Many smaller businesses choose niche markets for various reasons and these niche markets can be very lucrative. This article will look at ways to identify and assess whether they are right for your business?

For many smaller businesses it is important to have a focused strategy which enables them to operate in a small part of a chosen market with great success. This has a further advantage of giving smaller business a way to compete with larger organizations and achieve a level of protection against competition.

How is it Relevant to You as Owner? As owner of business, you decide on business strategy and make informed choices as to where business will be going. Being clear on possible niche markets or a niche focus of your business can be crucial to ultimate success and sustainable growth of your business.

The advantage of operating in a niche is that you can specialize in a small market and hence become a leading supplier of that specific product or service.

Niche marketing can be extremely cost-effective. For instance, imagine you offer a product or service that's just right for a select demographic or population group in your area, such as South Africans or students. You could advertise in newspapers or websites that focus on them, which have considerably lower rates than stations that program for broader audiences. So your marketing budget would go a lot further, allowing you to advertise with greater frequency or to use a more comprehensive media mix. Taking on a new niche can be a low-risk way to grow your business, as long as you keep in mind several important rules: Here are a 4 steps to consider when choosing a niche market.

Step 1 Being Clear

The first step in almost any process is being clear on what you are doing. Processes like this can take time and money to complete and as a small business owner both time and money are valuable resources that should not be wasted.

Ask yourself: What do I want from this process, how exactly am I going to accomplish it, what resources do I need before I start, who will manage process, how will I know when its done?

The steps to be followed in first phase could be as follows. It may vary from one project to another.

Convene a meeting with stakeholders of project and identify exact aim and required outcome of project.

Assign a project manager to assist in development for project.

Identify potential team members required to support proposed solution.

Convene a proposal review meeting with potential team members to identify: proposed creative approach; scope of work, potential number of effort days; resource requirements; technical requirements; and other issues to be addressed in proposal.

Produce a work breakdown diagram, proposed budget and resource requirements list considering steps 2, 3 and 4 bellow.

Note: This phase is extremely important. A good carpenter always measures twice and cut once. This step is about specifying what measures will be.

Step 2 Doing Your Research