We hear all the time about the need to find a niche in order to stand out in today’s crowded marketplaces. But that’s easy to say, but less easy to do. Firstly, let’s remind ourselves exactly what a niche is. It is defined as “products or services that appeal to a small, specialized section of the population”.
Businesses have always needed to be niche to a certain extent because it’s just not possible to be all things to everyone. But because of the fast moving, global marketplace that most businesses operate in now the trend is towards finding smaller niches in order to stand out. The narrower the niche, the better.
Niches are not sitting out there waiting to be found. Instead, they occur to you when you do the necessary groundwork. This is a process for self-discovering the narrow and specialist niche market that you can serve.
Spend a dedicated period of 2 to 3 hours going deep and answering the following questions about yourself.
- Who do you really want to serve? Think about the people who you would like to do business with in an ideal world. Be specific. Is it businesses or consumers? Where are they? How old are they? What do they do? What issues do they face? How do they see the world?
- What skills do you have? What knowledge do you have? What experience do you have?
- What interests do you have? Running a business of any kind is tough, but running a business you have little or no interest in is many times tougher. Your odds of failure or quitting are much higher if you’re running a business that you are not interested in.
- What are your biggest and proudest achievements? Credibility is so important especially for start-up businesses. If you can point to a success in the same or a similar arena, it will strengthen your ability to succeed.
- What exactly do you want to sell?
The answers to these questions should suggest some general markets that you could enter with a new product or service. You might have half a dozen opportunities that you could examine in search of a niche. So the next question is as follows:
- For each of those possible markets, what thorny problems do customers experience? The best way to do this is to ask this question directly of prospective customers.
From this work, you should eventually have an Aha! Moment. If you’ve done your groundwork job diligently enough, the perfect niche for you to serve will pop into your head.
Your job is not yet complete, though. You still need to appraise and then test out your niche business idea. Check out the competition by carrying out a thorough analysis.
Next, check that your niche has the following characteristics.
- Easily accessible customers. If you can’t contact them, you can’t serve customers.
- Underserved or neglected customers. You don’t want your niche to be in an oversaturated or already well-served market.
- The potential for growth. You’ll want to start a business that’s built to last, so make sure you can foresee a long-term future.
Finally, check out how you feel about your niche business idea. Does it feel right? Can you see yourself enjoying and succeeding in this niche? If so, go for it.