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All the World's a Niche

Robert L. Johnson, Founder and CEO, Black Entertainment Television

In 1980, when I founded BET Holdings II with financial support from John Malone, chief executive officer of Telecommunications Inc. (TCI), MTV, the leading entertainment cable channel, was playing mostly pop and rock, all but ignoring the African-American audience that generally prefers soul music or rhythm and blues. In launching our cable channel, Black Entertainment Television, which initially aired only for two hours on Friday and Saturday night, we were aiming to fill that void.

What happened next was that MTV, within a couple of months, also began playing soul music and rhythm and blues. For a fledgling such as BET, MTV's ability to use its considerable marketing muscle to respond so quickly could have been unnerving. But we at BET weren't unnerved; in fact, we figured that MTV's entry into "our" market was inevitable.

Just as BET was serving only a segment of the broad-based market for entertainment products--what is commonly called a "niche" in business circles--MTV, albeit considerably larger, also was serving but a segment of this larger audience. Itself a "niche" business, MTV had targeted young people, just as we had African Americans.

Think Globally, Act Locally

Indeed, it's the nature of cable television to be a "niche," because we offer choices to discreet audiences without denying other audiences different choices. Taking this logic a step further, you could argue that all companies, even the largest, are actually "niche" businesses.

Even if you are Coca-Cola or McDonald's or IBM, you must market soft drinks, hamburgers, or computers in what might be called a "niche fashion," tailoring your pitch for specific consumers and for varying cultures around the globe. Mothers go to McDonald's for one reason, kids another--and you need to reach them both. You surely won't convince the Moms if you're selling them on the toy in the "Happy Meal" bag. You must, in other words "think globally, act locally."

In sum, all the world's a niche--the business world, at least. Given that, fledgling niche companies (as was BET in 1980) can be spared the tyranny of thinking along the lines of, "I can't because I'm small and they're big." Instead, these companies are free to concentrate on what they really need to do, which is to survive.

And to survive, as either a fledgling or established niche player, a company must be steadfast about its mission, creative about its products and services, and dogged about its efforts to expand.

Be True

At their most fundamental, niche businesses carve out a specialty product or service for a discreet audience. To survive, they must stay true to what their customers want them to be. People flock to McDonald's for fast food and french fries, so when they get there, the food better be fast and the potatoes fried if they are to return.

At BET, our audience expects us to represent the African-American experience, culturally, socially, politically. We don't dare disappoint. In addition to our flagship entertainment channel (which now programs 24 hours a day, seven days a week), our cable-TV channels offer all-black movies and jazz, an African-American phenomenon.

Our magazines target the black audience for entertainment (BET Weekend), news (Emerge), and health and fitness (Heart & Soul). Even our restaurants fall in line. Our BET SoundStage features a music theme, while BET on Jazz Restaurant specializes in New World Caribbean Cuisine. In our business, there's no marching to a different drummer; we stick to our own.

Stay Cool

Within the framework of familiarity and consistency, consumers also expect the excitement of fresh ideas. This isn't a paradox. Even niche companies must keep moving--constantly--if they are to survive. Those that stand still are destined to fail.

At BET, the solution has been expanding within our framework--leveraging our "brand," if you will. Once we did the obvious--taking our flagship channel from a mere two hours twice a week to round-the-clock programming--we turned to launching the specialty movie and jazz channels. Then we took our "brand" to publishing, a business similar to cable TV, in that both disseminate information which is supported by advertising and measured by readership.

We believe we can leverage our brand indefinitely; indeed, to keep pace with the competition, we believe that we must. In the early 1990s, we entered what for us were different businesses, such as our restaurants and an apparel line for men, hedging the risk by going in with partners who had operating expertise. What we brought was the brand. Put another way, you can bet that we won't soon be opening a Chinese restaurant.

Take Heart

The third leg of the niche-business stool involves committing the resources necessary for expansion. It's at this point that many niche companies hit a wall. If you're only bringing in $5 million in revenue and you're paying yourself $3 million, you'll find it hard to put together the resources necessary for expansion--and for survival.

Remember that survival is the operative word, not "niche." The good news is that you needn't be intimidated as a niche player. If you aim to be true, stay cool, and take heart, then you can compete against the world's other niche companies. All the world's a niche, and keep in mind that you, too, are a part of the world.

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