Photo by mentatdgt from Pexels
Photo by mentatdgt from Pexels

To choose the e-Commerce niche that is right for you is not an easy task. Just because a new iPhone is a trend right now and everyone wants it does not automatically mean that the best idea is to sell iPhones, but just the opposite - there is a lot of competition there and it is the smartest decision to avoid that niche.

Niche is a distinct segment of the market and represents the exact category into which your products and services fall. For example, electronics is too broad for a niche. On the other hand, smartphones are much narrower. You do not have to be afraid to narrow down your niche and make it specific - once you choose your e-Commerce niche, your brand will revolve around it and you will be able to attract clients and build your target audience based on their specific needs and the exact solutions that your products or services will solve. For sure, this will eliminate the general public and you will lose some potential clients, but at the same time you are going to create more demand among people who really need your product.

Not by accident, defining your e-Commerce niche is the most important step, as it will define your business and the direction in which it will go. That is why, you need to understand what a niche is and how to select one for your business. Do not forget to think about choosing a niche in which you already have some knowledge and resources as this will serve you as advantage. Also, do not forget to check what competition is doing and learn both from their gains and pains.


Photo by Breakingpic from Pexels
Photo by Breakingpic from Pexels

You already have the idea in your head. You've already analyzed its strengths and weaknesses, and evaluated the possible opportunities and risks. Now that you have all the information available, it is time to start working on the most important part of setting up an e-Commerce business - to find the perfect niche for your product or service.

To do so, you will have to go through several steps and answer a couple of questions which will help you define your specific niche market. 

You will be able to find detailed instructions on how to define your niche market in the next "Process" section.


In order to be able to execute your task properly, the first thing that you will need to do is to go through the "Resources" section and have a look at the additional readings and videos that will help you familiarize with the niche market concept. Once you are done with reading, it is time to grab a pen and empty sheet and start writing (or you can use the SWOT Analysis template already used in the previous topic section).

Now, let's take a look at the steps that will help you identify your niche:

  • Take advantage of your passions and interests: Can you identify a hobby or skill you are good at? Is there a specific area that your friends or family ask you about when they want an advice? What themes do you enjoy learning about?
  • Define customers' problems and needs: Try to think of the problems faced by your target market and how your hobby can become a product or service that meets their needs.
  • Research the competitors: You might have a viable product idea, but how many other businesses will you be competing with? Ask yourself "What is different about the services or products I will offer?" and "What are the "extras" I will bring to the market with my products or services?" so you can find out what will be your competitive advantage over the others on the market.
  • Identify your niche and its profitability: If you're dedicating your resources and time to a new business, it's important it has the ability to become profitable. Try to do some research on your own, investigating samo factors such as customer demographics and location, product quality and price, etc. During your analysis, if you find a fair number of similar products, but not an overabundance - this means that your idea could be profitable.

Once you are done with all of the above-listed steps, you will be able to define your exact niche, or at least you will have some different ideas to think of. It is not necessary to do all the work in an hour ot two. Take your time, talk with people, do a decent research and when you are ready, do not forget to draw some general conclusions. You will need this information in the next steps.



If there is one thing that is absolutely certain, it is the fact that demand is never stagnant and that consumers always want more. Remember that smart entrepreneurs always keep track of innovations and discoveries entering their niche.

So far, upon the completion of this part of the scenario, you have probably already defined your niche market thanks to the tasks given to you. If the answer is "yes", you can continue to the next point of this scenario, where you will have the chance to learn more about the different options you have when choosing the most suitable online solution that will reflect the specific needs of your products or services.

Learning Outcomes

Competence Area 1: IDEAS & OPPORTUNITIES
  • 1.5 I can experiment with my skills and competences in situations that are new to me.
  • 1.8) I can identify the basic functions that a prototype should have to illustrate the value of my idea.
  • 1.12) My vision for creating value drives me to make the effort to turn ideas into action.
Competence Area 2: RESOURCES
  • 2.5) I can anticipate the feeling of achieving my goals and this motivates me.
Competence Area 3: INTO ACTION
  • 3.14) I can express my (or my team's) value-creating ideas assertively.