The first rule in niche marketing is that you must define who your target audience is. You need to create a mental picture of who your customer is. Is he a young adult or a baby boomer? Is your potential customer base mainly female or male? You cannot miss this step because it defines your whole business model and what kind of products you will provide.
Next, you need to find out what problems your niche are having. Every product solves some problem in some way or another. It could be a craving or desire that needs to be fulfilled, or a niggling problem that goes on for years and years. If your product can solve any of these problems, you're definitely heading on the right track.
The third rule is to test your niche. I know it's a cliché, but you need to test the waters before jumping in! Conduct a survey to find out what exactly what customers want to see in your product. Do a market test for your product to see if it sells before going on a full-blown advertising campaign.
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