Choose the right Niche for your business

Niche Marketing in a Nutshell

Niche marketing is an interesting component of the Internet Marketing world.

The word niche has many meanings, but in this sense we are talking about a very

specialized market. Retailers offer a prime example of just what this means. A

large department store offers literally thousands of products for sale in the same

building. A mom and pop store will offer a much smaller number of products, but

chances are that these products are of a special brand or are unique in some other

way. That’s exactly how niche marketing works, even online.

To begin with, niche marketing is an excellent choice for the Internet startup that

doesn’t have the capability to compete with a major business. Cash requirements

and workload are just two of the many limiting factors to starting such a major

operation. However, niche marketing offers dramatically lower costs and a much

lighter workload. This will be a great advantage to anyone starting an Internet

business.

The way it works is pretty simple. You do the research on your product, and you

find out who’s demanding that product. Once you know who you’re looking for,

you figure out where they tend to gather in the online community. Online sites

where you can always find people gathered by their interests are places such as

forums, mailing lists, and newsgroups, all of which offer the visitor a chance to

post and participate. Finding the customers you want for your business is as

simple as doing a search for the type of place you would go to online. You join in

the discussions and ease in a note about your products and where they can be

found at the end of your posts.

If you choose, paying for advertising space on some highly-focused website can

work too. Just be sure to do your homework before you go placing ads. Make sure

you are putting your ad on a site appropriate for your business, and that the ad is

highly visible. Make sure also that you are using sites with a good reputation and

plenty of traffic.

The reason niche markets are so great is because you are not spending all of your

time trying to tell millions of people about your thousands of products. You are

instead telling a very specific group of people who are likely to be interested in

your handful of products. You spend less time on marketing, and less time on

merchandising and inventory. Instead, you maximize your profits of a much

smaller inventory with people who are much more likely to buy. It’s truly a win-

win situation for the small Internet business.

How to Identify an Existing Demand

Identifying an existing demand for your online business is absolutely crucial to

any chances for success. Whatever your product or service is, finding the niche

market to sell it in is just not enough. You may be lucky and strike a gold mine,

but chances are that your shot in the dark will be a bad one. It’s far better to take

the time to analyze the demand for a particular product or service before you

place that good for sale.

This is one of those areas of business where you’re going to have to do some

research to get what you want. So, to better serve your purpose, it would be

helpful for you to first come up with a list of the different niches you are

considering. Once you have the list, make a plan for how you intend to do your

research. A comparison of the results between the niches you research will give

you an idea of which ones will offer the best chances for success.

One way you can research the demand for a particular product or service is to

join the forums previously mentioned. Get a feel for what people are talking

about while you participate. Look for people making comments about something

they’re looking for but just can’t seem to find. This will often help you to come up

with a starting point for further research.

Tools exist on the Internet which can assist you in your research. Through these

tools you can enter keywords and search phrases. The tool will give you the

number of times in a given period that those searches were done. Another way is

to look at the number of clicks. Clicks and hits are great ways to find out just how

much demand there is for the niche you’re researching. The greater the number,

usually the greater the demand is for products or services in that niche.

Other tools allow you to find out how many visitors there are to a site. You will

want to do this when you find a niche where you’ve realized that there are very

few sites in operation. The reason is that there could only be a few sites because

the demand is low in that niche. To determine the demand, you need data on the

number of searches, as mentioned above, and on the number of visitors to these

sites. If the sites are not getting much traffic, you may consider looking in another

direction as this is not a hot market to enter.

If you do your research, chances are that you will find a few great opportunities,

and many not-so-great ones as well. This is where you can make a good business

decision about what niche to enter, and avoid that dangerous shot in the dark.

Common Mistakes Made in Researching Your Niche

When you are ready to begin your research on the niches you’ve selected, be sure

you’re aware of these common mistakes before you proceed. These mistakes can

do some serious damage to your results, and potentially to your budget, if you

wind up picking the wrong niche to enter based on faulty research. Let’s take a

look at the most common mistakes made.

Perhaps the single greatest mistake made in researching a niche is making too

broad a scope. Remember, these are niches. A website devoted to cars is not

operating in a niche market. However, if you break it down, you can develop a list

of the niches under the umbrella of cars. Examples of niche markets could be

things such as vintage automobiles, or a site devoted to a particular model of car

and everything there is to know about it. The point is that you want to be as

specific as possible when you research a niche. If you research based solely on

“cars” then you are going to think there’s a massive market full of potential

customers out there. However, when you get down to the niche, you’ll find

instead that there really is no reason to think that thousands of enthusiasts will

flock to your site about Yugos!

Another common mistake involves not collecting enough information. You want

to spend some real time on this now so you aren’t spending that time later

wondering what went wrong. What many people fail to do is to look carefully

through the Internet for varying keywords and search phrases, so the researcher

is not actually finding a complete body of data to analyze. It is entirely possible

that inaccuracies or omissions of this type can cause you to miss about half of the

picture.

This is truly a word of caution: DON’T make the mistake of getting

emotional in this process. You would be surprised at just how easy it is to be so

enthusiastic about what you’re doing that you taint the research data you collect.

You have to be impartial when you do this research. Sure, it’s exciting knowing

that you’re going to open an online business. But if you let emotions get in the

way, chances are you will find yourself looking over the research you collected

wondering just where you went wrong and why your business is failing.

As a final note, don’t be fooled by appearances. A lot of hype goes into the

marketing game, and if you’re not careful, you can get caught up in it. Just

because you think dogwood-scented candles smell great, and you found only one

site offering them for sale, and that site claims the candles to be a best-seller,

does not mean there is really a big market out there for them. Don’t let this trap

catch you. Look at everything you do from a detached point of view. If you can

separate fact from fiction, you’re on your way to success in niche marketing.

List of Hot, In-Demand Niches Online