This is the, “My business is too specialized. It will never do well online.”

I just love this argument, because it’s the easiest to solve. In fact, if you can make a solid argument to me as to why your business is too specialized to work on the Internet, then you’ve help me do my job.

What I mean is this. By telling me that your type of customer is not looking for you online (that’s hogwash by the way), you’ve done one of the most difficult tasks for a small business. That is identifying exactly who is buying your products. Those that buy your products now are clearly the easiest market for them in the future.

The bottom line is that the most specialized businesses are the ones that work best online. The reason is because you can target your prospects on specific “niche” web sites, and you can use very specific keywords (called long-tail keywords) to define the exact person who fits into your typical customer’s demographic and mindset.

So don’t worry that your business is too specialized. Worry instead that your business is not nearly specialized enough. This is a much more difficult problem, because it may require shifting the marketing strategy of the business to focus on one specific group. It’s often difficult to convince business owners to let go of certain demographics even if they are not producing the desired results.

In my last post I talked about how people tend to group themselves into geographical groups, but this is even more true for interest, lifestyle, and demographic groups in social media. If you can find the social groups for your niche online and learn to tap into them, you may need to hire more people to  handle all the business you’ll suddenly get.

Most of us who’ve run our own businesses for a long time have said this and truly believed it when we said it. However, I believe in most cases it’s simply not true. Yes, I’m saying that when I said it in the past, I was flat-out wrong.

In the next few posts I’m going to go through various arguments to this question and the ways to overcome them. Today we’ll focus on geographic proximity.

Many businesses, such as gyms, repair shops, and even local retail stores throw out the argument that because they need customers to walk into their brick and mortar establishment, they would obtain no benefit from selling in their Internet space.

The type of business will determine the specific strategy used. But, for example, a local retail store can certainly offer their items for sale online or at least begin the sales process even if it requires customers to pick up items in the store.

Look at car dealerships. Why go to the dealership first and listen to a salesperson when you can configure your car online, do an inventory search, look up the invoice price, and THEN head into the dealership armed with all the information? It’s true you’ll need to go to the dealership to pick up the car, but you don’t need to spend hours there while the salesperson fiddles with his computer. The salesperson is likely to use the same web site you could have accessed at home.

These same principles apply to service companies. Let’s face it… today many people do their shopping online. Let’s take the gym example. Sad as it may be, some people will spend more time on a gym’s web site than they do inside the gym. They scope out all the activities, the equipment, and the membership options before they step foot inside. If they like what they see, they’ll go take a tour and sign up. But when they walk in that door, they’re ready to buy. Once they do sign up, many never return. But they do continue to pay that monthly fee!

The argument I hear quite often is that a small, local business cannot compete on the Internet with the national chains. This is actually a valid point to some extent, but the reality is that advertising programs such as Google adWords allow you to geographically target your traffic.

Along the same line, many people who search for a local business will put the name of their town in the search phrase. This means that local business should be optimizing for organic search results using the most commonly used name of their location as part of their prime keywords.

There’s more good news. When it comes to online social media (Facebook, Myspace, etc), people tend to group themselves together by location. Also, because of social media, when you do attract customers, they tend to attract other customers who are in the same general area.

Stay tuned for more on this topic next time…