How To Pick A Niche For Your New Business

So you’re sold on the fact that you need to figure out what you love in order to be freed from the shackles of a nine to five job. You’re thinking long and hard about what you enjoy and what you’re good at, but you’re having some trouble narrowing it down to a single thing that you can represent—a single niche that you can occupy.

In the book “Expert Secrets” by Russell Brunson, he identifies that there are three core markets: Health, Wealth, and Relationships. Underneath these three core markets are their submarkets.

Submarket Examples:

  • Health - diet, nutrition, strength training, weight loss

  • Wealth - finance, investing, real estate, sales

  • Relationships - love, dating, marriage

There are of course a lot more submarkets than what’s listed above, but the idea is that once you’ve chosen which market you are going to occupy, you need to narrow it down a bit. Once you’ve narrowed it down to a submarket, you need to break it down further into your niche.

Your niche is going to be the people within your submarket that represent your target customer. The best niches aren’t just demographics, but rather people who are in a particular situation for one reason or another. Here are a few examples:

Your Market > Submarket > Niche

  • Health > Diet > Entrepreneurs that want a diet that will give them sustained mental energy throughout the day.

  • Wealth > Retirement Planning > Dentists who are worried they won’t have enough money in order to retire on time.

  • Relationships > Making New Friends > Ex-patriates that are having a hard time making new friends in their new country.

There’s three other factors that you need to keep in mind when picking a niche:

1. Where’s the money at? In any marketing there’s going to be a target market that makes up 10% of the audience, but are disproportionately profitable. Who are these people going to be in your target market? Don’t sell to college students just because you are one and you can relate to them. If they’re broke and can’t buy, they aren’t a good niche for you. Make sure that your target market is willing and capable to spend money—and if possible, target the most profitable 10%. Remember, following your passion is a lot more fun when you aren’t broke.

2. What are you irrationally passionate about? You don’t want to pick a niche just because it makes money. If you do that, then you’re bound for failure. Think about what gives you energy more than anyone else you know. What are you always talking about that your friends don’t seem to care about? If you have that “thing” that people want you to shut up about, it means that you’re irrationally passionate about it. That’s a good thing. Do business in this area. If you don’t occupy a niche that you’re passionate about, you’ll give up too early on because you’ll realize that the money isn’t worth the suffering.

3. What are you an expert in? People will only follow you if you can position yourself as an expert relative to your audience. The good thing is that to be an “expert”, you just have to be smarter about the topic than the people that you are selling to. You only have to be one step ahead of the rest in order to be credible. If you’re a fat kid, don’t choose weight loss. Nobody will listen to you. You need to position yourself as someone that has reached the light at the end of the tunnel. Also remember that you can borrow credibility. By using quotes, statistics, facts, and borrowed stories about what you’re selling, you will be credible not because YOU are credible, but because the people you’re talking about are credible.

Once you have your niche narrowed down, you can start thinking about what product to sell. The most important thing to think about when you’re choosing a product is how is it going to be different from everyone else.

What’s going to be your new thing?

You’re new thing is going to be why people buy from you and not the others selling to the same niche. A great example of this is the explosion of the ketosis trend. It was a new diet that focused on eating more fat in order to lose fat. It was the complete opposite of what people would typically think to do, but because it was a new and “better” way to go about weightless, it caught on and began to trend.

Whatever it is that you’re selling, give it a catchy new name. Position it as an opportunity that has never before existed. The Keto-Diet was a totally new thing that people bought into. Dan Kennedy sold “Magnetic Marketing” secrets, which was a new way to go about cold outreach. Russell Brunson doesn’t sell a website building software he sells a “ClickFunnels” building software. His big push is to “ditch your website and replace it with a ClickFunnel in order to save your business”.

The way that you position your product is super critical. You don’t want to be another identical fish in the pond, you want your program, product, or service to stand out because it’s totally different than anything done before.

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