Niche businesses offer targeted services or products, but starting one can be risky due to market saturation or obscurity. Niche markets can be identified by narrowing down a traditional service or product. Internet marketers often use and teach niche marketing, but a niche business cannot thrive without demand. Micro niches may need to be popular or paired with other niches to be successful. Market saturation can also lead to direct competition.
A niche company offers a targeted service or product, usually one that traditional companies do not provide. For example, many companies offer basic landscaping services, but notably fewer use pet-safe, low-allergen plants and chemicals. Niche marketing is not a new technique, but starting businesses, in particular niches, is risky because it can fail for many reasons. Sometimes a business niche is too obscure and most people don’t need the service or product it offers. Other times, the market is already saturated with similar businesses or becomes saturated after the business idea becomes popular.
Niches can be identified by thinking of a business such as “house cleaning” and then narrowing it down to something like “blind house cleaning”. This company would specialize in cleaning blinds, something many home cleaning companies refuse to do or charge extra for. Another example is “computer repair” shortened to “Apple computer repair”. Most traditional businesses offering a service can be boiled down to a niche business. It’s also possible to have a niche product like ear plugs that protect people’s ears while still allowing them to hear everything, just at a lower volume.
This type of business strategy is not new, but it gained a lot of popularity when it was introduced to the Internet. Internet marketers often use and teach niche marketing. In fact, people pay substantial sums of money to attend courses and conferences on the subject. These people are usually looking for new niche business ideas or ideas on how to expand their current niche business. On the other hand, some people don’t own a niche business but advertise it as an affiliate.
A niche business cannot thrive without people needing its services or products. Sometimes people choose companies that are very niche. For example, a woodworker decides to specialize in creating solid oak computer desks, but gets no business for months, then only a few clients after much publicity. Such a small niche is called a micro niche which usually needs to be very popular to be successful or paired with other micro niches to make enough profit.
Another potential problem for a niche business is market saturation. The point of building a business around a service or product that few people offer is little or no competition. Sometimes people have already discovered a niche and cornered the market. While it is still a very focused and technically niche service or product, it will likely no longer be profitable for a new business unless the service or product can be improved upon. Niche markets can also become saturated once a person starts a business, leading to direct competition, sometimes with companies with larger budgets and established customers.
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