What is a Niche Market?
A niche market is a subset of a larger market with its own particular needs or preferences, which may be different from the larger market. For example, within the market for women’s shoes are many different niches, or segments. Shoes for vegan women would be a niche market, as would shoes for plus-sized women, shoes for nurses, or even shoes for transvestites. These would all be niche markets within the larger women’s shoe market.
What Makes a Niche?
Nearly every market can be further refined, or divided, by the particular needs and preferences of its constituents. Some of the most common ways to define a niche are based on:
- Price (high, moderate, discount)
- Demographic base (gender, age, income level, education level)
- Level of quality (premium, high, moderate, low, cheap)
- Psychographics (values, interests, attitudes)
- Geographic (the buyer’s precise location)
Marketing to a Niche
Marketing to a niche is much easier than appealing to a broad market, since a niche has much more in common in terms of needs, wants, or preferences. Selling handbags is a huge market, for example, and there are many niches with many different uses for a handbag within it. You might have new moms who want a handbag that can be used as a diaper bag, you might have college students who need a bag to hold their books, single women in need of an evening bag to hold their phone, keys, and credit cards, vacationing moms who want a large beach bag to hold their family’s gear, and many more.
But understanding the different needs of each niche makes it possible to speak directly to them in your marketing – you will have a greater chance of attracting a buyer’s attention and winning their business by making it clear that your product is for them specifically.
The Downside of Marketing to a Niche
While targeting a niche as your focus will make it infinitely easier to find them and convince them to buy from you, you need to be sure there are enough buyers in that niche to make it viable. A pet store that caters to a wide variety of pet owners has a much larger potential customer base than a pet store that caters to local ferret owners, or Poodle lovers. Those niches may be too small for a local population.
That said, veterinarians that specialize in treating cats or horses, for example, stand out from generic vets and position themselves as experts in that niche. That’s the advantage of targeting a niche market – people prefer to deal with specialists, which is what you become when you claim a particular niche market as your focus.
Original Article: https://www.shopify.com/encyclopedia/niche-market