Meaning of niche

Niche (pronounced neesh or nitch) is a word used in ecology and marketing. In its original use it is a noun that describes a shallow recess, especially one in a wall, to display an ornament. It came into English from the French verb nicher to make a nest.

In ecology, niche theory describes how an organism or group of organisms is always competing with others for the resources they need to survive. An evolutionary strategy to reduce competition is to find a niche that other organisms aren’t using or not using very well. Here is a short explanation from Dr Seuss:

And NUH is the letter I use to spell Nutches,
Who live in small caves, known as Niches, for hutches.
These Nutches have troubles, the biggest of which is
The fact there are many more Nutches than Niches.
Each Nutch in a Nich knows that some other Nutch
Would like to move into his Nich very much.
So each Nutch in a Nich has to watch that small Nich
Or Nutches who haven’t got Niches will snitch.

It is similar in business. Your business is competing hard for customers. You have to work very hard to keep them or they will get “snitched”. One way to decrease competition is to use a niche marketing strategy. It concentrates efforts on a narrow sub-segment of customers. First you identify the customer needs, or wants, that are not being satisfied by existing businesses and then develop specialist goods or services that satisfy them.