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Find your niche to sell online advertising

Find your niche to sell online advertising

This article was written by Ed Hatton for the column the Start up Coach and published by the South African edition of Entrepreneur magazine in April 2011 and is posted here by their kind permission.

Securing advertising income in a massively competitive environment requires smart strategy and good delivery – by Ed Hatton

 The Challenge

An entrepreneur wants to approach businesses to advertise on his free business listing website. He has all the stats of how many visitors he has to his site but he doesn’t know what angles to use.


This entrepreneur has chosen the online sector for his new business. One of the key issues is the speed of development; new innovations change the landscape all the time. Another risk is the extent of the competition. There are thousands of directories, and hundreds of search engines, all trying to attract people searching for information or potential suppliers.

In this heated environment it is easy to focus on the measures that the industry uses – page impressions, unique visitors and click-throughs. But these are only measurements of traffic. The entrepreneur’s business must find and address a need profitably if it is to survive and prosper. All the visitors in the world mean nothing unless visitors use the information from the directory to buy or enquire about services. Similarly companies listing on his directory are there to source new enquiries which they can turn into business opportunities.

So now the question becomes ‘how can this directory generate business opportunities for the business listed?’ This must be done in a highly competitive environment with industry giants and thousands of small competitors trying to do the same.

Look for competitors weaknesses

Big information dispensers frequently deliver too much information. Also the results they display in the first few pages are those with popular websites and good search engine optimisation rather than their merit for a task. For instance a Google search for ‘lawyers in Krugersdorp’ restricted to South African web sites returns 5,840 results, and the first page shows more directories and lawyers in other cities. This entrepreneur could look for ways of providing more accurate information, displayed in a neutral order.

Finding a defensible niche is a very established marketing strategy and can be applied to internet based businesses. There are excellent South African niche directories for accommodation, geographical areas, and political parties. Operating in a niche market is easier than trying to compete with the large established services.

A key aspect of success in this business is the credibility of the directory itself, or the organisation behind it. The entrepreneur will need to identify how he can develop the credibility and reputation of his brand to leverage this factor, and this will be easier to achieve in a defined niche, like a type of service or a geographic area.

The business has to make money, and the business model in this case is to offer advertising space to companies that have listed on the directory. The first step is to show them that being in the directory serves their purpose by bringing in new enquiries. Once achieved the entrepreneur needs to construct a convincing argument that advertising will increase that business benefit and be cost effective.  If all of these statements are true then paid advertising will inevitably follow.

Finally in this, as in every business, if all the strategies do not bring sustainability or evidence of profit, the entrepreneur needs to look himself in the eye and ask the question ‘has the horse died?’ If the business shows no sign of success despite all the best efforts and advice, then it may be time to find another horse. If this is the sad case then this decision needs to be made before the devastation left in the wake of a business failure puts him off further entrepreneurial activity.

© copyright Entrepreneur Media SA (Pty) Ltd. All rights reserved. No part of this article may be reproduced, stored in a retrieval system or transmitted in any form without prior permission of Entrepreneur Media (Pty) Ltd.  Permission is only deemed valid if approval is in writing.

3 Responses to Find your niche to sell online advertising

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