The Adaptive Agency Blog

How To Niche Down (Part 1)

by | Jan 30, 2024 | Strategy

Too many agents are stuck in the grind. They got into business for great reasons:

  • be their own boss
  • make a lot of money
  • help protect people

Now, they work internet leads for a living.

There is a path to the impact and the income you dreamed of. But it’s not in being the hardest-working commodity auto insurance seller.


Because nobody cares. If a customer just wants to save a few dollars, their options are limitless. They came to you to save money. They’ll leave for the same reason. And they might not even remember your name.

If you want customers who give you all of their business, stay with you for decades, and give you ridiculous Customer Lifetime Value, you have to stop selling random products to random people. You need to find your niche. And you need to dominate it.


What Do I Mean By “Niche”?

I’m talking about the intersection of two things:

  • Customers with non-commodity needs and wants.
  • A provider with the ideal solution.

When these two things come together, customers get excess value. And they return the favor in cross-sales, retention, and referrals.

non-niche is something like “everybody who wants a good price on car insurance.”

soft niche could be “customers who want good service”. Or convenience. Or to deal with someone they know. These customers are better than random, price-obsessed customers.

robust niche solves a small number of  important problems for a small target segment of the market.

The transaction volume for a robust niche is lower, but so is customer churn and competition.

On the other hand, a robust niche offers higher margins, greater impact, and deeper satisfaction.

Niche owners work fewer leads, but the leads have higher intent and close more often and with higher premiums.

Let’s dig into what a niche might look like.


Niche-Building Approaches:

There are a few ways to niche down. Here are four examples, in order of robustness:

  1. Offer better service.
  2. Offer convenience.
  3. Leverage your information advantage.
  4. Specialize.


Offer Better Service

It’s hard to really call this a niche, but it does start to separate customers who want value from price shoppers.

If you offer better service, you’ll tend to retain customers who are somewhat less price-sensitive. They’ll stick around as long as prices don’t jump too high.

Most agents believe they serve this niche, making it hard for agents to really differentiate themselves via “better service.”

Moreover, most agents who claim to serve this “niche” don’t actually prospect accordingly. They grind leads, take what they win, and then deploy “good customer service” as a retention tool.


Offer Convenience

People with money will pay more for convenience. Having an agent nearby, having all their policies in one place, straightforward bills and an easy claims process are all examples.

These folks throw away insurance mailers from your competitors. And they don’t worry too much when prices go up. They simply don’t want the hassle.

But they are susceptible to major price increases. And they’re vulnerable to conversations with friends and colleagues about better overall solutions.

As with agents who focus on “better service,” convenience is more for retention and multi-lining after-the-fact. But prospecting and the buyer’s journey are mostly indistinguishable from other agencies.


Leverage Your Information Advantage

A certain slice of the market is interested in “doing it right.” They want to deal with someone who can educate and empower them to make good financial decisions. They’re looking for an expert.

You have years of experience and know-how to share. That’s worth something, and customers who understand that value won’t settle for something cheap and generic.

This is a smaller market, but there’s also less competition. The differentiation is high.

There’s a catch, though. Some agents use their information advantage to overwhelm clients into buying. When the client starts to feel vulnerable because of their information disadvantage, things start to go sideways.

Agents with a niche in this realm prospect differently. They can’t afford to sift through a thousand bargain-hunters. Instead they spend their time with their best clients, rubbing shoulders with their networks, and driving a lot of referral business. They also have a presence in the community, and they seek out opportunities to share their knowledge as a brand-building exercise.



This is where you really niche down. Finding customers with a particular need and developing a best-in-class approach to fulfilling it. This is scary to most small businesses because it means missing out on a lot of transactions. But if you can become the go-to for that segment, you win.

Sales development in a niche like this is as specialized and unique as the customers, the problems being solved, and the solutions being proposed.

Niching down is not for everyone. That’s why it’s a niche. It requires a commitment to doing business very well over a long period of time.

In fact, that’s what we’ll be talking about in the next article: care, credibility, and differentiation.

Here is a link to Part 2.