Business Plan Help

Finding a Niche Market - Apple, Nike, and Grantwood Have Done It!

I love gadgets. I am an athlete, well at least right now I consider myself an athlete because I am working out 5 to 6 times per week. My work outs include running, biking, weights, and yoga. Once the weather gets colder and I pickup more projects I will go into hibernation for months and will not be an athlete anymore. I have been known to run in races and even complete in a triathlon or two. I travel too much to commit to team sports anymore and the travel often gets in the way of regular work outs. I am analytical and track all my workouts as well as other data (heart rate, weight, etc) in Excel. So, how do I stay motivated to stay an athlete and not go into hibernation this winter? Or more importantly, how would one identify me in the market and target me for products?

Lets take the second question first and assume my description is the niche that someone wants to exploit by developing a product. We will call this market niche the gadget runner. The gadget runner market niche can best be described as sports or athletics; however this is very broad and one would want to drill down to a more specific niche. The characteristics of the gadget runner market niche are:
1. Competitive individual sports including running, biking, weights, and yoga. To drill down further one would select only one of these sports.
2. A gadget that would apply to someone falling under the description in characteristic 1.
3. Feeds on my competitive nature.
4. Ability to track my progress.
5. Portable for the road warrior.

What products fit into the gadget runner niche? Fortunately Nike has already done the work. They developed the Nike + iPod Sport Kit. A runner puts a sensor on their shoe, or if they have certain Nike shoes the sensor fits in a special pocket under the insole, and plugs a receiver into their iPod Nano and they have a smart pedometer. The system tracks a runners pace, distance and time and allows the results to be uploaded through iTunes to the Nike + website (http://nikeplus.nike.com). This product as is covers characteristics 1, 2, 4, and 5 of the gadget runner. The web site features include an area to set and track goals as well as an error for challenges that allow one to compete against other runners around the world Features like these cover characteristic 3 of the gadget runner.

So Nike lures the runner into buying the Nike + iPod Sport Kit and then uses the touch point with the customer to sell other products to the runner. Or, is Nike using their extensive line of running clothing and shoes to market the kit and other related products like sport head phones and iPod cases to existing customers. Either way they have exploited a niche occupied by my fellow gadget runners. And Nike continues to exploit the touch point with the gadget runner by using the Nike + web site to market these products to us every time we upload a run or review results to the site.

Another opportunity is an extension of another company’s product, after all the Nike + iPod Sport Kit is an extension of Apple's iPod Nano. Another company, Grantwood Technologies has created an extension to the Nike kit by making the Shoe Pouch for Nike+iPod that holds the Nike + Sensor for those that use non-Nike running shoes. By doing this they have unraveled some of the exclusivity of the Nike+ kit to Nike running shoes, but at the same time they have increased the portion of the gadget runner market likely to buy the Nike kit and related products.

Whether you already have a product that you are looking to market or a market you are looking to exploit, put pen to paper and list out the characteristics of the product/market. Look at how similar products are sold or how products that you like are marketed. In this post, I have chosen to use a product I like and would recommend as an example. Are there products that you love that you can learn something from? Are there products you love that you can make better with an extension? Finally, will the addition of the Nike+ iPod Sport Kit to my workouts keep me motivated through the winter?

See all iPod Nano products on Amazon.com