The saying “You can’t be all things to all people” is certainly worth keeping in mind when you’re starting an online store. You won’t be the first person who has decided to sell a trendy product with mass appeal, and as a result, you’ll be up against some stiff competition. When you’re first starting an online store, it’s better to go after a niche market that has less competition and more room for growth.
The term “niche market” refers to a subset of the entire population that may be interested in specific products based on certain characteristics. For example, jogging strollers would appeal to the niche market of moms who enjoy running, and egg-and dairy-free baked goods would appeal to the niche market of vegans who like sweets.
So how do you decide what niche market you should go after? Keep this advice in mind.
Choose a market with room for growth. The idea behind niche marketing is that you’re targeting a specific group of people, but not a group that’s so small you can’t grow your business. For example, you might be able to find some interest in kitschy pastel unicorn paintings, but if you only have a dozen or so people who are willing to buy, it’ll be hard to grow into a larger business.
Look for hard-to-find products. You’ll be most successful if you can provide products that your customers have a hard time finding elsewhere. For example, if you live in the US, you might be able to start a business selling food products from other countries (like vegemite from Australia) that would appeal to ex-pats and Americans looking to expand their palates.
Choose a market that you have ties to. Some niche markets may just be a more natural fit than others for you. Let’s say your family is already in the restaurant business. You may be able to use their connection to buy cooking supplies wholesale to start your own online business. Or if your best friend makes beautiful glass jewelry as a hobby, you may be able to team up to turn that hobby into a business. Going with a market that you already have connections to will make it that much easier to break in.
Choose what you know. Although there’s no rule that says you have to be an expert in the niche market you decide to pursue, it does help if you already have some familiarity with the products you sell and the lifestyles you’re catering to. If you’re someone who loves rock climbing, it might make sense for you to sell customized rock climbing gear, or if you’ve been baking since you were old enough to reach the oven dial, it might make sense to start a gourmet bakery.
There’s no shortage of niche markets or lifestyles that you can cater to. The important thing is to find one that you’re excited about and that you see a lot of potential in.