What are the most profitable e-commerce niches?

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The global crisis has made a “new normal” regarding shopping behavior. Of course, most people were forced to switch to online buying at the pandemic’s beginning. But nowadays, customers prefer purchasing on a click much more than losing time and going to a physical store even when they can. 

So e-commerce became an opportunity for every retail company, big or small. If you consider setting up an online store (or expanding an existing one), first define your niche. In this article, we’ll look at the most profitable niches for e-commerce business and methodology for determining your own. We will start with evergreen industries that consistently tend to grow. 

eCommerce for fashion

Top 3 evergreen niches to enter online

If you are just starting with your e-commerce business, you may want to choose one of the three following niches:

  1. Economy
  2. Health
  3. Relationships

Even though those are extensive topics, you can never go wrong if you pick a market related to one of these three topics. People generally care most about their money, health, and relationships. And they seem to cause people the most problems as well, which is why these topics are so good for e-commerce businesses! People are willing to spend money solving problems and ironing out everything in these three key areas. 

Yes, there is a ton of competition here, but there’s also a ton of money being made. Competition is a good indicator since it proves that money is already being made in that niche. And you’re not going to be competing with all of them – only a segment.

How to segment your niche?

There are two approaches to market segmentation. First, you can enter a vast online market and compete for their little pieces, a technique we can call Big Pond, Little Fish. Otherwise, you may like the idea of choosing a small component of a large market and becoming the top player in that segment, which would be Little Pond, Big Fish.

Neither strategy is wrong, and you should pick the one that makes the most sense to you. 

Once you have defined your market and strategy approach, you can look for untapped opportunities within that niche and drill down into sub-niches. 

For example: health > mental health > anxiety disorders > panic attacks > panic attacks in children.

If your chosen niche is highly competitive, you may need to drill it down so far that the market segment may be too small to make decent money. You have the option to start from a wide industry and narrow it down over time, but we recommend that you start from a smaller segment and branch it upward again when ready to grow.

What are the best research tools for niche selection?

Business success depends on the quality of your decisions, and the decisions depend on the research. By researching, you will:

  • Find the most profitable business ideas and opportunities
  • Better understand your target audience
  • Understand the competition

So it is crucial to use the right tools to overview the desired industry and get a clear idea of the business potential. Because you are making and growing an online business, your focus should mainly be on keywords people type into search engines and their growth trends. 

There are many tools for researching, and Google provides its own for free (there are paid pro versions, too), such as Google Planner and Google Trends. A planner is a tool that gives you an estimation of the monthly search volume of desired keywords, while Trends make comparisons between terms easier.

We recommend you to start choosing your e-commerce niche with what you are passionate about. You cannot be successful doing a job you don’t like or selling products you don’t believe in. From there, consider market demand, potential profitability, availability of products, and your competition.

With all of this in mind, let’s have a look at the most profitable e-commerce niches in 2022.

Technological and home office equipment

Technological equipment is always popular, partly because more innovative devices constantly appear on the market. Some of the high-tech items are laptops, keyboards, and monitors. In addition, sales of certain digital goods have remarkably risen due to the pandemic. These include productivity tools, time management tools, and video conferencing tools.

Another possibility is concentrating on non-technological home office essentials such as office chairs and working desks. Even though selling technological and home office equipment may lower when the crisis ends, it doesn’t seem remote work will be over anytime soon. According to Gartner, 74% of companies intend to keep some of their workforces remote after the pandemic ends. 

Gear for fitness and home gym

Whatever happens in the outside world, fitness enthusiasts will never stop caring for their physical and mental health. Gyms have started reopening, but attending the gym still represents too much health risk for many people. On the other hand, fitness lovers have realized that they do not need to leave the house to stay in shape. 

Fitness is yet another evergreen niche suitable for starting an e-commerce business. You can focus on space-saving home gym equipment such as dumbbells, resistance strips or pull-up bars, or some dietary supplements for those who want to take their workout to the next level.

Entertainment products

Entertainment is a vast industry that covers a variety of niches. Since people have been locked in homes, they are looking for ways to enjoy their increased free time and have fun.

According to Statista, 26% of American consumers reported spending more on home entertainment because of the pandemic. Entertainment products can be anything from video games to kid toys, and here are the articles that mostly exploded in sales in recent years.

Spending on video games has reached a record high, but some people prefer old-fashioned forms of entertainment, so board games have also exploded in popularity in recent years.

As school activities closed and parents tried to entertain their children at home, sales of toys and games for kids increased.

Many adults and children use the lockout period to evolve creativity, so arts and crafts materials in North America have increased revenue compared to the previous year. Arts and crafts are a popular pastime and have proven to help reduce stress, so they are always popular regardless of the world crisis. 

Food and drink

The food and drink market was one of the most affected branches during the shutdowns. Restaurants worldwide have been closed for a long time and yet need to reopen, and some will not survive the closure.

Mass remote has changed how people procure and consume food. For example, grabbing a sandwich at a local fast food isn’t an option anymore. Closing schools means that children no longer enjoy school meals, leaving parents to organize breakfast, lunch, and dinner 24/7, which can be a real challenge. 

Naturally, meal delivery services have exploded, and if you already have cooking knowledge (or own a restaurant), your e-commerce business can be competitive from the start. 

Keep in mind that not every family has the budget to order cooked meals every day, so the need for home cooking erupted. Your business can also profit from selling kitchen products from hard-to-find ingredients to bread makers – anything that will make consumers’ everyday feeding easier. 

Seek help when choosing an e-commerce niche

Choosing the right e-commerce niche is the foundation on which a business can expand or collapse, so make sure to do it right. If you are not comfortable deciding on such a significant e-commerce success factor, don’t worry; we are here to help you. Take your chance and book a completely FREE 30-min session with our expert! Tell us about your business, passion, and goals, and let professionals do the heavy lifting for you. Let’s talk!