Originally posted on February 8, 2016 by John Dessauer
“Forget the conventional wisdom. If everybody else is doing it one way, there’s a good chance you can find your niche by going in exactly the opposite direction.” – Sam Walton
Choosing a niche for a new business does not have to be a difficult process, but it does involve some careful research and soul searching. By soul searching, I mean really delving into your individual interests to discover a niche in which you can sustain interest for an extended amount of time. This niche will keep your creative energies alive and working diligently toward the establishment of your business and future success.
Begin by writing down all the interests and life experience you have acquired, such as hobbies or past jobs. Study this list and pick a couple of ideas that appeal to you as business possibilities. You want to pick a niche in which you have considerable knowledge or would be willing to devote the time to establish yourself as an expert in the future. Take as much time as need with this step and consider your choices carefully. My quick advice? Do what you love!
For me this has always been starting a business that in some way associated with real estate. It started off with just investing, but that single core real estate business has created other businesses that are associated with real estate such as a brokerage, property management firm, teaching, writing, etc. You never know where your niche will lead you…
Research all the pros and cons you might encounter by choosing this niche for your future business. For example, investigate the amount of money needed for startup or any special licensing that might be needed.
After the startup research is complete, now is the time to determine how much interest exists for your chosen niche. Just how many potential customers are out there for your new business? This can be the most important stage of the process and there are several ways it can be done.
One way to research your potential niche is to use free keyword tracker tools available on the Internet. Enter your niche keyword and you will be given the number of times this word has been searched for online in a given time period. This will give you a quick indication of how much interest exists for your chosen niche right now.
Another way you can conduct research is to check out what websites already exist in your chosen niche. It is a good idea not to target a niche that is too competitive or too under populated. Too much competition means it will be hard to become established in the niche and too little competition may indicate the niche is unprofitable or there are other problems, such as little public interest or legal issues.
You will need to determine your market and what sort of problems these potential customers need to solve. I train our real estate investors to look for problems to solve in their own real estate business. One way to do this is to join any forums that cater to this niche. Here you will learn the concerns of your potential customers, what problems they need to solve, and what they would be willing to spend money on.
Instead of trying to appeal to a large audience with a large niche such as children’s toys, try instead to target a more specific market, such as toys for special needs kids. This way you will not be competing with the big stores, but will be offering merchandise that those stores don’t sell. Specialty goods that are difficult to find locally are what customers will be searching for, not a common item they can go out and buy at a local store. Decisions like that will definitely affect your business.
“Remember, wealth has nothing to do with money, success has everything to do with failure and life is a simple as you make it!” – John Dessauer