Your best chance of success as an entrepreneur is to offer a product or service that’s unique to a marketplace that needs what you and your business have to offer.
Finding that niche, or creating it, clears the field of competition and gives your startup business a path to takeoff. Filling exactly the right position in the marketplace can create an overwhelming advantage that gives your new business a fighting chance.
“Your business has to find its unique and authentic proposition and voice,” says Kevin Carroll, author of Rules of the Red Rubber Ball: Find and Sustain Your Life’s Work. “What makes and differentiates you? What are you doing better, or more of, or amplifying more, than any competition? And don’t worry so much about the competition as about doing what you want to do, well.”
Start with your interests and passions
The best businesses stem from someone’s passions, interests and background. Your efforts to find the right niche should begin with an assessment of what kind of product or service you could get excited about providing, what market you would be enthusiastic about serving, and what skills and aptitudes you have that could make it all work.
Charlie Warner, for example, has been a lifelong comedy fan. He retired as a marketing vice-president for America Online and wanted to start his own enterprise. So the New York City resident launched DailyComedy.com, which provides users with new comedic material every day, including videos designed specifically for the internet, and allows users to create a comedy “stage” where they can post their own jokes and videos.
Search for needy spots in the marketplace
As an employee, consumer, family member, hobbyist or any of your other life roles, you constantly notice things that could be done better, or holes in the marketplace that just shouldn’t exist. Now is the time to start looking at those gaps as business opportunities and figuring out what it would take to fill them.
Rich Bianchi, for one, was an executive at Honeywell, the computer company, and noticed that no tools existed to help the employees on his project teams answer the basic question: what are the most important things I’m supposed to be doing today? So he founded Alexsys and came up with a project-management software package called Team Pro, which now is used by hundreds of organizations around the world.
Come up with a new take on an old category
The ranks of successful startups are teeming with this approach. Cranium founders Richard Tait and Whit Alexander were working at Microsoft nine years ago when they thought up a new kind of board game, one in which no one loses and everyone has heroic moments. Artuzzi’s Italian Kitchen in Roswell, Ga., has succeeded with a casual-Italian theme without the high prices of, say, an Olive Garden. And Ryan Black went one better than Red Bull by creating an all-natural energy drink, using the super-nutritious juice of the Brazilian acai berry as the basis for his Sambazon line, now for sale nationwide.
Market research and critical thinking are the keys to figuring out how to come up with a fruitful new take on what’s already out there. “You need to do typical market research – online, talking with people, going into stores to see what’s out there,” says Farhana Huq, founder of CEOWomen, a not-for-profit outfit in Oakland, Calif., that helps immigrant women find their entrepreneurial niches.
Pick up where a previous niche occupant has left off
Sometimes, filling the niche you want to occupy is a matter of finding someone else who’s already in that business but dropping out. If you like how that company has defined and filled the niche before you, buying an existing business is one way to land in the space you want.
Mary Warren, her son, Chris, and her brother, Thom Warren, wanted to get into a niche service business together in Atlanta. They focused on the possibilities in the cleaning, repair and maintenance of fine rugs, an industry filled with family-run companies. At a national industry convention several years ago, they learned about an Atlanta-area rug-cleaning company that was going out of business. They bought its equipment, were able to tap into its client base – and Cristomar got off to a flying start.
Our Bottom Line
There’s no better place for your startup business to be than alone in a promising business niche. A lot of upfront searching and thinking can help you discover, and perhaps create, just the space in the marketplace that will separate your company from the pack.