How a $15M Beauty Lab Found 5 Profitable Niches (And How You Can Too)
Niche Beauty Lab went from zero to 15 million euros in sales in 6 years by doing something most companies avoid: they got smaller, not bigger.
Instead of launching one beauty brand competing with everyone, they launched 5 brands, each dominating a specific niche. Here's their exact playbook and how to apply it to any industry.
The Real Numbers
- Revenue: 15+ million euros in 2022
- Team: 34 employees ($170K revenue per employee)
- Growth: Triple-digit growth in direct-to-consumer sales
- Efficiency: Moving to larger headquarters in 2023 due to rapid expansion
- Strategy: 5 specialized brands instead of 1 general brand
Their 5-Brand Portfolio Strategy
Instead of "Niche Beauty Lab skincare for everyone," they created:
- Acnemy - Only acne treatment (salicylic acid, retinol, niacinamide)
- Theramid - Only anti-aging with peptides
- Transparent Labs - Only clean/transparent ingredients
- Hyalulip - Only hydration and lip care
- Hairvest - Only hair care
Notice the pattern: Each brand owns ONE problem completely.
The Niche-Finding System (Step by Step)
Step 1: The 3-Star Review Mining Method
Why 3-star reviews?
- 1-star = angry, probably unreasonable
- 5-star = happy, no insights
- 3-star = "it's okay but..." (this is gold)
How to do it:
- Go to Amazon's top 3 products in your category
- Filter for 3-star reviews only
- Read 100+ reviews looking for these phrases:
- "Works but not for my specific [condition]"
- "Good product but I wish it had/didn't have..."
- "Decent but nothing made specifically for..."
Real example from acne products:
3-star reviews consistently mentioned: "too gentle for severe acne," "wish it was stronger," "didn't work on cystic acne."
Result: Gap for stronger, medical-grade acne treatments → Acnemy was born.
Step 2: The Search Volume Validation Formula
Before building anything, validate demand with data:
Free tools to use:
- Google Keyword Planner (search "acne treatment severe")
- Amazon search suggestions (type your keyword, see what auto-completes)
- Reddit (search your niche + "reddit" in Google)
The math:
- Monthly searches × 2% conversion × $30 average order = monthly revenue potential
- If that number is >$10K/month, the niche might be viable
Example validation:
- "Severe acne treatment" = 33K monthly searches
- 33K × 2% × $30 = $19,800 potential monthly revenue
- Enough to build a business around
Step 3: The Competitor Gap Analysis
What you're looking for:
Products that try to solve your niche problem as a "side benefit" rather than the main focus.
How Niche Beauty Lab found gaps:
- Acne: Big brands make "gentle acne care" (gap = strong acne treatment)
- Anti-aging: Big brands make "anti-aging moisturizers" (gap = pure peptide serums)
- Clean beauty: Big brands list some clean ingredients (gap = 100% transparent formulas)
Your action steps:
- List the top 10 products that partially solve your niche problem
- Note what they do well and what they compromise on
- The compromises = your opportunity
Step 4: The Price Gap Strategy
Niche Beauty Lab's pricing insight:
Don't compete on price, compete on specialization.
Their actual pricing strategy:
- Drugstore acne products: $8-15
- Luxury acne products: $80-150
- Acnemy acne products: $25-45 (the "specialized but accessible" gap)
The formula:
Niche price = Mass market price × 1.5 to 2.5
Why this works:
People will pay more for products made specifically for them, but not luxury prices for unknown brands.
Real Application Examples (Other Industries)
Software/Apps
Gap found: Project management tools are built for teams, but freelancers work differently
Opportunity: Freelancer-specific project management ($40/month vs $15/month for team tools)
Validation: Search "freelancer project management" on Reddit - tons of complaints about existing tools
Fitness
Gap found: All fitness content targets 20-35 year olds
Opportunity: Age-specific fitness programs (40+, 50+, 60+)
Validation: "Fitness over 40" gets significant search volume, minimal specialized competition
Food/Supplements
Gap found: Protein powders are "one size fits all"
Opportunity: Diet-specific proteins (keto protein, paleo protein, diabetic-friendly protein)
Validation: Search Amazon for these terms - high demand, limited specialized options
The Direct-to-Consumer Advantage
Why Niche Beauty Lab sells direct:
- Retail stores want products that appeal to everyone
- Niche products don't fit traditional retail model
- Direct sales = higher margins + customer data
How to start direct-to-consumer:
- Shopify store ($29/month to start)
- Facebook/Instagram ads targeting your specific niche
- Email marketing to build repeat customers
- Content marketing to establish expertise
The Portfolio Scaling Method
Niche Beauty Lab's expansion logic:
Year 1: Acnemy (acne) → Prove lab capabilities
↓
Year 2: Theramid (anti-aging) → Same lab, different actives
↓
Year 3: Transparent Labs → Same lab, different positioning
↓
Year 4-5: Hyalulip + Hairvest → Same infrastructure, new categories
Key insight: Once you nail one niche, your infrastructure can serve adjacent niches efficiently.
Your scaling questions:
- What other problems could your solution/infrastructure address?
- What adjacent customer segments have similar but distinct needs?
- Can you use the same production/fulfillment for different niches?
The "Complaint Mining" Weekend Sprint
Instead of some drawn-out 30-day plan, here's how to find your first niche opportunity this weekend:
Saturday Morning: The Amazon Deep Dive
Set a timer for 2 hours. Pick one category you know well. Read nothing but 3-star reviews until the timer goes off.
Pro tip: Use this search hack: Go to Amazon, search your category, filter by 3 stars, then add "but I wish" or "if only" to your browser's find function. These phrases always precede golden insights.
Saturday Afternoon: The Search Reality Check
Take your top 3 complaints from the morning. Plug them into Google Keyword Planner. If any get 10K+ monthly searches, you're onto something. If not, go back to Amazon.
Sunday: The "Would You Pay?" Test
Find 10 real people who fit your target niche. Ask them one simple question: "If someone made [specific solution to specific problem], would you pay $X for it?"
If 7+ say yes, and you can deliver profitably at that price, you've found a viable niche.
That's it. No 30-day commitment. No complex frameworks. Just one weekend of focused digging.
Warning Signs to Avoid
Market too small: If total addressable market is under 100K people in the US, probably too niche.
Expertise barrier too high: If you need 5+ years of specialized training to be credible, choose a different niche.
Trend-dependent: If the problem only exists because of a current trend, it might disappear.
Regulation-heavy: Avoid niches with complex regulatory requirements (medical devices, financial products, etc.)
The Bottom Line
Niche Beauty Lab succeeded because they stopped trying to be everything to everyone. They became something specific to someone specific.
The opportunity is hiding in those 3-star reviews and Reddit complaints. Most companies ignore these signals because they're focused on the mass market.
But the mass market is crowded. The niches are wide open.
Your next step: Pick one industry and spend this weekend reading 3-star reviews. Chances are high you'll find at least 2-3 viable niche opportunities.
The question isn't whether the opportunities exist. The question is whether you'll act on them.
Found an interesting niche opportunity using this method? I'd love to hear about it. The best way to validate an idea is to share it and get feedback.
