Want To Choose A Niche? Get Started With These 5 Easy Steps

Festus Otasowie

Introduction – Niche Meaning

The decision to start any business is always accompanied first by the question of what kind of business. How to choose a niche is the first question every online business must answer in order to get started. 

The reason for that would be clearer once we understand what we mean by niche.

The Merriam-Webster dictionary defines a niche as a place, employment, status, or activity for which a person or thing is best fitted and an example is “She finally found her niche”.

So essentially when talking about choosing a niche what is important to understand when related to starting an online business is that you are better off finding and tying this business to the niche you are best suited for.

And it is not too difficult to understand why that is important. 

In our brief video below titled Making Money Online -Getting Started we show you just how important choosing the right niche is when starting your own business

Any person intending to start a new business (any kind of business) especially an online business would definitely encounter challenges.

And when that happens the majority of people quit.

In fact, a large number of businesses never make it past year one of their existence.

Furthermore, if the business is not an area in which you are very conversant or for which you have a great interest, the odds of failure are even higher.

So now that you know the reasons that many new businesses fail, would you love to increase your chances of success?

Definitely yes!

Finding a niche in an online business that fits you and to which you are passionately involved therefore becomes imperative.

What Is A Niche Market

A niche market is created when one identifies a subset or segment of a market, by their unique needs, of the product price, quality, features and customer demographics for the purpose of managing competition.

For example, many years ago, large organizations bought large printers, fax machines, copiers, and scanners -all as separate machines. However, a niche market for an all-in-1 printer was created that combined all of these features targeted at the Small Office Home Office (SOHO) customers at a far less price than having to buy each of those machines individually.

As may already be evident, the existence of a niche market helps new and smaller business compete with well-established ones by identifying parts (pockets) of the market which were hitherto unserved.

But besides small businesses even larger corporations can also use the identification and creation of niche markets as tools to grow their existing sales.

What Are Niche Products?

Niche products are goods or services with features that appeal to a particular market submarket. Unlike other products, a typical niche product can be identified by its customized usage and suitability for the submarket it serves.  Sometimes it is also identified by the specific demographics of the people it appeals to.

As an example, suppose within the men’s fashion you identified a sub-niche “super Large” for shirts. Assuming the size corresponds to XXXXL. You have checked that none of the big shops sell any shirts of this size except its custom made.

Also imagine if from your research you discovered that there is a sizeable demand for these types of shirts and this demand remains unmet.

What could you do if you were looking to start your own online business?

For one,  you could do so by partnering with some manufacturing companies to create this specific size of shirts and then promoting the products.

Better still (if you had the money) you could start your own small manufacturing outfit to create the products yourself.

You can use niche products and services to focus on specific sub-niches as a way to quickly launch your business without the usual high entry barriers that may be common to larger niche markets.

What Is A Niche Business?

Going by the definitions and descriptions we have had so far, a niche business, therefore, is one that has been set up to cater to the specific needs of a selected subset (niche) of a market or customers. It is usually also characterized by identifying specific needs that existing products have not met and so becomes highly sought after.

If properly done it is also always quite profitable by virtue of its meeting a need created by a market gap.

What are the challenges with setting up niche businesses?

For one, many times you are developing very specific products. That is not good or bad in itself. However, there would be risks that you are sometimes unable to validate because you have not seen these types of products or services before or because the existing products have not been used in a certain way before.

Secondly, the risk could be higher in which case extra precautionary measures may be required to guarantee success.

Thirdly, there may be regulatory hurdles to cross.

Whatever the case, if successfully executed, niche businesses have the potential to become very profitable. The one thing you need to pay particular attention to is that it could be fraught with higher risk.

A higher risk profile for your business could severely hamper your ability to source for funding in which case you may have to adopt a  sole risk approach for the business.


Steps to Choosing A Niche

Now that we have learned what niches are let us go through the actual process of how to choose a niche.

At this point, we already know what niche products and markets are and have gone through some niche examples.

So here are the practical steps to actually choosing a niche:

Step 1:  Take An Inventory –Interests & Passion

By the very definition of a niche, we must first understand ourselves in order to know what we are trying to match when we choose a niche. We need to identify some of our hobbies, interests, passions etc.

Here some questions to ask yourself in order to determine what your interests and passions are:

  1. What do I enjoy spending my time on?
  2. What kinds of leisure activities interest me? Are you interested in Indoors or outdoors?
  3. What kind of things could I spend all day doing and not be tired
  4. Am I an introvert or an extrovert?
  5. How comfortable am I standing before crowds? For example are you the type who already shared loads of pictures and videos on Facebook? Or are you the reserved type who would rather read other people’s posts but hardly posts yours?

Step 2: Research Your Online Business Niche categories

We have also gotten some indication of our interests and passion-based on some of the questions we have answered, what do we do next? As you would already begin to see, choosing a niche is all about achieving the best match between the different sub-niches and your personality type. So the next thing in this process is getting to also know the different online niches there are out there.

Now in order not to overwhelm you, let us start with some very basic list of generic online niches you can start with. And as you get further in the steps you can then narrow them down to select a particular sub-niche.

According to many online marketing experts such as Neil Patel, it is generally accepted that there are about 7 big categories of online marketing as listed below:

  1. Affiliate marketing
  2. Email marketing
  3. Search engine optimization (SEO)
  4. Search engine marketing (SEM)
  5. Content marketing
  6. Social Media Marketing (SMM)
  7. Pay-per-click advertising (PPC)

To understand this in pictorial form see the Online Marketing Tree infographics below:

How To Choose A niche Infographics

However, for simplicity in this particular instance we will focus on just three of these broad groups below:

  • Affiliate Marketing
  • Email Marketing
  • Content Marketing

Notice that although you don’t find content Marketing listed as one of the “fruits” in the online Marketing Tree, blogging is a typical example of content marketing.

Your ability to choose an online niche for your business would to a large extent depends on knowing what niches are available and the more you understand each of them the more you are able to determine if it is the right fit for you.

Sometimes it may also be necessary to identify which niche may be easier to start with especially if you are new in the online marketing business.

Now is any niche particularly easier than others?

That depends on many factors.

A number of factors such as your existing skills, your understanding of the different niches, your predisposition all have a role to play in how easy or difficult you are able to start an online business

Step 3: Determine the Personality/Passion Niche Fit

This is where the actual work of choosing a niche is.

So you have asked yourself some pertinent questions as to understanding what some of your personal interests are. You have also answered questions that helped you understand what your passions and interests are.

If you didn’t know before now, you probably realized from the few questions above that you are really not the extrovert you thought you were.

Or you just realized the mere thought of doing a video that millions of people out there will see scares the hell out of you…

Yea that could be scary even for people who have been in this business for a long time.

However, like most things, the obstacles are usually easier to overcome when you know how to.

It is also possible you just realized you are very passionate about sports and maybe more specifically, football.

You have your favorite club or team in a particular league.

Now you realize that you are so passionate that you have been collecting memorabilia for this club since you were a teenager.

If anyone cared to listen you could talk about this club, its players, their past matches, etc all day. You go watch their matches without fail.

And so did you then realize that you could set up a fan website and blog about this your favorite team?

That is what we are talking about in matching your passion with a suitable online niche. This is the very essence of choosing a niche.

And if you didn’t already know, did you also know that you could then become an affiliate and promote the sale of the club’s merchandise (such as jerseys, scarves, etc)  on your website thus generating income as an affiliate marketer?

Did you also know you could do this either directly as the Club’s affiliate or via sites such as Amazon as an Amazon Associate?

Well, you may say you don’t know how to write posts. But that is no problem.

What if you could produce videos to talk about interesting club related news, issues, transfers and do post-game reviews, etc?

You could then operate a YouTube video channel and do the same thing described above!

On the other hand, you could choose to do things a bit more differently.


By setting up a website, you could set up email marketing by identifying interesting online products you could promote using automated internet marketing tools?

Here you don’t need to show your face or stand and talk to strangers if you are the shy type.

There are lots of opportunities to start an online business if only you can invest the efforts that are required to choose a proper niche.

Feeling excited about how simple it is to get started with online marketing? Click on the Get Started button below and take the first step to starting your own online business.


Step 4: Evaluate & Test your Chosen Niche

So using the criteria below perhaps you have now decided to give it a try. You know this is what you want to do.

To get started with say setting up the blogging site that enables you to share the passion about sports, cooking, fashion..whatever it is.

So how do you know it’s the right niche you have selected?

Unfortunately, there is no way to know 100% right from the onset.

It is starting with what you already know about yourself and working with that.

Could you also come to the point where you experience challenges with this approach even if you have followed all these steps? The answer is yes. But perhaps the better question is would you allow any setback to prevent you from pursuing your dream and vision? I would say hell no!

That is why this step of evaluating your selection and testing comes in handy.

You may have to start and realize that things are not really working as you have expected and so have to adjust your plans.

That is ok.

The key is to do this quickly, learn from it by documenting what you did and what to do differently.

This is by no means a failure as it is not terminal.

I was watching an animal documentary recently and I learned that even the chetah with all its strength and speed only achieves a successful hunt one out of seven.

So just imagine if it gives up trying after the fourth time it is unsuccessful?

Well it starves to death

If the animals learn to persevere to achieve their goals why not us?


So learn to take quick actions –note not callous but quick. This is about decision making without the analysis that leads to paralysis (if you know what I mean).

That s the strategy that all successful entrepreneurs adopt.

You can’t be an exception to that rule.


Step 5: Review For Optimization Opportunities

So now that you have chosen a niche and started developing your content of promoting your products what do you have to do next?

There is always room for optimization.

In other words, you can always refine and grow this business once you start seeing how it is operating.

That is by no means an easy task but very doable if you follow a proven “plan-do-check” process.

Did you choose to start a blog post? What other related product niches can be linked to the business?

How can you grow it to make itself sustaining?

What is your definition of success in this business?

What additional resources –knowledge, skills, etc would you need for the business?

Now you can see that although you may have thought of this as a hobby or past time, it could jolly well become your mainstay depending on how much you believe in and commit to it.

Yes, its true many people start out wanting just a side hustle –just an additional source of passive income.’

But the reality is that many people always sooner than later realize that it has become the main hustle and now about to generate the income to replace your main hustle.


How To Find Profitable Niche

In answering the question of whether the chosen niche is profitable or not it depends.

From experience, it greatly depends on how much effort you put into all the steps already described above.

How much did you really seek to truthfully and honestly answer the questions about yourself?

How much did you try to research and understand the different online marketing niches listed above?

Now is it also possible that some niches could be more profitable than others? Of course!

So what does this mean for people desiring to choose a profitable niche?

I strongly believe that whether or not a chosen niche is profitable is a function of how much you put into the process of choosing it.

The truth is that whatever your passion, whatever your interests, there are always going to be people who share in this interest.

It, therefore, becomes a case of identifying how to make this in such a way as to identify these people who share in these passions and showcase this interest.

Secondly, a cursory search on Google trends for any search term related to this niche can always already show you whether or not people are already searching for information relating to this endeavor of yours.

As already mentioned above while it is true that some niches could be more profitable than others there is always wiggle room to make any niche profitable if you seek to understand that niche and put in the required efforts to grow it.


How To Choose  A Niche For Affiliate Marketing

Recall from the examples already given above, choosing a niche should follow similar steps as already listed. However, different affiliate networks offer different products.

So whereas you could literally choose any niche to start your blogging is based on interests and passion, there is not as much flexibility as an affiliate.

The chances are that if you were to say interested in a very specialized kind of sport there may not have been an affiliate network or products in that specific area.

However, that is not to say you can’t still do something by way of affiliate marketing.

It just means that it may require more work.

Perhaps you have to then develop your own products to promote personal or to develop an affiliate program around.

Is this impossible? Of course no!

Will this be more difficult and more challenging to achieve? Yes –especially for beginners.

That is why in determining a chosen niche if you can also tie your selection to solving a problem within that niche all the better.

People will always pay to get solutions to their problems.

What about finding a business within a niche that aligns with what you are very passionate about?

You will be having the best of both worlds!

So to effectively chose a profitable niche for Affiliate Marketing, you will need practical advice: You should ensure that you in your Step #2 to also identify potential affiliate networks that offer products and services within the niche you are interested in.

I guess that does make sense.

How to Find Your Niche In Blogging

Just as in the case of finding your niche for Affiliate Marketing, what is required in addition to the five steps already listed above is just some practical advice.

Choosing a niche in blogging would be a lot easier if you align the chosen niche topic with what already comes naturally to you.

This could be things that are already of interest to you by way of the existing skills you have, the leisures you pursue or other areas that you are passionate about.

It is no brainer that anyone engaged in things they are not passionate about would sooner than later run out of steam.

As in any worthwhile endeavor, you will experience challenges and difficulties with time.

Getting the energy to persevere and look for solutions to overcome these challenges depends on how very well motivated you are about the cause of your pursuit.

Do people give up midstream to achieving their dreams in online marketing? Lots of people do.



Starting an online business and indeed any business starts with understanding what type of business you need to engage in. Choosing a niche for your inline business is the recommended first step in that journey.

How successful you become in this business is a function of how prepared you are at the beginning and how your level of commitment to it. Any time spent in trying to prepare for the business and understand it is usually paying off later.

The benefits of spending time first to properly chose a niche are enormous –you could avoid losing money, heartaches and increase the odds of your business being successful.


How To Choose A Niche –FAQ

  1. What is the meaning of a niche?

    A niche as a place, employment, status, or activity for which a person or thing is best fitted. When applied to online marketing as in choosing an online niche, it, therefore, means finding a subset of an online market that is best suited to you

  2. How important is it to choose a niche before you start online marketing?

    While it is possible to start an online business without first putting some thoughts about what niche to go into, it is not advisable. Any research into what niche you should pursue increases the chances of your success in the business you set up.

  3. If I choose a niche now can I also change it later?

    It is definitely possible that you could do the necessary research maybe even identify a problem that going into a particular niche may solve but discover that many of the data are not aligning. In fact, most often than none, no matter the research you do you will never have perfect data to make your business decisions in which case you have to learn and adjust as you go along. Choosing a niche is just one of those everyday business decisions to be made.

  4. Are all niches profitable?

    All niches have the potential to be profitable and not all niches are equally profitable. However, the level of profitability you experience in any particular niche is a function of how much you understand that niche.

Share post on

Leave a Comment

Your email address will not be published. Required fields are marked *

Get the complete eCommerce trends eBook

In depth coverage of nine top eCommerce trends of the 2020s when you subscribe to our Newsletter

Start-Up Guides

Very cool advertising slogan

More To Explore

Subscribe to our newsletter

Don’t miss new updates on your email
Scroll to Top