Whether you’re an ecommerce veteran or just starting out, differentiating your business can be difficult in today’s world. That’s where a niche product can save the day.
Don’t know what a niche is?
Well, read on and we’ll explain what it is and why it may be just what your business needs.
We’ve also thrown in the top ten niches we expect to blow up in 2021 (skip to the bottom if you already know what a niche is).
What is an Ecommerce Niche?
An ecommerce niche is a specialized market of shoppers. It’s a simple concept and is often divided into these categories:
- Demographic: characteristics of individuals including age, gender, income, education, etc.
- Geographic: based on customer location
- Psychographic: characteristics of personal thoughts such as attitudes, interests, lifestyles, principles, etc.
- Pricing: similar to income level, from premium to affordable
Let’s say you sell jewelry. This category includes so many types of products you could sell. From diamond earrings to mood rings, the market is massive!
But if you tried to sell everything, how would you market a product line to both a 13-year-old girl wanting a mood ring and a 30-year-old man looking for an engagement ring?
The answer is: you can’t. At least not effectively with a small business marketing budget.
The solution: find your niche.
So, for the online jeweler, here are a number of niches you could focus on:
- handmade wooden watches
- vintage jewelry from a certain era
- Star Wars cuff links
- custom charms
So why focus on a small category of products? Well, selling in an ecommerce niche has many perks.
Pros of Selling Niche Products
If you’ve ever heard the saying “cast a wide net,” an ecommerce niche may sound like a useless strategy. Large retailers like Amazon and Walmart sell all sorts of products, but they also have the resources to do so.
For smaller businesses, selling a wide variety of products can quickly become a money pit.
By the time you spend your budget on inventory, storage, shipping, marketing, and all the other aspects of running a business, you’ll barely make enough to profit. It’s not always the best approach; that’s where an ecommerce niche comes in.
Focusing on a popular niche and taking advantage of multichannel selling benefits entrepreneurs in the following ways:
1. Less Expensive
Selling niche products saves you money across the board. From cheaper marketing to less operational resources, you’ll save heaps of cash by being the big fish in the small pond:
- Cheaper Marketing. Developing an ecommerce marketing strategy for a particular group of people is much easier than marketing to the masses.You know who the customers are, what they like, and where they shop. Not only does this make marketing painless, it makes it much more affordable. You won’t waste money advertising in the wrong places and to the wrong people.Here’s a great image that shows the difference between marketing to the masses and niche marketing:
- Lower Storage Fees. Unless you drop ship products, storing 100s of SKUs in a warehouse isn’t economical, especially with storage fees on the rise. Be selective about what you sell so you don’t pay your weight in gold to FBA.
- Fewer Listing Fees. Listing hundreds of products on 5 different channels that charge listing fees isn’t an effective strategy. There is less risk when listing a limited product line that you know will sell.
2. Better Profits
Not only do selling niche products save you money, it can make you more money. Aside from the obvious point of lower costs meaning higher profits, there are other ways your pockets will benefit:
- Higher Prices. Highly competitive items can lead to price wars which means selling products for little to no profits. Niche products usually have less competition. As you can see, there are less searches for the more niche keywords, which also correspond with less competition.
Not only does that benefit your SEO strategy, it also helps your pricing game plan. Calculate your cost of goods and determine the best pricing strategy for your audience.
- Brand Loyalty. Selling to a niche market allows retailers to build a brand, which is harder for the liquidator-type retailers. Merchants can focus on building more personalized content and customer experiences for their target customers which leads to stronger brand loyalty.
- Better ROI. Once you’ve developed a brand, you can build a network of influencers to push your products. Influencer marketing can bring 11x higher ROI than traditional marketing.
3. Reduced Resources
Trying to manage 100s of SKUs for 15 different categories isn’t reasonable for SMBs.
Not only do you have to manage the storage of said products, you must keep track of all the product identifiers, and the tasks of listing them on each platform.
- Less Management. Managing accurate product counts for a catalog with 100s of SKUs isn’t for the rookie retailer. More employees or an ecommerce inventory software is needed to keep your stock levels updated. Selling a modest number of products in a niche can be advantageous if you’re just starting out. It gives you time to learn about the industry, the cost to sell the products, and more. Once you’ve gotten the hang of it, expand to more channels and add new products within your niche.
- Lean Staff. Multichannel selling is a great way to build brand visibility and increase sales. But, it can be a nightmare for sellers with a laundry list of products. From listing attributes to product identifiers to product descriptions, you need an army of employees to list products. Start small with a niche segment and build your catalog over time. It will save a ton of payroll dollars and sleepless nights.
- Better Supplier Relationships. Lastly, staying within a niche means you have less supplier relationships to manage. That means you have the time to build better connections with all your suppliers and possibly receive better deals down the road.
Tips for Finding the Best Ecommerce Niche
So, you want to get started but you’re just not sure what ecommerce niche to sell in.
We’ve got you covered.
Here are three important tips to help find the perfect niche for your business.
1. Do Your Research
Whether you already have an idea of what to sell or you’re completely clueless, you should do research to see what’s viable or futile. Try following some online trend publications, find data on Google Trends, and check selling opportunities on the Amazon platform. We have a great guide on using Google Trends to find your niche, if you’ve never used it before.
2. Choose Wisely
There are a few simple rules to follow to help your chances of finding a great ecommerce niche.
Here are some things to consider when choosing products:
- Sell niche products that list at more than $15, but don’t go much higher than $200. This usually helps you arrive at a good balance between profitability, average order values, and demand.
- Be wary of seasonal products that only bring in money during a certain time of the year. While you can make a lot of money selling seasonal products, doing so is more challenging than the alternative, and quite a bit more risky for small businesses.
- Only sell items that don’t lose value as they sit on shelves. For example, electronics lose value fast, and unless you already have an active customer base that’s interested in those products, you probably want to avoid those products.
- Sell products with more ambiguous pricing. Everyone knows what most electronic items should sell for, but informational items and jewelry are more subjective in pricing.
- Choose items that are easy to ship and not fragile.
- Smaller products work best for niche stores.
3. Find Existing Sellers
Try using various keywords in Google searches to find out who else is selling the types of products you’re interested in. First, you want to see if the specific market has too many sellers already. Second, you can see who is successful and who isn’t to help your marketing strategy.
Pay special attention to any seller that shows up over and over again in your searches. Take a peek at their online store, social media, and customer reviews. You want to learn:
- Do they look successful (how many reviews do they have and are they good)?
- Are they posting on social media and blogs?
- What are the strategies they employ to engage customers?
If you don’t find many retailers during your search, it could either be a good sign or a bad sign. On one hand, you may have low competition, but on the other hand, there may not be much of a demand for that product.
This is where free tools like Google Trends and Google Shopping Insights can help you understand how much interest a specific product or category may have.
For a more in-depth dive on finding a niche, read our more thorough guide on how to choose your perfect ecommerce niche. There, we explain all the considerations of choosing the best niches that suit your brand.
Best Ecommerce Niches of 2021
If you’re targeting upcoming and trending niches, timing is everything.
Wait too long and everyone jumps on the bandwagon, leaving the market flooded with competition. But if you can strike at the right time, you can establish your brand as a niche leader before all the copycat brands hop on.
Based on search trends and expert recommendations, we’ve collected a list of the top 10 best ecommerce niche products for 2021.
1. Men’s Beauty Products
What better way to break in the new decade than by deconstructing gender norms!
If you’ve been following retail trends over the last decade, it should come as no surprise to see men’s beauty products on our ecommerce niche list: the market for beard grooming products alone has been growing healthily over the last 5 years.
In addition to beard wax and oils, traditional beauty products like lip balm and moisturizer targeting men are also a growing market. If your customer base is more traditional, good old fashioned shaving supplies are still well in demand.
As part of the beauty niche, these products also work well with subscription boxes — as with women’s beauty products, customers will want to try recommended samples before settling on their favorites.
2. Home Exercise Equipment
Exercise equipment has long been kind to ecommerce brands, but in 2021 it’s going even further. The push to stay in and avoid public gyms has caused fitness fans to exercise at home instead, and many of them discovered that they actually prefer their home gyms.
Naturally, you might have trouble shipping treadmills or heavy weight sets, so online retailers fare better with smaller equipment: kettlebells, roller wheels, slam balls, chin-up bars, single dumbbells, and resistance bands. There’s also a lot of workout stations that are assembled at-home, so as long as you keep them in the box they’re easy enough to store.
3. Books on Politics
Books have any number of niche categories, starting with fiction and nonfiction, all the way down to micro-niches like vegan Cajun cookbooks in Spanish.
These niches all have their built-in audiences, but lately one niche — political books — is expanding at a noteworthy rate.
Biographies or memoirs about current political leaders seem to be a more frequented category. Titles such as Bob Woodward’s Fear and Rage on the Trump presidency, or the slew of Ruth Bader Ginsberg biographies, including those aimed at children are very popular.
Although not strictly political, books on race have been trending since the summer, specifically since the start of the George Floyd protests. As of this writing, Candice Owen’s Blackout holds the number 3 place on Amazon books.
4. Natural Feminine Care Products
While feminine care and hygiene products are an evergreen category for online retail, combined with the trend of natural and eco-friendly products, it becomes a breakout niche with little competition and lots of potential.
Their popularity is partly thanks to the success of Honey Pot, makers of all-natural washes, cleanses, wipes, and menstrual products.
They’ve had a good year in 2020, leading to competing companies like Kushae popping up to claim a share of the market.
The bottom line: more women shoppers are looking for natural and eco-friendly versions of the everyday products, not just for the environment, but for the enhanced treatment on their skin as well.
5. Natural Pet Care
Just like natural feminine care products, the niche of pet products has always been strong in online retail. It makes up the second (pet supplies) and third (pet food) most popular CPG product categories in ecommerce.
Combine pet products with the trend for natural products, and you adequately fulfill two of Pet Biz Marketer’s top retail trends: organic pet food and healthy pet treats.
A sub-niche of natural pet care is cooking homemade natural pet snacks.
This satisfies a few different niches at once — pets, natural foods, and homemade goods — although it does take more work in manufacturing them all.
Still, considering how much pet-owners enjoy shopping for their pets, you have a good chance to make up the cost of the extra time.
6. Disinfectant Products
It’s no secret disinfectants were a best-seller in 2020, but surprisingly the trend isn’t dying down as much as you’d think (it certainly declined since the summer, but interest still remains higher now than before March).
It’s highly likely that the demand for disinfectants will last well into 2021, and perhaps the regular use of hand sanitizers, disinfecting sprays, and antibacterial wipes will become part of everyday life from now on.
Coupled with Clorox’s shortage of wipes, demand for disinfectant products will likely remain strong for a while.
The brand Microban is taking advantage of the opportunity to capture some of the market share, as they’ve been getting noticed for the first time this year.
7. Boutique Rugs
To be honest, we’re not exactly sure why boutique rugs are trending now.
What we do know is that, according to Google Trends, keywords related to “rugs,” in particular “boutique rugs,” are surprise breakouts.
For online retailers, that’s great news.
Rugs are convenient to store and can be sold at various price ranges, depending on your customers.
There’s also a variety of niches to target, depending on your brand, although “boutique rugs” seems to be the most popular ecommerce niche.
8. Organization Helpers
Along the same lines as boutique rugs, there’s an increased interest in personal organization products — in particular for garages and closets (maybe we have the quarantine to thank for this trend, too).
Although not as stylized as the other product niches on this list, organization helpers are more of an essential purchase than an impulse buy.
Organization products like wall organizers, DIY simple shelving, pegboards, and storage units of all shapes and sizes can move great on their own, not to mention they’re ideal for cross-selling.
If you’re specializing in fashion, you can also offer closet organizers like shoe racks, jewelry bins, or standard hangers.
9. Smart Speakers
No ecommerce niche list would be complete without electronics, and in 2021 that means smart speakers.
Although not a new niche, smart speakers have spent the last few years proving that they’re more than a passing fad. By now, more and more households are catching on — and want a smart speaker for themselves.
Specifically, The Roku Smart Soundbar is a hot item, which connects streaming services to your TV in addition to killer audio. Alexa devices are still best sellers (at least on Amazon), with the fourth-generation Echo Dots quickly rising in the ranks.
10. Eco-friendly Versions of Everyday Products
If you’ve read our top ecommerce niches for last year, you’ll recognize this entry — seems that the planet still needs help, according to shopper preferences.
The first is cloth diapers, or reusable diapers.
The reasoning here is the same as other reusable products — significantly reduce your personal trash by washing and reusing the same set of diapers. It may require extra cleaning, but you’ll save more than just the planet, you also cut down on the cost of buying new diapers over and over again.
We also see a new trend in bamboo toothbrushes, like those from WooBamboo. Bamboo toothbrushes are becoming quite popular as a way to curb plastic usage — made from fast-growing bamboo, these toothbrushes are biodegradable and can even be composted at home.
It’s Your Year!
Ecommerce has become more popular than ever before. Millions of people are getting in on the action by starting their very own online business. If you’re one of these entrepreneurs, consider focusing on a particular niche product. You’ll have less competition, save some money, and create a brand you can be proud of.
As a recap, here are the top ecommerce niches of 2021:
- Men’s beauty products
- Home exercise equipment
- Political books
- Natural feminine care products
- Natural pet care products
- Disinfectant products
- Boutique rugs
- Organizational helpers
- Smart speakers
- Eco-friendly versions of everyday products
After choosing an ecommerce niche, you’re ready to take on the tasks required to run a business. But, managing finances, fulfillment, shipping, multichannel listings, and other difficult jobs may take up a bulk of your time.
Luckily, you don’t have to do it alone. Ecomdash offers expert ecommerce inventory management so you only have to worry about selling your niche product! Start your 15 day free trial now and when you decide to work with us, you’ll receive a free onboarding session.