Choosing a niche for your eCommerce business

Yesterday I read someone post on the Internet they wanted to build an eCommerce, but didn’t really know what to sell, so they thought about selling a little bit of everything, adding things to their store as they thought they were trending or popular.

It doesn’t work like that.

You’re not Amazon (of course). You’ll never be able to effectively advertise your shop to people if you sell items in dozens of different categories.

You’ll have a really hard time branding your shop and building a following on Instagram or Facebook if you’re a generalist.

To have success in eCommerce you need to choose a niche.

What’s a niche? A niche is a very specific market segment that you will dive into.

A niche allows you to

  1. Create a brand
  2. Target your target customers using laser-cut advertising
  3. Go where your customers are

If you are selling camping equiment, it’s hard to emerge in that highly competivive space, unless you niche in, for example you might decide to sell camping equipment for RV owners, or camping equipment for bouldering enthusiasts.

You advertise your shop to people in that niche, by finding them online via targeted ads, and they will love the fact that there is an online shop that seems to be made just for them.

If the shop seems made just for them, you’ll have an easier time getting them in your email list, do the first purchase, upsell other products that might appeal them, and have them purchase again in the future.

Don’t make up your niche

Targeting a niche you are already familiar with is always a great help. But don’t just dive into something because you are passionate about it. There might be too many competitors, or there might be reasons why there are no competitors yet.

A niche with no competitors is unlikely to stay so, if you prove success, but it’s not always the case, maybe you will go unnoticed for quite a bit of time.

People are always looking for successful niches, as if there are no competitors it could be a sign that the niche is not a space where people buy, and usually there aren’t many risk takers. The easiest thing is to look for profitable niches, and try to step into that market with a unique angle.

Don’t just choose a niche because it’s popular, or because it’s the new hotness. You’ll have thousands of competitors. Also, don’t just choose it by targeting high traffic keywords, as that’s a receipe for failure.

The key to deciding if a niche will work for you or not is evaluating, testing and validating a niche before spending too much time on it.

How to evaluate and test a niche

That’s a good question at this point: how do you determine if a niche is good?

Evaluate a niche

You need to find the answer to many questions before determining if a niche is good for you:

  • Are you prepared to stick with if for the years to come?
  • Do you have a list of 10 product ideas that will fire up that niche?
  • Do your products solve a pain point? To they serve a need? A passion people will be eager to spend money on?
  • Will your products be easily shipped? Will they need to be purchased again in the future, or are they once in a lifetime products?
  • Is there competition already in this space? Is there a lot of competition? If this is too much competition, the market is likely to be already oversaturated, and there will be many other shops already having a price battle, and you’ll have a hard time trying to attract customers to you, as they will show up in every Google search and will outbit your ads.
  • Is this a trending market that has a future, or is this just a fad that’s going to disappear in 6 months?
  • What’s the price range for the products? What’s your margin if you pursue the idea? 20%? 400%? You don’t know?
  • Can you find out where your prospects hang out online?
  • Do you have any clue of what this niche is about?

These are just a few questions you need to ask yourself. Think about it.

Test a niche

There are many ways, one of the easiest things is to create a fake offering, and drive people to that offer using ads.

Invest a small amount of money, let’s say 1 to a few hundreds $/€ in Facebook ads targeting users in a very specific niche, maybe people that like a similar page. You need to have an easy place to find your prospects, or it will be hard to acquire new customers in the future.

Send people to your website, add a call to action, maybe let people enter their email, and measure the metrics of your campaign. Then compare them with other tests you do, in different niches. Don’t just fall in love with an idea, but validate and test multiple options.

Your shop personality

When you find out that the niche you’re passionate about is a viable option, it’s great because the fact that you care about what you sell will show up in everything you do, people will know it by the level of care you put into it.

One thing I notice is that a drop shipping business is usually a low personality business. It’s just one of the many. A product in there is sold by dozens or hundreds of other shops, and a customer is a Google search away from going to the other, less costly shop, and you will be just one of the many.

On the other hand if you sell stuff that can’t be found elsewhere, and you add your unique touch to it, customers will be amazed by your shop personality and will be eager to come back and buy more from you.

Think about it: what if Amazon tomorrow starts selling their own version of a product you sell. There are many stories of profitable niches being blown away in one day.

Is this possible in your niche? How will this affect your sales?

Make yourself unique and clearly differentiated from the others in the market, find out what’s your secret sauce.

Prepare to stick with it

While you can grow interest in any niche, passion is harder to start up in this way. Are you ready to spend hours crafting content marketing strategies for a niche you are not passionate about? How will this affect your message to the world?

The best way to have success with a niche is being the go-to person in that category. Be the expert. Be the trusted authority. Build an authority site. Don’t be a do-it-all, but niche down.

Being in such position will allow you to have higher margins on the things you sell, because there is no real alternative than buying from you, the expert on the matter.

To do this, you need to have passion in what you do, or you will quit in a matter of a couple months if things don’t turn out to be a huge success right from the start, which is unlikely.

Make yourself memorable

Don’t let your customers, or even just site visitors or social media followers, forget about you.

  • Have a memorable brand
  • Provide a unique experience on your shop
  • Have a great presentation for your products
  • Have high quality products
  • Make your customers feel important, as they are
  • Do something strange

You need to know everything about the products you sell, create interesting stories about them, and you cannot do this without being passionate about them.

I hope you had a good read, and you found out a couple things you can do to choose your perfect niche! If so, please recommend or share it.

Please comment below if you have something to add or ask.

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