When I built my first store, Bucket Hats NZ, in July 2022, I had zero retail experience.
I’m a copywriter, so I knew how to market a product and build a brand. And I’d been writing content for the ecommerce industry for over a year.
Well, why not give it a go?
So I did, and after six months, I was in the green. BHNZ had become a profitable business, bringing in consistent daily sales. Now I’m passing on my knowledge.
This guide is designed to teach you how to start your own scalable Shopify store using the exact methods I used. We’ll cover the entire process of building a profitable ecommerce store from the ground up.
First, here’s how I launched my ecommerce store with almost no upfront investment.
What is a niche?
In ecommerce, a niche is a more specific product category, often a subset of a larger category.
Instead of targeting the highly competitive market of Tools & Machinery, for example, you might specialise in saws or hammers. You’ll be serving a smaller market, but there will be fewer competitors. This allows you to quickly climb to the top of the food chain with minimum friction.
What are niche products?
Niche products are items that fall into smaller categories.
If ‘chairs’ are a broader product type, then a niche product might be office chairs – or even wheels for office chairs
The Oodie and Manscaped are both examples of successful Shopify stores selling niche products. Both of these famous brands target a specific audience with a flagship product or product type (comfort wear and men’s grooming tools, respectively).
This allows them to be ultra specific with their marketing, resulting in more sales.
A few more examples of niche products:
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Guitar strings
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Sustainable shoes
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Outdoor rugs
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Parachute backpacks
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Trampoline springs
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A niche Shopify store does not mean you can only sell one thing.
Take guitar strings for example.
You could sell nylon strings, metal strings, 6-string packs, 7-string packs, and single strings. You could also cross sell similar items like violin strings, cello strings, harp strings, guitar picks, guitar straps…
When you target a more specific product type, you come across as more of an expert. This makes customers trust you more, resulting in more sales.
Tips for choosing a profitable niche
Choosing a profitable niche is all about finding the right product and getting it in front of the right eye.
Here are my best tips for picking a profitable niche:
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Look for something that can give you at least 50% profit margins excluding tax. There will be additional costs added to your total COGS later, and thin margins early on can mean none when expenses start piling up.
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Choose a product/market you already know. It will be a lot easier to market your store to an audience you already know well. Consider products related to your hobbies or career.
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Research your future competitors. Before you settle on a niche, it’s important to check out the who’s who. Consider how challenging it would be to compete with the big names.
Don’t get hung up on one idea. It’s easy to get excited when you find a potentially profitable product, but never get attached. The ecommerce journey is full of wins and losses.
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Look for desirable products with terrible reviews. If your competitors are making sales despite terrible reviews, it means the product is very popular and there is an opportunity to serve the market with a much better alternative (yours!).
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If you’re drawing a blank on where to start with your research, just think about the things you use in your everyday life. You can even look around the room – perhaps you could sell clocks, fake plants, bookshelves, or duvet covers?
Now let’s talk about the most important part: Product validation.
How to conduct product research
Product research consists of two parts: Investigation and Validation.
In the investigation phase, we are simply trying to find products that might be winners. Once we’ve formed a few ideas, the validation phase will determine if they have real potential.
Marketplace product research
A good place to start your product research is on online marketplaces.
Some examples of these include:
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Amazon
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AliExpress
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AliBaba
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TradeMe
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Etsy
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eBay
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Walmart Marketplace
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Since we’re ‘investigating’ niche products, you’ll want to dive deep into the subcategories.
Some marketplaces even have lists loaded with great product ideas. Amazon’s Best Sellers, Movers & Shakers, and Most Wished For lists are all great resources for product research.
Other marketplaces offer similar lists or search filter functions. See what’s trending, what’s popular, and which products you think you could improve on.
Google product research
Google offers many ways to research niche products.
It’s worth taking some time to learn about keyword research and SEO. This will be very helpful both in validating product ideas and in bringing traffic to your website.
Here are some resources for getting started with SEO:
In content marketing, keyword research is performed to find high volume search queries with few competitors targeting them. Similarly, keyword research can be used to identify products with high search volume and no gigantic brands competing for sales.
You can find out the search volume and competitive difficulty of a keyword using a number of free and paid tools.
These two are free, but with limited daily uses:
Take some time to watch a few Youtube tutorials on how to use these websites to conduct free keyword research.
Qualities to look for in a winning product
To help you on your product research journey, here’s a quick checklist of ideal attributes to watch for.
What to look for when conducting Shopify product research:
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A product type or industry you know well
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Products with 50%+ profit margins
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An underserved audience
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No big-fish competitors
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Products that people want to buy
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Products that people want to buy online
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Products with low freight costs
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Products that are easy to source
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The more of these attributes you can tick off, the better chance you have at picking a winning product.
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