6 Growth Guaranteed Ecommerce Niches To Invest In 2015
2014 had been a great year for e-commerce entrepreneurs (not to mention the amazing holiday sale results that are coming out) and as per the reports things are going to get much more interesting in 2015. As e-commerce evolves, more and more promising niches or industries start sprouting and the possibilities hidden will be limitless. The following six industries are found to be the most promising among the lot, with massive growth potential. Hope you find them useful.
An online automotive industry which sells OEM and aftermarket parts and accessories online is estimated to reach 6.5 Billion in 2015 (Hedges & Company). In 2014 brick and mortar automotive industries grew by a mere 1.5% whereas online industry grew by an amazing 16%. Apart from the growth factors, what makes this industry even more attractive are the characteristics of its targeted consumer base. A study by ‘comScore’ in mid-2014 found that more than 60% of the shoppers make more than 5 purchases in a typical 3 month period and only 27 percent of them would return a product once purchased (This is half the rate for general online shoppers). Nearly half of the products purchased in this industry are ‘Factory original parts to replace the damaged’ (Top Demand), ‘Parts to modify or improve the function of the vehicle’ (Second Favourite) and ‘Parts or accessories to change the appearance of the vehicle’ (Third Favourite).
Online grocery industry had reached an astounding $6.5 billion last year which was actually a negligible 1.2% of the total grocery sale then. As per ‘BI Intelligence’, the industry will reach nearly $18 billion by 2018 which is 21.1% compounded annual growth rate (CAGR). In comparison, offline grocery sale is estimated to grow only 3.1%. Interestingly, ‘Nelson research’ estimates the global online browsing and buying intention percentages of online grocery buying customers to be 30 and 27 percent respectively for the next 6 months.
The industry is transforming the way the consumers used to purchase grocery from a store. The customers love the convenience since it allows them to:
- Get personalised offers and recommendations based on purchase habits.
- Save precious time by allowing them to Buy Online and Pick Up in Store (BOPUS) or at the doorstep or at nearby kiosks.
- Track their previous purchases and modify previous purchasing lists to use it again.
- Share grocery list with the family members and collaborate while shopping in-store.
- Save by subscribing to scheduled purchase offers.
The latest research by ‘Transparency Market Research’ shows that the market of Baby care products will reach $66.8 Billion globally by 2017. Products like diapers, clothing, shoes, feeding aids, strollers, and furniture are going to be the major products that will be sold through e-commerce platforms and e-commerce marketplaces. More than 40 percent of all revenue in this sector is estimated to come from a sale of diapers. Organic skincare and branded baby clothing are some of the other popular choices. Experts say demand will increase over the next five years, owing to demographic factors (primarily, an increased birth-rate) and a rise in disposable income that will prompt busy parents to shop from their couches whenever they can grab. By 2018, it’s predicted, that there will be more than 6,000 baby-product e-tailers.
The global beauty market is expected to be worth $261 billion by 2017 (Lucintel). Beauty e-commerce generated about $3 billion in sales in the United States alone in the previous year, which is roughly 4.5 percent of the $66 billion categories. In the much discussed ‘ATKearney’ study it was found that skincare, personal care, and hair care score highly in e-commerce buying, making up the top three in cosmetic category. In the study, it was revealed that consumers in this industry would readily shop online, motivated primarily by price and product choices. In fact, product availability, free shipping, and price were identified as the most wooing features of online shopping in this industry.
Research giant ‘Nelson’ conducted a survey in 60 countries covering more than 30,000 consumers (who have online access) in February and March 2014. They found that more and more people have started buying pets products online. The online purchase intention of the consumers in this industry grew from 9% in 2012 to 21% this year which makes this industry a hot destination for early investors. Even better, the global average of browsing versus buying of pet products online is nearly 1:1 ratio, at 24% browsing and 21% buying respectively. Which means, when a consumer browses for pets products online it is highly likely that he/she would purchase it, also you can expect to build a loyal customer base. Pet food constituted 80% of the pet products sold online and the remaining constitutes pet toys, pet grooming kits etc.
DIY (Do It Yourself)
‘Global Industry Analysts’ (GIA) reported that the global market for DIY products is estimated to reach US$716.2 Billion by 2015. The rapidly increasing number of products and services, including books, websites, television programs, tool-kits and accessories contributed towards the growth of this industry. The widespread availability of easy-to-use products for home repair, crafts and decorations and gardening activities also augurs well for the market. This market got a major improvement in home enhancing segment during the recent economic recession, as price-sensitive consumers preferred spending their leisure time at home, doing household chores to curb the extravagance.
Also Read: Top 5 Successful eCommerce Business Models
Please feel free to let me know if there are other e-commerce niches which you feel should be a part of the list. I would love to hear your valuable feedback.