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How To Find A Niche Market: Your Ultimate Guide

By Denis Koshelkov

Find a Niche_Market

In dropshipping, your success heavily depends on the niche you’re working in. So, finding a niche market is one of the most important aspects for an ecommerce entrepreneur.

Therefore, in this article, we are going to discuss how to find the perfect niche for your dropshipping store, how to approach it, what advantages you will get from that, and what mistakes you should try to avoid.

Let’s get right into it!

What is a niche market?

Before we focus on finding a niche market, let’s start with the definition.

A niche is a narrow market segment with some specific products that are interesting and desirable to a certain category of potential buyers.

For example, let’s take a broad market: clothes. Within this huge market, there are lots of smaller product categories: outerwear, underwear, homewear, sportswear, and many more. And each of these categories, in turn, can be divided into numerous, even smaller niche segments, for example:

  • Classy jackets and coats for young men
  • Comfortable workout clothes for women
  • Affordable home clothes for toddlers

Now, you see it: there can be countless variations! Defining a niche, you:

  • Take a broad market as your starting point (for example, clothes)
  • Pick a narrower category within it (for example, office wear)
  • Make it even more narrow to understand who you will be targeting (for example, smart suits and accessories for middle-aged men)

When your niche is defined in such a specific way, it lets you run and grow your business much more efficiently as you understand:

  • Who exactly is your average target audience representative
  • Which product features and online shopping aspects are most appealing and desirable to this audience
  • What should your advertising messages be and where you should place them to reach your potential customers effortlessly

And now, when you see how important it is for your store to be built around a certain narrow niche, let’s discuss the importance of choosing a niche store over making a general store and how to find a niche that gives you the best business opportunities!

Finding a niche market to focus on VS running a general store

At first glance, dropshipping may seem like a very easy way to earn money. And in most cases – it is! All that you need to do is set up your online store and upload the most popular products.

It doesn’t take much to open a general store: all you have to do is import the most popular products to your website, regardless of their niche. You will have a wide range of products to offer and attract lots of customers and earn a fortune. It should do the trick, right?

As a matter of fact, running a general store, you’ll probably face some challenges you need to be ready for. Let’s look at the most significant ones.

  • High level of competition

Having a general store means competing with the biggest marketplaces out there – Amazon, eBay, etc. And even though you can actually compete with large-scale retailers quite successfully, it will surely take some time for your store to start standing out in the customers’ eyes.

Plus, regular brick-and-mortar stores located close to your buyers’ place of living are something that you should consider, too. In most cases, if customers can get the same product you’re offering in a nearby store, even if you provide a better price, they won’t opt for online shopping. Why? Because customers who are looking for more general items won’t wait for the goods to arrive if they can purchase them right on the spot.

  • No chance to use SEO to promote your store

For a dropshipping business, marketing is everything.

SEO, or search engine optimization, is a low-cost (mostly, free) way to drive more visitors to your store by making it rank higher on Google. Thanks to it, online business owners can successfully promote stores without spending money on ads, especially when they sell something that people look up on Google deliberately.

Of course, this strategy can only work with niche-specific products, and not just some random generic items. A well-defined niche gives you a chance to choose the necessary keywords, properly optimize the store pages, and fill them up with unique content. That’s how your store moves higher on Google search results page and gives you more opportunities to scale your business.

Sounds tempting, right? Now, let’s discuss finding a niche market that is best suited for you!

How to find the perfect niche for you

Finding a niche market that you’ll enjoy working with (and estimating its potential profitability) will require you to do some research. Here are some things you need to think of to find the perfect niche for you.

  • Consider your own interests and passions

Customers need to be sure that they deal with someone who doesn’t simply want to line their pockets at consumers’ expense but has something in common with them. In this case, your clients perceive your service as a sort of aid.

It’s important to establish trust with your potential customers!

Besides, if you like what you do, it’s much easier to keep yourself focused on having your business succeed. The simplest way to specify your passions is writing down a list of the interests. Carefully think about the sites you frequently visit, magazines you read, communities and groups on social networks you’re subscribed to, etc.

  • Estimate the level of competition within the chosen niche

Before choosing a niche to focus on, analyze it thoroughly.

Can you be competitive in this niche? What potential profit can you expect?

Identify the sites of your potential competitors, and compare their prices. Think of the original products you could offer, non-typical pricing strategy you could use, and the unusual promotional strategies you could try to make yourself different from others.

  • Pay attention to the emotional response your products are triggering

Nowadays, people suffer from the crazy pace of living. To cope with the stress, they need some positive, uplifting emotions. If your product can make them happy, it will be great for your success.

  • Make sure the goods actually solve a problem

Think about your interests and what are the most common difficulties within them. Generally speaking, your product needs to help customers overcome or alleviate the obstacles they face while working or spending time on their hobbies.

  • Find something unique

Most people want to draw other people’s attention. It’s not a brand-new discovery. Nobody wants to wear the same dull clothes or plain accessories. Customers will be eager to buy something unique and recognizable.

  • Check if the items hold some sort of value

Everyone wants to keep their image up to date. Some products make you look respectable and fashionable.

You can try out our free niche evaluation tool to check your niche potential easily!

Finding a niche market using AliExpress

AliExpress is one of the worlds’ biggest online marketplaces where you can find hundreds of thousands of different products from all kinds of categories.

When choosing what products you are going to source from AliExpress, you have to carefully evaluate several key factors, such as relevant statistics that help us understand if this niche and these specific products are popular with potential customers.

While scouring through AliExpress in searching for a niche market, here are the elements to pay attention to and estimate the popularity of the niche.

  • Estimate the product quantity on AliExpress

Look at the number of items that can be found on this platform upon the use of a particular keyword. Furthermore, to get the best results possible, check the free shipping option and the 4*+ rating to get the best products and sort the products by the number of orders.

Number of offerings on AliExpress for a niche product

As you can see by search results, this niche is very popular with over 6,500 products to choose from.

  • Find a trusted supplier

To get a better understanding of how trusted the supplier is, here are the parameters you should evaluate the reliability of the seller by:

  • How long the store has been in operation
  • What’s its feedback score
  • What is the percentage of its positive feedback
  • How much the items match the description
  • What buyers say about the quality of seller communication
  • How satisfactory is the shipping speed

You should heavily consider each parameter, however, in our opinion, the most crucial of them is the percentage of positive feedback.

  • Evaluate the seasonal fluctuations in demand

There are types of goods (for example, Halloween decorations, Christmas gifts, etc.) that are in demand only within a limited period of time. There’s nothing wrong about having these products in your store if they are combined with some other kinds of offers (birthday cards, wedding decorations, etc.) that are not season-dependent, but it’s not recommended to rely on them solely.

If you are not sure whether the niche you’ve chosen is seasonal, check it with the help of ‘Google Trends’ tool.

In order not to miss the hottest trending topics, monitor general public interest towards various areas of life. Google Trends shows the graph illustrating how public interest towards some particular topic is changing.

Google Trends is an instrument that gives you the necessary insight into general public interest towards this or that product. This service is designed to analyze search trends, so it can be perfect for your business because it shows:

  • How the search volume changes over time
  • What are the most popular search terms
  • Where do the people searching for this term live
  • Whether the interest towards this search query is seasonal and changes through the year

In order to use it, you need to:

  1. Pick a product category. The easiest way to do this is to rely on AliExpress in order to gather all the possible categories (e.g. electronics, home and décor, jewellery, etc.).
  2. Go to Google Trends and type in this category in the ‘Explore Topics’ field. Let’s take ‘knitting’, for example.
  3. Look at the result and try to analyze it with the use of additional settings.

For example, this graph shows how the search volume changes over time, and, as you can see, it decreases gradually. To learn more about these dynamics, you can change some settings:

  • Your region of interest
  • Time frame
  • Categories
  • Type of content

Google trends niche market results

What’s interesting, this example shows the seasonal interest in this search query. Like we previously mentioned, if you mouse over this particular graph, you will see that peak seasons for this search query are winter months.

Surely, you will also find it essential to see the regions where this search query is the most popular.

Niche market interest by region

Additionally, you will get the chance to take a look at the most popular related search terms and estimate the speed of their popularity growth. This will be a very important piece of knowledge at the moment of planning your marketing and SEO strategies necessary to promote your dropshipping store.

Niche market related topics

Finding a niche market using Instagram

Let’s estimate whether we can use Instagram for this or that particular category. All you need to do is type the chosen category in the ‘Search’ field.

Niche market on Instagram

As you can see, there are numerous results in the dropdown menu. These search results contain your focus keyword, which is why they are shown to you. Your task here is to open every one of these and see what users are posting. Also, this can help estimate how popular a certain topic is on Instagram.

Furthermore, try to collaborate with accounts that specialize in this niche and have at least 10,000 followers as this provides us with quite a significant audience. The most common way of such collaboration is promotion via shoutouts – we ask the account owner to publish our advertisement posts from time to time on a paid basis.

Finding a niche market with the help of Facebook

To check whether the niche you’ve chosen has the necessary potential, type its name in the ‘Search’ field on Facebook and choose the ‘Groups’ section. You will see a list of the existing groups that have this keyword in their name and the number of their members.

We usually consider a niche to be promising and prospective if it has more than 15 groups with more than 30,000 members per each.

Additionally, it can be useful to also check out the ‘Pages’ section – it gives you even more insight into this niche popularity and its opportunities for your business.

finding a niche market with the help of Facebook: see how many related Facebook groups there are

To learn more about strategies that are most typically used to promote an online store on Facebook, visit our blog – this case study shows a detailed example of a successful promotion.

Finding a niche market: mistakes you don’t want to make

Making mistakes is all part of the experience. The more you make – the wiser and experienced you will be. However, isn’t it better to learn from other people’s mistakes rather than your own?

Based on our experience, we are ready to share with you some thoughts on what common mistakes you should avoid.

  • Ignoring your personal interests

Like we mentioned before, creating a dropshipping store based on something you like, you will have extra motivation to succeed. Furthermore, you get the opportunity to market and promote it on a professional level that inspires trust and motivates your visitors to proceed with their purchases.

This has already been told a thousand times by each and every business guru, yet still, it is worth mentioning: “Choose a job you love, and you will never have to work a day in your life.”

  • Only focusing on the profit

A very common question among our clients is: “What niche will give me the highest profit in the shortest time?”

And don’t get us wrong, there is nothing wrong with the desire to make money after all this is the main reason why people launch their own dropshipping stores.

The sad truth is, most likely, this approach will result in a poorly performing business. A profit-first attitude is a common mistake in ecommerce. Sometimes, people simply don’t care what they are selling, all they want to know is what’s most profitable.

Having figured it out, they launch a store and simply sit back waiting on the profits to come in. The niche is hot, why bother promoting it, right?

There are others out there that don’t mind supporting the store activity, however, experience other challenges along the way: knowing nothing about this niche apart from its good financial potential, they struggle with picking the right products, identifying their target segments, and communicating with the audience.

  • Doing no research

Let’s suppose you’ve chosen a niche on a whim, and picked the one based on your sweet nostalgic memories, or the one hailed as the hype and trendy one for this season, or whatever.

You spend some time and effort on building a suitable store, invest money in paid ads – and then find out that there are not enough high-quality AliExpress items to add to your offer.

Or, you’ve discovered that this store idea is already taken by high-profile market players attracting all the existing customers.

Or, you’ve successfully processed a number of sales but noticed that the final revenue is not worthy of your effort.

To prevent any of these scenarios from happening, finding a niche market requires you to conduct your own, independent research. There you will determine the strengths and weaknesses of the niche that seems a good pick to you.

  • Offering no specific value

This is a common problem for “general stores” that sell a random mix of unrelated items. However, niche-focused online stores can face similar problems throughout their dropshipping journeys.

Like many other businesses out there, dropshipping is a customer-oriented business. So, it is crucial to understand how a particular niche allows you to create a distinctive shopping destination that can successfully compete with other stores because of its unique selling proposition.

Meeting your preferred audience’s requests and focusing on their needs is the key to attracting customers. So, if you don’t see the way to use your chosen niche to create a memorable, landmark store that is tailored to suit the buyers’ needs, it’s wise to move on to a more client-centered product range.

  • Allowing no room for growth

One possible strategy of choosing a niche for your dropshipping store is focusing on hype items trending right now. As long as this particular product is popular, you can theoretically make good money from it. Still, as soon as it gets forgotten, you will need to rapidly switch to another super-hot category.

Traditionally, a less risky approach is more popular. Entrepreneurs choose a niche with a more or less stable demand that is expected to remain in a long-term period. Over the course of time, they slightly update their product range along with the promotional methods.

Summing up how to find your perfect dropshipping niche

You don’t have to go far to look for the best dropshipping niches, as we have already picked the best niche products for you. Nevertheless, finding and choosing the right niche market takes some time. You need to carefully consider and research various aspects and determine what is the best opportunity for you.

In dropshipping, selecting the right niche is one of the most important focal points, so approach this with due diligence and preparation.

Now, you have a much clearer idea of how to find a niche for your dropshipping store! And if you want a fully functional online store made specifically for you, we have the solution! So, find your niche, launch your store and count the profits! The best of luck in your business endeavors! 

avatar
By Denis Koshelkov
Denis is a copywriter at AliDropship. Having graduated from the Faculty of International Business as a specialist in advertising, he explores the rapidly changing and evolving digital marketing industry and feels committed to sharing his findings with a wider reader’ audience.
46 Comments
nathan 5 years ago

Best guide for dorpshipping thanks for your effort

yaros 5 years ago

Thank you for your feedback!

Nirikshan 5 years ago

I think this is the best case study, Thank You

yaros 5 years ago

Thank you!

Neil 5 years ago

It’s very obvious you put a lot of effort into the service you provide for your clients , thank you for this well written and informative article.

yaros 5 years ago

Thank you! We are glad you found it useful.

di 5 years ago

Im not understand – must pay 900 dolars for what? there is way to use dropshipping platform without pay?

yaros 5 years ago

Hello, you don’t need to pay $900. The plugin with all its features is available here for $89 https://alidropship.com/plugin/

Arun 5 years ago

Thank you very much Yaros, I’m following you WF post and the ones here, extremely useful! Soon, I’m going to be one of your client… Do you accept my own niche suggestions too when I order for a custom web site?

-Arun

yaros 5 years ago

Hi, Arun! Yes of course, we will be glad to consider your niche!

kanwal 5 years ago

Thank you so much for this amazing and informative post.

Paul Ascalon 5 years ago

Hi, just wanna know what happens next after taking all the scores? How do we apply it to select the right items? Shall we choose only the ones with a perfect score? Is there a passing mark?

yaros 5 years ago

Here we usually recommend focusing on two main parameters – feedback score and the purchase volume.

James Barron 5 years ago

HI Yaros,
Really appreciate the in depth review in choosing the right niches , I have personally been
wrestling with trying to choose the right one for a month. With this guideline I believe
I can eliminate a great deal of guesswork in settling on the right niche.

Michael Njo 5 years ago

A very thorough report. The most extreme niche report if you ask me. My problem however is the keyword analysis, competition review, and keyword competition. There is no information whatsoever on these key terms and they are the most integral elements in identifying a niche. If you could please elaborate on the difference of these terms and their scale definition, I will be very grateful.

Mufaddal 5 years ago

This page info is really worth reading and understanding especially for people like me , who are new to this e-commerce business world. Thanks for the info. Really appreciate.

Mike 2 years ago

Just need to know where will my site be post and what is the starting cost is like to get it up and selling.

Olga L. 2 years ago

Hi, thank you for your interest!
Please, check out this page to see the starting cost of different business options: https://alidropship.com/stores-comparison/

Tiffany Milan 5 years ago

Thank you so much for this. You have cleared up a lot of confusion for me. Now, I can gauge the market a lot better and actually have a place to start.. Lifesaver!

Peace

Yz 5 years ago

I will be very honest. I’ve been reading a lot of this stuff for the past two months or so but definitely the two kings of super value are two people: Yaros then after comes kingpinning travis.

Will 5 years ago

Where are your explanations for keyword analysis, competition overview, and keyword competition?

These are crucial components that determine whether your list of niches work.

yaros 5 years ago
Muhammad Ibrahim 5 years ago

After Reading all the comments from the above , i feel buying the Plug in for a Customized Website immediately. But the only suspense is that i hope that there is No Hidden Costs which may disappoint me to use it immediately. I understand that i will have to pay an additional cost if i will use the Social Rabbit Tool and Hope for the others everything is included in the fees of US$299.00 + US$48.00 Yearly Hosting Fee. Thank you for any points not cleared…

yaros 5 years ago

I can confirm that there are no any other additional fees. For this price you get a complete webstore ready for getting your first orders.

wayne 4 years ago

Yaros is your theme for sale? will it work on shopify?

yaros 4 years ago

Themes come free with the plugin. They work with WordPress only.

Mike 4 years ago

Ahh.. I already choose my niche, bought AliDropship Plugin and paid my Domain before reading this article. You are not recommending Apparel but my niche fall under that category. What will happen to me? Should I buy another Domain and move my AliDropship Plugin into that new hosting and domain?

yaros 4 years ago

Don’t worry, apparel niche can work great, but I recommend that you avoid shoes.

Amaury Guerra 4 years ago

Thank you,Olga !
Very good tips.
Why do you include only the items that have the free shipping option ?

Don’t a paid shipping is usually faster than the free ones?

Olga L. 4 years ago

Thank you for the feedback!

Free shipping option means that neither you nor your buyer will have to pay extra for delivery – in other words, your expenses are lower, you get the opportunity to increase the price to a reasonable level, and your client gets more likely to buy the item.

If you feel that for your target audience the speed of delivery is a more important factor than price, feel free to choose paid shipping option as well. In this case, we recommend to choose the items with ePacket delivery option as it’s more quick and convenient.

Nikolas Barrera 4 years ago

Great article, tks

Andreas 4 years ago

We are talking about pure gold info on this . Great work #Yaros and #olga

Richard 4 years ago

Are you going to update the list for 2018?

Shehan Perera 4 years ago

Thank you for your insight. I’m just learning about dropshopping and have purchased the Aliplugin app. Your article is really helpful to me to refine ideas.

Natalie 4 years ago

hello! could you please tell me how you rate a Trusted supplier? is it special tools?

Belly Biya 3 years ago

Thanks for this guide

Xzendor7 3 years ago

This is a great guide; one of the best I’ve read for researching s targeted niche store. I t really takes a lot of the guess work out of determining which niche can be profitable.

Thanks for the info Olga.

ologunde Adekunle 2 years ago

Great article well explanatory more inspiring write up from you.Great job weldone

ehab 2 years ago

thanks for the article ,it is very useful.
one question the link to websta is not working ,any reason ?
Thanks again

ymk 2 years ago

Stuck with the same place. Seems websta is no longer active? Any alternative or being able to skip this question?

Olga L. 2 years ago

Hi, thank you for pointing this out!

We’ll try to find the alternative and edit these instructions. In the meantime, you can just look for the necessary accounts manually, by typing the target keyword in Instagram search field.

Ana 2 years ago

Thanks for the very helpful and still relevant article And thanks as well for the follow-up info on Websta. While you’re looking for an alternative, may I suggest editing the article with the info in your reply? At least this will ensure that readers don’t waste their time trying to use Websta or find an alternative themselves.

Olga L. 2 years ago

Hi, thank you for your feedback!
Yes, we’ve edited this part already.

Tony Cook 2 years ago

Really great article… incredibly helpful. Thanks Olga.

malika 2 years ago

Great info ,good thanks .

Jess 2 years ago

i tried the “Find Your Niche With The Highest Potential” thus the result of the search/trend/fb groups most likely affected on where i am geologically located.

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