Exposing the myth of the niche market drop shipping

Exposing the myth of the niche market drop shipping

The definition of  niche market is a market in which a very specific product is focused. According to the Cambridge Advanced Learners Dictionary it is a small area of trade within the economy often involving specialized, unusual, and made for a few people products.

 

 

Starting around six years ago many resellers were convinced (due to questionable advice) it would be a good idea to focus on a specific item versus a particular market. All across the internet so-called experts raved about finding a niche. For example instead of focusing on selling green products as a whole they would recommend for new sellers to focus only on energy efficient light bulbs. We had many sellers contacting us wanting to set up websites for off the wall items some of my favorite are “tennis balls for walkers, hair clips, mustard based hot sauce, and my favorite one the remote control battery backing because “everyone needs an extra battery backing for their remote control.”

 

The argument for this was pretty simple a unique niche would have less competition which would equal more search engine exposure for your website, and more sales. In a perfect world this would be ideal, but in a drop shipping environment this argument carries a lot less weight. There are many reasons why you would not want to focus on a unique niche.

 

1.  A unique niche market will limit your customer base. While you may sell the best mustard based hot sauce in the world it is going to be very hard to get people to come to your website if no one is searching for it unless you spend tens of thousands on a national advertising campaign even if you rank on the first page of Google for the term mustard based hot sauce.

 

2. Most places that write about the profits of a great niche just so happen to have that niche for sale for the low low price of _. I doubt that’s a coincidence.

 

3. The market changes. What do acid washed jeans, fish net stockings, water beds, and the Nintendo Wii all have in common? They have all came, and went. While in 2008 it would have been OK to have a website called (Best Nintendo Wii .com) sadly it is 2012, and the Wii has been replaced. Placing all of your hard work into one particular niche item can draw some short gains which would be fine for eBay, but with a website you are building an online business that will last as long as you allow it to.

 

4. Your products are what your supplier carries. If you’re using the drop ship method you’re not storing your own products, and selling them. You are selling what someone else is storing for you. This means the same products you will have access to will more than likely be available to thousands of other resellers, and odds are you will still have the same amount of competition, but in a smaller market.

 

example of market

 

 

So you may wonder what the alternative to a niche is. Quite simply it’s smart thinking. For our hot sauce seller I would think it would be best to focus on all types of hot sauces, and offer the mustard based as an option. This way you would have a variety of products for people to choose from, and more people searching for your products every day.

 

Yes it’s true that means you would have more competition, and you may have to work a little bit harder to get your website to the first page, but in the long run once you get there the rewards will be greater because you will have more sales.

 

Let me be clear we do not recommend setting up a website with no definition like a mega-mall, and niches are fine for short-term gains on eBay. What we do recommend when setting up a website is that you have a theme that has a variety of products, and keywords you can target.

 

 

 

 

 

 


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Pretty in Pink

September 12, 2012, 7:11 pm|Reply

Awesome post ! You are spot on I think in most cases the term “niche” has been manipulated to confuse people, and make them think there is an easy route. Real e-commerce takes work, but it is worth it in the long run. I was on a site yesterday that was referring to electronics as a niche ! Electronics is as far from a niche as I am from China.

Muriel Szweda

October 12, 2012, 5:08 pm|Reply

The things i have generally told persons is that while looking for a good on-line electronics shop, there are a few issues that you have to think about. First and foremost, you need to make sure to choose a reputable and reliable retailer that has picked up great opinions and classification from other people and industry analysts. This will make certain you are handling a well-known store to provide good assistance and aid to the patrons. Many thanks for sharing your thinking on this site.

Great post

October 13, 2012, 6:15 am|Reply

Great post very informative!

Manna

October 15, 2012, 12:26 pm|Reply

Very great article I almost got involved with something similar. I have learned a ton from reading all this info! You guys rock.

Kandy

November 30, 2012, 10:45 am|Reply

Your post, Exposing the myth of the niche market drop shipping, is really well written and insightful. Glad I found your website, warm regards from Kandy!

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