NICHE MARKETS
Internet stores have a distinct advantage over brick and mortar stores: The cost of doing business is less. Leasing space in a viable location and staffing that space are major expenses for the brick and mortar merchant. In contrast, the Internet store is frequently comprised of one person with a desk top computer spending just a few hours each week.
The niche market is often characterized by products having too few potential customers in any one geographic area to support a successful brick and mortar store. This doesn’t mean that it’s a small market, just that a broader geographic reach is needed to make selling into it viable. This is where Internet selling starts to shine brightest.
MICRO MARKETS
Some niche markets are miniscule by normal standards. We’ll call these micro markets. Worldwide, there may be fewer than 1000 potential customers in a micro market. Effectively selling into these markets would be very expensive without the Internet. With the Internet, these markets can be the most interesting because they constitute a community of like minded people that you can get to know individually.
Speciality, vanity, and information websites often offer a micro market opportunity. Don’t shy away from adding a little commerce to your special interest web site. You’re probably not going to get rich selling into a micro market but, you’ll have fun with the interaction. After all, commerce, trading in goods and services, is one of man’s earliest forms of social interaction. And there’s nothing like putting a few bucks in your pocket while having fun.
Most niche markets are sub and sub/sub categories of general markets and micro markets are sub categories of these. For instance Radio Control is a sub category of the general hobby market. This would be a niche market but airplane Radio Control is also a niche market, simply more specific. Even more specific could be the Antique War Bird Radio Control. This might be at the micro market level. Only the enthusiast would know for sure.
What the enthusiast turned merchant should know is that an entry into a micro market with a store on the Internet has the greatest chance of succeeding. Revenues may not be great but, expenses will be low and you’ll be staying away from the intense competition of the big guys. Item price will not be a major issue.
FINDING A NICHE
The number of niche market categories is limitless and the specialties within these niche markets, themselves niche or micro markets, is huge. The way to tell if an item you want to sell is a part of a niche or even better a micro market is to search your local village or a shopping mall. If you can’t find the item or something pretty similar you’re probably looking at a niche market item. If you think there are some other people anywhere in the world that would want the item, you’re on your way to becoming a pure-play Internet merchant.
Mel Davey is the creator of ImagineNation (http://imaginenation.com/), a full service E-Commerce Application Service Provider, offering Storefronts, Order Management Utilities, and 3rd party credit card processing.
