Operating in a niche can be very cost effective as well as enabling your business to become a leading player in its field. A niche market lets you target your sales messages with greater precision; the more specifically you define your niche the easier it is to cater to the shared interests and needs of the people or businesses in that market. A great example of niche marketing comes from an entrepreneur by the name of Frank Kern. He markets a product for parrot owners that he guarantees will teach their parrots to talk within 30 days. This one product nets him an estimated $20,000 per year and is just one of fifty niche marketing sites he’s in the process of setting up.
What is a niche market?
A niche market is a group of people or businesses that can be described as:
- Sharing the same interests and requirements
- Having a need or want for your products
- Sharing the same communications channel(s)
- Large enough to produce a profitable volume for your business
- Not presently being targeted by a large number of your competitors
You need to find areas where prospective customers’ needs aren’t already fully satisfied. Analyse any other businesses operating in this market area and the quality and features of the products they offer. You then have to create a competitive advantage by offering a value-add that isn’t already available.
Clarify what you’re doing
Estimate just how much time, money and other resources will be required to profit from this niche. Meet with your team and prepare an outline of the project. Identify what is needed to develop the product or service to a marketable stage, what marketing investment it will need, and the timeline for its development and launch.
Create your niche proposition in detail
It would cost a fortune to set up a business that sells all kinds of books online and could compete with Amazon.com. They’ve had ten years to grow into the world’s biggest bookstore and would probably be impossible for a small operator to successfully compete against. But you could profitably cater to a niche of the book retailing market – for example, publications for owners of classic Fords or people interested in the art of silk painting, and succeed because of your specialisation.
Consider every aspect of the product itself. What’s needed to make it the most attractive option available to your niche and how will it be marketed? Go through everything in detail with your chosen niche in mind; the language you use, the packaging, and how it will be sold are just some of the details that have to be worked through. Be sure that the product is right, the pricing is acceptable and your marketing efforts appeal to your audience before moving ahead.