Over the years, we have been promoting the practice of "targeting a niche market" for location-based leisure (LBL) facilities as the formula for success vs. trying to be all things to all people. This persistent industry paradigm, at least for new starts, is what inevitably leads to road kill. At different times we have described targeting a niche market as:
We recently had the opportunity to take part in an Internet seminar on branding jointly sponsored by IAAPA and Tom Peters. The presentation was by Will Koch, the general manager of a small, independently owned, highly successful theme park, Holiday World, located in the middle of nowhere in Indiana. Holiday World is not only successful, but its attendance continues to grow despite competition from large theme parks. In 2002 when other parks were suffering from the economic downturn, Holiday Park's attendance grew 21%. And attendance grew as well in 2003, even though guests coming from Indianapolis, Louisville and Cincinnati are closer to either Six Flags or Paramount theme parks.
Will Koch attributes Holiday World's success to "focus[ing] our business very specifically on one market segment and to refocus[ing] our entire business to serve that market segment better than the big guys do." Will says that "whatever business you are in, you must become 'first in mind.' In order for a customer to choose you, you must be No. 1 for that customer. . . Customers don't visit their second-choice park. They visit their No. 1 choice park. . . Your job is to figure out how to be No. 1 to somebody. Being No. 2 to everybody is a recipe for disaster."
Thanks, Will, for saying it so succinctly.
So how has Holiday World become a No. 1 destination? Will says, "For our park, the answer is that we are better at serving families with younger children. We have learned these guests prefer our park to the big guys. To them, we are No. 1.
"Nobody wants to choose the lesser of two similar competitors. Don't be afraid to stand out! You shouldn't be afraid to stand out from your competitors! As you grow, don't try to widen your appeal. Restrict it! Be No. 1 to somebody. Show them you mean it!
"Here's the key. The most important thing is to zero in, to focus your efforts to serve [a] market better than your competitors. For us that meant adding attractions, changing services, restructuring in such a way that we could differentiate our product."
If you are in a market that doesn't have any direct competition, don't make the mistake of thinking you are the exception to Holiday World's success by targeting a niche market. Consumers today are increasing travel and are exposed to many leisure venues. This sets their expectations. Even if you have no direct competition in your market, unless you become something special to a particular market segment, you will still be rated as a No. 2. Remember, being the only game in town doesn't cut it alone. People in your market still have the choice of doing other things, such as visiting the park, going to see a movie or just staying home and watching a DVD or playing a computer game. You have to be something special to a particular market segment. There are two paths you can follow with your LBL: targeting and delighting a market niche for success, or following the path to the road kill cemetery by trying to please everyone.
For additional reading on this subject, see: