trying to outdo your competitors on price or quality. But when that fails, one possible strategy to consider is to search for a niche market.
Here, you specialize in a particular category and profess to do that one thing well and do it exclusively. The Starbucks coffee franchise is a prime example: They started out as a small chain of espresso shops in Seattle, Washington. That’s it, that’s all they’re known for: coffee. Although their success has helped them to venture into tea and other beverages, as well as snacks and pastries. So now they are more of a chain of coffee shops known primarily for their coffee.
It’s arguable that Starbucks wouldn’t have existed without the college/technical crowd. The chain became the “happening” place for college students and especially tech entrepreneurs, two groups known for their enthusiasm for coffee drinks. The decor and atmosphere of the early Starbucks stores reflect this very well: a modern, urban and sophisticated environment, in which you would not be at all surprised to find a poet scribbling on a notepad, a programmer or blogger talking on a laptop. , an artist silently sketching the crowd, and a couple of old intellectuals playing chess at a corner table, all while alternative music on the speakers provides the subtext.
Bars are a prime candidate for niche specialization. We’ve all discovered the country/western theme bar, the disco club, the blue-collar “fern bar”, the biker bar, the sailor bar, and the popular sports bar. The bars cater to a wide range of specialities, and there are establishments dedicated to singles, exclusive bars for members of an alternative lifestyle to meet and socialize, or themed bars for fans of a particular music genre. Bars, being recreational anyway, lend themselves easily to having a theme. You’ll also see bars that market themselves to an age-based niche, such as establishments themed as “speakeasies” or that cater to a jazz-loving crowd. Anything from a 1950s “sock hop” to a 1990s “yuppie safari” can be paired with a bar.
Restaurants are another frequent candidate for niche specialties. Virtually any ethnic variety of food is represented in a restaurant somewhere. But restaurants have a lot more options to find their niche than just their national identity on the menu; and so we have truck-stop diners, wine country bed-and-breakfasts, glitzy upper-class establishments, sidewalk cafes, family-oriented pizzerias, and specialty shops like bakeries and ice cream parlors.
It could be argued that pizza, by itself, is no longer identified with Italian food. The national chain “Chuck E. Cheese” demonstrates this very well. Founded by Atari founder Nolan Bushnell in San Jose, California, they knew their target market was suburban families, so they established a restaurant that sold not only pizza, but also arcades, shows, and a wide variety of entertainment aimed primarily at young children. The chain remains one of the few reliable family-friendly establishments today that offers a viable option for a family-friendly night out. The restaurant is suburban and Americanized; You will find very few references to Italy apart from the menu.
Even hotels and casinos get in on the niche marketing action. Here, niche marketing is less important, since these establishments are too large to not be geared towards being for everyone. The casinos especially aim for a specific theme to design everything afterwards. A cruise along the Las Vegas Strip will reveal casinos inspired by an ancient Roman emperor, a western saloon, an Egyptian pyramid, the city of Paris, the city of Venice, etc. Many casinos now also focus on fun for the whole family and include everything from movie theaters to full-scale amusement parks with games, live shows, and attractions.
Whichever niche you choose for your own business, you need to be able to understand your target audience. Think of it like a point system. You get a point for your Asian restaurant if your menu is authentic enough that a member from that country could eat there and not know the difference. You get more points if the business is decorated in a country theme; For an Asian restaurant, foo dogs, Buddhas, and bamboo and water fountains are popular touches. You get another point for your Asian theme if you offer chopsticks as an alternative utensil. Etc. Every point you can add to your scorecard represents one more way to provide your niche customer base with an authentic experience.
