Product Niches vs. Market Niches
One of the hardest things to do when formulating an Alpha 2.0 business, perhaps the hardest thing to do, is determining your niche; that market niche who will buy your products / services / information. I get more questions on this topic than any other business area.
One of the biggest things guys do wrong when trying to determine their niche is they mix up the product niche with the market niche.
A product niche is when you niche the thing you’re selling.
A toaster isn’t a niched product. Pretty much anyone can have a use for one and could buy one.
A pregnancy test is also not a niched product. It’s certainly a more narrow market than a toaster, since only females of child-bearing age can use them, but that’s way too broad to be a niche.
A liquid testing kit for verifying if gold coins are real… now that’s a niched product. That kind of thing only appeals to people who purchase gold coins.
When I say “product” I also mean information or services. Selling industrial drainage pipe cleaning is a very niched service. Selling an ebook on how to build a 1974 Pontiac GTO from scratch is a niched information product.
A niched market is different. That’s the market you’re actually going to sell your product (or service or information) to. If I sell an ebook on how to get a girlfriend to anyone, I’m not niching my market. If instead I only sell it to divorced men over age 50, now I’m niching my market. It could almost be the same damn book. (It probably shouldn’t be, but it could.)
Some guys attempt to niche their product without niching their market. (“I’m going to sell a custom day trading system only focused on tech penny stocks to anyone who wants it.”) This fine, but not a great idea. Selling to the entire world is a very hard thing to do even if your product is amazing.
Other guys attempt to niche their market without niching their product. (“I’m going to sell accounting services to architects.”) This is better, since you are niching your market, which is the most important aspect of all this. This can work and I’ve certainly seen people make money this way (myself included). But it’s not the absolute best way to do this.
The best way to niche is to niche your market and your product. (“I’m going to sell a gold coin testing kit to extreme right-wing end-of-the-world types who only buy nonnumismatic coins.”) If you can niche what you’re selling and the market to which you want to sell it, now you’ve nailed it. Assuming you’ve got really good margins on what you’re selling, with just a little marketing you’ll be making money very quickly.