The COVID-19 pandemic snowballed the transition from regular retail to online retail for many customers. In a nutshell, more people are turning online for products and services. This exponential rise in the user base has opened up many business opportunities for budding entrepreneurs. However, finding the right niche is easier said than done.
That’s why we are writing this short guide to help you make an informed choice. It is not just about short-term profits. This e-commerce business guide is all about ensuring long-term sustainability.
What is an e-commerce business?
E-commerce is defined as the activity of buying or selling products or services using the internet. In a nutshell, any kind of commercial transaction that is initiated online is e-commerce.
An e-commerce business is an entity that is involved in selling goods or services to consumers or other businesses.
How do you start an eCommerce business? You can read this detailed eCommerce business guide to learn more.
All ready to kick-start your e-commerce enterprise? Here are the top 10 e-commerce business opportunities that we think are going to be big in 2021.
#1 Beauty and health products
There is one thing that never goes out of fashion – the beauty industry. The industry had combined revenue of over $49 billion in the United States alone! This is despite the lockdowns across the country. So, you can expect a sharp increase in demand in 2021, a lot of it online.
There are plenty of niches to explore in the industry as well. For instance, vegan and cruelty-free products will help you tap into a sizable market. You could even focus on men’s grooming and beauty products as well. There has been a concerted effort by marketers to get men to buy more beauty products and it is working. You can tap into that demand as well.
How do you sell these products?
I recommend using Amazon if you are thinking of retail arbitrage. If you plan to create a private label brand, both Shopify and Amazon are great options early on. Make sure you set up your own website as well.
#2 Digital learning
Closed schools and colleges were a blessing in disguise for the Edtech industry. The demand for online courses and digital learning platforms is steadily rising. If you are an educator, or even an entrepreneur passionate about the education industry, this is right up your alley.
The global Edtech industry was worth $252 billion in 2020, and it is expected to breach the $350 billion mark by 2025.
So, how can you build a business in the education industry? I recommend focusing on a niche. There are way too many fields and vocations across the world, and you cannot target all of them. Build a business that creates courses or content on a niche that is not being targeted by your competition. You’ll need to do a bit of homework, but it is more than worth the effort.
#3 Affiliate marketing
This is a way to earn a steady stream of income by promoting other businesses or their products and services. Many platforms are actively looking for partners who can amplify their brand. All you need is a flair for writing and an enamored following.
Affiliate marketing is more of a long-term plan. You need to grow your social media channels or your blog, and you need to keep pushing content that engages your audience. Once you have a following, you can start partnering with brands.
For instance, SellerApp has an affiliate program that is perfect for you if your audience is e-commerce entrepreneurs. Even Amazon has an affiliate program!
#4 Publish ebooks
Authors don’t need publishers anymore. With kindle publishing and the proliferation of the internet, ebooks have quickly found an audience. Reading habits have changed. According to Statista, 335.7 million ebooks were sold in the US in 2019. That number is expected to grow.
Amazon is usually the way to go if you are planning to self-publish. You can also set up your website to sell your books. This allows you to get critical customer information that you otherwise would not on Amazon.
#5 Sell personalized art
According to Statista, the online art market amounted to approximately $4.82 billion in 2019. This number is expected to hit $9.32 billion in 2024. So the experts are clearly pointing to a surge in demand.
You can tap into this demand by opening up a niche art store or creating personalized art pieces for customers. You don’t need to restrict yourself to a canvas, everything from handicrafts to music is fair game.
Etsy is a good place to start selling handmade vintage items, handicrafts, and anything artsy!
#6 Reuse and recycle
There is an increasing demand for used goods in online retail. There could be a couple of reasons for that. The obvious one is the lower prices. The other has to do with climate change.
People are becoming more conscious about the impact of our consumption on the environment. Therefore, there is a steadily increasing number of customers who want to reuse products instead of buying new ones. You can leverage this increasing demand with a niche online store that deals only in reused products. You could even list used products on eBay or Amazon. You will have a larger reach early-on by using established online marketplaces. However, the reach comes at the cost of branding opportunities.
#7 Smart home products
Automation and smart home products are some of the best niche markets to explore. The market value is expected to hit $246 billion by 2025. So, this is a trend you do not want to miss. There is one potential drawback – these are not cheap products, and you will be competing with heavyweights if you are trying to launch a private label.
Retail arbitrage is one way to get started. However, that doesn’t guarantee long-term profits. If you are tech-savvy and if you are capable of tapping into the niche market, smart home products can be incredibly profitable.
#8 Subscription boxes
This isn’t a specific product. It is a general business idea. Millennials seem to love subscription boxes and the market is so big that Target, Walmart, and Amazon all want a piece of the pie.
What is a subscription box?
Just like customers subscribe to Netflix, there are subscription services where companies send a curated collection of products to subscribers. The recurring delivery is usually monthly.
Why is the business model so profitable?
Why would customers give up their ability to choose and decide between multiple brands and products? Decision fatigue is a real problem and in some cases, fewer options are better.
Subscription boxes like Dollar Shave Club have given consumers the freedom of not having to choose! There is also the anticipation of waiting for the monthly subscription box as well as the joy of unboxing!
Like any other business, the key is to find a marketable niche.
Condensed nutrition is in vogue. Dietary supplements are forecast to hit $230 billion in revenue by 2027. With people always on the move, a balanced diet is a farfetched dream for many consumers. That is where supplements come in.
It is not just about supplements critical nutrition though. A lot of the market is focused on fitness enthusiasts who are on the lookout for effective protein powder and protein bars.
This is a great opportunity for those who understand the science behind supplements, especially if you are planning to branch away from just protein products.
#10 Focus on pets
We noticed an interesting Halloween trend last year. There were a lot of people buying costumes for their pets! There are two key reasons for this trend.
- As a result of COVID-19, people are spending more time with their pets at home. Pets are now part of the family and pet parents want the best for their four-legged friends well, usually four-legged anyway.
- More people bought or adopted pets during the pandemic.
A smart entrepreneur can tap into the demand for better handmade treats and costumes for pets. The market is seeing steady growth.
This is already a niche market so your success will depend on the quality of your product and marketing. I suggest selling on Amazon early-on to reach a wider audience. Once you have an established brand, you can consider switching most of your sales to Shopify or through your brand’s website!
The future of retail is online. The COVID-19 pandemic pushed businesses and customers online. This was a common trend across the globe. If you start your e-commerce business now, you have the opportunity to leverage this increased global demand. Unlike a regular brick-and-mortar store, e-commerce is not restricted by national boundaries.
Good luck with your new e-commerce venture!
Arishekar N, the Head of Marketing at SellerApp, specializes in digital marketing, in addition to website keyword optimization for search engines. His areas of expertise include enhancing the organic ranking of webpages on search engines with innovative SEO strategies and online promotions.