Once upon a time, when businesses were all "offline," you didn't concern yourself as much with "niches." A store that sold rugs in San Diego didn't have to compete with a rug store in Miami and in many ways, your location was your niche. But then came the internet, which in effect, "flattened" the world. So although there is still some regionalism when it comes to online businesses (an online rug store in the US may never compete with one in the UK), there are still only so many rug stores that can succeed in one location (in this case, online). So what has happened is that niches on the internet are not so much about location, but a lot more about the actual idea. And consequently, you have no shortage of experts and books discussing subjects such as of finding these new markets (Blue Ocean Strategy) and leveraging specialty products (The Long Tail). So the question is, whether you're considering a new web app or a blog concept, how do you come up with an idea that is "niche" enough to be original, but not too "niche" so that you make up half of your visitors? Here are some questions that may help you:
Being Niche Enough (So That You Have Originality)
1. Are You Unique at Your Core?
Just because an idea is unique to you doesn't mean it's unique to everyone else. Describe your idea in under 6 words and then, based on that phrase alone, determine whether the idea is really different from other ones out there. You don't really want your idea to fit into this phrase -- "It's just like ___________, but with much less ____________." Just like ProBlogger, but with much less content. Just like FreshBooks, but with much less features. Just like Facebook, but with much less traffic. Let whatever your "hook" is be part of your core message.
2. Who Won't Care About Your Idea?
Knowing who your app doesn't apply to will help refine your idea in many ways. Having this "people group" in your mind keeps you from catering to the wrong crowd and adding features your real audience won't care about; on the flip side, you'll be freer to focus on your core uniqueness and the demographic to which it applies. Apple, for example, has never been bothered by the fact that programmers and office-types generally don't care about Macs (and are thus characterized as "PC types" in their commercial campaigns). So instead of even trying to break into that market (for now), they characterized such people as "not them," and instead, focused on the "Apple side" of technology.
3. Are You Passionate About Your Idea?
I know it doesn't seem that passion about an idea leads to originality (after all, can't a person be passionate about plain old pants? Or crackers?). But in reality, people who are really passionate about an idea seem to innovate at a much higher frequency than people who aren't. The reason? Because anyone who's passionate about an idea thinks about that idea all the time, and everything in life seems to come back to how it affects their passion. All this mental focus often leads to new ideas as well as originality within old ones...
Not Being Too Niche (So That You Have an Audience)
1. Do Trends Favor Your Niche?
What's hot? Green earth, mobile, and the eighties. What's not? Dolls, board games, and lumberjacks (as well as all things flannel). It's not bad to be in a narrow niche, but if that niche has no growth ahead of it, you could be in trouble. Carefully consider the next five years and whether you believe there's growth ahead (unfortunately, most people "get their ideas" at the peak of obvious trends). Be willing not only to research the industry, but also to contact key players in the field (who are usually more than happy to "talk shop"). You must have a feel for your niche and its future.
2. What Do Friends Think?
I'm amazed at how many people have a unique business idea that they have never discussed with others. Usually, such people are reticent because either (a) don't want criticism of their darling, or (b) fear that others might "steal" their idea. The problem is that people grow too close to their ideas and are unable to see the pros/cons of their idea -- even though everybody has friends or contacts that they consider honest and critical. Having these minds give you their initial reactions to your idea will help you see whether your idea is viable to a crowd larger than just you. Don't fear their response...most people enjoy giving input.
3. Have You Spent Real Time Researching Real Numbers?
In two minutes with Google and Excel, I can put together this pitch: My idea is selling tee shirts with their own screen-printing kit. Accessories would include fabric paint and pre-made screens. Furthermore, the craft market is a $31 billion industry and no one has ever tried this concept before. Look at my spreadsheet -- if I capture just 1/100 of 1% of that market over the next 3 years, I could have a business valuation of $3.1 million. I know this example is full of bad logic, but to be honest, most people do less work than this before deciding that their "niche" has enough of a market with which to make cash. Be realistic and do your homework. Know how many people are actually searching for your idea. Know how many of those you can actually reach and how you would do that. (And to be honest, you should probably try this test out -- multiply your "obvious" audience by .001 and see if you still have enough people to make your idea work.) If you're going to spend weeks and months executing an idea, I would hope you spend the hours up front making sure your "niche" will actually have visitors.
Of Course There Are Exceptions
Although I believe in the questions above, and run my ideas through these filters, I acknowledge that there are exceptions to all of them. Although the above questions make great discussions and help you refine ideas, don't let them stop an idea that you love because even ideas that seem too "copycat" or too "narrow" (tumbleweed anyone?) can succeed. At the same time, don't pretend that all your ideas are (a) original and (b) demand an audience. Ask yourself the above questions and think through your ideas in a new way.
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Gary
