Having thoroughly researched the topic of niche marketing and having written a book on the subject, I can tell you with some authority that there is no algorithm for finding a niche business that is perfect for you. Making that choice is art rather than science.
My research did uncover some commonalities among the successful niche businesses and the entrepreneurs themselves. While I did not uncover a secret formula for success, here are a few of my findings:
1. Many successful niche businesses started accidentally. Sometimes a hobby grew into something bigger. Other times a small idea took on a life of its own.
2. Most niche businesses started slowly with a lot of trial and error. The entrepreneur kept improving the offering until he or she got it right.
3. Most of the entrepreneurs had a special connection to the market. They were intimate with the customers and extremely knowledgeable about their wants and needs.
4. Making money was not the key determinant in choosing the business. In fact, it was initially pretty low on the list of priorities. The rewards came later.
5. The competition was never an issue since the competition typically did not serve the target market or did not serve it well. Most successful niche businesses have little real competition.
6. Most successful entrepreneurs had personal talents and interests that nicely aligned with the niche business. They liked what they did.
7. During the early stages of the business, they somehow found enough capital to survive. Most were self funded.
8. Contrary to popular opinion, most entrepreneurs were conservative and avoided unnecessary risks. They were frugal and made very calculated decisions.
9. Many of the entrepreneurs were sons and daughters of entrepreneurs. It seemed to run in families.
10. The niche market served was big enough for the niche business to make a good living, but was not big enough to draw the attention of the bigger firms.
John Bradley Jackson
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