nicho de mercado


How to Choose a Niche Market: 7 Tips to Start Your Business

Your niche market determines the audience you’ll be talking to. Learn how to choose the right niche market for your product.

João Pedro

04/18/2022 | By João Pedro

Choosing a niche market is a crucial step for anyone starting a new business. After all, it’s impossible to create a product or service that meets the needs of all audiences. People are different, and so are their interests and demographic profiles.

By defining a niche for your brand, you determine the audience you’ll be talking to, and consequently, the strategies you’ll be using to convince them to buy from you.

Keep reading to learn a few tips that will help you choose a niche that represents the perfect balance between your skillset and a profitable market!

What is a niche market?

A niche market is a portion of a larger consumer group with a similar profile and interests. A niche also represents an opportunity within a business sector.

It can be broad, such as sports gear – or specific, such as protective equipment for football players.

What’s the difference between a niche and a market segment?

You might be thinking, but what about market segmentation? Is it the same thing as a niche? The answer is no. Many professionals use the terms synonymously, but the difference between them lies in the specificity of the groups. .

A segment is a broader group, with consumers with similar pains. Meanwhile, a niche market is a more specific and – often – untapped group. In other words, a niche is a small portion of a market segment.

Besides determining the right persona for your product, niches also seek to explore new markets, seeking to supply demands that don’t receive as much attention or face strong competition in the market yet.

For example, if you analyze brands such as Amazon, Walmart, and eBay, you’ll notice that they all work with a very wide range of products and services. This means that these e-commerce consumer groups attend a very broad market.

But you can still make money on the internet by reaching a 20-year-old who’s interested in fitness products, for example, or a 40-year-old homemaker who’s looking for kitchen appliances.

Now, let’s consider MAC, the large cosmetics chain. They have a specific audience, people who like makeup. As a result, their communication and even their choice of brand ambassadors, are completely focused on meeting this audience’s needs.

Narrowing it down a bit more, we can highlight the brand Eleiko, which provides gear for athletes and professionals who practice Crossfit. Pretty specific, right? In this case, the group interested in the brand is smaller, but because it offers a unique product in the market, the brand ends up being more assertive in its digital marketing campaigns.

Why is it important to define a niche market?

As we mentioned earlier, when defining your niche, it’s extremely important that your sales strategies are assertive. Therefore, if you want to start a business and are looking for a market to operate in, decide if you’d rather:

  • Enter a broad market, with several strong competitors, in which you can sell products to different audiences;


  • Find an underserved segment and try to become an authority in that field by offering products that are ideal for your consumers’ specific needs.

Unless you have a major investment backing your new business, we’re sure that you saw a great opportunity in option B. Below, we’ll explain why it’s so important to choose a niche:

a) Fewer competitors

One of the main advantages of working in a highly segmented market is the lack of major competitors since specific niches are generally underexploited. Remember the example of Eleiko, it’s a sports equipment company, but it meets the demands of a very specific audience.

If the brand opted for generic keywords such as “sports equipment”, it would face stiff competition from well-established businesses in this segment and would most likely spend a lot of money on advertising to attract visitors to its page.

Can you see the problem with this strategy?

However, by focusing on more specific keywords, such as equipment for high-performance sports, the brand focuses on a smaller niche and, therefore, has fewer competitors.

b) A more qualified audience for your offer

There are many posts about the sales funnel here on the blog, but in a nutshell, it’s the process of following your users through all the stages of the buyer’s journey – from the moment they learn about your product to the moment they purchase it.

And why should you care about this? Relax; we’ll get to that in a moment!

Users searching for a targeted product or service are usually between the consideration and conversion phases of your sales funnel, they’ve already identified that they have a problem and are looking for a solution. As such, they’re more likely to sign up on your website to receive additional information and maybe even ask for a quote.

The smaller the niche, the easier it is to understand your target audience’s needs and produce content that meets their demands when they need it most.

Needless to say, when you create value for the people who visit your page, it’s easier to convince them to buy your product later.

c) Trailblazing

By operating in a segmented niche, you also have the chance to be a trailblazer in a market that hasn’t identified new demands from the audience yet – such as the market for people with celiac disease, which was practically nonexistent until fairly recently. 

Have you ever wondered how the first companies that invested in this segment are doing today? By providing a solution for people who don’t consume products containing gluten, they built authority and gained a lot of spontaneous media coverage.

Still on the topic of trailblazing, there’s the possibility of creating a new demand and then providing your solution to a new audience. You can map your persona in depth and understand what your ideal customer’s behavior is.

If your audience feels that you understand them and that you are talking directly to them, they’ll feel more confident to buy your products, even if it isn’t an urgent need for them.

d) The possibility of making strategic partnerships

By segmenting your strategy into a certain niche, you can find partners that can help your campaign succeed.

These partnerships can be with other businesses, which don’t compete with your business and help provide good results for your campaign.

Here, for example, you can become stronger by partnering with digital influencers or other types of affiliates.

These people fully understand social media and are able to help promote your brand. They communicate well with the niche, and can help not only in the campaign, but can also better understand the nuances and needs of your audience.

What are the types of niche markets? 

So far, you’ve learned what a niche is and the importance of defining one.

But, to know which niche makes sense for you, and especially, how it can be profitable, you need to understand the different types of segmentation – of which there are four: geographic, demographic, psychographic, and behavioral.

Let’s quickly discuss each type of segmentation.

Geographical segmentation

This type of niche is based on your target audience’s location. It’s usually the same place where the business is located, but delimiting itself within a city, state, country, or even a neighborhood.

Obviously, like in every niche, you need to perform comprehensive research about the audience found within it and of course, about the competitors operating in the same location.

It’s also common for geographic segmentation to be applied in a type of strategy called geomarketing which is used by smaller local businesses, or even large organizations opening their headquarters in a new country or city.

Demographic segmentation

A niche within this segmentation takes into account the audience’s age, gender, religion, income, or educational background.

This information is a determinant of certain habits of an audience, which in turn influences a person’s purchasing power.

Not to mention that this information determines the language style you should use in your strategy.

There’s no shortage of examples of campaigns defined by this segment, which usually includes products related to gender, such as sanitary pads. 

Psychographic segmentation

Here you’ll find niches determined by their audience’s lifestyle, as well as by values and personality.

These campaigns are generally based on a lifestyle or even an ideology. 

Behavioral segmentation

A behavior-segmented niche is based on an audiences’ shopping habits.

It takes into account a consumer’s shopping history, i.e., the type of products that a particular person usually consumes. Generally, audiences in these niches pay attention to what benefits a certain product brings to their lives.

Sportswear campaigns, such as for running shoes, are a good example of this. Delivery businesses also use this type of niche a lot.

How to define your niche market

Now it’s time to think about defining a niche for your business. This must be done even before you start selling on the internet, okay?

In addition, it’s necessary to study and plan a lot. Otherwise, your campaigns will not be as assertive and probably won’t achieve your desired results.

Below are a few tips to help you while starting your business.

1. Decide which market you want to work in

Let’s start by defining the ideal market for you. We don’t recommend choosing a niche just because it’s trendy. The best option is to choose something familiar for which you have affinity and interest. In other words, the most profitable niches will be those you already know.

For example, if you’ve always played sports, it might be a good idea to go into the business of selling sporting goods. If you’ve always enjoyed cooking, how about entering the frozen-meal market? Or even opening a restaurant specializing in a specific cuisine.

Take some time to study and find a good niche market that you’re interested in. The internet is the most accessible place to research and find unexplored niches. Also, think about your needs as a consumer. 

2. Identify a problem that you can solve

The next step is to find out about your niche’s problem or need. You should know that there are demands not yet met by competitors. Therefore, your mission is to create a perfect solution for your target audience.

If you’re familiar with the subject, as we mentioned in the previous paragraphs, you might already know what the niche’s needs are. In this case, you just need to validate the solution and make it feasible.

But, if you haven’t identified a problem yet, or if you have doubts whether such a need affects your niche, it’s a good idea to search for keywords, in addition to customer comments on your competitors’ social media profiles. You can even look for other channels where you can find the audience’s opinions, such as Yelp.

3. Evaluate supply and demand 

Another very important detail when choosing a niche market is to check if there is demand for the product or service and if competing brands offer similar solutions. After all, you don’t want to invest in a business with no prospects, do you?

Doing this is quite simple.

With your list of potential topics already created, start researching about the demand for these topics using keyword tools of the most popular search engines, such as Google.

Also, check searches that are similar to what you wish to produce. They provide great insights into the audience’s pains.

These tools show the number of monthly local and global searches for keywords. One of the best tools for checking the demand for a niche is Google Keyword Planner, but you can also use and SEMrush.

Use the tool to check the search rate for the product’s subject matter on the internet: is there sufficient demand? How often are the main keywords searched for?

Also, check if there are similar products being sold on the websites that appear in search engine results when these keywords are searched, and if so, analyze the competition.

By cross-referencing the demand data and knowing your competitors, you’ll be able to analyze the viability of each of your options, and ideally, choose a niche with high demand and few competitors.

4. Research trends

There’ll always be users searching for weight-loss solutions, how to make money working from home, tips on how to be more productive, among other trendy topics.

Trends are items in great demand but also in great supply, and being yet another person in the crowd will not make you successful. Therefore, you should follow up your research to find trends that are more specific and choose a niche with higher demand and lower supply.

Certain tools can help you with this, such as Ubersuggest which suggests specific keywords with sub-levels related to the topic you’re searching for, cross-referencing data from real searches.

Google itself can also provide valuable insights. When you perform a search, the tool automatically completes your sentence with the most searched terms. These suggestions can give you good ideas of niche markets to invest in!

To make the best decision regarding the suggestions, you can also use Google Trends. With this tool, you can make a comparison between keywords and view, in chart form, the best option for you to operate in.

5. Analyze your competitors

It’s time to research your competitors and how they behave. In other words, study the problem that these businesses are trying to solve. Do you know why? When too many businesses try to solve the same problem, the market becomes saturated. 

Evaluate everything beyond the solutions offered: research prices, communication channels, and what their language style with their audience is like – are they more formal or informal, like Netflix?

This strategy allows you to find gaps in the market and thus, you have the opportunity to offer innovative solutions. This creates value for your customers, meaning that they view you positively. This is called a competitive edge – and you should focus on cultivating your own competitive edge.

6. Focus on a specific audience 

You might have already read about personas in most of the articles on this blog, and this one is no different, since the profile of the ideal buyer influences all strategic business decisions.

  • What kind of content should I produce?
  • What are the social networks where my audience searches for information?
  • What are the needs of this audience?
  • What do they expect from my product?

If you still don’t know which portion of the market you want to reach, it’s impossible to advertise your product, unless you want to lose a lot of money or confuse your audience.

Creating a product for teenagers is not specific enough. However, selecting male teenagers who practice extreme sports, and study in private schools in New York, will make you more assertive in your strategy.

7. Run tests! 

Once you’ve chosen a niche that matches your skillset, it’s time to test whether your idea has the potential to conquer the market.

To do so, you’ll need to create a prototype, or MVP (Minimum Viable Product), which is an initial version of your product that will allow you to collect data from your customers and validate your idea without much effort and using fewer resources.

You can offer a free trial version of your service, make the first module of your online course available for free, and observe how your audience reacts to it.

Promoting a webinar can also be great for understanding your audience’s main questions and making the necessary adjustments before launching your product.

7 tools to help you find a niche

Coming up with innovative product or service ideas to serve niche markets isn’t very easy. Oftentimes, defining a persona, analyzing the competition, and brainstorming might not be enough.

Fortunately, there are tools that can help you choose a niche market through accurate and segmented data. Below are some of the best:

1. Google 

As you can see, the search engine’s autocomplete feature provides many niche ideas. This is because all suggestions are based on the main searches carried out by Google’s users.

To use this feature, just use the product name + a complement, such as “for”, “of”, or an adjective.

For example, when searching for “marketing course for…” Google suggests a plethora of possible niches you can explore, such as marketing courses for lawyers, cosmetics, Instagram, dentists, and others.

2. Google Maps

That’s right. Google Maps isn’t just used for mapping traffic routes or finding nearby businesses, it can also provide good ideas for niche businesses.

With Google Maps, you can lay the foundations of a geographic segmentation strategy, an interesting idea if you plan on investing in locations where your chosen niche is still underexploited.

To do so, you simply search for the type of establishment and the desired geographic location. For example, you can search for “computer stores in downtown Austin”.

If you find other establishments or professionals are offering the same services as you do in a particular city, neighborhood or location, you can focus on areas lacking businesses within your niche.

3. Google Trends 

Remember how we explained that it’s important to keep an eye on the latest trends when choosing a niche? This is because the interests of audiences are constantly changing, and what is fashionable today might not be tomorrow.

In this sense, another tool (also from Google) that must be included in your planning is Google Trends. With Google Trends, you can accurately check the growth of searches for a particular subject over time.

Would you like to know if your niche is in demand? Simply use the keywords you found using our first tip, and track the growth of interest in these terms.

The nice thing about Trends is that you can also segment your search by geographic location and language. This way, you get a much more accurate idea of the demand for your services in your region.

4. Keyword Planner

Another Google tool that can help out when choosing a niche market.

While Google’s search engine only suggests related terms, Keyword Planner goes a step further and allows you to find keywords similar to the name of your product or service, opening up new business opportunities.

With this tool, you can find out the number of searches for a given term, segment it by geographic location, and the level of competition for the keyword.

5. SEMrush

SEMrush is one of the largest competition monitoring and analysis tools on the internet. It will help you understand if a niche market exists or not, as well as check the amount of competition in that segment.

With SEMrush, you can even find out who your main competitors are within a niche, with which keywords they compete with you, and even track traffic data from their channels. To do so, simply enter the address of the website you want to evaluate.

And that’s not all. If you want to implement a content production strategy, you can also use the tool to improve your channels’ SEO, monitor your social media profiles, and manage content.

6. Buzzsumo

This is another great tool for tracking market trends and your company’s performance on the internet.

Buzzsumo helps you identify internet trends, understand what a niche is talking about on the net, and of course, conduct a complete analysis of keywords and other terms associated with your business.

It’s a paid platform but it has a 14-day free trial and different plans for freelancers and bloggers.

7. Facebook

The world’s most famous social network is also a great platform to help you not only discover your niche, but also follow its trends.

Year after year, Facebook has been improving its features for businesses on the network. In addition to already having great business features, Facebook can help you in the task of finding a niche market with the features that have been around the longest, such as groups.

Not to mention Facebook Ads, which allows you to target campaigns according to your audience, such as where they live, how they access the internet, and, of course, demographics.

How to become a benchmark in a niche market 

You now know what a niche market is, as well as its importance. You’ve also learned about the different types of niches and how to define one. In addition, we showed you 7 practical tools to help you choose your niche.

Now the question is, “How can I become a benchmark in a niche?” First of all, you need to practice what we mentioned in the previous paragraphs. Other ways of positioning yourself as a benchmark are:

  • Produce quality content;
  • Have a solid, strong brand;
  • Invest in good customer service – after all, customers are responsible for building your reputation;
  • Offer a unique buying and after-sales experience – building customer loyalty should be one of your brand’s goals. 

Define your niche market now! 

If you’ve come this far, it’s a sign that you already understand the steps that need to be taken in order to define your niche. These steps are: understanding the types of niches, using tools to find the ideal segmentation, familiarizing yourself with the market, identifying problems, searching for trends and competitors, and conducting tests.

All of this is important to give you a competitive edge, to become a benchmark in the market, and most importantly, to deliver what your audience is looking for and needs.

By defining a niche market, you’ll put the spotlight on specific audiences that were previously overlooked by other brands, whether they’re large or small. By promoting solutions for such groups, your business can become a benchmark in a segmented market. 

If you’d like to learn more about choosing your niche market, check out the video below!