A niche market, in its simplest of terms, is a market within a market of highly targeted products, services and customers. Why would one want to enter a niche market if there are so few overall customers and items? Competition.
Within a niche market, you’ll be able to command a larger share due to the lower amount of competition. Large companies spend millions (even billions) of dollars each year to target mainstream markets; simply put, they don’t consider niche markets worth chasing. Because the competition from large companies is nearly non-existent in niche markets, your efforts will be more likely to pay off in the long-run.
So how do you find a niche marketplace? Use the following steps to help determine a market, find a product and carve your own authority within the market.
Step 1: Determine the marketplace
Before you choose a niche off the top of your head; begin by doing research into how active and passionate customers are within a niche.
One of the easiest ways to find a niche is by sorting through product listings on Amazon or eBay. Drill down further into each category until you’ve found highly specific items; for example shoes, women’s shoe, women’s athletic shoes. The later is a niche market which isn’t as saturated as simply going after shoes.
Step 2: Determine if the niche is profitable
After you’ve found what you believe to be a niche, research whether customers within the niche are buyers. Not all niches have customers who feverishly purchase items.
Browse through the listings on Amazon or eBay to examine how often customers buy these niche items or services. Take notes along the way within a spreadsheet of your competitors, customers, and marketplace value.
If the niche proves to be one which customers actively buy, you’re well upon your way of finding a niche market.
Step 3: Find niche publications
The quickest way to determine the niche you’re considering is worthwhile is to seek out publications, groups, and discussions online and offline. If a niche has a magazine, you’ll know that it’s a large enough market to support the publication.
Likewise, if you notice that there are blogs and forums dedicated to the niche you’ll be able to accurately determine if you will be profitable within the marketplace. Of course, you’ll now know of your competitors and what you’ll need to do in order to succeed within the niche.
Step 4: Find what people pay for marketing
Online and offline advertising is great metrics in order to determine the value of a niche. If a niche has thousands of users but no-one advertises to this group either:
A. The market can’t support it
B. The competition isn’t going after the market
More often than not, the first in these two choices are the results. When you can’t find marketing campaigns for a niche it often points that people aren’t buying and that the authorities within the niche aren’t returning on their investment; this means that the niche market may not be worthwhile to pursue.
Step 5: Does the niche have a demand?
The final step in finding a niche market is whether the interested parties within the market have a gaping void for products and services. Chances are that there are many questions and requests for items and services to facilitate those within the niche – if you can develop this product or service you’ll be able to successfully enter the market.