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The Web continues to change every second, and sure enough, there are more than a billion registered sites on the World Wide Web (1,127,630,293 according to Netcraft‘s most recent survey of Web servers as of February 2023): the online business is immense and there are almost literally billions of opportunities. Anyone can start a blog, and those who do maybe spend time hoping to increase visits and start making money, but sometimes the problem is in the industry. Marketing, finance, insurance, information, fashion, travel, and technology are some of the topics that have the most competition, of course the reason is simple: there is a high demand for these types of content, and they are among the areas where the earning potential is definitely highest. It might therefore be disadvantageous for a new site or blog to jump right into these topics, becoming a “small fish in an ocean”: more strategic would be to find the famous niche market, the narrower scope might offer more visibility and thus better returns.

What is a market niche

But what exactly is a market niche or niche market? Simply put, it is a market segment with few competitors and therefore low competition, where there is obviously good demand.

The economic expression draws on the term niche, which is used in architecture to refer to a small empty space – a cavity or alveolus – obtained within a large wall, within which statuettes or cult images are usually placed.

So like the architectural element, then, in business the niche is a market space that is small in size but characterized by an interesting number of people who have a specific need that a product or service can satisfy.

Continuing with the definition, a niche market is a small market segment, i.e., a subset of a market that relates to a specific topic, inhabited by a targeted set of people or companies that wish to purchase this specific offering. Another relevant aspect, the economic niche is a part of a market that competitors have not yet reached, or that they occupy only partially and without fully and perfectly satisfying demand. What’s more, large, mass markets often represent an evolution of niche markets: thus, starting small today could also mean finding yourself with a competitive advantage for large-scale success tomorrow.

The characteristics of niche markets

A niche market is a segment of a larger market that may be defined by unique needs, preferences, or identities that make it different from the main, general market.

It may consist of a part of a customer base, or a certain type of product.

The fact that supply and demand are small does not mean, however, that niches are unprofitable: in very large markets, for example, niches can also be worth millions, although more frequently they are small spaces, sought primarily by small firms. Given fixed costs, limited demand and modest size, in fact, conquering a niche market does not always bring the necessary profitability.

To better understand what a market niche is we can give a practical example: within the women’s shoe market there are many different segments or niches, focusing only on larger sizes, footwear for special professional categories (such as nurses) or vegan productions. Or, in the pet industry, setting up a business selling dog collars is a niche market, as is specializing only in cat sweaters, pet dishes and feeders, or GPS trackers for pets.

In practice, with the right analysis almost any market can be further refined, or subdivided, according to the specific needs and preferences of its constituents. Some of the most common ways to define a niche are based on:

  • Price (luxury, moderate, discount, outlet)
  • Demographics (gender, age, income level, education level)
  • Quality level (premium, handmade, cheap)
  • Psychographics (values, interests, attitudes)
  • Localization (residents of a particular country, city or even neighborhood)

Focusing on a niche is thus a strategic business decision geared toward serving a particular customer base better than competitors targeting the broader market, and this applies to sites and SEO as well.

Why look for a niche market

Basically, the initial strategy consists of a field choice: that is, we can either serve the mass market or a niche market. Entrepreneurs who serve the mass market usually create many products or engage in multiple industries, struggling to stand out and become a market leader for each of their offerings.

This mechanics is different for entrepreneurs in a niche market, who instead create specific products or serve specific audiences. In addition to narrowing the scope of their business, serving a niche market can allow them to gain more credibility and become the brand of choice for their audience more quickly.

In short, it might be a good idea to go out and scout out niche markets, exploit them, and make money by increasing the likelihood of success through analyzing niche products or services that may have better market feedback to attract more customers and potentially even build a comparative advantage over competitors who are generalists.

Pros and cons of small market segments

Everything perfect? On the face of it, it seems that everything is easy, but we have to deal with some problems, of course.

While on the one hand we have less competition, or in some cases a complete absence of competition, in others we have difficulty finding a sales direction once the market has become saturated.

Trying to summarize, mainly the pros of finding a market niche in which to focus can be identified as:

  • Low competition or absence of competitors.
  • More direct contact with the customer than in large sectors.
  • Possibility of ranking with less difficulty on search engines.

Wanting to go deeper, working on a specific segment means aligning products or services with a small group of customers and with competitors that tend to be smaller in quantity and qualitative size than those operating in the more general and generic field. By reducing the core business, we will offer a specific product or service that will eliminate many companies from the customer radar, although this clearly means that there will also be fewer interested customers-which is why we need to try to enter a niche market that has an appropriate audience, considering the big picture and beginning to build the foundation for success.

Once we find the right niche, we can implement a series of penetration strategies in this segment, which is vital because it provides valuable information about target customers and improves the way audiences view their brands. This is the goal of niche marketing, which serves to improve brand loyalty, generate active audience engagement, and have higher lead conversion rates. That is, instead of investing in ads to penetrate a broader market, we can focus on targeted marketing campaigns and personalized customer service: interacting with fewer people means that it is easier to cultivate potential customers and build quality relationships, developing a closer bond with them; these aspects will also be perceived by the audience themselves, who will see the brand as a true partner, rather than a salesperson interested only in their money-with positive effects also in terms of feedback and reviews, which we know is an important element in building a brand’s social image.

These aspects also carry over to the economic sphere: operating in niche marketing reduces buyer personas and allows for more efficient spending and investment by targeting specific types of potential customers. More importantly, this can mean generating higher profits by continuing to develop products and content with unique features that meet the needs of ideal customers.

Referring instead to search marketing, finding a niche market in SEO means attracting qualified, targeted organic web traffic: usually, niche audiences search for long tail keywords, and so content must take this into account. Rather than creating generic, wide-ranging texts, it may be appropriate to narrow down the analysis to find the right words and strings that will help us convert web visitors into paying customers, intercepting customers who are already in line with the product or service we are proposing, who are interested in or need this product/service, and are therefore more likely to convert.

As for the cons of a niche, we can identify them (also based on what has already been written) in:

  • Reduced demand compared to macro areas
  • If competition is present, it is possible to fall into the temptation of creating a sub-niche
  • Sales directions that are difficult to find when the market is saturated.

How to find a market niche

Choosing a niche gives an online business a competitive advantage right from the start: launching immediately into a crowded product category or market means facing a tough uphill battle against established competition, while focusing on a niche and specializing products and services in a narrow market allows even novices to make better use of resources, optimize conversions and develop a loyal customer base. Selling to a niche market can be a short-term or long-term strategy; the key is finding the right audience and adapting everything we do to present ourselves as the best choice for the target audience’s needs and wants.

At the outset, however, the niche market and the products to be served are just ideas, a hypothesis of what we think will resonate with the target audience, and only a thorough analysis can give us the right assurances that we are not jumping the gun (or to failure).

The first step in finding a niche is to figure out whether there are enough buyers in that niche to make the investment worthwhile: if we verify that the industry is indeed too small to generate reasonable interest and profit, it may be more appropriate to target a different audience within that niche or even to promote a different product.

More generally, however, to find the right niche we need to consider:

  • The characteristics of the product with respect to market needs
  • The pricing strategy for the products
  • Quality of production
  • The positioning/branding of the site and the brand
  • The digital marketing strategy

Translated into “advice,” this means starting by investigating ourselves and our brand, identifying the problems and needs of potential customers-what in SEO we can call search intent-and then analyzing the competition already present. The other basic steps are precisely defining the niche and its profitability and testing what we are proposing, product or service, to predict whether it resonates and how much.

Niche market and SEO, the elements to consider

After we have found our particular market segment online, we also need to identify the users: actually, if we have worked well we should not wait long, because our task is rather to make our site visible and clickable, to make it easy and desirable for them to find our resources, and the way to do that is with SEO.

In concrete terms, we then need to think about our target audience and the buyer personas of this segment, focusing our efforts on understanding their needs, how we can respond to them, and any focal points, but most importantly, analyze what makes the niche market different from the broader market, and thus what are the levers to specifically appeal to the users’ wants, needs, and preferences.

Understanding the unique needs of each niche makes it possible to speak directly to them in marketing campaigns, and thus to increase the chances of getting a buyer’s attention by making it clear that our product is specific to them, or that our service is perfect for what they need.

Broadening the discussion, online success (or conversely, failure) is determined by two major factors:

  • The market we select.
  • The keyword research, search intent identification and content creation strategy we apply.

If we can optimize both aspects, we lay a solid foundation for our business, which will be able to intercept the right people in the best way, offering them something relevant and useful. On the contrary, missing one of the factors means making any effort ineffective, joining the large number of sites that earn little or nothing online.

One of the main causes of failure, in fact, is not taking the time to do the necessary market research to see if a business idea is feasible; more frequently, people rush in, improvise and select a niche at random, target random keywords or, worse, don’t even think about keywords and just “hope” at best (except to be surprised if the results don’t come).

People who succeed online take a very different approach: trivially, they carefully research markets, identify profitable niches, study specific keywords and follow a proven plan. And we can do that too, easily, thanks to SEOZoom.

How to identify the best niche market with SEOZoom

Within SEOZoom there are several tools that allow you to launch an industry analysis in order to identify an interesting and profitable niche, with different approaches that can best suit any type of need.

The most specific function is called “Niche Investigation” and it is within the “Keyword research” tools: as the name suggests, this is the tool that accompanies us to analyze a target niche, study the sites present, find out which are the most interesting keywords of that niche and, therefore, get insights to improve the website by unearthing new high-profitability keywords, which have interesting volumes but few indexed results (or many results, but poorly optimized).

Understanding and using this tool is really simple and immediate, with three different modes of investigation.

In the first case, “Keyword Research” allows us to get a complete keyword research for each sector identified by SEOZoom: just search from the list for the category we are interested in, the one that is closest to the topics covered on the site, click and wait for SEOZoom’s automatic analysis, which will quickly show a list of keywords related to the chosen sector, identified by scanning the reference sites of the niche. The table shows the complete list of keywords in the industry (which can be several thousand!), so it is crucial to use filters and column sorting to make the information more useful and usable; clicking on the “Questions” tab, on the other hand, we can view users’ frequently asked questions with respect to the selected niche, with an indication of the impressions generated by each of them.

The second mode of analysis is “Spy on Competitors” which allows us to obtain a list of strategic keywords from a domain that we enter manually and that we consider a good reference for the sector of interest. Basically, SEOZoom analyzes the site we have decided to spy on, analyzes its competitors, and provides a list of keywords related to the niche it belongs to, which will be useful to us in your strategic evaluations.

The last feature is “Content Gap” and allows us to find out if we are missing profitable opportunities due to gaps in the site’s content, which has real “holes” compared to what competitors are publishing and what people are searching for. Again, the research starts by entering a site to analyze: SEOZoom probes the site, the industry and the competitors, then presents a table with the keywords relevant to the niche, but on which the analyzed site has no specific content or has content that does not rank in Google’s top 50 positions, also indicating whether pages on similar topics to the selected keyword appear on the site (and therefore there is a content focus problem) or whether the keyword is a pure example of Content Gap.

It literally takes 5 minutes (sometimes a few more if the industry is very deep) to unearth a target niche for each vertical and also identify early, keywords around which to center the content strategy.

Other tools for unearthing profitable niches and keywords

More broadly, SEOZoom provides different other paths for identifying interesting and profitable new market niches.

For example, we can start with the Website Rankings analysis, which breaks down all websites into more than three thousand different sectors, reporting for each of them the top 100 sites ranked according to Google’s rules. Or, in a similar vein, we can refer to the Sectors feature that appears when we analyze a site, and which x-rays each website by calculating its Topical Zoom Authority by extremely vertical categories, so as to offer a complete view of all the topics for which a site, albeit small, competes and proves to be better at than others.

In both cases, the sectors and niches are categorized following Google’s own criteria-and so it is not SEOZoom that decides that a site belongs to a sector or that a keyword belongs to a subcategory, because the tool analyzes the information received from the search engine’s scans and sorting.

Still, we can completely change our approach and, instead of starting from the observation of a site (our own or competitors already in the industry), we can work on the keyword, but going for a lower volume long tail variant that is more specific to the needs of a targeted target audience.

In short, the opportunities are many, and SEOZoom is our ally in discovering which niche best suits our business.

Dynamism: we need to be ready for change

Whatever the strategic choice, however, we must remember one last thing: many times a niche can be short-lived, because the market changes with incredible speed, and we often need to be responsive and ready for change. In short, understand what direction the market is going in and accompany it to save your business: sometimes, a niche can evolve into a category of its own, or it can be encompassed and disappear, and so on.

However, there is also to be said that there are timeless niches, those that do not take too much of a hit from trends: the only problem with these micro sectors is that they tend to become saturated more quickly, because there are always more competitors ready to take over. As a result, it may become necessary to look for even more sub-niches, but going against a common phenomenon of the market being too small to make a profit.

Ultimately, market competition requires us to be versatile and ready for change. And to ask ourselves each time, is it better to “be a small fish in a big sea or a big fish in a small sea”? Or, as Pink Floyd teaches, “Did you exchange a walk-on part in the war for a leading role in a cage?”, adapting the answer to the analysis of the context, our expectations and our real possibilities.

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