How to Find a Product Niche and Start Selling Online

Online competition is fiercer than ever. This is why figuring out what to sell online is a strategy in and of itself.

You’d be surprised how many people set up a store before they know what they will sell. This is setting yourself up for failure.

Choosing the right products to sell will impact every other business decision you make. Forget a pretty theme. Forget a catchy company name. Forget which shipping options you offer.

They’re all important, but the most important thing you must get right from the very beginning is exactly what you sell and how you price those products.

No matter what industry you pick, there are really only two kinds of products and both can sell really well.

First, there’s what we call commoditized products. These are the products everybody needs. Think of anything you buy at Walmart or Amazon that has a big brand behind it — food, golf clubs, clothes, kids toys, etc. Now think of the brands — Heinz, Callaway, Levi, Fisher-Price.

There are also products we refer to as unique products. These are usually one-of-a-kind, handmade products. They are products made in small batch runs or products that are made on demand. Think of a unique beaded necklace, hand-made frozen yogurt or leather iPad cases.

Many brands sell a combination of commoditized products and unique products. Take a look at Spearmint Love, for instance. This site aggregates baby clothes from across the web (commoditized), as well as offers a few unique products of their own.

Offering only commoditized items, especially if those items are brand name or already sold on major marketplaces like Amazon or Walmart, will make it extremely difficult to be successful. Amazon and Walmart can buy items in large quantities, lowering the price of the product. Your startup likely won’t be able to compete.

However, if you can offer unique products alongside commoditized ones (think of using Etsy Wholesale or reaching out to makers on Instagram) and build a great brand experience along the way, you are setting yourself up for success.

Coming up with unique products can be difficult, though. Here are six different wants to generate ideas.

1. Improve on Fragmented Frustrations

We’ve all heard the saying: necessity is the mother of invention.

Taking this tack when generating ideas for a product or service is a reliable avenue to kickstart a successful business.

Opportunities may exist in a few forms, including an improved product feature, a market unrealized by your competitors, or even unique marketing.

Try tuning into your everyday tasks. What things put a hitch in your giddyup? Those small annoyances can turn out to be a brilliant business idea. Pinpoint a problem and conveniently solve it.

Your product or service doesn’t necessarily need to be a huge, complicated endeavor. It can be quite simple, yet exceptionally effective. As an example, look at the story behind Karen Rzepecki’s invention of the reCAP Mason Jars Pour Cap.

“Our story began with salad dressing,” she writes. “After creating yet another oily mess with the lid and ring, I searched for a pour cap that would fit my Mason Jars and allow me to shake, pour, and store dressing.”

Rzepecki realized there wasn’t one, so she went ahead and created something all her own.

As many do, Rzepecki used reusable, ecofriendly mason jars for food storage. However, when trying to shake, pour and store items, things got sticky. To alleviate the issue, Rzepecki created a simple lid with a spout that fit both large- and small-mouth mason jars and took her new product online.

Today, she owns a successful online store and is diversifying her product offering to scale her ROI.

“Our sales have increased this year, and we are spending a lot more time relooking at our SEO,” says Rzepecki. “Just recently we switched over to PayPal by Braintree so we could take advantage of the simplified checkout as well as selling on Pinterest. With that, our checkout was immediately improved. It’s all part of our work to improve our customer experience as much as we can.”

2. Build on Passion and Experience

Let’s be honest, starting your own business means long hours, likely some rocky terrain and the occasional, if not frequent, sacrifice.

Being passionate about what you do will not only help you see the forest through the trees during the hard times, but it will also help you in crafting a brand that speaks to people in a way that is meaningful and engaging.

Putting Love and Life to Work

Evan Streusand launched his very first business years ago after a trip to South America. There, he found a group of shoemakers working in a fair wage factory. He made friends, had drinks, and when he came back to the U.S., he launched Fortress of Inca to help support the efforts of his new friends.

Today, he sells those shoes to brands like Anthropologie and Free People.

Before Thanksgiving 2016, he decided to open an additional venture –– this time with his partner.

The launch story was oddly similar.

The two traveled to West Texas. They stumbled upon a pair of robes in an outpost, and over the course of their vacation, found themselves not wanting to take them off.

They had drinks with the locals – in their robes. They went out two-stepping – in their robes. They stargazed and watched the Texas sun rise over the butt of the Rocky Mountains –– in their robes.

When they came back to Austin, with new friends and experiences in their pockets, they launched Highway Robery.

“Highway Robery really feels like an extension of who we are and our personalities,” says Evan.

“We love coming up with new ideas, and this particular project has got our minds going in a million different directions. From the fabrics we want to use to the photo shoots we’re planning down to the text we want to use on our website –– it’s all exciting at the moment.” Oh, and puns. We love puns. Expect us to use a lot of them, be they good or bad!”

3. Craft a Brand that Resonates

Creating a brand that resonates is particularly important if you’re thinking of pursuing a competitive ecommerce industry.

Crafting a recognizable and memorable brand means you’ll need to put in the time to research and truly understand your target audience.

Your brand should speak to your potential customers in a way that both resonates and compels them to come back. In other words, you want to build loyalty based on audience identity.

Some great questions to start with here are:

• How does your target audience like to be addressed?
• How will you position your product?
• How will you design your website to communicate your brand and appeal to your potential customers through layout, color scheme and calls to action?

When a Brand Becomes a Lifestyle

When it comes to crafting a brand and experience that resonate, Tyler Merritt of Nine Line is an expert.

Merritt’s goal when launching Nine Line, a patriotic apparel company, was to cater to his fellow veterans and those still serving in the armed forces. He quickly realized, however, that this patriotic flair hit a resonating tone with his fellow Americans as a whole.

“We like to promote patriotism,” says Tyler. “We believe in certain things that might be considered controversial. We don’t think they should be. You can not agree with public policy, but to service members and other individuals, the American flag represents something that’s sacred. That’s our personal opinion.”

Tyler promotes the Nine Line brand through every single aspect of the business, from the t-shirts to well designed emails and product packaging. The patriotic and respectful spirit even flows through his hiring processes. The company hires 100% veterans.

4. Hop on Trends Early

Carving out a place for your brand within an emerging market is ideal.

To do this, it is pivotal that you stay up-to-date on recent, trending products and services –– and then launch an ecommerce site to capitalize on them before they hit peak popularity.

This business angle can be a slippery slope, given that many trends don’t last. However, the upside can be tremendous for a small business owner, as you’ll have a leg up on SEO and establish yourself as a leader within the industry from early on.

Start thinking of products or services that have been trending up in recent years (e.g., technology, survival gear, vintage, healthy living, flash tattoos).

Launch Before the Craze

Serving as proof that launching in the right market at the right time leads to success, online store Fugoo was built on the backs of team members who played integral roles at Acer, eMachines, Harmon Kardon, JBL and Toshiba.

The Fugoo team even won “Best of CES” awards in 2015. These awards given out typically to brands like Apple and Google when they show off new, unseen technology and products.

“Fugoo’s team is comprised of award-winning industry leaders who have been integral in the creation of many key technology industry milestones, including driving the development and industry adoption of Bluetooth,” reads their website.

In all, the Fugoo team used their skills and industry knowledge to launch the Fugoo Bluetooth wireless speaker just before the bigger technology brands caught on to the trend.

5. Fulfill Guilty Pleasures

Another solid business avenue to pursue is catering to customers’ passions, or even their vices. Shoppers often spend more on their guilty pleasures, developing deep loyalty to brands that understand their obsessions.

Take Jeni’s Ice Cream for example. Founder Jeni Britton Bauer has been making ice cream professionally for decades, and founded her own brand in 2002. Sure, she was ahead of the organic and all-natural trends, using whole ingredients and dairy from grass-matured cows from the very beginning. She also added an artistic flair to her flavors, calling on every ice cream lover’s guilty pleasure – trying the newest, creamiest versions.

Today, customers can order ice cream online and have it shipped to their door, removing all barriers to getting that creamy goodness to their mouths faster than ever possible before.

Jeni’s Mission Statement:

“We are absolutely devoted to making better ice creams and bringing people together. It’s what gets us out of bed in the morning and keeps us up late at night. We believe that you can grow a business as a community of people, with artful attention to detail and the customer experience, and get continuously better at the same time. That REALLY great ice cream served perfectly in a sparkling and beautiful space, with attentive and in-the-moment service (we believe service is an art) brings people together and helps them connect. And that sometimes sparks fly. And that there should be more sparks flying, generally. We like to make people feel good.”

6. Serve Niche Segments

Niche segments often spell success for ecommerce.

Take, for example, Berkey Water.

Berkey Water is a water purification system unlike anything else on the market. You could put radioactive sludge in it and it would pull out drinkable water for you.

It is that good.

And because it is that good, it has niche markets which are increasingly loyal to the brand. For instance, the prepper market –– full of individuals who are readying for disaster 24/7. Or, the health and cancer recovery segment –– where individuals are looking for the absolute cleanest water possible.

Plenty of other shopping segments love the Berkey Water filter, as well, but their success has long been hinged on markets on the lookout for the absolute best in water purification.

And the love that these segments have for the product is proven in their testimonials:

7. Spot Business Opportunities Absolutely Everywhere

If the above suggestions aren’t resonating, here are a few ways to find great business ideas in your everyday life.

• Start taking people seriously when they give you compliments. What is it that people tell you you’re great at? Perhaps family and friends can’t get get enough of your online reviews. This is exactly how Spearmint Love started. Founder Shari Lott was a once-time baby clothes blogger and reviewer. Soon, she realized she was gaining more traffic and praise than many of the brands she promoted. So, she decided to start calling in wholesale orders and selling the goods herself. Today, Spearmint Love is a wildly successful brand, and Sheri is a well-known trend-spotter in the industry.
• Start snooping around websites like eBay, Amazon and Etsy. You’ll be amazed at the simple things being sold online, including vintage items found at a thrift store, party lights, dog toys, tablecloths, decorative pillows and wedding decor. Checkout a site like GolfEtail which uses eBay as an additional sales channel to significantly increase overall brand revenue.
• Think about a new spin for old items. Even just giving something a new paint job can turn a $5 item into a $50 gem. Check out the angle Bread & Jam took on standard items you’d likely find anywhere, turning them into treasured pieces.
• Consider impulse buys or items people buy regularly. This could include items like incense, candles, novelties and DVDs. Dog for Dog took typical products like dog food and treats to a whole new level with donations and celebrity endorsements.

Continue on to learn how to evaluate your list of business ideas to better understand what is realistic, feasible and market-ready.