- Different Definitions of a Niche Market
- Finding Niche Markets
- How To Choose a Niche Market
- Researching Niche Products
- Why Choosing the Right Niche Market Makes Sense
- How to Decide Which Niche Markets Are Profitable
- The Most Profitable Niche Markets
- What Is Niche Marketing and Why You Should Be Involved
- Disadvantages of Niche Marketing
- How to Define Your Existing Niche Market
- Creating a Niche Marketing Plan
- Niche Marketing Examples
The saying goes that if you try to please everyone, you will end up pleasing nobody. That’s why “niching down” and digging deep into your market to find a profitable segment is a smart marketing strategy for your business.
Let’s say your target audience is people trying to lose weight. This is a very broad population to reach. Instead of marketing your weight-loss product to everyone, narrow your audience down. You might decide to focus, for example, on women who have busy lifestyles and slow metabolisms and are close to menopause. If you create an offer that applies to this specific group of consumers, you have better chances of getting conversions. Choosing the right niche market is an essential first step to developing a winning marketing strategy.
What Is a Niche Market?
A niche market is a portion of the market with specific needs you can fulfill. You might define a niche market by its audience’s:
- Specific needs.
- Unique preferences.
- Beliefs and attitudes.
Having a well-defined niche market before you develop your product or service can help give you clear direction and a competitive advantage.
Finding Niche Markets
It can be challenging to pinpoint a niche market. You should invest time and effort into researching the larger market to identify segments that are well-defined, growing, and profitable. You can then make an informed decision about your target market based on your findings. To find the right niche market for your product or service, follow these steps:
1. Identify the People You Want To Serve
It is important that you work with people you can please and serve comfortably. You will need to research their:
- Geographic location.
- Age and gender.
- Income level.
Once you have these characteristics narrowed down, you can dig deeper to create a personality profile to match your brand.
2. Clarify How Your Product Solves Their Problem
Find out what you do best and who it will appeal to most. List what you have achieved and which types of customers you delivered the best results to. Chances are, these people will be your ultimate niche market.
It might be a good idea to find a niche with similar experiences as yourself. For example, if you suffered from indigestion for most of your life and found a solution, you can target people who are trying to do the same.
3. Put Yourself in Your Customer’s Mind and Shoes
This is a step many people forget about. You should always consider what’s going on in your customer’s head. What are their priorities in life? Where are they now, and where are they going? What are the most important problems they’re seeking solutions for?
If you don’t know the answers to the above questions, you might want to do additional marketing research. Surveys such as SurveyMonkey or a simple Google form can help you gather important information about your prospects’ world views.
4. Find the Link Between What You Offer and What Your Niche Wants
It is important that you synthesize your brand’s values and offers with what you have learned about your target niche. After you have gathered ample information about your potential niche market, determine whether they are a profitable population and easy to target.
If you find a match between where you want to go and what you are trying to achieve in your business long-term, you can confirm that your selected niche has growth potential, is lively, and is profitable.
5. Determine if the Connection Between Your Brand and the Niche Is Strong Enough
Make sure your brand aligns with your selected niche’s needs and desires. If loads of people in your niche are searching for solutions, but they rarely spend money on them, you might need to rethink your strategy. Likewise, if you discover you currently have no competition, ask yourself if it’s because other companies had a good reason not to target that particular market segment.
6. Carry Out a Test Run
Following a niche evaluation, conduct a market test where you find out whether your product or offer can generate enough interest in the given niche. If you can’t achieve good conversion rates, you might need to tweak your offer, your website copy, or your pricing.
7. Launch the Product or Service
After completing a test run and getting results you’re happy with, scale up your targeting campaign. Define a clear message your niche market resonates with, and do A/B testing to define which version of the campaign will get you a better return on your marketing investment.
How To Choose a Niche Market
There’s no straightforward way to choose a niche market. You can try several methods but must know your market before you select one. Plenty of market research databases are available to give you an indication of how big the market is, what direction it’s going, and its predicted growth rate.
As a general rule, look for niche markets currently being served by other companies. You don’t want to be the first person to test whether an idea will work. If people are already making money with niche products in the segment, you probably can too.
Also look for a niche market that is profitable long-term and makes your business sustainable. You might not be able to make enough money selling $5 phone cases online, given the cost of setting up an eCommerce site and marketing. However, if you can make additional money on the back end, you can pull in decent profits.
Competition research is essential to determine how you can offer something more valuable to the same people than existing niche players. Find out if a price war is going on and what the balance is between supply and demand. If the niche market is oversaturated, you might want to look for a new one.
Finally, find out how motivated people are to buy your products or services. The more buyer traffic you can locate, the better chance you have to make a sale. Simply put: Determine how painful the niche’s pain points are and how you can best address them.
Researching Niche Products
If you’re launching a new company, product, or service, look at what is already available in that market and how you can create or offer something better. Your first stop should be Google.
Let’s say you want to create a software that monitors companies’ online reputations. You should get familiar with the solutions other companies offer and create a list of their features and benefits. Next, check their prices and see whether you can still make a profit if you offer similar products at a lower cost.
You can find plenty of market research tools that will aid you in this process. Completing marketing research of your potential niche markets and products can help you create a unique value proposition that is easy to communicate through your marketing campaigns.
Build a list of what your competition is doing right and what you can do better. A simple spreadsheet works well and can help you highlight where you can penetrate the niche market with the least effort. Don’t forget to check review sites, as they will tell you what customers love about a product or service and where it is lacking functionality.
Meeting a need other companies are not addressing is one of the easiest ways to break into niche marketing.
Why Choosing the Right Niche Market Makes Sense
If you only have a general idea of who you are marketing to, you won’t be able to address them directly through your content marketing and promotions. Know what your ideal client is thinking, what their problems are, what motivates them, and what their buying triggers are. Learn how they respond to advertising, where they hang out, and what their buying habits are.
You can do this by checking your competitors’ campaigns. See if they are advertising on Google and whether they have a blog or a YouTube channel. See the engagement on their campaigns to see how you can market your unique product or service to similar people.
However, don’t simply replicate the offers already aimed at your target audience — your product should present more value. One of the most challenging things about niche marketing is communicating a value relevant to your niche’s needs and wants.
How To Decide Which Niche Markets Are Profitable
You start a business to make money, which is why determining a niche’s profitability early is important. Find this information by subscribing to newsletters and industry reports, following people who are already making money in the market segment, and doing your own research. However, the proof of the pudding is in the eating, and you cannot get full answers until you test your product or service.
To avoid spending a lot of money on marketing a product or service that won’t end up turning profits, talk to those who know your audience well. People who offer complementary products or services can help.
You can also research how frequently people search for similar buyer keywords on Google and other search engines. A buyer keyword is a search term that shows a great intent to buy. It can be anything from “leather jacket prices” to “buy leather jackets.” People who are looking for “leather jacket styles,” on the other hand, might be searching for information for a fashion blog and have no intention of buying a product.
You might also want to check Google’s suggestions. For example, you can type in the search engine “weight loss products for … ” and Google will fill in the blanks. The results might give you an idea of what people are searching for. If the keyword matches what you offer, you can find an angle to market your products and optimize your website or landing page to search engines.
Another great way to determine a niche’s profitability is to look through affiliate network statistics. ClickBank is a great place to start. Let’s say you just created an online weight loss program for people who work from home and are in their 50s. Check out the ClickBank marketplace to see how many sales products that might appeal to people in your niche get. If people are making money already, be sure that with the right marketing strategy you can, too.
The Most Profitable Niche Markets
Some niche markets have a lot going for them when it comes to profitability, growth, and market size. These include:
- Health and wellness: Many people want to feel and look better.
- Pet products: Our pets are part of the family, and we would do almost anything to make them happy.
- LGBT-specific products or services: Many people in this group believe mainstream products do not suit them.
- People who love traveling: Anything involving travel, holidays, and spending quality time with loved ones belongs in this market niche.
- Gaming community: You can appeal to these people with products designed for their lifestyle, such as blue light glasses or ergonomic chairs.
- DIY enthusiasts: Learning new skills is a great way to boost your self-esteem. Buyers in this niche are emotionally motivated.
Online learning is a great niche to enter if you specialize in a particular skill you can teach, such as playing the guitar or speaking a new language. The online education industry is expected to hit a market value of $350 billion by 2025. With more people working from home, it is likely the size of the market will grow even faster than predicted.
What Is Niche Marketing and Why Should You Be Involved?
Niche marketing is a form of promotion that targets a specific ideal client persona or avatar. It is easier for a new company to target a smaller segment than an entire market. Mass marketing requires investing a lot of money into marketing. If you don’t have the marketing budget of a company like Coca-Cola, you can get a much better return on marketing investment using niche marketing.
It is also easier to create targeted content for a narrow niche than to appeal to everyone. The more you know about the problems people in your chosen niche face, the better you can communicate your solutions and value to them.
The Disadvantages of Niche Marketing
There are a few disadvantages to narrowing your niche. One of them is the limited market size. Let’s say you are selling products for moms with toddlers. Your market size will be much smaller than a store that caters to moms with babies and teens, too. Further, you’ll need to invest a lot of time and energy into understanding your niche, so you can talk their language and address their specific needs.
How To Define Your Existing Niche Market
If you are already in business and would like to refocus your marketing, evaluate your existing niche products to see whether they are still relevant to your selected audience. No matter how well you did your research in the beginning, customer trends are changing faster than ever, and you need to ensure your brand and target niche still have strong synergy.
Completing market research and surveying your existing customers can help you find out whether you are talking to the right people and marketing the right products for the appropriate niche. Some people decide to create a lead generation campaign that includes market research. These are called quiz funnels, and they help you understand your market and identify buyers. You can always tweak your niche market, and even your audience, when the business or market changes.
The main factors you should research when you define your niche market are people’s values, interests and passions, location, preferences, and the price they will pay for the product or service.
Creating a Niche Marketing Plan
You can reach the niche market you want to target using several methods. If you have the budget to invest, you might think about placing targeted ads on Google, YouTube, or social media. Thankfully, you can simply transfer the characteristics of your ideal client to the ad campaign and focus on your preferred audience when you set up your campaign.
Clearly defining your audience is only the first step. You also need to reach out to the people in your niche market to make sales and build long-term relationships. Creating a marketing plan for your products is essential for success.
You might start with a mind map to brainstorm ideas for addressing your niche’s most urgent needs. You can explore different ideas until you find one that resonates with your brand and your audience’s wants, needs, and preferences.
Instead of focusing on all the aspects, features, and benefits of your product or service, highlight the one that’s most likely to appeal to your target customer.
Marketing professionals often forget about the psychology behind buying decisions. You need to understand what goes on in your potential customer’s head and the thought process that leads to buying decisions. Knowing your niche market’s buying triggers can help you create a strong brand and marketing message that will deliver sales.
Your product or service needs to address one or more specific needs of your niche. If you’re not sure how to start assessing your potential buyers’ needs, check out Maslow’s Hierarchy of Needs pyramid. This model of human needs can help you decide whether you are addressing your audience’s basic, safety, emotional, esteem, or self-actualization requirements.
Implementing a sales funnel for lead generation might speed up your market acquisition process and help you build a list of qualified clients interested in what you can offer. The different types of funnels you can add to your marketing strategy include email marketing, social media funnels, or content marketing campaigns.
Niche Marketing Examples
Check what is working in your chosen niche, and learn how other people are generating traffic, leads, and sales. You don’t have to try to reinvent the wheel to create an effective marketing strategy.
It’s important, however, that you create a customer journey and map out your client acquisition plan. If you don’t have a high-ticket product, you might consider adding one to upsell your existing customers. Further, look at different ways to get people on your list. The more you can engage with them, the more chances you have to sell to them.
The online store Lefty’s provides a great example of a successful niche marketing campaign. It focuses on left-handed people who are struggling to find products that suit them. The company sells everything from oven gloves to hand tools designed for the left-handed population.
Jacamo is a clothing company that focuses on a narrow niche comprising men who wear larger sizes and cannot find the style of garments they are looking for.
A well-known company that targets a well-defined market with unique niche products is Lush. This organization targets consumers who love cosmetics but want them to be ethically sourced and eco-friendly. They communicate their values and ethos clearly on their website.
Image via web from lush.com
No matter your business, niche marketing can help you save money, clearly define your brand, and get better conversion rates on your campaigns. Get to know your customers, talk their language, and address their problems, and you can tap into a small but profitable segment of the larger market. Being relevant is one of the best ways to build a long-term and fruitful relationship with your potential customers.