Estimated reading time: 7:00 minutes
What I’ll learn from this article: how to identify niche markets and work with them in a profitable way
Do you know why sometimes you find a product for something that’s so incredibly specific that you can’t understand how it came to be? Finding a solution for such a particular need is what converts into a niche product or service.
That’s how major brands have grown, offering a solution to a problem or an idea for something that nobody has ever thought before. For that reason, so many people have been trying to do it for a while now. But, what’s the secret to doing it?
For some, niche markets are precise and narrow paths to sales. But there’s more to it: they often come with challenges exclusive to their target audience, sometimes even aggressive competition from people with more time in the business.
However, I’ve compiled a handy list of things you should do when it comes to identifying (and using!) niche markets for your brand.
But first, let’s break down what a niche market is exactly and why you should use it.
What are niche markets?
Niche markets are nothing but a smaller portion of a market, one that is differentiated by the interest of potential buyers in products or services that are tailored to their needs. Let’s break it down with an example that most of us could relate to: smartphones. What if you decide to buy one?
The broader market contains several submarkets, called “niches” where brands could market their product. For example, phones that work under duress conditions (think of water, dirt, heat, humidity, etc.) that are sold to nature lovers and backpackers is a niche market.
Now, where does the difference between a niche market and a regular market stand? Several factors could indicate if something is or isn’t one of those small, highly profitable markets.
Some of these are the following:
- Demographically specific: this means that you select your audience for their geographic location. For example, a city where your niche market is young women with children over five years old.
- Pricing specific: if you have a price range that’s incredibly specific, you’re already in a niche market in your product or service offering. For example, high-value products are in a niche market, and this makes them exclusive for a particular audience.
- Psychographically specific: what’s the interest of the audience you want to reach? The psychographic factors such as attitude, lifestyle, personality and so on. These will have to be directly related and resolving a need in your target audience, for the niche using this factor to work.
- Quality specific: appealing to a specific audience it’s important; it’s all that matters when it comes to quality niches. Most of the times, these are limited to high-quality items or budget-friendly products, but these markets often need to be within an additional niche to be profitable.
The handy guide to identifying niche markets for your brand
Once you’re sure you want to play in the big (yet narrow) league of branding for niches, you need to know something: while these can be highly profitable, identifying them is a challenge that can make or break your project.
Why is this? Because the impact of niche markets is rarely comprehended until you’re already working in them.
For that, we’re going to give you a handy guide for you to find and explore the wonders of these specialty-business opportunities.
Implement market research strategies
If you’re planning on working within a niche, you need to make sure that you’re using the right approach when it comes to sales psychology. The factors that come into play when offering a product or service need to be as aligned as possible to create positive results in the long run.
Use market research strategies to work on a practical solution, one that could help you understand just exactly where you could focus.
Is it on a product or a service? What’s age group has the most consumers? What’s their income?
Focus on data that could narrow down your insight into where to look for your niche audience; that way you’ll have a more active approach to the business as a whole.
What are some effective market research strategies?
- Face-to-face surveys
- Online polls
- Customer habits analysis
- Geographic data analysis
Study the needs of your audience
If, on the other hand, you know exactly the audience you want to talk to, for example, young males between 25 to 35 years, you need to use your market research strategies to know the potential consumer for what might be offering.
Studying the needs of your target audience also gives you a tool to explore their purchase behaviours, and to identify potential future projects.
Now, you might be using market research strategies for this, and that’s great. But you have to take it up a notch to find your preferred audience’s likings. This is when a good team of experts comes in handy; you’ll have an informed opinion on the real applications of your offering for your audience.
This is fundamental for all fields, as it implies that you’re doing the extra mile when it comes to creating something functional and profitable.
Select a target market (and an audience)
Being broad and trying to include a handful of markets for niche offerings is a sure way to miss the mark. Most of the time you’ll find yourself lacking the necessary focus to work effectively.
For that reason, selecting a target market, it’s perfect to narrow down your strategies to something that can be studied and worked with.
Once you do, create ideal buyer personas for your niche to work. This will help you create a more specific strategy to work with them when it comes to offering, production, marketing and so on. Keep in mind that buyer personas, while within your market, might not be who you want as an audience in the long run.
These will always be evolving as you work in your product or service, so consider making adequate changes to them every time you get analytics on your brand.
Use keyword investigation
It might be the simplest, but more effective way to identify niche market ideas; as it’s functional and almost anyone can do it in a pinch. With tools to identify keywords, you’re rarely off the mark when it comes to identifying niches.
Some even use this as their primary job: they create websites with these keywords and then use them to sell referral products that fit within that category.
If you want a business on your own, however, keyword research is an excellent way to start narrowing down potential alternatives for products or services in your area or within a defined audience.
Keywords also work as vantage points when it comes to selecting a niche, as you can already narrow down certain aspects, like monthly searches, competitivity and ad pricing (if desired).
Bits of advice to work on niche markets
Don’t think you’ll find success overnight: it’s important that you know how to manage your expectations in niche markets. These, while small, tend to be competitive and most of the time you’d have to make a conscious effort to offer more than other alternatives. The best tip? Have patience and work within a structure.
Now here are some tidbits on how to work effectively within niche markets:
Create realistic short term goals
While it’s interesting to find solutions for problems or needs, you can’t try to fix it all at once. Create realistic goals that work for your project, and plans to achieve them.
That way you’ll stay motivated to work through thick and thin, as regardless of how you do it, you’ll be achieving things that will work towards your ultimate goal.
It’s best if you avoid using overly complicated tactics to work niches. Focus on how humans behave: they want the easy and most straightforward method 90% of the time; why create something complicated?
Use simple tactics and (unless it goes with your niche) a simple language that everyone can understand to send the message. It will look and feel more natural, and that’s incredibly appealing to audiences.
Focus on ROI
The return of investment is fundamental when you’re working on marketing strategies, and while it might not look all that important for marketing efforts when compared to financial gains, it’s key to success.
A high ROI for social media efforts and other plans is perfect as it will enable you to focus on furthering your efforts to achieve more goals in the niche market while you establish a good online presence.
Don’t neglect social media
While to the non-initiated it might look like a monster with a lot of heads, social media is an incredible tool for niches. It allows you to tailor your efforts for a more defined audience; that, in turn, creates an efficient path to reach their hearts (and their pockets!).
Use strategies that are as innovative as you can, boost engagement and create curiosity. With that, you’ll have social media working for your niche in no time. And to do so, there’s no better way than to use the right information from valuable sources. That’s why I invite you to browse through our library of lessons in business practices that could take your brand or project to the next level.
By John Mackenzie – Founder & CEO of Staff Leverage, NT Digital and JohnMac Digital
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