When starting up a new venture, you must ask yourself: Do I
have a viable niche and how do I go about securing one? The most common form of success for small
businesses is establishing themselves as a niche market. No retailer can be all things to all people. “There are always going to be consumers out
there whose needs for a particular product are going unmet – leaving room for
the small business to succeed by meeting those needs.”
I’ve read two opposing theories to discovering whether you
have a viable niche. One is that you
want to be the only one out there selling your product so make it unique. Another is that by finding competition,
you’ll know your niche is viable – meaning that other people have been there
before and have been successful at it. I
recently read an article where the author made this exact point by saying: “If
the market is saturated with fad diets, you have more of a chance of writing a
bestseller with a fad diet, than with a rigorous lifelong diet. If TV is swamped with reality shows, then
you’re better off making yet another – yes, another – reality show.” Both ideas make a good point but I’m still
not 100% sold on which one I think is more effective in the long run.
These two opposing views aside, many experts tend to lean
towards recommending that you look for unmet needs as the best way to find a
viable niche. That said, it’s never a
bad idea to build on what’s already out there.
Look at your competition and see if you can do it better; if you can
offer something that they’re not offering.
Where are the holes in their business model? What are they not offering consumers that you
potentially could? It’s OK to look at
someone else’s idea and make it better; to grow and expand your own business
model by tapping into what’s already out in the marketplace.
“You can create all kinds of wonderful and wonky products
and/or services but if no one wants what you’ve produced, what’s the
point?” Therefore, you have to do your
market research. If you want to know if
there is a market out there for a particular product, the best way to find out
is to ask. Don’t just come up with a
random idea and throw up a website and see if people bite. Do your homework first.
Marketing is perhaps more important for niche market
businesses than for any other kind, because the niche market business is by
definition, unknown and succeeds or fails on making the connection with exactly
the right kind of customer/client. If
you open a coffee shop, people know what you’re selling but if your idea is
more off the beaten path, then you need to vocalize it more.
Many experts say that one of the best ways to find a niche
market is by starting with your passions and interests. “Your efforts to find the right niche should
begin with an assessment of what kind of product or service you could get
excited about providing, what market you would be enthusiastic about serving,
and what skills and aptitudes you have that could make it all work.”
Sometimes, filling the niche you want to occupy is a matter
of finding someone else who’s already in that business but dropping out. If you like how that company has defined and
filled the niche before you, buying an existing business is one way to land in
the space you want. Then think as you
did as a consumer about what the holes were in the business and what product or
service wasn’t out there when you were merely a customer – fill those holes and
you might just find your viable niche!
Lastly, don’t be afraid to evolve. Don’t hesitate to tweak or even make
significant changes to any facet of your business. If it adds value, it’s a good thing. In order for a business to grow, it needs to
evolve. Monitor feedback from customers; they can be critical, but this
is exactly what you want.
As I wrap up, here’s some food for thought: “To keep a
business strong and competitive, you need to evaluate the lifetime value of
your target market. That means taking a
long-term approach to marketing by assessing the lifetime value of the
customers.” Nurturing consumer loyalty
is the best way to capitalize on this.
When you have a niche, you might fall prey to becoming too specific in
the audience you are targeting and might lose your customer base over time.
Here are some articles to check out about finding your niche
in business:
“How to know if you have a viable niche”: http://www.psychotactics.com/blog/viable-niche/
“Seek an edge by finding your niche”: http://entrepreneurs.about.com/od/becominganentrepreneur/a/findingniche.htm
“Find your niche”: http://www.business-opportunities.biz/2009/01/28/find-your-niche/
Until next time…
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