To create innovative cosmetic products or to start a cosmetic brand, you need to know about and find niche markets. Since science majors never really learned about this type of marketing information, I thought it would be helpful to give you a quick run down of what they are, why you should care about them and how to find them.
Niche market for cosmetics
A cosmetic niche market is no different than a niche market in some other field. Essentially, a niche market is a sub set of a larger market. In practical terms, it is a smaller group of people with some specific characteristic that sets them apart.
So, if the general market is everyone who uses personal care products, a niche market would be men who use personal care products. Women who use personal care products is also a niche market, but it is so large that almost no one considers it niche. You could find further sub sets of these groups to find even more targeted niche markets. For example, women with naturally red hair color could be a niche market. This group could be broken down even further as women with naturally red, curly hair, a focused niche indeed.
Cosmetic chemists and niche markets
Now that you know niche markets are smaller segments of consumer groups, why should you care? There are a couple reasons that this is important to cosmetic chemists.
First, if you are trying to create innovative new products you will have to make products that solve specific problems. All of the easy-to-solve problems in the cosmetic industry have already been solved. Unless you work for a large company that has a basic research wing you will not likely be able to solve the significant problems like wrinkles, acne, hair loss, hair growth, etc. However, you can solve some of the easier problems that niche markets experience.
Second, if you are going to start your own cosmetic line as many cosmetic chemists want to do, you will need to identify a niche market for which to sell your product. The reality is that you will not be able to compete with the big cosmetic companies for the general market. It is only the niche markets that are too small for big companies to pay attention to that you will have a chance. The fact that big companies ignore them means less competition for your new brand and a greater possibility for your success. Also, niche consumers tend to be more rabid fans of their brands. They like that there is a product made especially for them. This will give you a significant marketing and product development advantage.
Finding niche markets
The key to finding niche markets is to start with a large group of consumers and identify sub sets of that group. Then make a list of all the products in the category and match them up with your consumer group.
Step 1 – Identify consumer groups
In this step you just make a list of all the consumer groups you can think of. Mind mapping can help. It also helps to narrow your list down right away. If you start with a large group like all consumers it will be harder to drill down to smaller groups. So, let’s start with a group like men. Here is a short list off the top of my head of sub sets of the male consumer group.
1. Grey haired men
2. Bald men
3. Metrosexual men
4. Teenage men
5. Boy babies
6. Red haired men
7. Curly haired men
8. Fair skinned men
9. Left handed men
10. Male athletes
11. Male college students
12. Male musicians
And the list could go on. Niche markets can be found among any group. They can be grouped by some physical feature, some hobby, some job, or any activity that groups people.
Step 2 – Identify possible products or problems
Once you have a list of consumer groups, you can list all the types of products that general consumers use. The list might be something like..
1. Skin moisturizer
6. Shaving cream
7. Nail polish
8. Hair gel
9. Color cosmetics
10. Anti-aging creams
And this list could go on too.
Of course, rather than listing products you can make a list of problems that your specific niche group has that may not be a problem for the general population. This may be something like Gluten Allergies. A list like this could be more helpful but it could also be more difficult to make.
Step 3 – Match up the who and the what
You have your list of consumer groups and a list of products. Now, just match them up. (e.g. Nail polish for male musicians, Sunblock for male athletes, Shampoo for bald men).
Now, whether your niche market or niche market product is a good idea depends on the size of the niche market and the nature of the market. But we’ll save figuring out these answers for another time.