Look online for advice on Internet Marketing and you will find tons of advice on “finding your niche”. The theory is that if you focus on a tiny target market you will be able to provide precisely what people are looking for. There is clearly some sense in that. For instance, let’s imagine you are interested in fake moustaches. That’s a narrow niche. You can get fake moustaches from Amazon and Ebay, but you get much more variety from Facetache. This is clearly a niche site, focusing on just one thing, an interest in fake moustaches.

Online you can find all kinds of narrow niches like this. But could you go even narrower? Would a business gain even more success if it were on “fake Mexican style moustaches” for instance, or “fake British Cad moustaches”? If you were after either of them and you found a site dealing with those highly specific interests you would think you had found precisely what you wanted.

That’s theory. There is some merit in it because businesses that narrow their niche do find good results. However, it causes no-end of management problems. Your business might end up needing to narrow its niches into hundreds of websites which then need maintaining and promoting. Also, there is the problem that you may narrow your niche so much that you are then having to find the mere 100 people in the world who might be interested.

Besides, look at the most successful online retail sites – Ebay, Amazon, AliBaba – you can hardly describe them as niche marketers.

So, could the whole concept of niche marketing be a distraction?

A clue that this may be a possibility comes from new research which shows that 40% of the income from online retail sites comes from just 1% of their visitors. The study found that it wasn’t WHAT people were interested in that mattered but HOW they wanted to shop. In other words, instead of creating niches of products, it might be better to have niches based on customer behaviours.

This would mean that instead of needing hundreds of online stores, you might only need a handful making it much more manageable.

Guess what Amazon does? Oh goodness me they deliver their stuff to different kinds of shoppers, rather than for different ranges of products. There is the utilitarian shopper who goes to Amazon, searches for what they want and clicks the button to buy it. But they also target the impulse buyer with their email marketing. Then they have ways of getting to the subject buyer through their associate scheme.

Focusing your niches on customer behaviour, rather than product types, could be more manageable and also more productive. It works for Amazon and this new research provides an insight as to why.