The benefits and limitations of niche marketing

by Cathy Kirkpatrick, Senior Advisor, Tourism, Alphabet

There’s a saying in marketing: “The riches are in the niches.”

It suggests there’s more worth in marketing a specific product or service to a specific audience. Not one size fits all—fit just for them. It’s about resonance.

How does it apply to place marketing?

There are millions of tourists in the world and millions of places they can visit or live.  Why choose one destination over another?

Art and culture, outdoor adventure, food and drink. Travellers pick destinations based on personal interests. It’s no different from choosing which brands you’re loyal to or which businesses you partner with. It’s an alignment of values.

Niche marketing is inherent to your brand narrative—the distillation of a place and its people. It’s how place brands and destination marketing organisations say “people like you visit destinations like this.”

Cultivating your brand story

You can’t choose a niche without knowing your story. Fortunately, you don’t have to make it up - only uncover what already exists. 

A compelling brand narrative is based on truths. Not a lofty mission statement cooked up in a boardroom. It communicates the real identity of your destination and promotes what it offers. Not what you wish it offered or want people to think it offers.

It’s how you strategically position your place and how you paint a clear picture of the place.

Engage stakeholders and partners, community organisations and local businesses, resident groups and associations.

Leverage marketing intelligence and consumer research through your municipal, regional, provincial, and national tourism associations and activity/sector based organisations

Gather first- and third-party data on behaviour over time—look for broad based trends in lifestyle, media habits, and consumer product consumption.

Find the common threads and stitch them together. That’s how you reveal your brand story—through real truths of your destination. Once you have clarity, it’s time to consider your niche marketing approach.

Go wide or dig deep

There are two main ways to niche: horizontally and vertically.

Horizontal niching is when you market a broad range of attractions or experiences to a specific audience.

Consider travellers searching for family-friendly activities. This niche isn’t focused on one type of travel experience but rather a destination with a wide range of attractions and activities. A place suitable for families - safe, accessible, easy.

Vertical niching is when you cater to individual interests or passions, targeting a specific traveller type with a deeper, more narrow focus.

Think adventure travellers. They crave thrilling outdoor experiences—helicopter tours, white-water rafting, skiing, and snowboarding. They seek destinations rich with adventurous experiences.

  1. Niche based on primary experience; all-age entertainment, agritourism, culture and heritage, wilderness and wanderlust.

  2. Niche based on traveller type; families, foodies, history buffs, nature lovers, and art addicts.

Which method to pick, do you go wide or dig deep?  We suggest you do both. Be sure to explore the positives and potential negatives before choosing how to niche your destination and which type of traveller to target.

Five benefits of being niche

  1. When you focus on a specific niche, you foster a strong brand identity. It helps you craft more resonate messaging, visuals, and experiences for travellers.
  1. A tailored experience creates loyalty. Niching offers the opportunity to turn travellers into repeat customers and brand advocates, and increase organic reach.

  2. Niching amplifies marketing and advertising. Travellers are more likely to engage with content and offerings catered to their interests.

  3. Better return on investment. Marketing efforts become more efficient when you target a specific audience with a specific offer.  It’s also easier to track success.

  4. Niching leads to powerful media targeting. Whether it’s digital or traditional, paid or earned, targeting a specific audience or interest helps you select appropriate channels to maximise your ROI.

Five limits of being too niche

  1. A niche audience might be too small or a primary experience might be seasonal. Both pose a challenge to achieving higher volume  and multi-season visits.

  2. Saturation and overtourism. Your unique positioning is at risk the more popular a niche becomes and your destination’s resources are in danger the more they are promoted.
  1. Niche preferences change over time. The more single-minded you are, the harder it is to adapt to market fluctuations and evolving traveller trends. You must keep up.

  2. A significant investment may be needed for diversification when you're tied to a single niche—resources are needed to create new experiences, attract staff, and update infrastructure that align with that niche.

  3. All your eggs are in one basket. Relying on a specific niche can narrow market growth, making your destination more vulnerable during economic downturns, global pandemics, and shifts in consumer behaviour.

So, what’s the strategy? How do you boost the benefits and limit the limitations?

Find balance between catering to a specific market segment and welcoming a broader audience. Stay true to your destination’s core identity, while staying nimble enough to adapt as trends, behaviours and market conditions change.

Choosing a niche isn't just about finding a corner of the market. It’s not just about segmentation, either. It's about resonating with the right type of traveller, helping them choose the right destination—a place fit just for them.

The Place Brand Portfolio is City Nation Place's searchable portfolio of Awards case studies from the past five years.