Every business has a customer or group of customers who are the perfect fit for their business, but sometimes you have a product or service that better suited for a more specific type of customer. Finding your business’s niche or tapping into a niche market is an effective way to stand out from the competition in your industry. Does your business have a niche market? In this post, we’ll discuss how business niches develop and how to identify whether you can tap into a niche market for your business.
A niche business is one that focuses its time and energy marketing towards a small, yet specific audience within a population of an industry consumers. Niches aren’t always clear to identify and they are often discovered by accident. Not every business has a particular niche, while some businesses may have more than one. Whatever the case may be, niche markets can be an untapped source of revenue for a business or a way to pivot an under-performing product or service and market it toward better-targeted customers. If you have a business that has a specific target audience, you may be able to hone into a niche market to grow your business.
There are two ways to find your niche in business. The first is by looking at your business’s current customers to find and hone in on commonalities. The second way is to figure out what’s missing for your target audience and to create the solution for them.
Niche businesses tend to build a more specific audience than an industry’s overall audience. To find your niche market or to figure out if you have a niche in your customer base, take a look at your current customers. Who are the people or the types of people who are the best fit for your business’s products and services? What problem is your business or product solving for your customers? By taking a look into the specific challenges that your business is addressing, you may be able to find similarities between your customers.
Take a look at your current customers to see what they have in common and how you can provide more services based on their commonalities. A yoga studio, for example, may have a number of clients who are parents. While a yoga studio is great to give moms a break from their kids, many moms don’t have time to arrange for child care. By offering child care at your yoga studio or mommy-and-me yoga classes, you may be able to build a niche of clients who haven’t been able to take a yoga class because of childcare concerns.
When it comes to developing a niche for new products and service, you can probably find a customer to purchase any product that’s made. If you’ve ever taken a look at Brookstone’s online catalog, you’ll see that there are always new and unusual products that you never even thought would have a market.
Do some research on your current market. What problem is your business or product solving for your customers? By taking a look into the specific challenges that your business is addressing, you may be able to find a niche in your target audience. Are there any gaps in your industry or issues that your target audience has that aren’t being addressed? What are the current complaints that your customers or clients have? If you can discover what’s missing in the eyes of your customers, then you can provide an answer to them.
Use your knowledge of your business to read between the lines and find ways in which you can take an already-existing product and improve it. What value can your business bring to the industry? What needs to be improved and how can you improve it? As you’re honing your business idea, keep asking yourself, “What can I do to enhance the customer’s experience?”
A good example is a laundromat or dry cleaner in a city or college town. While business may be good, you know that many of your customers struggle to get their laundry done because they’re busy with work or classes. If dry cleaning isn’t bringing in enough money, what about a delivery laundry service? This is just what happens in many college towns—dry cleaners are turning to delivery laundry services because of an unmet need in their target market of busy young students and professionals. These customers are willing to pay a little more for the convenience factor of not having to get quarters and wait around for their laundry to be done.
One example of a successful niche market is dog daycares. Off the bat, the idea of a daycare for dogs might seem odd to the person who works close to home or who has a big yard for their dog to run around in. While dog walkers were common, most people were content leaving their dog at home and walking it when they returned home from work.
The niche market for dog daycare came about mostly in cities where busy young families and professionals were living with dogs in small apartments without yards. With their busy schedules, dog owners weren’t able to always run home to let their dog out before attending to other responsibilities like meetings, childcare, or social events. This meant leaving dogs at home for extended periods of time. Dog owners wondered, “What if there was a daycare for dogs like there was for people?” Just like that, dog daycares were born. Now dog owners can arrange for their dogs to be taken care of during the day and play with other dogs to burn off energy while their owners are at work. Dog daycares and camps have been increasing in popularity in cities and suburbs providing services for a niche market of working professionals with high energy dogs.
Think about helping people save time and money, providing convenience, and making something more fun. Some examples of niche businesses are:
Gauging the overall interest for your product or service might be difficult, especially because some people might not even realize they’re looking for the product that you’re offering. But if you listen to your customers, you might find a niche that can work for your business. Do you have a niche market for your business? Let us know in the comments below!