Niche Markets

A niche market may be defined as a small segment of a large market.

Say that the large market is auto parts. Is "tires" a niche market?

No, because Niche markets are created.

Pink tires with purple polka dots might be a niche market.

Is that true?

No, it is not.

The reason is that there is no market for pink tires with purple polka dots. Have you seen any cars running around with tires that are pink with purple polka dots?

You have? Where, at the circus?

Small Markets Versus Niche Markets

Just because a market is small does not mean that it is a niche market. Just because a market is specialized does not mean that it is a niche market. To find a niche market, you must obtain a sharp spade and find a need, or perceived need, that is not being filled.

To find a niche market you must study a market, mingle with the people in the marketplace, and find out what they are saying and doing. If you are like my son and already part of a special group, then you have an advantage.

If there are people in the marketplace that are looking for something specific that they have not found, it may be a niche market.

Perhaps you can supply a solution to a specific problem that some part of the market population is looking for.

Looking for a Refrigerator

I have used this example before, so being old and senile, I’ll use it again:

You decide that you need a new refrigerator, as I did yesterday.

What do you do?

I went to the local hardware store first.

I did not find a refrigerator there that I wanted.

So I drove to Twin Falls, taking my wife’s care-giver along to make sure that I bought the right refrigerator.

To make the story short, I purchased the refrigerator from from one of those large hardware / lumber stores that have driven many neighborhood hardware stores out of business.

But I could have gone to a Mall.

My thinking would be that I would go to one of the largest department stores like Sears and buy a refrigerator. That store would be a mall anchor store.

So I what would I do?

I would drive into the parking lot and perhaps I would catch a whiff of the odor coming from the food mart. So on my way to Sears I would grab an Orange Julius and a slice of pizza.

Now I would walk down the hallowed halls of the mall looking in the windows of the larger anchor stores and the many smaller shops along the way. I might see a low cost for a quality laptop computer. I might drop in that store and purchase it.

Now with my computer under my arm, I pass a kiosk where a pretty young lady tempts me with a pair of sunglasses. She says they make me look distinguished so I buy a pair.

With sunglasses on, a young man sells me a new case for my cell phone. Finally, I find a refrigerator at the anchor store and leave the mall.

Note that I bought a lot of stuff besides the refrigerator. This is called impulse buying. It occurs when folks visit Amazon.com. Fore that reason, many affiliate marketers promote

Amazon.com products. The buyer might buy much more than the product being promoted bringing higher commissions for the affiliate marketer.

Did I visit any niche markets in the Mall?

Nope!

Not one!

Popular Products and Consumer Products

Products that are sold in your local supermarket, anchor stores and shops in malls and in hardware stores are not niche markets. You have to find something specific to a small segment of a market that is not being supplied.

That is the dilemma of new marketers. Finding a niche market is not all that easy to many.

You can not just reach up into the air and grab one.

Market Research

It takes research of the market and you need to know the people in the market and you should communicate with that community. You should become a member of that community.

Many people have started an Internet business simply by using what they have learned from their hobbies and activities. Some have taken special knowledge they have to build a business. The bottom line is that no resource should be overlooked. One successful man liked to juggle so he built an online store.

Next Part III: What are People Looking for on the Internet