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As a small business owner, you may often be asking yourself: “should I specialize or generalize my product, service, or niche?” It’s very tempting to try and be everything to everyone, especially if you have a lot of experience and a broad skill set, so you might be thinking, “if I narrow down my market, I’ll limit myself to less customers.”


The idea of specialization may be hard to stomach for some small businesses, and especially those that are starting out. The truth is, generalizing can actually lead to slower business growth. Specializing in a particular service or product can help you attract more customers who are specifically looking for what you offer. In this article, we’ll provide the top 5 reasons why specialization is often a key to success and profitability.


  1. Be Seen as an Expert

By narrowing your focus, you give yourself the opportunity to become an expert in a particular area. This will make it easier to find and understand your target customer, as well as speak to their specific needs. As a result, customers will see you as an authority figure in your industry and will be more likely to do business with you. Once you become an expert in one area, it will actually enable you to grow your business into other related areas with the same customer base because they will perceive you to also be an expert in those things. This is a cognitive bias known as the halo effect.


  1. Increased Efficiency and Productivity

By specializing, you can streamline your business processes and become more efficient and productive. If you’re a solopreneur or run a freelance business, your time is limited and productivity is paramount. When you’re not trying to please everyone, you can focus on perfecting your craft and becoming the best at what you do. You’ll find that you will not need to spread your resources too thin on different things. In turn, this enables you to become more efficient with your process and productivity, saving you valuable time and money.


  1. Better Use of Marketing Budget

When you have a clear understanding of your market and specialization, you can use your marketing budget more effectively to reach them. You’ll be able to use targeted marketing strategies that are known to work well with your target market. This will ensure that your marketing efforts are not wasted on those who are not interested in what you do. As a result, you’ll get a higher return on investment for your marketing budget and see an increase in new leads or conversions.


  1. Higher Quality deliverables

By specializing, you can concentrate on your main product or service and ensure that the quality of your deliverables is the best it can be. You’ll be able to spend more time understanding your customer’s dreams, fears, and doubts. When you do, you’ll be able to tailor your solution to each element of the customer journey. This is one of the best ways to improve customer satisfaction and build brand loyalty.


  1. Attracts More Referrals

Word-of-mouth marketing is not dead—in fact it is still extremely important. As customers who are short on time are inundated with business solutions everyday, the most efficient thing for them to do is ask the people they know for referrals. The benefit of specialization is that you’re more likely to get referrals from your current customers. If you can solve a problem for one customer, there is a chance that they know someone else with the same problem, and with referrals comes higher conversion rates. This word-of-mouth marketing is invaluable for any business because—not only is it free marketing, it’s one of  the most effective marketing strategies.



In small business, specializing can lead to increased chances of business growth in many different ways. From being seen as an expert in your field to improved efficiency and productivity, there are numerous advantages to narrowing your focus. Specializing isn’t the answer for 100% of business owners out there, nor is it the perfect solution for every industry, but it is a tremendous way to increase profitability in a shorter amount of time and will set the stage for growth and future opportunities.