Once upon a time, the economy was doing well, and many successful equipment leasing companies were obtaining a high return on investment (ROI) by targeting companies that simply needed funding. Direct mail campaigns, and direct response Internet leads that focused on the end users were providing a profitable return, even with a small response rate. However, this marketing strategy fell flat when the economy did. Since the economy turned, many equipment leasing companies have changed marketing strategies. But most companies are still trying to figure out what’s best. If you are one of these equipment leasing companies, there may be great opportunities in niche targeting.
Equipment niche targeting simply means to focus marketing efforts on a group of end users that are using a particular type of equipment. Many leasing companies think that they have been niche targeting, but most just apply their regular sales and marketing procedures towards particular industries. Well, I’m here to say that really isn’t niche marketing. If you are going to niche market effectively you really need to implement a whole new business process towards your newfound target group. In this article I will explain how to choose a profitable equipment niche, and the techniques necessary to achieve more with less.
A Sharper Focus
Choosing which niche to focus on is the most important part of this overall strategy. The more specialized you are in targeting a niche the better. In other words, instead of focusing on medical equipment, focus on tattoo removal lasers, instead of focusing on alternative energy equipment, focus on solar panels, and so on. A good place to start is by shifting your focus on only the equipment niches that are actually cutting costs for the end users. For example, one of these niches might be business computers equipment. This niche is attractive for several reasons; 1) This equipment has a short useful life span, and thus a high cyclical turnover, 2) This equipment advances rapidly, meaning there is better equipment offered at better prices every year, and 3) This equipment can actually reduce operational expenses for companies with lower price tags and increased worker productivity, key for survival in this new economy.
Companies that have an existing lease within the particular equipment niche have a high probability of entering into a new lease now. It is easy to obtain a UCC marketing list that contains all existing lease holders for your particular equipment niche, and implement it into your existing CRM, but doing this alone wont bring more customers. So how do you change sales & marketing strategies to target these particular niches? Targeting a particular equipment niche requires a higher intensity of sales efforts, with a smaller group of prospects. This prospect group has a very high probability of entering into a new lease within a particular time frame, but that doesn’t mean they are easy to acquire as customers. By reducing overall marketing expenses and having existing human capital focus intensely on the new target, a higher ROI should result.
Building Partnerships
The real key to achieving an extraordinary level of success within a niche is to build better relationships with the vendors that specialize in your target niche. When you are strategically targeting an equipment niche, the standard procedure of recruiting vendors goes out the window. By building a database and marketing campaign around your niche, you are in a unique position to offer vendors a tremendous amount of value. Share the prospect group, and now both you and the vendor are focusing on the same customers and you are both offering services that compliment each other. By sharing the marketing efforts and referring each other business you will amplify your own sales efforts with your new vendor partners. Partner with as many vendors as possible that specialize in your equipment niche. If you define geographical territories for each vendor, you should not run into conflicts of interest and competition between vendors.
It’s a beautiful thing when leasing companies and vendors come together and share in the actual sales efforts. Sharing in the rewards of those efforts is even better. Partnering with equipment vendors isn’t just for big leasing organizations, at least not when you’re marketing to a particular equipment niche. For smaller leasing companies it might mean just reaching out to a few star sales people at large vendor branches and dealerships. You will be referring each other valuable customers. Most vendors of equipment are fairly open to various funding sources, the bottom line for them is selling more equipment, and as long as that happens, where the funding comes from is not very important.
Sophisticated marketing and sales campaigns can be executed when specializing in a particular niche. Marketing and sales efforts might involve getting a marketing list of prospects that have leases that are likely to expire. That marketing list could be shared between the vendor and the leasing company. Both the vendor and the leasing company can opt in prospects for automated email campaigns, and actionable marketing streams. Sharing the task of lead scoring can also be arranged. One of the nice things about this approach is that it doesn’t require a large marketing budget. Niche targeting and developing vendor relationships is mainly human capital intensive rather than dollar intensive, and in a market where talent is cheap and dollars are sparse, it might just be the best way for your organization to grow. Next time we will explore the various sales tools necessary to market to equipment niche end users.