Every startup business blog advises you to target a niche market when starting your business. Simple observations of the world around you will give you the niche that suits you best. Let’s look at how you can find the best niche that suits your area and needs.
What is Niche Marketing?
Niche Marketing is finding a small segment of an existing market and targeting that specifically to exclude all other influences. The niche market features selected define the product or service that you supply. This way, you become the go-to specialist in that area or service, and you can grow your business off that base. With a niche market to target, you aren’t taking a shotgun approach and hoping to hit a customer. You are homing in on those most interested in your product or service.
How do you define your niche market?
There are several ways to look at a market and segment it to find your niche audience.
The Price/Quality Matrix: Are your prices lower with a cheaper quality or lower price with better quality than others in the market? Is your product of such a premium quality to the competition that you can charge more? Even better, is your product the only one available?
Demographics: Are you targeting the older generations, millennials, married couples, families, or children? Or an alternative group?
Interests or Attitudes: Will you target a group with a specific interest or who has a targeted outlook or belief on the world around them?
Geography: Is your niche only in your neighborhood or town or over a wider area?
Once you have taken a deep dive into these areas, you can determine the niche for your product or service and target that specifically. And be mindful that your niche may cover two of these categories!
Your niche product or service should ideally solve a need or provide a benefit to the niche market you have selected.
By being specific, you can reduce advertising and marketing costs by building from a focused base and expanding your business.
What is your niche worth?
Sell the products or provide the services that people want.
Your niche business beginnings aren’t aiming to be the largest marketplace in the world – you need a small set of customers with a specific need to start. Remember that if you have 500 loyal customers that spend just $20 per month with you, that is $10,000 in revenue per month.
Isn’t that a great starting point?
Which Niche has the Most Unexplored Business Potential?
There are niche opportunities in nearly every market that you look at around you. Examples of a niche market exist in segments like books, smartphone accessories, fitness, homeowners, and specific demographic communities you are familiar with in your neighborhood and city.
The best niches?
As with any marketing strategy, you are providing a solution to a problem that someone has.
You will get the business if your solution is better than your competitors.
There are two groups of people that are the best targets for your niche: people who have a disposable income to spend on things that make them happy; and people who are so fanatical about something that they are constantly spending their money on the pursuit of their interests.
Find your market niche.
In the future, we predict a growth in the way consumers look at the world around them, and those areas are the niche markets with the best-unexplored business potential.
Saving the planet.
Consider the movement to better the planet – the Eco-friendly consumer and those living consciously for the betterment of the environment.
This group is so passionate about how they are living their lives and the impact that it is having on the planet that they will pay a premium price for a product that offers an environmental benefit to the planet, not necessarily just buy the cheapest item.
They form an emotional engagement with the product where the benefits to the wider community outweigh the small additional cost that their wallet may endure.
They will purchase based on the renewability or recyclability of the item, not just on the lowest ticket price. This makes them an excellent niche target for your product or service if it delivers a benefit they see value in.
The nature of your product or service could be biodegradable, compostable, or some other new way that we can return what we use as consumers to the planet to be reborn in another form.
When you provide the market with a product or service that delivers these tangible benefits, this group will beat a path to your door to spend money with you. They will probably be lifelong clients as they believe in the benefits you provide to the planet.
Like our first group that encompasses all aspects of the planet we all live on, the drive to renewable energy is focused on saving the planet by, firstly, reducing our reliance on fossil fuels that pollute our environment and, secondly giving us a source of energy that will last us and our children and our children’s children long into the future.
The potential markets in new sources of renewable energy or the tools and systems by which we acquire and consume renewable energy are limitless. And your niche may be created by inventing a new energy source that all of humanity can benefit from.
If your niche is another way to acquire a renewable energy source or a special way that renewable energy can be used when you have a niche that will grow even bigger over time as people want to reduce their reliance on oil.
This segment won’t be a price-sensitive market and has huge potential to develop from a niche market when it joins with other large-scale providers, distributors, or energy users.
Pet ownership is increasing worldwide as we all seek comfort and companionship in our homes and lives. Pet owners are another demographic that dotes over their dog, cat, bird, or fish and will spend ongoing amounts to keep their pet fed, happy, and healthy.
While many believe this is a crowded market, there are niche ways still to be found that pet owners believe will solve a problem for their fur babies.
Potential niches for pets can include natural pet foods and natural solutions to ticks, fleas, and other pests. Another growth area is innovation in combining traditional collars and leads with technology like GPS trackers. We are already seeing CCTV technology integrated into pet monitoring cameras and automated feeding systems.
Anything that helps integrate their pets into the owners’ lives is a niche market product or service they will happily subscribe to.
Personal wellness products and services are a niche that is growing with people wanting to escape from the stresses of modern life.
Examples that currently exist in this market are candles, perfumes, and oils; vitamin and skincare supplements; and healthy eating products.
As part of people’s desire to care for their environment around them, they are looking at their internal environment care as well.
The wellness area includes holistic services like nutrition, alternative medicines, and preventative care. Plus, more personally involved activities like Yoga, Mindfulness, and Meditation. We already see the integration of wellness services and products into environments like co-working spaces and traditional offices, so this trend toward a holistic wellness overview in people’s lives doesn’t just exist at the home level.
Will technological advances move into or out of the personal wellness space? Some say that devices like activity trackers and smart devices improve our well-being, while other schools of thought say they cause many problems.
Either way, the increasing stresses modern life and technology place on people’s lives will continue to make personal wellness at the forefront of many people’s minds. The opportunities for new wellness techniques and solutions are limitless.
How do you tap into that Niche?
When determining your niche isn’t front of mind, there are some tools you can use to distill down an idea, thought, or segment to pinpoint the market niche that you want to target.
You can start simply by searching Google or your favorite search engine for your topic and see what results are returned. This will give you an idea of what exists locally for you in your chosen niche market. It will also show how others in the market present and market in your niche area.
If your search returns hundreds of competitors for your idea, you aren’t niche enough!
You can also utilize Google’s search suggestions. Simply type your niche in the search box and read the suggested search list. This reflects the most common similar searches people have conducted on Google and can help with long-tail keywords that will assist with making your niche even more targeted.
Many great tools are available on the internet, like the Google Keyword Planner Tool within the Google Ads platform. You will need an account, but it’s free to use.
This will allow you to enter a key phrase and see related key phrases that people search for. The biggest benefit is that it shows you search volumes for the phrase in the geographical market area that you select so you can determine which are the most popular searches and which Google users rarely search for.
If a keyword’s search volume is low, it may indicate a low demand for that product or service, or it could be that the public isn’t aware of your niche solution!
It also shows related searches which can lead you in the direction of your market niche through the popularity of what your existing market is searching for.
The Google trends platform allows you to track the number of searches on a topic over time.
Enter your keywords, then select the time range you want to investigate, and it will show you a chart that will help you understand keyword search data over time. This trend can be an ongoing rise or fall over time or a seasonal search trend.
Where there is a seasonality to search volumes, this can assist in helping to plan the timing for product launches and ensure your marketing dollar is spent at the right time of year.
It also shows related topics at the bottom if you want to investigate other close keywords to your niche market idea.
These tools can also assist you when your niche idea involves a word that you use commonly but analyzing the search data reveals that most people call it an alternative name.
You can also spend some time in communities online following hash-tags on social media or looking at active communities on subreddits and then listening to what they are discussing. This can give you a great sense of what the community feels about your niche area, but only with people using that online platform!
Evaluating the competition.
Once you have established the validity of your niche, you need to evaluate what competition is in the market.
Is this competition better than you on a price, quality, or service basis? How will your offer improve over what they bring to the market?
If you have honed your niche to the finest point, you should have little competition in the market.
Of course, if your product is a true blue ocean product, then you won’t have any competition in the market and can set your price point based on what you believe the market will pay for your product or service.
What are your Niche Next Steps?
You have now selected your niche, evaluated the potential demand, and found the solution to meet your market demand.
Go back to a fundamental of marketing that has been around since the 1950s – the 4P’s.
Product: Have you determined the product or service that fits your selected niche?
Price: Have you priced your niche product or service in the market? Have you evaluated single buy pricing, multiple buy pricing, and trade or distributor pricing?
Promotion: Have you determined your niche customers and how you will reach them?
Place: Where will your niche good or service be available?
Once you have determined these factors, you can start testing your niche with people you know or experts in the potential market that you are targeting. While their feedback can be important to your journey, don’t let skeptical friends or family influence your direction.
If your niche product or service is in the right market, you may want to look to social media influencers to review or be seen with or around your product or service.
Once you have your first orders, solicit feedback from your first customers. Include this in your marketing plan to ensure they are happy with the product or service and where they may see areas of improvement.
If the product suits, start building a community on a suitable online platform or social media site to start and attract potential customers in your target market. This can also assist with creating a buzz around your product.
Make sure you have a credit card payment method if you use an online platform or shopping portal to start selling your products online.
Set small goals to drive your niche in the direction you have planned.
Make sure they are SMART Goals
Once your niche starts to flourish, look at a similar niche next to it and grow that niche.
How many more niche markets have unexplored potential?
As outlined above, many niche markets exist. These exist in plain sight in our everyday lives.
Some of these niche markets are full of competitors competing over a small space already.
One of the main drivers in new niche discoveries appears to be technology, but the technology doesn’t drive the niche demand. Instead, the modern entrepreneur will look at a small niche market with a need to be solved and then at how technology can deliver a solution to that need.
Technology is the solution to the need, not the change’s driver. Following this methodology framework, we will always have additional niche markets with unexplored potential; you only need to identify them.