Whether you sell books or women’s clothing, you don’t want your store to be just like the others in your category.  One way of distinguishing your business – while pursuing your own passion – is to offer a narrow niche of merchandise. This can be a great idea, or a recipe for failure, depending on where you are located.

What is a niche market? If a general store tries to stock everything for everyone, a niche store could be described as doing just the opposite: providing merchandise that targets the needs of a very specific customer group. A rule of thumb in determining whether you should have a narrow focus for your inventory is the size of your community.  The smaller your market size, the broader your selection needs to be. Even in a  fairly sizable city like Madison, Wisconsin, we know that we can attract more customers to our shop by having a wide range of merchandise categories.  

There are stores in our community, however, that do fine by appealing to just a segment of shoppers, for example dog lovers.  The customers that stop in delight in finding items curated to their interest – and a broader selection of breed-specific SKUs than a normal gift shop would stock.  In a smaller town, there might not be enough dog lovers with disposable income to justify a shop with this narrow a niche. 

One example that is often given of a successful niche shop is Lefty’s the Left Hand Store. While this may appear to have a limited potential market, there are in fact over 36 million American southpaws.  Lefty’s broadens their reach by being located in a tourist area (Pier 39 in San Francisco) with robust foot traffic – and by also offering a limited selection of their top sellers at a Lefty’s kiosk at Walt Disney World Resorts in Orlando, Florida. They extend their reach even further by shipping online orders around the country and even internationally.  

The shop in the photo above is also located in a tourist area (the Edaville Christmas Market in Carver, Massachusetts).  While a focus on garlic may seem narrow, in fact over 90%, of the world’s cuisines use garlic in some form – so many visitors will be tempted to stop in to see what The Hippy Pilgrim is offering. In this case the name on the door is an effective hook, but the shop does in fact carry other food and seasoning products.

The best rule of thumb regarding niche marketing is: the smaller your potential market area, the broader a selection your shop should offer. If you want to offer a focused selection, first research how many customers there are locally, and check out the online competition to see if you can reach beyond your community. Once you are open, make and maintain continuous communication with the targeted customers who will be essential to your success.

Happy Retailing,

Carol “Orange” Schroeder