Finding the ideal eCommerce niche amongst dozens of available options might be time-consuming and somewhat overwhelming.
The good news is that we have helped you highlight the benefits of selecting an eCommerce niche, the factors to consider when choosing a niche, and even prepared a list of the most profitable eCommerce niches in 2024. Fasten your seatbelt and let’s have a ride of a lifetime while you read we dish out our promises.
The ecommerce Business and its current state in 2024
Buying online has become necessary and a big part of many people's lives. Special thanks to COVID-19, the growth of e-commerce has since exploded and has increased activity and new consumers.
Online shopping has grown from obscurity to a multibillion-dollar business over the last few decades. Purchasing something online has become a normal practice for millions of individuals worldwide. Recently, the number of people purchasing goods and services online rose to about 2.14 billion according to a report made by OBERLO.
One core reason for the increased popularity of internet shopping over the years is the personalized experience that businesses can deliver to their customers via digital platforms.
The growing acceptance of technology is enhancing the efficiency and reach of e-commerce ventures. The widespread usage of social media and the teeming population of the middle class also increased demands for online purchases, favourably boosting the growth of the business-to-consumer (B2C) market. Indubitably, the internet has fundamentally altered how people buy and sell.
E-commerce is transforming customers' purchase behaviour. Banks and other e-commerce participants are concentrating their efforts on implementing novel business models that will enable vendors and customers to transact safely and securely online.
The market's largest merchants are attempting to augment their traditional retail operations with online commerce and strategic alliances with other major e-commerce sector players i.e. payment processors and e-commerce software platforms.
With the growing popularity of the internet and technical innovation, it is now much faster and easier than ever to buy and sell online. People are no longer restricted to visiting a physical store to purchase a product.
Consumers are utilizing their laptops, tablets, and even mobile phones for a variety of tasks, including online shopping and even selling products. Individuals can now shop and even operate their businesses from the convenience of their own homes.
With an estimated number of about 28 million eCommerce sites across the entire globe, if you want to buy a specific product, there is a 100% chance that you will find an eCommerce site that sells exactly what you’re looking for. With new websites being established daily, these numbers suggest e-commerce is a fast-growing and intensely competitive space.
What is an eCommerce niche?
An eCommerce niche is a specialized subset of a bigger market. When you are in a niche you choose to sell a particular set of related goods or services that fall into a single category. The best eCommerce niches are undeveloped, cater to a very specific consumer demographic, and have a considerably smaller audience with a higher profit margin.
Handmade items, pet food, stylish t-shirts, eco-friendly products, cosmetic products, gadgets, personal care goods, organic skincare, and supplements for women are just a few examples of eCommerce niches.
By focusing on a market, you might identify underserved areas and segments. Profitable eCommerce niches are highly specific and include an inherent distinction.
Why should you choose a niche for your eCommerce business?
With over 2O million ecommerce stores worldwide, competition has never been more ferocious. The majority of businesses lack the resources necessary to compete for market share in a variety of diverse markets. As a result, choosing a niche enables you to concentrate your efforts on a smaller market segment with less competition, find an audience easier and cut unnecessary marketing costs.
Contrary to popular belief, this can result in higher revenue than attempting to do too many tasks at once. Concentrating on a niche market also enables you to develop a more intimate relationship with your consumer base. Understanding your target market inside and out is an essential component of eCommerce success.
Profitable eCommerce niches in Nigeria 2021
Selecting a profitable Niche is critical if you want to attract the proper people to your eCommerce store and make a better profit.
Consider your passions when determining your specialization. You cannot sell a product in which you do not believe, thus it is critical, to begin with, your passions and interests. Consider market demand, possible profitability, product availability, and competition.
Keeping this in mind, here are the top 5 most lucrative areas in the eCommerce industry in Nigeria.
1) Home Security Products
Many people are now looking to protect themselves and their belongings from theft and other dangers. As a result, they purchase home security products. Smart home security is not something new: security and control systems have been among the most popular smart home equipment over the last few years. Statistical figures only show an upward trend.
It is no secret that everybody desires to live in a safe home. In the past, not everybody could afford to create comfortable conditions in their home with different domestic safety products. However, home security solutions are now accessible to virtually everyone and affordable.
All necessary home security equipment may now be purchased and installed extremely easily. New trends come out each year, the technology develops and hence the efficiency of home security equipment.
The demand in the Home security niche in recent years has grown and is fast becoming very profitable. Such demands are invariably fueled by the rising tide of smart homes. It's also a very special product offer that many consumers can easily afford, as it is nowadays easy to operate and manage household security equipment (you can do so from an ordinary smartphone device).
A large number of people are considering purchasing a home security system. The majority of them are self-installing. And you may strike gold by encouraging these individuals to purchase these things through your online store!
2) Health and wellness
Health and Wellness Niche is one of the most lucrative niches since the inception of the internet. People want to be happy and healthy, regardless of their background, culture, or economic standing. They are also willing to pay for products or procedures that will assist them in doing so.
It's one of the most promising markets for online commerce. The worldwide health and wellness business is worth $4.2 trillion! This indicates that there is lots of room for new business. And you can have a piece of the pie right now.
You don't have to create your products to have an online business in the health niche, you can make money selling other people’s products. There are wide options to Dropship, be an affiliate marketer or even a White Label.
If you wish to pursue this area, you will require an extensive understanding of the health sector and possibly a qualification.
3) Tech products and gadget
New is cool and classy. Everyone loves to own a new gadget with cool new features. Something to make life easier and more enjoyable. The tech products and gadget niche is an extremely profitable eCommerce niche in Nigeria, because of the constant yearning for the latest tech gadgets, particularly among Nigerian youth. It is not uncommon for a Nigerian to own many phones and laptops, and still be eager for the next iPhone 17 Super Max.
It is a profitable niche because of the huge percentage of Nigerians who own multiple phones. The Nigerian mobile phone market is enormous, and whether you sell Android phones, iPhones, or tiny phones, you may earn a comfortable living selling phones to low- and middle-income Nigerians.
The average Nigerian upgrades their gadgets frequently, whether it has gone bad or are still excellent, which is the third reason why the phone sector is profitable in Nigeria.
4) Fashion and Apparel
Nigerians are very fashionable people, known for their exquisite fashion taste and we often don’t mind spending all we have to own beautiful clothing pieces. Nigerians, according to a report, buy most of their clothing from fashion stores online. Being a fashion and culture-conscious nation, this does not come as a surprise.
During the lockdown, we witnessed fashion influencers wearing adorable outfits, fashion labels creating great collections, and fashionistas trending designs that consumers could wear at home.
According to Statista, the Nigeria Fashion and apparel eCommerce niche has a market volume of $2,483m in 2021.
Fashion and apparel is the largest segment in the eCommerce market, accounting for roughly 20% of overall retail eCommerce sales this year.
The next few years look even better for the Fashion and apparel eCommerce niche as revenue is expected to show an annual growth rate (CAGR 2021-2025) of 12.25%, resulting in a projected market volume of $3,942m by 2025 and, the number of users is expected to amount to 85.8m users by 2025.
With these numbers highlighting the country’s potential as a great market for the fashion industry, Kitcart could help you leverage e-commerce for its fashion and apparel business.
5) Food & Personal Care
The eCommerce niche Food & Personal Care contains food and beverages (excluding baby food), as well as medicine, cosmetics, pharmaceutical and personal care items (including prescription pharmaceuticals for the private end-user (B2C) Medical products for personal use are also included in this market area (e.g. blood pressure monitors, disinfectants, dressings).
In Nigeria, this e-commerce niche Food & Personal Care has a current market volume of US$483m according to Statista and the number of this niche customer is expected to reach 35.9m users by 2025.
Despite these amazing numbers and projections, the Food & Personal Care eCommerce niche has yet to be fully embraced by Nigerians when compared to sectors such as gadgets or fashion and apparel.
This is owing to the perishable nature of food and beverage goods, which require special storage and logistical considerations. And you know people would just prefer to walk into stores to pick up items themselves.
However, recent trends indicate that the Food & Personal Care eCommerce niche is poised for growth. With the right eCommerce strategy, technology, and logistics solutions in place, the Food and Personal Care eCommerce niche can gain market share and even dominate the eCommerce sector. If you want to get a major slice, it is only wise to get in early.
Other eCommerce niches to look out for are home accessories, Home Gym and Fitness Equipment, Pet Products, digital products,
How to find the perfect eCommerce Niche for you
Okay, you're convinced. eCommerce niches are the way to go. But now you want to make sure you find the right one. Here are five recommendations to assist you in identifying the ideal niche for your eCommerce business.
1. Stick to what you know and enjoy.
What are your interests and passions? Sure, you could simply pick a lucrative speciality and go for it. You'll have a much easier time marketing and running your business if you're inspired by and interested in what you're offering. Furthermore, you will have a greater grasp of the products, making it easier for you to connect with your customers.
2. Examine the Trends
What's in vogue? A basic, free tool like Google Trends may give you a good indication of how much interest there is in a particular eCommerce niche. Google Trends will show you how searches for your possible niche have changed over time, as well as interest by area. Here's an example:
Using Google Trends to look up “skincare products” and as we see over here over time (last 5 years), that niche has done well, but won’t be profitable in the coming months or years.
Google Trends can assist you in deciding how to allocate your marketing budget according to states, as rivers and Lagos are the states that do most for this niche.
3. Conduct a keyword search
It's also a good idea to do some keyword research on your possible eCommerce speciality in addition to using Google Trends. You may utilize the Keyword Planner that comes with Google Advertising whether or not you plan to run ads. The amount of searches is a good predictor of how profitable eCommerce categories will be. If the search volume is minimal, the niche is unlikely to be profitable. Product demand may be correlated with higher search volumes.
Let's have a peek at the Google Trends search volumes for our keyword “Skincare products” :
As we can see, skin care products have a low search volume and might not be very good as an eCommerce niche if search advertising is your major source of traffic. However, this data contradicts the high purchase volume of skincare products on social media platforms like Facebook and Instagram.
4. Select items with high profit margins.
Ecommerce niches require products with a bigger profit margin because they have a smaller market to work with. Gross profit margin and net profit margin are calculated using a formula, and both are crucial. However, you may not want to fuss with it if you're just starting and trying to decide which products to carry. So, what's next?
You may get a rough notion of whether or not a product will be profitable for you by looking at the cost of each item versus how much customers are ready to pay for it. This isn't going to be precise to determine the margin because it doesn’t account for the cost of marketing, shipping, and storage. It will, however, give you a rough idea of how much money you might gain from each product's sale.
5. Don't Sell Just One Item
It's easy to get caught up in the temptation of starting an eCommerce business with just one product. Instead of selling only one product, we propose picking an eCommerce niche and a few products that meet that niche. If you only sell one thing, you will be forced to shift gears rapidly if the popularity of the product drops. If you only have a few things to sell, you'll have more time to locate, source, and advertise new ones as the market's interests naturally ebb and flow.
How KitCart can help your eCommerce business.
Kitcart provides cutting-edge e-commerce technology that caters for both online and walk-in sales. We help businesses keep stock, manage customers, take orders, issue invoices, receive payments, and manage staff.
Do words like "coding," "design," and "application integrations" sound technical and boring to you? We feel the same way. That's why we have automated everything so you can start selling right away -- no coding, zero deployment, installation, and integration delays.
To open your shop, all you need is a brilliant business idea. With Kitcart, you get more than just an eCommerce platform, you have a business platform, payment infrastructure, a 24/7 support team, and a strong community of kitcartels that are all in to see you succeed.
The act of selling products online has evolved significantly in the last few years. The emergence of eCommerce niches has opened up the playing field for entrepreneurs all over the globe to start their online stores, sell products, and become profitable.
This article shared insights on niche industries that are likely to grow soon. These niche markets will be worth exploring for entrepreneurs who want to make a profit from eCommerce in 2021.
Use the eCommerce niches suggested in this article to guarantee profitability in your e-commerce adventure. Kitcart will help you set up and automate your eCommerce business.