One of the ways for businesses to stand out over the competition is by catering to a niche market. This article will help you understand what niche markets are, how they work, and niche market examples.
It will also explain how you can take advantage of them in your own business.
Niche Market Definition
A niche market is a small part of a larger market that has unique demands and preferences. Niche markets make it possible for specialized products and services to be sold directly to targetable audiences.
Catering to the needs of a niche market is one of the ways that businesses can become more competitive.
A lot of companies target a broad audience with their products and services, called mass marketing. While this is an OK strategy in itself, it often does not address many unique demands that smaller niches have.
Small businesses can take advantage of this by taking care of the needs of these overlooked audiences. In the process, they build loyalty with them.
Think about it this way; instead of selling computers, a company focuses on the niche market that needs good quality hard drives for their computers.
Or perhaps instead of offering general cleaning services, a company focuses on the niche market that needs carpet cleaning services.
Or even instead of selling sports equipment, a company sells golf balls or tennis rackets.
The list goes on.
These examples show how small businesses can stand out by carving a position in the larger market environment. Here are a few more examples of niches that you may want to get into:
You can define your niche by a number of factors: the demographics of your audience (age, education level, gender), the quality of your products and services (cheap, premium, handmade), the values of your audience (attitudes, interests, philosophies), or by catering to certain hobbies and interests.
Some niches are also defined by the income bracket they market to. Others are defined by the price points of the products and services.
Geography and location can also be a niche factor. For example, setting up shop for a certain product that’s needed at a place where there previously was none.
As you can see, no matter what market you are in, there are several subcategories of services you can offer. This is what allows you to cater to the needs of a specific niche market.
However, not all niche markets will be profitable. You need a good understanding of what will be worth your while and what is not worth the hassle.
I’m going to split this list of niche examples into two categories; niches that make money online and general profitable up-and-coming niches that are worth looking into.
I should also mention here that I’m not necessarily saying that these niches will make you more money than others. These are just the ones that a lot of people have found success with.
Profitable make money online niches
Here are some of the niches that have worked really well for online businesses:
- Finance: You can join various affiliate programs for finance products. You’ll then recommend them to your audiences to make money in this niche
- Make money online: A lot of people are constantly looking for ways to make a little extra cash online. This is a niche with a massive potential audience
- Business solutions: More and more businesses are turning to the internet for solutions for various problems that they are facing. This will be your target audience
- Health and fitness: This is a very broad niche with lots of opportunities for niching even further down. You can choose to focus on weight loss, yoga, healthy living, and so on
- Personal development: People are always looking for ways to improve their lives. If this is something you are passionate about, this is a great niche to focus on
- Travel: Although travel is not what it used to be pre-COVID-19, things are slowly picking up. Reviews and recommendations will be your bread and butter in this niche
- Relationships, Dating, and Romance: This niche has a huge potential for growth. From how to pick someone up, to demographic-specific dating advice (age, nationality, gender, race), to how to have a successful marriage, and how to deal with divorce; the possibilities are nearly endless
- Hobbies: Hobby niches are profitable because they have few but very loyal potential customers. Picking the right one can yield massive returns
- Fashion and beauty: People will pay a lot of money to look good. Positioning yourself as an expert in this niche can be very lucrative
- Lifestyle: Lifestyle is a wide niche that can be rather tricky to monetize. However, if you are up for a challenge, ad revenue and sponsorships can be very lucrative
The best way to make money with any of these niches online is to start your own blog. If you are completely new to blogging and haven’t started your blog yet, I’ve got your back! Here is my super-detailed step-by-step guide on how to start a blog and make money in 7 simple steps.
Profitable upcoming niches that are worth looking into for your business
This next list is a general list of emerging niche markets that you may want to explore. Here are a few examples of profitable niches that are worth looking into:
- The LGBTQ+ community: This is a niche with massive growth potential. It is hard to find clothing made for certain body types or products designed for the LGBTQ+ community. If you can make a genuine connection with them, they can be very loyal to your brand.
- Environmentally conscious consumers: More and more consumers are willing to embrace greener alternatives for products that they consume. This has a huge market potential
- Virtual Reality: Virtual reality is another emerging market that is proving to be highly lucrative. Becoming a pioneer in this niche will put you in a great position when VR goes mainstream.
- Cannabis and CBD markets: Cannabis is a huge market, expected to hit almost $43 billion globally by 2024. CBD and CBD products are a small niche within this larger niche with a massive growth potential
- Pet owners: Products and services in this niche can be pet-specific or lifestyle specific. There is a lot of opportunity for growth here, too. Pet treats, pet accessories and clothing, pet trackers, pet cameras, customized pet photos, and more are all business opportunities you can look into
- Gaming: Console gamers, PC gamers, mobile gamers, and tabletop gamers are all viable options. This is a group of people that enthusiastically spend money on their hobbies. It helps if you are passionate about gaming, too
- Jewelry enthusiasts: Customized and handmade jewelry is another massively profitable upcoming niche that is absolutely worth looking into. It’ll help if you are a jewelry enthusiast or if you have a background in jewelry design
- Homeowners: Home security, home decor, and home rental solutions are a massive market that is only set to grow
- Remote workers: This market has been growing for years. It is set to grow even more with life after COVID-19. This is the best time to strike the iron while it’s hot.
- Men’s grooming: Products like beard oil and other men’s grooming products have come seemingly out of nowhere. This is a niche market that is still finding its place in the larger market. This makes now the perfect time to get into it and grabbing yourself a piece of the pie
- Local residents: There is a consumer-driven movement to support local businesses. Depending on where you are, city-specific, culture-specific, or team-specific products and services can be a massive hit with your audience
Need help getting started in any of these niches? I talk about how to start a small business in this post. You may also want to borrow one of these ideas and set it up as an online business. If that is your plan, check out my detailed guide on how to set up a successful online business here.
How does a niche market work?
To find a niche market for your business, you first have to do some research on how the broader market works.
You also need to know how existing niche markets perform. What unique niche markets already exist? What potential is there to establish new ones? How profitable can they be?
You want to find a segment that has lots of potential customers, a lot of room for growth, and very little competition.
One of the best signs for this is finding a small number of similar products and services that are doing OK. This will tell you that your idea might be profitable. On the other hand, if there is zero competition, it might be a sign that other people have already tried it and found that it wasn’t worth the effort.
The next thing you have to do is set your business apart in terms of quality assurance, specialization, and communication. This is what will keep bringing your customers back over and over.
Advantages of niche marketing
Here are the main advantages of niche marketing:
- It leads to reduced competition for your products and services
- Niche marketing can set you apart as an authority/expert within your niche
- It allows you to focus your business efforts at a singular point, leading to better results
- A niche market is a great way to establish brand loyalty in your business
The more you niche down in your business, the less competition you will have.
Think about it. If you sell jackets, you have to compete with a lot of established companies. It’s going to be really hard to please all your customers. But if you sell jackets for people who travel a lot, you have less competition. This means that you have more freedom in pricing your products, allowing you to focus on creating the best product for your customers.
You become more likely to be recommended by people looking for that particular product. With time, you will become the go-to specialist for said product.
Disadvantages of niche marketing
- Establishing a niche and being successful in it will have other businesses coming in to get a piece of the pie. For example, setting up a small family restaurant in a remote town and getting lots of business from the locals will soon have bigger, more established companies coming in to give you some competition.
- It makes you too dependent on one particular product. Because of this, the growth you will experience will eventually stagnate, and market changes will hit you hard.
Is a niche market the right choice for you?
Niche marketing is a great way to set yourself apart as a specialist who does what they do really well. When you position yourself as the go-to business within a particular niche, it is easier to provide more value and build loyalty with your audience.
Find a niche that you can become an expert in that also has a large potential audience. You’ll have hit the jackpot.
Did you find this post helpful? What products or trends would you add to this list? Let me know in the comments below. And if you think that someone in your circles might also find this helpful, please do not forget to share it with them!