Shopify: Niche Store vs General Store?
Updated: Sep 10, 2019
Niche Store! General Store! This is probably one of the first, yet one of the most hardest decision when you just started dropshipping. And it is also one of the most common questions that come up from newbies. Plus given that some people in certain Facebook groups are crushing it in niche store, some are crushing it in general store, it didn't help with the end decision to choose either niche store or general store to begin with.
With that being said, should you start a niche store or a general store?
But before that, I would like to explain what is a general store and a niche store so you would have a better understanding beforehand. So that I can give you a valuable insight into what model is easier to market.
If you have already built your first store(s) and have seen some initial profits, I still encourage you to read this article with an open mind in its entirety.
Niche Stores: Shopify Niche
A niche store is an online store specialised in selling one particular type of products or services. There are two types of niche store. Broad Niche and Narrow Niche.
An example of a broad niche would be a store selling accessories for men and women (most notably women). They might offer everything from apparels, bracelets and shoes all the way to jewelry and cufflinks.
Put simply, they have chosen one industry segment that they want to be in (their niche) as women’s accessories and apparel. Think along the lines of the ever-successful Forever 21 fashion store.
Narrow Niche: Shopify Niche
An example of a narrow niche might be a store specialised in selling clothing for Corgi. They first decided they wanted to sell clothing for dogs, but that was a niche there already.
So they decided to went even deeper and made their niche narrower. Instead of offering products for every dog breed, they only serve and target customers with Corgi as pets.
Now that we know what a niche store is, it will be much easier to understand what is a general store.
A general store is like Amazon and Walmart, as you’re trying to appeal to everyone by offering different types of products and services. In other words, it does not specialise in selling one particular product type like in our two previous examples above.
Instead, it offers plenty of different kinds of products from gadgets and clothing to home appliances and jewelry at the same time.
Now that we understand what both models are and how they work, it’s time for the fun part. Let’s fully analyse both models and see what the pros and cons are for each.
Niche Store Pros:
#1 It’s easier to rank:
With a good SEO(Search Engine Optimisation) strategy, a niche online store will take less time to rank on search engine such as Google, on social media and keyword advertising. Depending on the niche type that you are pursuing, there might be little competition.
#2 More Precise Traffic Targeting:
One advantage about going niche is you can literally pinpoint your target audience. In other words, since you’re selling just one particular kind of product, you know exactly who would be most interested in it.
#3 Easier to Convert Visitors:
Usually, the majority of traffic coming to your store is probably because they are actually interested in what you’re selling and not because they are just browsing your store (as that will usually be likely the case with general stores).
Typically, niche stores are also known to receive a greater number of orders than a general store, especially if they succeed in getting a lot of traffic (as long as their site is well-optimised).
Niche Store Cons:
As with any other business, no business model can be called perfect, there are of course some drawbacks to running an niche store.
#1 Takes time to develop
Establishing a niche store actually takes a lot of work and research on specific niche before starting your online store and while it’s running. First of all, you need to perform online market researches and spy on other online stores that are running a similar niche as you in order to find the most suitable and profitable product for your goals. When the store is finally online, you’ll need to keep running tests and trials to improve performances.
#2 Limitation Growth
After spending much time growing on your online store, you will eventually hit a certain limitation on your growth on your niche store. Simply put, there is only that much of a specific people that are interested in that certain particular niche. For example — if you are running a yoga niche store, there is no way to make every single one to be interested into yoga.
Now that I have explained the pros and cons for niche stores, we will now take a look at all the positives and the negatives of running a general eCommerce store.
General stores are generally more flexible in what you can do and offer with them. One thing that you can be certain — you will reach a much wider audience with your advertising and that should be used to your advantage.
But is it all rose and honey with general stores? Let’s find out!
General Store Pros:
#1 Your income ceiling is limitless
Unlike a niche store, a general store has the ability to generate multiple streams of revenue from different multiple niches. This is a huge plus factor as compared to a niche store.
#2 It is easy to set up products
Setting up a general dropshipping store takes very little time. You can choose a couple of the most trending products from multiple niches and add them into your store. Therefore, less preparation and time are needed to building and launching the store.
But still, it’s always better to run market research and analysis before starting, but the plus is that you can still test niches and items while the store is up and running.
#3 Wider Reach:
Due to the fact that you offer products from multiple niches, you will naturally have multiple different target audiences to market to. You will have at least one per each category of products.
Not only you will be serving marginally different ad creatives to the same audience as you would with a niche store, but will spread the delivery amongst various audience groups.
General Store Cons:
On the surface, a general store seems really simple and easy to maintain. It also seems like a good idea to be able to generate multiple streams of revenue from different multiple niches. So are there any disadvantages to running a general store?
Well, sorry to burst your bubble. Of course there are!
#1 Low Conversion Rates
Usually for this group of visitors, they are actually not searching for anything. They are just browsing your site to see what kinds of products you offer. Probably they might just be attracted to your attractive Facebook Ad copy or your interesting brand. That is because general store visitors lack a buying intent at the core factor leading to converting someone into a customer/buyer.
Usually, general stores apply low prices to stay competitive. However, your average revenue per visitor and profit margins will be low as well. In other words, compared to a niche store, a general e-commerce might sell more and make less.
#2 More Competition
The most prominent characteristic of general store is market saturation.
Well, there is a reason behind this. Due to the nature of a general store being more simple to manage, most people nowadays begin their eCommerce dropshipping journey by starting a general store. One notable fact is when you start a general store, you are also actually competing with giants such as Amazon and AliExpress as they are also a general eCommerce store, if you look at a different angle.
Now that we finally have all the facts down and know exactly what are the pros and cons of each business model are, it’s time to return to the reason why you are probably reading this article in the first place.
Should you build a Shopify niche store or a general store to begin with?
To be honest, neither a niche store nor a general store are perfect business models. They both offer great opportunities in terms of generating revenue, but also come with certain disadvantages. I run both types of store and they do make me excellent stream of income, only difference is using a different set of marketing strategy.
But if you are a beginner, I would personally suggest starting off with a niche store. A niche store may be more tricky in planning, marketing and selection of products for your store, but it makes scaling a tad more easier. And it is a lot more easier to build up your brand. Even though eventually you will hit a limitation growth on your income but remember, learning how to generate income and profits online for a start is more important than anything else.
A general store, on the other hand may actually be more suited for advanced level marketers in my personal experience. A successful general store would actually require an entirely different marketing strategy. One such example would be sourcing for suppliers for products at a wholesale, or even at manufacturing level. But that would be an entirely different topic altogether, which I will explain it in time to come.