5 Ways to Find Your Ecommerce Niche
For the past decade or so ecommerce has taken traditional brick and mortar businesses by a wild surprise. But the success of ecommerce portals depended hugely on deficits in the existing model of an industry that, made people switch from one to the other. Didn’t the online ecommerce portals selling branded clothes capitalise on the efficient use of time and convenience that people experience when they shop online for a product?
In the next big step, within the online ecommerce market itself, customers are shifting from portals that provide generalised products to portals that cater to specialised services. Therefore, one of the tricks to have a successful ecommerce business is by finding a new ecommerce niche. Finding a new ecommerce niche can sometimes be nothing but plugging the existing voids in the conventional industry. Thus, by finding a new ecommerce niche you may launch yourself into a market where customer demand always existed.
Niche businesses are thriving today because of the limitations of physical retailing and the rise of aspirations of the customers who know exactly what s/he wants. As an entrepreneur, you need to understand (a) what to offer, (b) whom to offer it to and (c) how have an efficient system in place to complete your orders. Any new ecommerce niche would also be developed keeping in mind the above-mentioned considerations.
How to find a new ecommerce niche?
Given the dynamic nature of the ecommerce business, finding a new ecommerce niche may not be easy, but here are some tips on how to start:
1. Brainstorming: As a first step, think about your own experiences and how technology has made life made a little better by providing access to a service that most people could not have had access to.
2. Understand industry trend: One may come to an idea by thinking of a problem that they face and how technology can be used to tackle it. You can also look at online customer trend publications like Trend Hunter, Spring Wise and Trend Watching to understand new products that you didn’t know existed. An example could be of apps that offer to run your chores for you. Maybe, a busy lawyer in a law firm left his passport back at home on a day he needs to fly out to Hong Kong. Now, he can use an app like TaskRabbit to get it to him from home at a nominal cost.
What to keep in mind while finding a new ecommerce niche?
Any business is run for a profit motive. Therefore, while introducing a new ecommerce niche, you need to take into account whether it is economically viable for you to sustain it, keeping in mind the existing conditions of the market, the resources at hand and customer aspirations,
1. Identify your strengths and weaknesses:
You need to understand the pros and cons of introducing a new ecommerce niche for a specific market. You need to be strategic about your choice and have to –
(a) analyse the profit margins
(b) ensure that the products that you list should be hassle-free to sell
(c) market the products to the right people.
2. Watch the competition:
Once you have shortlisted on product ideas, look at how others in the industry have launched similar products. Following the industry influencers on social media can help inspire new ideas. Online tools such as FollowWonk and LittleBird provide a constant stream of carefully curated content from the people in the know. Learn from their mistakes and experiences and accordingly come up with a plan to launch the product.
3. Understand your niche customer base:
You need to identify the specific group of people to whom you want to offer your products and services to. Identifying your niche customer base will allow you to understand the likelihood of the success of the product. Factors including social considerations may become relevant in determining whether a new ecommerce niche is suitable for the market. For instance, online radio cab service providers like Ola and Uber were successful in cities like Mumbai and Delhi, but despite attempts did not manage to penetrate tourist destinations such as Goa.
4. Define your product:
While aggregators in e-commerce usually have more ‘likes’ and ‘fans’ on social media, the engagement and interaction that happens via niche businesses is more personal and thematic. Customers of a niche market know exactly what they want. Therefore, you need to define the niche market in a way that allows customers to comprehend your product or service and distinguish it from other generalised versions of the product or service being offered. If you are a niche lingerie portal for women, make sure that your marketing campaign carries that message to your customer clearly.
5. Middlemen communication:
The amount of data and information that has to be passed back and forth in ecommerce can be overwhelming. Therefore, while finding a new ecommerce niche, keep in mind the system you need to keep in place to sell it. Consider whether you can automate your processes to eliminate middlemen communication. Online food portals such as Zomato have successfully put together a system by which they take sales from all channels, forward them to the supplier and simultaneously forward tracking information back to the customer, and plug all that data back into their accounting software.
If you are looking to enter the ecommerce industry, and want to find a new ecommerce niche, think about the ways in which you can fulfil an existing unsatisfied consumer demand. Next, analyse your existing capacities and see if they match up against the systems that you need to have in place to run the business profitably. Finally, market the product to the right consumer base and define your product in a manner that customers are able to distinguish it from general products.
To know more, get in touch with Browntape. We are India’s leading ecommerce experts, and we are always happy to help!