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Finding a niche for an app is not different than finding a niche for an affiliate website or an adsense webstie. Both work in a more or less similar aspects.
There are many resource on the internet available that will teach you how to do niche research for affiliate/adsense website. Below are my suggestions on how you can do it for app
Step 1 – Find traffic: Find a market that has lot of demand. There is no point in putting in effort on something which only handful of people will use.
Step 2 – Find passion: Often people tend to work on something which they don’t have passion for. Try to see if in step 1, you can find something of your passion. Something which you are fond of or knowledgeable about. Something on which you can work for hours without getting bored.
Step 3 – Find gap: Find a gap or need in that market identified in step 1 and see how you can fill that gap. If there is something which people are looking for and is not there, provide it.
Step 4 – Do Intensive market research: There are 1000’s of app out there. Possibility is, what you are trying to do is more or less already available in the market. If not, then awesome. If it is, then see the services that app is providing and try to outsmart that app with your one. You need to do intensive market research for it. You might need to spend hours on PlayStore and iTunes app market to see what is already available and how you can beat it. Install those apps and see what they are offering and what more you can offer.
By now, you must have found a niche that has traffic or is of your passion. Something which is needed by community which is not already available or perhaps somewhat available but not exactly what they want. You have also done intensive market research on app stores to see how many other apps are out there offering more or less what you are about to create and how you can beat those apps in features or services. The only thing left from here onwards is kickass game design, HD graphics and good development and you are off to a successful app.