What is niche product? How to find your niche in 2020?

eCommerce Marketing 17 min read Leave a comment
What is niche product? How to find your niche in 2020?

As the veteran e-commerce merchant or just the intended store owner, you should hear about the niche markets at least a few times. However, do you know what the word “niche product” is all about?

How we define a niche market?

For short, niche or niche market is the segment of the whole market. It describes a focused, targetable of the portion of the broader market in which specialized services and products can be sold.

what-is-8-niche-product-the-thin-line-of-light
You may think of niche market as the narrow path, the thin line of light in the darkness.

For that, we can easily realize that many companies are working on the niche rather than being generalists. Examples, you will see the bakery store in your neighbor and it has only a few unique kinds of bread and cake. Opposite to this store we’ve got the supermarket which not sell only kinds of bread but so many other products (clothes, toys, meats, electric devices, etc. ) For that, we can state that the bakery store is likely working on niche market than that supermarket.

The example above is just the imagination for you to get acknowledge about niche market swiftly. Of course, in real practice, we can have a more complicated situation about “To be a niche or not to be a niche” than that. But for e-commerce, you can define niche market by the definition mentioned earlier.

Remember, a niche market will be defined by its own unique needs, preferences, or identity that makes it different from the market at large. To be simple for you, you can follow some criteria to determine which would be the niche product and which would not be:

  • Price: What the price range of the product? (Low, average, or luxury?)
  • Quality level: How is the quality of the product?
  • Customer’s demographic: Who does need these products? (Age, gender, income level, interest, needs etc.)
  • Geographic: Where does a customer come from?

As a new business, you will see that going for the niche market would be an easier tactic than join in the big playground with many major competitors.

niche-product-is-the-precious
Targeting for the niche product needs a lot of patience.

We can take the archery products category for example. There will have many products in this category. Natural wooden recurve bow can be a niche. It only serves the need of a wooden-material bow and a certain type of bow. However, defining natural wooden recurve bow as the niche product would lead you to misunderstand.

Let’s try another example.

How about the archery set for left-handed archers? Yeah, for this time, our niche is more clarified. You can see, the left-handed persons are not the majority in the general society and the archery, somehow is not in the top popular hobby. Combination of two factors, you can see that we are targeting to a very narrow segment of need. What is that? The left-handed archers!

left-hand-archery-as-niche-product
The left-hand bow is the good example of niche product.

What are the niche product ideas for 2020?

Because niche products are not easy to find out so we are not going to state the list below is full of top products that you can make money in 2020. It only serves you as an example, to reinforce you acknowledge the concept of niche market. If you have the same ideas, why don’t get it launched?

1.Reusable food wrap

Consumers are getting away from plastic food wrap concerning the harm to the environment. They are seeking for a green solution in every aspect of life. Food wrap is the first one. Because the majority still think of plastic wrap, reusable food wrap will make its way to be niche product.

niche-product-reusable-food-wrap
The beeswax food wrap is getting more popular over time, due to the increase of environmental risk awareness.

Food wrap made from beeswax is getting more popular over time and you can find your way to create your own reusable food wrap or just to dropshipping this innovative product!

2.Special need cosmetics

The mass cosmetics never serve who has special dermatological needs although that special need is real. If you can provide the products for the harsh skin, sensitive skin, or just some special conditions, you will undoubtedly have orders. And if your products can serve people well, you are making the way into niche while people are coming back for your store.

niche-product-example-special-need-cosmetic
The perfect skin exists only on the mass market print ads. In the real life, people have many skin problem that need the special treatment and they will be your potential niche products.

What is actually the special need cosmetics? MiSMo Body Care and Sephora are good examples of this category. However, find the good products in this niche is not easy at all. Therefore, we can say high-risk high-reward.

3.Craft drink

That product niche is a great example of how e-commerce can respond to the growing demand for craft, non-mainstream products.

Cider, whiskey, beer, wine, and others rely on small online shops to supply them with their favorites that are hard to find in traditional shops.

draft-drink-will-be-the-next-niche-product-2020
Draft drinks are not only drunk at the pub but they can be bought through the e-commerce platforms.

The beauty of those niche online shops is that they carry a large variety and often connect customers with local producers. Also, niche brands with artisanal spirit find their fans and are able to share their journey.

4.Sustainable and ethical clothing

sustainable-clothes-niche-product-2020
Due to the wave of environmental and social problems awareness, fashion market has required the sustainable clothes.

As an environmentally-friendly lifestyle is spreading among the wealthier, the clothing industry is shifting to more sustainable manufacturing and attention to materials. Brands focus on very narrow customer segments like environmentally conscious surfers or highly sensitive to synthetic fabrics mothers-to-be.

5.Healthy food and drink

After the era of fast food, people are coming back to healthy meals. However, they will not make their meal this time, they will pay for it.

healthy-food-as-the-niche-product
Like craft drink, healthy food now can be served through e-commerce delivery channels as well.

You may feel strange hearing it but it is what happened. The niche of healthy meals on the go was created because people are busy but they are concerned about their condition. And this niche is very open for all of you to let your creativities shine.

Why should you start an e-commerce store with niche product?

1.Good for beginning

As a fresh new e-commerce store, you have to choose the market to start with. Generally, there are two options for you to choose: go for the mass market or push on the niche market.

On the first option, that would be an easy start for everyone. You can see what is the trend products at these moments and go for it. Somehow it would work perfectly and your store would succeed. But that chance is really low. You know why? Because mass product requires no special approach, no special experience, and no special skill. Because the market demand is constant and if everyone goes for the mass market that will lead to the oversupply status.

So, we can call the mass market as the broadway for everyone but the narrow way leads to success.

How about the small, niche market for the fresh e-commerce players? Yeah, it is great for the start and you will know why.

niche-product-help-you-make-a-checkmate-in-e-commerce
You should avoid big competitors at the beginning by go for the best niche.

First, pushing in the small market like niche product can help you avoid the big competitors in the mass market. Don’t even think about having a battle with those big stores. There is no David and Goliath story in e-commerce in the mass market. With the niche product, the big mass stores are not competing directly with you and you will survive on the first stage.

Second, if your niche product is a real niche, you will have customers for sure. Because a niche, as mentioned earlier, is the market portion that specialized in the products or services that can be sold. It means, before the true niche product existed, the special need has been there for a long time. Therefore starting with niche product will leads you to that niche’s customer.

chart-report-show-up-improve-by-niche-product
You will find that niche market will earn money for you in the long term.

The final great thing of niche product on the beginning is just the result of the above paragraph. You will have your customer and because your products are working there is no reason your customers are not coming back. That how we call the value of niche. Your business will get the high conversion rate that some small or average general stores desire.

2.Excellent for develop

When your store survived the first stage on the e-commerce journey, it is going to the next stage, the developing stage. What you can do for your business on that stage is totally your choice if your store is the niche product store.

As you have worked in that niche for a time, you can easily evaluate your niche to get the answer for a question “is it possible to push further or scale-up with this niche product?”

niche-market-can-easy-help-you-make-decision-in-future-of-your-business
In the long term, you can easily make the decision on your niche product or not.

If the answer is “no”, you can hold your store scale to keep the stable profit rate or start on the new niche market.

Because the niche market is based on the special niche, that means you never need to scale-up to get more money. Your store can get a lot of money in the long-term.

How to find your niche product in 2020?

As you’ve got the basic knowledge about the concept of niche but there still is one thing very important that you may not know. That is the niche product must be found yourself. Follow all the niche suggestion may lead you to the bland future.

Why? Because if you can find out the niche product suggestion list that means the others can, too. When there are too many people in a niche market, it is no longer a niche product but the general market as well. Of course a niche market require a “niche-mind” to operate it well, however, too many players in a small playground can ruin the tiny market and lead you to failure.

Therefore, the most important mission to do when starting with the niche is finding it on your own.

how-to-find-your-own-niche-product
To find the niche product on your own is the same thing to make the path in your life.

Before to get started, you must write down some outlines of the products you want to sell, follow the structure:

  • Price range
  • The product’s benefits/features that serve the market’s special need (important)
  • Product quality
  • How you going to tell people what you are selling (marketing)

1.Find niche product on your own: Start with search engines

It is the basic way to do and everyone can do it. Don’t get me wrong, it is simple doesn’t mean it doesn’t work. Actually, many merchants found their potential niche products in that way.

Step 1: Random search

Start with Google or any search engine you like and drop them any keyword you want. For example, we will go for “eco-feminism products” at first. The results will show you more details about “eco-feminism product” and even some products seem not involved in that keyword, in that case, the Bamboo razor for men.

google-random-search-help-you-to-determine-niche-product
With the result showcase in the above image, you have a lot of information to investigate.

Okay, what to do now is crawling all along the search results. You will have to collect information as much as you can about that keyword. They will provide you the basic concept of how the market thinks about “eco-feminism products”. Don’t avoid the newspapers, it will let you know if there is a special need.

Dig in every rabbit holes, in that case maybe the “reusable tampon” or “green feminism supplies” as well. It would be a potential niche for you. Your competitors would target the same niche but you still outplay them by pushing the keyword further.

Do more research on the keyword. Double-check it by searching for who is selling this niche product and you will see the picture of your pre-niche clearly.

Step 2: Build an idea

We will take “green feminism supplies” as an example. You will have to draw your mind map to see what you define “green feminism supplies”.

There are at least two options to understand the term “green”. It could be involved the environmental-friendly material, reusable, etc. Or it could be healthy, harmless to the woman who uses it. You can pick one or all, it is up to you.

By your definition, you are able to determine the value/the special need that you are going to provide. It is the fundamental of the niche market.

mindmap-niche-product-idea-build
This is the simplified mind map of how you build an idea of your niche from the random search

If you choose “environmental-friendly feminism product” as your main concept, you will have to follow that concept as much as you can in every aspect of your store (ad contents, your audience question, store design, etc.)

Step 3: Seek for an idea

Your idea in the previous is just the draft version. In this step, what you have to do is do more research. Find who is going on the same niche or at least a very close niche to yours, to see what they are doing with they store.

You need to do it very meticulously. How do they introduce their stores, what colors are used on stores, what blog articles are about?

green-cosmetic-niche-product-example
This is an example how to approach customer in “green cosmetic” products line

For example, in the niche “environmental-friendly feminism products”, store A’s got an idea about “The Mother Earth”. They tell the story about the earth and link it to the feminism. It is truly a story and it could get some attention.

Step 4: Search or build on your own the community

This step actually is not a separate step. The niche market relies on its community in which people share their same needs or question. You must make sure that your niche has its community or at least, you can build it from a scratch.

When you are searching for random keyword, the community may exist before. If it does, you can stick your store to its community by dropping some content about what you are selling, some questions, etc.

If not, you will have to build it. How to build it? You can use social media platforms to do it. We will tell you how to build that kind of community in another article.

2.Find niche product on your own: Start with your passion

Step 1: Find what is your passion

Try to answer these question below at first:

  • How do you like to spend your free time?
  • What magazines do you subscribe to?
  • What clubs or organizations do you belong to?
ask-yourself-about-your-hobbies
Approach from your passion, get started by your hobby.

The answers of questions can show what is your passion at the moment. We will take the passion here is an “archery tag game”.

Let’s move to the next step.

Step 2: List down “Problems and Solutions”

With “archery tag game” as the passion, we will develop it to a good niche. Because archery is the passion, we will know what the archery tag players need to play the game, like:

  • A bow (longbow, recurve bow, etc.)
  • Special arrow for archery tag (soft arrow head)
  • Quiver
  • Safety equipments (mask, glove, shield, etc.)
  • Bow accessories

With every product, there are a lot of variants of it based on size, function, etc. Remember we are going to be a specialist, not a generalist so do not stop at the list above. You must dig deeper into every single line.

use-your-problem-solve-mind-to-build-niche-product-idea
With this method, you need to solve every problem, just like the way you play puzzle.

You can do it by listing down “problem and solution”. For a bow, what is the problem and solution?

The problem may be: the player is left-handed, the player’s low physical condition, the player’s height, etc.

The solution will be the both handed bow, the low-poundage bow, the short recurve bow, etc. respectively.

Every solution above can be developed as your niche. You will be totally okay if you are selling the short recurve bow and every short archery tag player knows your store.

find-nihce-product-based-on-your-hobby
This is the procedure map of this method to determine the niche product based on your hobby

If you cannot figure out the solution for a certain problem, don’t worry you can find the answer by research more and more or it is not a problem, actually.

Step 3: Research competitors

As you have picked a certain solution to develop, you should research your competitors to see what are they doing.

Okay, let’s take a “short recurve bow” for example. In your city region, two stores are selling that product kind. The difference is the material they use for their bows. One uses composite plastic and one uses fiberglass. You can do some surveys online in the archery tag community to know what material is more preferable. Assume the wooden bow is the most preferable and for some reason, those stores cannot provide it you will know what to do, won’t you?

It is a very little aspect of fact about niche market that can learn from researching the competitors. The price range, the quality, customizable settings, etc. are all the doors you should want to knock to reach your niche.

Step 4: Determine the profitability

The last checkpoint to see if that option of products can be niche is the profitability potential. You must be the one who calculates it.

Are the wooden short recurve bow needs in your region high or just a few people want to buy it for fun? You can get the answer by joining in the community, conducting surveys, etc.

If your niche product is not likely to have a good profitability rate, you should re-think about it. It may not worth to invest.

3.Tips for Niche dropshipping merchants

As the dropshipping, going for a niche requires more patience. And we will provide you some tips to help you archive success.

Find a good supplier

The dropshipping merchants’ social proof comes from the product quality, which can be controlled only from the suppliers. Niche products require even a higher quality.

dropshipper-make-the-niche-product-selection
Spend time to select the best supplier is the key to win niche market in dropshipping

How to find a good supplier? Pay attention on their number of orders and reviews they have got. The number can not tell lie.

You can get tips to find a good supplier here.

Image review

Ali-Reviews-8-photo-reviews-by-customers
The interface of Ali Reviews helps you to figure out the image reviews.

Use the social proof app like Ali Reviews, you can see if the supplier has image review or not. The image review is more valuable than a text review. If a supplier get thousand of orders and thousands of review but only a few image review, you can question them on product quality.

Price tag and Shipment

Last but not least, the price of the product and shipment to be applied is important. Use the process app like Ali Orders can help you to sort out what is the most suitable supplier for your niche.

And here are the articles I suggest you read next:

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