At WunderTalent, we know finding a product niche is tricky. Finding a profitable one is even trickier.
Thankfully, there are tools that can help. For example, Alogpix is an Ecommerce market research tool that helps analyse the worldwide market and provide estimates for product demand. Businesses like Amazon sell everything and anything to anyone and everyone. But for most businesses, that strategy doesn’t work, as competing with the likes of Amazon will cost you hundreds to millions of pounds.
That said, one famous success story is Jet.com, which Walmart acquired for $3.3 billion after they raised $820 million from investors due to 350,000 people using their site during the beta period. If you have an Ecommerce venture able to raise that kind of investment, then that approach will work. If not, a smaller niche with fewer competitors is your best bet.
This doesn’t mean you can’t make a lot of money. A niche is important, and an Ecommerce niche has several advantages for most businesses:
- Less competition
Even against the likes of Amazon, a niche product is more likely to be successful as it offers a specialised product, rather than a generalised selection.
- Greater voice
Terms like ‘market leader’ and ‘expert’ are used when you offer a niche product, strengthening your brand and authority.
- SEO
General keyword phrases vs. long-tail, niche phrases are less likely to rank on search engines, so site traffic has a greater chance of being generated.
With these in mind, here are 4 steps you can take to discover a niche.
- Product research
Developing a new product is very different to assembling products for a niche. The first requires research around customer problems, wants and needs, whereas the second requires a focus on convenience and service.
Identifying these niches can be as simple as asking the right questions. Developing new products requires creativity and ingenuity, while assembling products for a niche can be as easy as asking yourself what your hobbies/interests are, how they impact how and where you buy, and what would make that experience better for you. You can ask the same question to friends and family, expanding the pool of people you speak to until you come up with a (ideally narrow) list of product niches.
- SEO
Now you have your list, your next step is to investigate keywords for SEO. With Ecommerce niches, your potential to rank using important, product related keywords is higher, but you need to find out whether your niche is too big or too small first. This identifies the competition and lets you see how much opposition you could face. One tool to vet niches is to use a tool called Ahrefs. Typing in the appropriate keywords and phrases lets you see how many searches they get in a month, plus the keyword difficulty score. The lower the keyword score and the higher the searches it generates, the more worthwhile the niche.
- Supplier research
Having identified your niche, your next step is to research potential suppliers. This list needs to include all the products your Ecommerce business could sell. So, if you are specialising in food intolerances, searching for vegan suppliers or gluten free suppliers is a natural next step. Check supply chains and supplier directories, which should include product categories. Once you’ve put together a list, contact them, ask for their prices, their payment terms, and any minimum order requirements.
- Product analysis
An obvious next step, you now need to analyse the products from the various suppliers. You can use Algopix for this as well. It can be a good indicator of product demand and profitability. Taking your supplier offer and entering it into Algopix will give you an insight into how well that product might sell, including the shipping costs, payment processing and marketplace fees. It will also estimate the demand, sales and potential profit. After that, it’s just down to whether you’re comfortable with your niche and the products you want to sell.
At WunderTalent, we work with the finest Ecommerce professionals in the industry. If you’d like to get in touch and find out how we can help with your recruitment needs, please contact us here.
