Think niche – or why you don’t want to be Sears

I had a quick conversation the other day with someone interested in using my colleagues at GrowthSpur  to help launch his news web site. As usual, I encouraged him to charge ahead – but urged him to pick a niche, not launch a general news web site.

This goes against years of training and experience most of us have as traditional journalists: Bigger is better, right? Cover more things, get a bigger audience?

It’s hard sometimes to pull ourselves away from topics we know too well. So to understand why niche sites work so well, let’s look instead at the same issue in another industry – retailing.

Sears' logo, circa 1970

In the middle of 20^th Century, Sears was the dominant store in America. It offered most things to most people, conveniently located at almost every mall in America. Their shirts weren’t the greatest, but they had a plentiful selection. Downstairs, the hardware department had most of the tools you’d need; out in the garage, you could get a new Die-Hard and fresh tires.

Today, Sears is a mere shadow of itself – and it wasn’t dethroned by Montgomery Ward or others who tried to do the same thing, just better.

 Sears was beaten by competitors who seized niches and exploited new technology: Wal-Mart’s legendary information systems and overseas outsourcing allowed it to offer mass-market goods at lower prices. Nordstrom and others catered to some consumers’ desire for premium goods and outstanding service. Home Depot and Lowe’s stripped away the hardware business by combining more selection,  cheaper prices and  a lumber yard.

Today’s mass media – newspapers, tightly formatted radio stations, the Big Four TV networks – are Sears in the mid-1970s.

For the past 50 years, the economics of scarcity meant programming “most things to most people” was a terrific model (especially when you could jack up your ad rates at will because advertisers had few other options). But digital technology has destroyed the scarcity that made those models work.

The general daily newspaper during the Golden Era of the 1960s-1990s was a happy accident of economics. No one could possibly afford to publish just international news, or just sports news, or just the comics. In a world of $75 million printing plants, $600-a-ton rolls of paper and all those delivery trucks, bundling together many niches made the product work.

But none of those costs exist in the digital world. In fact, bundling the traditional newspaper mix together leaves mainstream news sites with a huge problem: Too much good stuff, all competing for attention. The result? Early newspaper.coms had home pages stuffed with hundreds of links, none of which stood out enough to have an impact.

So to entrepreneurial journalists: Don’t be like Sears. Don’t try to be all things to all people. Don’t try to recreate the newspaper model of covering everything, but not particularly well.

That why niche sites are the fastest growing part of the digital world. Here are a couple of my favorite examples. What are some of yours?