In a previous post we talked about turning a hobby into an online business and why it was a good idea to choose a very deep and specialized market niche.
We also said that the subject of the niche was important and that it should usually be a topic that the owner had experience in, knowledge of, training for, and passion about.
Most often, the business owner will be most successful if he can narrow his potential customer pool down to just those folks that have a great and frenzied interest in exactly what the owner is selling.
I think you would be surprised with the number of potential prospects globally, even though the niche chosen seems way too narrow.
Now, let’s examine some of the good and bad of turning a hobby that you might be passionate about into a full-fledged business.
Here are some considerations for you to think about:
1. Many passionate hobbyists sometimes have difficulty objectively assessing the true business potential of the hobby that so consumes them.
In such cases, too much passion for the subject can lead to certain faulty assumptions about market size, customer’s desired products, levels of competition, and your ability to treat this venture as a business rather than the hobby it’s always been.
If you love mountain biking, for example, are you really going to get the same enjoyment sitting at the computer writing about it as you do when you’re on the slopes?
2. When you actively participate in a hobby, you are seldom under continual pressure to perform at a high level and with lots of external factors weighing heavy on the mind.
When your hobby becomes the source of your income (or even just a supplemental source), the pressure you feel to turn a dollar and the responsibility you heap on yourself to be productive is greatly magnified.
Often the hobby-turned-business changes into business drudgery that you never thought it could become.
3. Signing up your family and friends to your customer list does not a viable business make.
Often you hear the phrase, “do what you love and the money will follow.”
While I believe in the goal of doing what you love, I’m not so convinced that the money always follows.
Sometimes doing what you love means avoiding the very pieces of business execution that are critical to success.
Family and friend’s opinions don’t count as unbiased market research.
They may encourage you to start a business and sell all your wonderful paintings, for example.
But once they fill their walls with your artwork, are you guaranteed that total strangers will then buy your products just as easily?
4. Does the depth of your hobby allow for deep, deep, specialization? Is there a market for the level of understanding and skill or ability you possess?
Are there unmet wants expressed by other hobbyists that you can fill?
I’m afraid there are some hobbies that don’t readily lend themselves to money-making; although I will admit that sometimes creativity and new ideas surface that bring small fortunes to the risk-taker.
5. If your hobby-now-business entails purchasing wholesale products for your market, will you be able to source those products competitively?
Many retailers will tell you that it is very tough getting wholesale accounts for some industry-specific niches – at least if you’re a small time operator working out of your home.
Some distributors won’t deal with you if you have an Internet-only storefront.
6. Are you willing to learn what successful business owners must learn to be profitable?
You may consider yourself “the king of radio controlled airplanes”, but there is more to being a profitable business owner than being knowledgeable about your niche.
You can certainly learn the skills and strategies that you need to be a great businessman, but if you’ve never run a small business before, you will most likely be in for a rude awakening about all the operational details that must be accomplished on a daily basis.
7. Is your hobby subject one that is not going away soon?
You may have the most awesome collection of 8 track tapes on the planet . . . but will you be able to convince other Internet enthusiasts that you have important knowledge and advice on the subject that they ought to pay you for?
You will be the one who will have to decide whether the hobby you love is worthy of your effort to squeeze a profit from it.
If you’re lucky enough to not be forced to make a profit from the business, for example, if you’re simply looking for an activity to keep you busy, then by all means forge ahead.
But if this little project is to become your livelihood, or an important piece of it, spend some time finding objective answers to all of the issues raised here before you launch!
What I’m saying is that market research prior to committing to the niche is extremely important. You want to learn all you can about the potential pool of prospects and their wants/needs/desires within the niche as well as your competition for their attention.
To your online business success,