top of page

Choosing the right niche when buying a brand or a digital asset

How and what to look for when researching your business

  • High competition

  • Product loss in the trends

  • Low dropping profitability

  • The wrong niche might stop the business from growing

  • How big is the niche you selected

  • Regulations in different Amazon marketplaces

What are the risks of buying a brand store already existing on amazon?

The Brand has products that represent the Brand of a store.

How does the market go in a specific niche of a product this store sells?

When we say niche, it is a part of the big category segmented into different types. Say each product has its categories, such as sports and outdoors, pet products, baby categories, and more. Taking the baby category as a sample, taking the specific market niche will break it down into sub-categories such as bottle and feeding, bedding and nursery items, travel products, and more. Under these sub-categories, you'll find product differentiation and market segments called niches. These niches of small and specialized markets define the specific competitors of a product and its potential for selling in the field.

One of the things you need to pay attention to is high competition.

How are the competitors doing versus the product of the Brand? If you see too many competitors and their sales are too far from your target product sales, this item might pull the whole store down. If your target brand's product needs more reviews from your competitors, you may need more time and effort to catch up. See the whole niche as if you will be able to compete with top competitors that already have well-established customer stars and reviews.

It would be best to look at a product trend.

You can forecast the future sales of the products if the demand is still present in google or amazon searches. If you see a graph going down, it can be the dead end of product sales. Markets and trends are changing from time to time, especially on electronic products, trendy fashion, and gadgets on amazon might be risky to take and sell if you don't have the plan and capacity to upgrade and compete with the newest market trends in a short period.

Another thing is dropping profitability.

Many economic factors change the cost of goods. Inflation can affect your manufacturer's production cost and depends on where you will ship the products. It would help if you considered calculating the cost of goods of each product of the Brand you want to buy, or you might end up selling products with no or less profit, throwing the money you invested away. Manufacturing costs could have been good years ago, giving a "thick" profit share. However, as the pandemic year arrived, all expenses increased, and profit eroded, so it might not be enough to continue the product's legacy.

Sad but true, some products will only last for a while if the costs continue to spike up if you wouldn't do something about it.

Talk about the growth opportunity. Choosing the inaccurate niche might stop the Brand from growing. When you buy a brand store, you also get the legacy of the products, and any impression from the previous customers must be continued the same way it was before.

Yes, but how many products in the Brand continuously satisfy the customers? Are there products you must let go of to keep good products going? Checking how to add more products to the Brand is also playing a big part in the Brand's growth. Choose a niche with more growth opportunities by adding more future products to generate sales and add value to your Brand. As a brand continuously grows, more products should be coming in to create sales, and as a result, your profits will increase significantly.

It's also risky if you do not analyze how big the niche you selected is. Setting your expectations and budget can be crucial when handling a brand where the niche directs you to the things you do not prefer in the first place. You may adjust your expectations once you see options that will match your preference, such as how many sales per month or year the product had, how many units you need to replenish from your supplier, and how much PPC you need to allow for the budget...

Trust and gather more data to know how big the niche you're going to prevent the shock the market has for you. Starting with a small brand can be a good start, but eventually, you'll aim for this store to grow more significantly.

What does Amazon say about regulations in different Amazon marketplaces? Have you ever heard of baby products recalled in the US due to safety regulation failures? Unsafe products have no definite ending for a product. Regulations and Amazon can restrict it anytime, even when the seller sleeps soundly. Be mindful of the things the store is selling. There are reasons we need help seeing on sales. The customer's safety is also a priority. It can stop the business anytime you encounter a notification of safety certificates asked by Amazon before they altogether remove the product from the Amazon list.

Do your research wisely :)

Ecreate Freedom LTD

1 view0 comments


bottom of page