Choosing the right niche is one of the most important steps before you can start your own eCommerce business and it is where you make or break your business module.
Every successful eCommerce business started in a niche just because it is very hard to grow your business if you have broader category product selection.
Focusing your resources on one niche is the right option to go for and it will give you the advantage to study your specific audience, rather than targeting a wide audience that is hard to reach.
Choosing a profitable niche is not that easy just because there are a lot of eCommerce websites nowadays and the competition in the same niche is very high.
This means that the advertising cost will be higher if many people advertise the same niche.
However, there are some basic steps to follow in order to choose the right niche for your eCommerce business.
Research Product Subcategories
Every eCommerce business owner must know that they must dig deeper into the subcategories in order to find the right niche for the store. The more specific niche you got, there is more chance to succeed in the market. People nowadays even started creating one-product stores, which proved to be incredibly successful.
Open eCommerce websites with categories and try to go in the subcategories in order to find the right niche that you can add value to it.
Keyword Research is Essential
Once you cleared away the path that you want to go through, it is time to do a bit of research. Even though a lot of people have already made successful niche businesses, you have to know that is not that easy.
When you research some keywords that will represent your business module it is important not to be greedy.
We all want niches with hundreds of thousands of search volumes, but it is going to cost you a lot just because the competition is very high.
You have to find the right balance between the search volume and the competition in the niche. Using AdWords you can find out search volumes, Google rankings, competition level and much more.
You must base your research on trending niches and not trending products.
Know Your Niche Products and Audience
After you selected the niche you want to target, you have to research the products that you are going to sell. Knowing your products is a very important step of creating the perfect niche eCommerce store. You have to know your products in and out by researching market prices, advertising methods, use, who will be interested in buying, quality, and much more.
For example, there is a reason why Superbowl ads are mostly about cars and food. The target audience of the people watching the game. As well as other games between NFL playoff favorites, is interested in those kind of products and thus it makes sense to invest into the sport niche.
Basically, when you create your niche store you have to know the whole DNA of it. This will be very helpful in terms of designing the website, targeting the audience, face returns, marketing and etc.
Now it is time to go through some numbers. Niche business can be hard in terms of financial limitations.
On a general store, you can have a different kind of products all with different margins. This way you can set a balance and price the products by different margins just so your average margin does not go below let’s say 50%.
However, in a niche store, the margin is determined by the products, so when you choose one category of product, usually all margins are the same.
That is why you must research the market and do financial analyzing on the products. Find out the highest and the lowest limit for pricing your products so you can determine the profit.
These are some of the steps that every eCommerce niche should be started. Remember, it will be hard, but as long as you believe in your business idea and roughly follow some basic guidelines, you will succeed.
Author: Mario Petkovski