Simon Sinek

ClickShip Academy: 101 - Finding Your Market Niche and Product

2020 was a tough ride! While many small-to-medium business owners found it hard to survive, eCommerce gave hope to businesses that would otherwise have wrapped up operations. 

At ClickShip, we’ve been proud to support SMBs across Canada as they have strived to sustain and prosper. Many stories of resilience and courage have made their way to us - we’ve been humbled by the gratitude of business owners who have been able to save large amounts on shipping by using ClickShip!  ClickShip_Oct_1

We are always looking to give back to the community that has allowed us to be who we are today. With eCommerce being a life-saver for so many Canadians, we decided to launch a series on starting an eCommerce business. 

We are proud to announce the first part of ClickShip Academy's inaugural blog series, “Everything You Need to Know to Start an eCommerce Business”. In this series, we’ll be covering everything from how to choose your eCommerce platform, how to build your logo and  how to integrate a shipping solution onto your website. We hope that you find this series valuable and that it helps you with your future eCommerce endeavours.

With the rise of multiple eCommerce marketplaces, dropshipping and a globalized economy, building a brand and selling your products online has never been easier. 

To be able to grab a slice of the eCommerce pie, it is vital that you get your business strategy right. What should you sell? How many variants should you offer? How do you determine price points? What’s the best way to promote your brand? Find yourself bamboozled by such questions?    

Worry not, we’re here to help! 

The first step to building your own eCommerce store is to find your market niche and determine which product you will be selling.

For obvious reasons, that’s not something that anyone other than you can determine - but we can certainly define a methodology that will make this process much less painstaking and logical compared to, say, choosing on a whim

20-01-22-market-segmentsImage Source: www.volusion.com

Today, we’ll walk you through the process of researching what product you should sell, keyword research, your own interests and more.

 

Let passion be your inroad!

It may seem tempting to jump into a market that sees constant, year-round sales and has high profit margins.

But as Neil Patel would tell you, 

Just because everyone wants a new iPhone doesn’t mean you should sell iPhones. In fact, that’s a good reason to avoid the niche. There’s a ton of competition.

neilpatelImage Source: www.talk-business.co.uk

 

Passion for the industry and the product you’re trying to sell is essential for your eCommerce business to be successful. 

Without the passion, motivation is difficult to muster up. Eventually, you’ll either burn out or simply vanish, as many start-ups do.  

If you are not just expanding into eCommerce after you’ve already established your brand or have sold products offline, you need to identify your passions and interests, and figure out what products you want to sell.

To figure this out, we suggest that you write down at least 5 interests of yours that can grow into an eCommerce business. Do you have an avid passion for soccer? Is there a market gap that you’ve noticed in the sporting goods industry? Do you think you can find a niche selling custom-made knee pads for Canada’s semi-professional soccer leagues? These are the questions you must ask yourself when building your list.

Most importantly, remember that your business should focus on solving consumer problems. Let’s talk about that a bit more.

 

Align your passion with an existing consumer need 

A product or service is likely to be successful if it solves a specific problem or need that a large number of consumers may have. Thus, one of your top priorities in determining your market niche should be to identify products that solve a problem.

When you look at specific market problems to solve, it’s best to focus your research on proven categories rather than new “hot” markets. 

We know, for example, that soccer players around the world will always need shin guards. However, if your product is related to a fad or trend you may have trouble sustaining growth.

Keep in mind you can always diversify and expand from your niche. Your initial focus, however, should be to become the sole provider (or problem solver!) in your niche. For instance, Amazon started as an online bookseller and is now a technology giant, shipping products around the world, but also creating content, its own products, as well as providing cloud web services.

If you do find a niche and become a sole provider, you can potentially become a price maker who can earn better margins than a price taker, who has lower prices and thinner margins.

Let's say you have now established your top 5 options. How do you go about choosing which option to go for? Some of the essential aspects you need to know are:

  • Revenues for your product category on all levels, domestic to international
  • How many competitors are there and how do they differ? What would set you apart?
  • Is the market new and growing or is it static and reaching maturity?

How can you find this information? There are many resources online that can give you this information. For data about competitors and how they are doing, SimilarWeb is a good resource. For a general market overview, you may look at bigger publications and their reports on industries. For revenue, a company’s publicly accessible records can be a good start.

 

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Try to avoid markets that have large companies making the same type of niche products that you plan on selling or a market that is oversaturated. Picking a niche product would give you a good foundation to build a unique selling point (USP). Ensure you utilize your USP to the fullest.

 

Conduct a thorough keyword search

Once you’ve decided which market and type of product to go for, you may start keyword research on your specific niche. You can do this by:

  • Using Semrush or Ahrefs to find out how your competitors are doing in your respective category
  • Take note of the keywords of those top domain sites using Semrush or Google’s Keyword Planner
  • Research keyword search volume
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Two of our favourite SEO and keyword research tools

 

Once you’ve run a general search, you can finalize the keywords you’re trying to rank for. 

Be sure that your product  aligns with the message you are trying to convey and is in a niche that is popular but still has a market gap.

Keep track of all this data in a document that you can refer to later and make modifications to your strategy accordingly. 

 

Build a buyer persona 

After you’ve decided on what product you want to sell, researched the market and determined keywords, you will have enough information to build a simple buyer persona. 

  • Who are you trying to sell to? 
  • What are they like and what do they buy? 
  • What is their income bracket? 

These are some of the questions that you need to know the answers to.

Buyer Persona

After you’ve built your general buyer persona, you should start having one-on-one conversations with individuals who are a part of your target market. 

Additional steps would be to research on forums like Quora and Amazon products and reviews. This would reveal what people are searching for more, and what their problems and feedback are.

 

Look beyond the obvious category or niche

Knowing every little bit about your category or niche is the way to go once you’ve decided to enter it. That should not, however, limit your options. You’ll be in a much better position to capitalize if you focus on providing value to customers over the longer term instead of selling one-off.

As you choose other products and upgrades to increase customer lifetime value, don’t put quantity over quality.

For instance, if you try to lower prices of your products to ensure sales and include a lot of the same cheap products in your store, you would find it hard to sustain this strategy for long. A cheaper option will always come along,  and you’d be cutting into your margins drastically if you try and match that. 

Instead, think about offering a higher-quality experience and enhanced value to your customers so that they keep coming back to you as their primary (and preferable only!) solutions provider.

 

Entrepreneurs come in all shapes and sizes…they have different ideas, personalities, goals, and different ways to achieve them.

Have you wondered what kind of entrepreneur you are and where you stand in your entrepreneurial journey? You could consult a magic 8-ball or take this quiz!

_What kind of entrepreneur are you_ (1)-1

 

Create an advantage over Amazon

It is highly likely that a potential customer will first check Amazon (and other major marketplaces) to buy a product online, irrespective of niche or category. Amazon sells everything (almost!).

It is vital to make your brand stand out by offering some competitive advantage over what’s available on the big marketplaces - whether it’s price, higher quality, better customer service, a unique value proposition, or a combination of these.

 

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Even after having achieved that, you may not immediately see sales. You’ll need to back up your offering with compelling marketing that is as unique as your offering! Most importantly, be consistent with your voice, be persistent in your efforts, be ready to make adjustments and aim for long-term success. Way too many people give up right on the verge of getting a big win or by not making that subtle modification when required. 

 

Put your research and new product to the test

Now that you have everything you need to start building a business around your niche product, your approach should be simple and cost effective.

Create a simple web page and price your product according to the margins that you would like to meet. Make sure you don’t overprice or under-price your product. Product pricing is a very important aspect of your eCommerce store, make sure you have done research on your competitors and suppliers.

Using a simple eCommerce store and testing your new product out in the market is a great example of a “minimum viable product”, a concept popularized by Eric Ries in his book “The Lean Startup” LeanStartup

 

The concept explains that a business, or in our specific case, an eCommerce website, should build an easily build-able product and push it out into the market as soon as possible. Once that is done, the business should get feedback from customers and improve accordingly. This process helps to prevent you from putting excess resources into products that may not even succeed. 

Once you start listening to your customers after you’ve launched, you can focus on building a loyal and satisfied customer base which is a better long term strategy for customer retention and focuses on your customers rather than the market.

In the end we hope you will have a market specific niche product that is ready to be tested out in the market, with a focus on giving the customers what they want and making sure that you are solving their problems.

After you have decided on your product and have found a consumer need and are ready to jump into the market, you will now have to start thinking about what Simon Sinek said,

“People don't buy what you do; they buy why you do it.”

SimonSinekImage Source: www.forbes.com

 

Using an eCommerce business planner is a great way to keep track of  the planning you need to do to  launch your new venture. Here's a great resource from our friends at Shopify.

And while you're checking out this resource on Shopify, take a moment to see how highly rated ClickShip is on the Shopify app!

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So we now know what you will sell, but why should we buy it from you?

In the next blog we'll be discussing branding and how to get your company logo created.

Stay tuned!

 

Ankur Khurana

Written by Ankur Khurana

Content Writer at Freightcom