If you have been thinking about starting an online retail business and have read any of the thousands of “how-to” articles out there, you have already learned that it’s very difficult to compete against the large volume sellers on the hottest selling items such as:

  • Nintendo wii
  • Wii fit
  • iPod touch
  • Xbox 360
  • Nintendo DS
  • iPod nano
  • Uggs
  • Nikon D90
  • Zune
  • Digital picture frames

Experts go on to say that to be successful, you need to find and exploit a “niche” market, a task that seems hard to understand, much less accomplish … until now. gauk auctions, the web’s largest database of verified wholesalers and drop shippers, offers you this course to help you follow the experts’ advice and define a niche market that you can make your own and profit from.

Course Structure

Our course is divided into 7 sections. Each designed to give you the information you need to identify a niche, jump in and start working.

Section I – Niche Markets Explained

Section I discusses what the term niche market means and why it’s the right strategy for online retailers.

Section II – Look inside Yourself to Discover Niche Market Opportunities

Section II discusses how to use your own experiences and ideas to identify target markets.

Section III – From Market to Product

Once you have defined a market that has a need, you need to figure out a product to sell. Section III gives you the techniques to come up with great ideas.

Section IV – Estimating Demand

You have a target market and a product, it’s time to-do the research to be sure that your niche is viable. Section IV gives you the tools you need to estimate demand.

Section V – Evaluating Competition

Section V helps you understand the competition in your niche.

Section VI – Making the Decision

Section VI discusses how to analyze the information you have produced to make an informed decision about a possible niche market.

Section VII – Moving Forward

Section VII provides an outline of the next set of steps you need to take to go from idea to reality. If you want more information about how to get started, you should take any of several courses gauk Auctions offer on establishing a company, creating a website, importing and so on.

By the time you have finished our course, you will feel confident in finding your niche and in owning it.

Section I – Niche Markets Explained

Before we launch into a detailed discussion of how to discover and sell to a niche market, we should take a moment to understand how the term niche market is defined.

Niche Market

A niche market is a group of potential customers who share common characteristics making them especially receptive to customized products or services that your company can offer.

Your niche market is the place in which you have a natural competitive advantage because you occupy the right place in the right ecosystem.

A good niche market is one in which:

  • You are highly visible and easily accessible to the people who are most likely to benefit from your work (including prospective clients and customers, prospective collaborators and partners, and others with whom value-adding activities are most likely to be mutually beneficial).
  • You can employ the widest range of your talents, skills, and training (your offer).

Terrific, now how does that translate into the real world? Let’s take a few examples.

Taming a Huge Market

You are a gaming fanatic. You have played them all and you know it all. You also know that if you search on the keyword “video games” on eBay, you find nearly 360,000 products being sold and if you search “buy video games online” on Google, you get 418 million hits! Well, there certainly seems to be a marketplace but it is a marketplace with an enormous number of sellers. So, even though you are an expert here and have something special to offer, this marketplace seems like a free-for-all with huge sellers involved. That’s why you have to find a niche within that market. Further on in this course we’ll tell you a good deal more about how to define and analyse niche possibilities but for the moment, let’s just think about possibilities. How about:

Select a game that you know people follow and have an intense commitment to playing. Use that game as the basis for developing your niche. Create a website that is for aficionados of the game. Write articles about the game, its developers, how it was conceived, how it has changed over time. Post a blog about playing the game and invite other gamers to join in. Think about what you like to snack on while playing the game and create recipe or two for hungry gamers. If the game is set in a specific country, write about the country and how the game does or does not compare with reality. If it’s a fantasy land, pose questions or conjecture about what other parts of the culture would be like. In short, create a wonderful place for gamers to spend time…and stock it with the game, game accessories, gaming systems and so on. Yes, these are the very same items that Super sellers A, B, C and XXX, YYY are selling but you, with your special knowledge, are selling an experience for buy ers as well. You are likely to find that serious game aficionados will buy from you even if you are a little more expensive than “Big Box Online” because you understand them and the game better. You also have the ability to market to your niche more effectively because you can use very specific keywords to attract your customers. You can bet it will be difficult to compete on keywords such as “video games” but you’ll have less competition on keywords such as “Special game WZX.”

Carving out a Market

Example: You have a child with a nut allergy. It’s really difficult because the consequences of exposure are significant. You have to be very vigilant and sometimes it’s hard to figure out whether a food is safe. So, you become a specialist company in food offerings in order to protect your child. Guess what…there’s a niche in there! You are not the only parent with this problem. How do you use that knowledge? You could:

Build a website that lets people exchange info on safe foods. You place that info into a newsletter that people subscribe to for a fee. (Wouldn’t you?) You sell advertising to food vendors. You locate hard-to-find foods and sell them on your website. You write articles about nut allergies and problem solving strategies such as “surviving lunchboxes without peanut butter.” You have a niche! Just think of how loyal this group of parents will be as they come to rely on your site for access to information, recipes and products. And…from this niche you can branch out and target schools, the other primary group that deals with nut allergies every day.

Niche markets are important for many reasons:

Well defined

First, niche markets are well enough defined for you to be able to sell directly to them because you understand their very specific needs very well. This is crucial to your understanding of niche markets: if you are able to answer the doubts and questions in your customers’ minds, and assure them your offerings meet their needs, they will buy from you. For example, you may not know what all dog owners need, but you can develop a very good sense of the special needs of dachshund owners. Or, most people like candy but for the chocolate lover, there is a special relationship that is wrapped up with fat content, packaging, symbolism and so on, a relationship that may be too nuanced for anyone but another chocolate lover to appreciate. Trigger those needs in your customers and you have a profitable market you can profit from.

Especially targetable using online tools

Niche markets are especially exciting in the online environment because online tools give you an exceptionally strong ability to target your audience.

Think back to our earlier examples. If you wanted to create a bricks and mortar video store, you couldn’t possibly survive selling only one game and the associated accessories. You would have to sell a variety of games and equipment, pitting you directly against big box stores and video specialty stores. In the online environment, your marketplace is not limited by the distance a customer is willing to drive, the time of night or the language they speak. You can fashion an online store that addresses all of those issues very efficiently. As a result, even though your niche market may be small compared to the larger video game market, it’s still large enough to create a profitable business for you because your net is cast so much further.

Economies of scale

Target or niche marketing is usually associated with higher profit margins because of built-in efficiencies. Selling the same product to the same type of client usually allows efficiencies in advertising. For example, you will need to compete on fewer keywords. You may need fewer wholesaler relationships. It’s easier to stay up-to-date in one area of concentration.


It’s easier to maintain your expert status in a niche market. You can remain a master of the peanut allergy and then maybe branch out into wheat allergies or lactose intolerance but if you wanted to address the entire marketplace of people with allergies, you would need to have a huge amount of information and many products at your disposal.

Section in Review

Let’s review what you have learned in Section I.

  • A niche market is a group of potential customers who share common characteristics making them especially receptive to customized products or services that your company can offer.
  • A good niche market is one in which you are highly visible and easily accessible to the people who are most likely to benefit from your work.
  • Niche markets are preferable because they can be well defined, easier and less expensive to access, well-suited to online marketing tools and simpler to manage.

Now that we have established what a niche market is and why it’s beneficial, in Part 2 we will explore how to identify possible niche markets to evaluate.

To your success
GAUK Auctions

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