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April 19, 2018

Find Your Niche Market

These days, finding an adequate niche market for your business is essential.  There is no way that a small business can compete on a large scale with the multi-million dollar advertising budgets and massive distribution of large corporations.   In real-world economies, David does not beat Goliath; Goliath crushes David before he even gets his slingshot out of his pocket. 

In the book Marketing Warfare, authors Trout and Reiss propose a way to effectively compete against a large, well-funded company:  do what they cannot or will not do.  For example:  Proctor & Gamble sells soap in every supermarket and convenience store in America.  If you made soap, you’d be hard pressed to compete with that.  But, P&G doesn’t make hand-made, all natural custom soaps; P&G is geared toward a larger level of manufacturing and distribution.  Hand-made soaps are “small potatoes” to P&G.  The market for hand-made soaps is too small for P&G but large enough that dozens of small companies now make a nice living making and selling custom soaps.  Those companies are doing what P&G cannot or will not do.  They have found a good niche market.

You don’t have to manufacture a product in order to start a business.  You can sell services like lawn care or income taxes, or you can sell items that are manufactured by others.  But, to be successful at any of these ventures, you will need to be able to compete effectively with the businesses that are already out there.  To do so, you will need to find a niche market that your competition is ignoring.

The best way to find a good niche market is to reverse engineer a solution.  Start by considering peoples needs and wants.  What do they have to buy to survive?  What do they want to have to make life more fun?  Be observant.  When you are in a store, look at what people are buying.  A clever way to discover products to sell online is to go to Amazon.com and look through their best selling products.  Do a Google search on each of these products and see how many websites are promoting the products, and determine what the level of competition is.  When you find a hot seller with little competition, you have found a perfect niche market; you just have to set up an affiliate account with Amazon and start promoting the product.  You will collect a commission on each sale.

You can also explore eBay to track what people are searching for that they are not finding.  By studying eBays unfulfilled demand, you can identify what products people want to buy and perhaps provide those products.

The key to discovering a good niche market is to ask two questions:  what is being sold, and who is buying it? When you find the answer to those tow questions, you have a workable idea for a business.   After that, there is still much to do to work out the details.  

Originally posted 2011-03-08 13:50:00.

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About Wayne Jordan

Wayne Jordan is a Virginia-licensed Auctioneer (#3481), as well as an AIA and CAGA Certified Personal Property Appraiser. Learn more at http://www.resaleretailing.com/wayne-jordan-auctioneer-appraiser/

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