What is niche market?

A niche market is a narrow, well-defined segment of a larger market — buyers with specific needs that broad, horizontal competitors serve poorly or not at all. Niches are defined by depth of need, not just size: compliance software for dental practices is a niche; “small businesses” is not.

Niches are where smaller companies beat larger ones, because focus outcompetes scale within the boundary: you can know the segment’s alternatives, language, and pain better than any generalist. The classic risks are a niche too small to sustain a business, and success attracting the big players in — both worth watching for continuously.