Is Your Niche Business Worth Scratch?

Monday, 14 April 2014 07:12
Blog author: 

Greetings!

I routinely encounter new, niche products from small companies. The developer is usually seeking assistance to achieve retail distribution. While niche products often face these and other challenges, they will become robust businesses only if they possess certain essential characteristics.

Curious to learn more? Read on, dear friends.

Is Your Niche Business Worth Scratch?

"Successful niche products deliver their highly compelling value proposition to a passionate and motivated customer base."

In an already crowded consumer product market, niche product success hinges on being more than just unique and clever...they must also be viewed by customers as necessary.

Easy, convenient way to remove beach sand from damp skin.
I was recently approached by the developer of a product called Sandsweepers (www.mysandsweepers.com) a patented, high loft non-woven pad that effectively, safely and comfortably removes beach sand from damp skin without use of talcum powder. It's also reusable. I've used the product and it works well. The need is common, though not especially intense, as one can always rinse sandy skin with water. Its success prospects are dim unless the developer can achieve retail distribution near beach fronts. Even with this, it is unlikely to ever become a breakout success because while practical and useful, for most people, it doesn't satisfy an intensely felt need.

Open air changing room for athletes.
Orange Mud, an outdoor athletic products designer and online retailer, has developed and recently launched its latest new product. It raises similar questions as Sandsweepers.

Their Transition Wrap and Seat Cover (www.orangemud.com/products/thewrap) is, in effect, a large towel that clips securely around an athlete's waist to enable him to change out of wet or dirty training gear without privacy concerns. It also has a built-in hoodie to drape over his car seat head rest to prevent dirtying or dampening his car seat while wearing athletic attire.

The product would certainly be useful. I routinely change out of my sweaty running shirt into a dry, clean one before joining my friends for breakfast at Panera. I can appreciate why someone might want to use a Transition Wrap for doing likewise with their running shorts. However, be it for reasons of modesty, peer behaviors, or simply the perceived lack of sufficient need, I suspect that most won't. Interestingly, I've convinced myself to buy one just by writing and thinking about the topic! (I'll let you know if its use becomes routine for me).

Changing consumer behaviors can be challenging. However, the Wrap's success prospects hinge on it. For this very reason, Orange Mud is taking a grass roots marketing approach, hoping that strong, viral word of mouth will drive customer interest and adoption...and in turn, help generate retail distribution opportunities. It is too soon to say whether they'll be successful. It may take a slow build, and in a best case scenario, cause a tipping point to occur.

High definition video camera goes anywhere to capture anything that moves.
GoPro (www.gopro.com ) is a small, lightweight, compact, high definition video camera that can be worn by a user or affixed to virtually any moving object anywhere to create dynamic video recordings that can be uploaded to computers for editing and online for sharing. Over time, it has benefitted from strong word of mouth and has built an increasingly expansive range of users and uses, from drone mounted airborne surveillance, to sports training, underwater use, etc. While one can appreciate its appeal after experiencing the dramatic videos it produces, there is no reason to believe that the market was actually clamoring for this product when it was founded in 2002.

Jump to 2013 and GoPro has achieved broad scale distribution and annual revenues in excess of $300M. GoPro is somewhat unique in the sense that it has also benefitted from online social media growth, associated video sharing, advances in technology component miniaturization and HD quality enhancement during this time period. 11 years is hardly an overnight success story, but its growth is certainly impressive. It is also now being emulated by a number of competitors, which is a sign that it is becoming more mainstream. Still, GoPro is a great example of how a compelling and unique product with a fanatic user base can become quite successful.

In Conclusion
Niche products are by definition, not for everyone. Even among stronger candidates, they often require persistence and patience to achieve success. If you're considering developing one, ask yourself (or better still, a number of others who will be completely honest with you) this critical question: do my target customers feel strongly enough about my unique value proposition and are there enough of them to matter?

Since 2005, BFS Innovations has helped its Fortune 500 clients with technology scouting, creative problem solving and new business creation and development services. Contact Michael today at This email address is being protected from spambots. You need JavaScript enabled to view it. or at 614 937-2408 to discuss your company's needs.



































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