In order to be successful, you need to find a target niche market for your business. This can be a daunting task, but it doesn’t have to be. By asking yourself these 7 questions, you can narrow down your options and find the perfect niche market to find your business idea. In this blog post, we will go over each question in detail and help you find the right niche ideas for your business?
1. What value can you provide to the Niche Market?
This is the most important point of the list which is why I have placed it first.
What can you provide to the niche market that other businesses cannot? This is what will make you unique and successful. It is important to think about this carefully because it will be the foundation of your business.
The first question you need to ask yourself is: what value can you provide to the niche market? This is important because you need to be able to offer something that the niche market wants or needs. If you can’t provide value, then your business will not be successful.
What do we mean by value? Value is when the whole is greater than the sum of the parts. When people are going to receive value, they are going to pay for it. There needs to be a perceived excess value, over the price they pay, for the consumer to purchase something.
So, what can you provide to the niche that other businesses cannot? This is what will make you unique and successful. It is important to think about this carefully because it will be the foundation of your business.
Let’s say you are out shopping and are both hungry and thirsty and are of the health-conscious type. You see a store that sells bottled water and they have a special on where if you buy two, you get the third one free. You think to yourself, “I am going to buy a drink anyway because I’m thirsty, so this is a great deal!” You just found value. The whole (in this case three bottles of water) was greater than the sum of the parts (in this case, two bottles of water).
You need to be able to offer something to your niche that they perceive as having value. This could be a product, service, or even just information. As long as they see it as being beneficial enough, they will pay you.
2. What do you love doing?
Another question to ask yourself is: what do you love doing? This is important because you need to be passionate about your business in order to be successful. If you’re not passionate about what you’re doing, it will be very difficult to find success.
Think about it this way: if you’re not passionate about your business, why would anyone else be? You need to be able to sell your passion and excitement in order to get people interested in what you’re doing. If you’re not excited about your business, it will be very difficult to find success. If you are passionate, it’s a good sign you are willing to dedicate your free time towards a new business.
Do you know what your passions are? Do you have more than one? What are you good at? These are all important questions to ask yourself when trying to figure out what you should do with your life.
For example, let’s say you’re passionate about two things: animals and writing. You could start a blog about animal rights or write a novel from the perspective of animal. What an incredibly unique perspective that is not natural to people. This is a creation of value for your readers.
3. Where is the money?
Another important question to ask yourself is: where is the money? You need to make sure that there is a market for your product or service. If there is no market, then your business will not be making money and therefore won’t be successful.
If your goal is to make money, you have to convince other people to give you money. In order to do that, you have to offer them something of value in return. This could be a product, service, or even just information.
Imagine you were already selling a product, and you had two potential customers that both desired the product. Let’s say the potential customers are a single mother living on welfare, and a millionaire doctor that owns his own practice. Who do you think is going to be more likely to buy your product?
The answer is obvious, the millionaire doctor. Why? Because he has money. He can afford to pay for your product. This is why it’s important to make sure that there is a market for your product or service before you start your business.
To find where the money is, pay attention. Study other people, especially wealthy people. Do market research on target audience people local to you (but don’t be creepy about it). Find out what small business owners spend their money on, and add it to your shortlist as a potential niche to enter.
When possible, target an audience that is more likely to give you money. You will spend less time selling, and more time developing and executing your product and service, and improving its quality every day.
4. What are your skills?
Another question you need to ask yourself is: what are your skills? This is important because you need to make sure that you have the skills necessary to be successful in your chosen niche market. If you don’t have the skills, then you will not be able execute on successful niche ideas.
I’m not just talking about hard skills like being able to program a computer or fix a car. I’m talking about soft skills like being able to communicate effectively, work well under pressure, or create new things. These are all important skills that you need to have in order to be execute on a great business idea.
People searching for what their skills are won’t find the answer on any websites. The answer comes from looking within yourself, or asking others that know you well.
You can always learn new skills, you don’t have the skills necessary to be successful in your chosen niche, that’s okay. You can always learn new skills. There are plenty of resources available online and offline to help you learn new skills. You just need to be willing to put in the time and effort to learn them.
If your goal is to make money, you have to convince your targeted audience to give you money. In order to do that, you have to be able to provide value. And in order to provide value, you have to have the skills necessary to do so.
For example, let’s say you’re passionate about writing. But you don’t have the skills necessary to be a successful writer. You will not be able to find success in your chosen niche market.
This is why it’s important to make sure that you have the skills necessary to be successful in your chosen niche market. If you. What do you have experience in?
5. What do you have experience in?
Another question to ask yourself is: what do you have experience in? This is important because you need to make sure that you have the necessary experience to be successful. If you don’t have the experience, then you will not be able to find success.
What is your job, what do you do for fun? What have you done in the past that has prepared you for this moment? All of these things are experience. And they are all important when trying to determine if you have what it takes to be successful.
Naval Ravikant advises to leverage your “Specific Knowledge”, which is the combination of skills and knowledge that is unique to you. It’s what makes you better than others at doing what you do.
Can you combine your skills to create a what Charlie Munger refers to as the Lollapalooza effect? The Lollapalooza effect is when several different factors come together to produce an outcome that is greater than the sum of its parts.
There is likely some combination of skills that you possess that makes you stand out from the crowd. Not every reader is good at writing, or digital marketing. Are you? If so, you could start a blog where you review books. Even if you were an average reader, if you had above average skills in writing or digital marketing, the combination of those skills could turn into a valuable product (the Blog).
If you don’t know your skills, ask others your strengths and weaknesses (or just the strengths if you are the sensitive type!). Ray Dalio recommends this, and enforces his employees at Bridgewater Associates to audit the strengths and weaknesses of other employees. By understanding where you fall short, you can put systems in place to either improve or delegate those tasks.
Pay attention to the compliments that others give you. If you constantly hear “You’re a great writer!”, then chances are you have the skill of writing. If you don’t believe me, ask any number of people and I’m sure you’ll get confirmation bias to support your skill.
Are people often asking you for help in a certain area? Do you hear “I don’t know how you do that so well” often? Unless the person is buttering you up or flirting, you have a skill in that activity.
You could start a business based on any of these skills, or any combination of them. The important thing is to understand that you need to have skills in order to be successful.
6. Where do you see yourself in five years?
Another question to ask yourself is: where do you see yourself in five years? This is important because you need to make sure that you are in a good niche market that you can see yourself being successful in for the long term. If you don’t see yourself being successful in the niche, then you will not be able to find success.
Have you actually sat down and taken the time to answer this question? If not, then you need to do so. This is an important question that will help you determine if you are in the right niche.
Where do you see yourself in 1, 3, 5, 10 years? This is an important question to ask because you need to make sure that you are in a niche market that will be around for the long term.
As I am writing this, it is my 28th Birthday. In 5 years it will be my 33rd Birthday. In 10 years, I’ll be 38. The life I will be living as a 38 year old will be drastically different from my life now as a 28 year old, and enormously removed from who I was as an 18 year.
I know that by the time I am 33 in 5 years, I want to spend quality time with my family every day, have a successful business while maintaining a high level of ownership, learn every day and many more things. In my study I have an A4 sheet of paper with my major life goals on it. I am not going to share the whole list here, but the items I have shared are at the top. And the point is: I know what I want and where I see myself in the future. And because I have a clear idea of that, I can make sure that the niche I am in now is something that will help me get there.
If you don’t have a clear idea of where you see yourself in the future, then it is going to be very difficult to find success in any niche. You need to have a clear vision of where you want to be, and then find a way to get there.
Exercises to Help you Visualize the Future
Visualizing the future is extremely important, but it’s not always easy. If you find it difficult to do, then here are a few exercises that might help you.
Take a piece of paper and write down where you see yourself in the future. Write down your goals, your dreams and what you want out of life. Close your eyes and visualize yourself living that life. Incorporate all of your senses into the experience. What do you see, feel, hear and smell?
The more vivid the experience, the better.
Another exercise you can do is to imagine yourself inside of the level of your favorite video game. What does that world look like? How do you interact with it? What is your goal in that world? Can you see yourself as the character?
You can also imagine yourself as a successful person in your chosen field. What does that look like? What are you doing? How do you spend your days?
You can also read biographies and autobiographies of people who have achieved what you want to achieve. This will give you a better understanding of what it takes to be successful.
All of these exercises will help you to better visualize the future and what you want out of it.
7. Is Your Target Niche Market Growing or Shrinking?
The last question to ask yourself is: is your target niche market growing or shrinking? This is important because you need to make sure that you are in a niche that is growing. If the niche is shrinking, then it will be very difficult to find success.
If you are entering a market as a new competitor, you’re at a disadvantage compared to existing players that have a higher brand value and more authority. You need to make sure that you are in a niche that is growing so that you can have a chance to compete.
It’s only really an issue for niche markets that are on a downward trend. Niches that are increasing in popularity each month will have enough growth to allow you to carve out your space in it. Especially if your business is on the Internet.
The Internet has created a level playing field for businesses. It doesn’t matter if you’re a one-person operation or a multinational corporation. If you own products and sell them or deliver services with a well-executed marketing strategy, you can find success.
The key is to make sure that you are in a niche market that is growing. If the niche is shrinking, then it will be very difficult to find success.
Use free tools such as Google, YouTube, Google Trends, Ahrefs, SemRush, Surfer, to validate if your targeted niche is growing.
If the niche has a high amount of views, that’s a great sign.
Google Trends is a great tool to see if your target niche is growing over time. Just enter in your related keywords and it will show you the trend. Finding specific keywords with high search volume shows how much interest there is in the keywords related.
View count of videos on YouTube, Instagram, Facebook and TikTok is a good way to see what is trending right now. The more data you are able to research on search terms, the more you will identify problems and pain points, which can lead to a great niche market.
If you are really drawn into a niche but it doesn’t have the right growth rate or monetization capability, you can still enter that market! Just be aware of the reality of the situation, and adjust your expectations of how much work will be required to see results.
Decide on and commit to the single niche that best suits you, your specific knowledge, what you care about and what pain point you solve for your ideal customer.
Conclusion
To choose a niche, the most important thing is to choose a niche that you are above to provide value to. It’s also important to make sure that the niche market is growing. You can use tools like Google and YouTube to check the growth of a niche. Find keywords on your target customers, as well as the broader market. If you’re drawn to a niche but it’s not growing, you can still enter the market, but be aware it may not be a very profitable niche. The most important thing is to commit to the niche that best suits you, so that you may have your own profitable business that delivers value to your target audience.
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