Choosing a Profitable Niche – Part 1
Choosing the right niche for your online business can mean the difference between making a profit or falling flat on your face. Why is this so important you ask…
There are thousands of new websites every day, all working to gain an audience. This can be for a variety of reasons, but for most, making money is the motivator.
There are different thoughts on what you should look for and where you should begin.
Searching for a Profitable Niche
A niche is a specific market that contains a group of people who share a common interest.
Reasons why newbies stumble with choosing a Niche:
1) Some believe that they’re going to be stuck with the Niche they choose. This causes stress which leads to procrastination. So rather than just choosing a Niche and moving forward, they sit in neutral.
2) Others are afraid the Niche they choose is going to fail and not be profitable. Again, this leads to sitting on the sidelines.
Both of these reasons are based on fear and stop beginner’s dead in their tracks. Nothing will stop you quicker than fear.
Two Approaches in Niche Selection
1) The first approach is choosing something you are knowledgeable about.
2) The second is choosing a topic that you are interested in, but don’t have direct knowledge.
Each approach has positives and negatives. Most prefer to choose a subject that you already have an intimate knowledge of.
I recommend starting with something you know and are passionate about for a few reasons:
1) Knowing Your Niche will allow your enthusiasm to help you sell it.
2) Because of your knowledge, it will probably be a better product.
3) It will make it much easier to relate to your market.
Don’t make the mistake of falling in love with your product idea, as it could become a stumbling block if you become too attached to it.
As you grow, you will want to develop several products in different niches. The more streams of income you have, the more stability you add to your business.
Make sure you start with ONE.
The most important key to choosing a profitable Niche is doing the research. You want to make sure that the Niche is good and can be profitable before you invest time and money into the business.
Research Questions to Consider
Some of the questions you want to answer through research are:
1) How large is the Niche you are considering?
2) How much competition is there in the Niche?
3) Does the Niche have profitability?
Do you see the potential for back end products? (If not, you may want to reconsider)Trends and fads can be VERY profitable, but I recommend you consider evergreen topics if you want to build your business for the long haul.
You want to keep in mind that people look for information to either ease their pain or fuel their pleasure. This is the kind of information they are willing to pull out their credit cards for.
Steps for Choosing a Niche
Take time to brainstorm some topics that you are interested in turning into a product. Write them down.
I DO MEAN WRITE.
Use paper and pencil for this. Trust me, it will make a difference.
Don’t be concerned about the details of the market for Niche just yet…
we’ll be discussing research shortly.
Here are some Profitable Niches to get your creative juices flowing:
Making Money Online
The list is endless and when you let your imagination go, you will be surprised at what you will come up with.
Doing the Research Matters
Use the Google Search tool by putting your Niche in quotes to research your topic.
Look at the following:
1) How many results did you find from your search?
2) Were there paid advertisements? If so, how many did you find?
3) What types of sites did you see on the first page?
When considering the number of pages in your search results: If your search comes back with too few, your niche may be too obscure. If the search has too many, you may want to narrow in on a more focused area of your niche.
When reviewing the paid advertisements, a lot of ads are a good indication that there is money being spent in the niche. Keep in mind that more ads also will mean more competitors.
Review the results on the first page. What types of sites are they? Does it look like these sites are making money? Are they offering any information products, or are they, possible competitors, with your product idea?
Check the PageRank of the sites on the first page. You can use any number of page rank tools. There are many add-ons for both Firefox and Chrome. This will give you an idea of how hard it will be to compete with these sites, at least from an SEO standpoint.
Find out how many times the topic is being searched for each day.
When you start to expand with multiple Niches, you should look into purchasing a Keyword tool to automate much of the steps above.
One of the tools I recommend for this is Market Samurai.
Be a Secret Agent
Spy on the competition using the free http://www.spyfu.com/
– How many advertisers there are for your Niche?
– How much traffic are these websites generating?
– How much money are they spending?
– What products or affiliate programs are they advertising?
– Do any related advertisers have an affiliate program? (potential back end promotions)
You can use Clickbank to see if there are similar information products, and how popular those products are. You will need to have a Clickbank account for this. As you look at the different information products, check to see what the gravity score is for each product.
Don’t ignore your gut feeling, quite often your gut instinct will be right.
In Part 2 of Choosing a Profitable Niche, we will discuss the steps for focusing in on a specific niche. Identifying a narrow portion of the niche that you will use to build your online business.
- Newbie Mistakes – Avoid making rookie mistakes. Don’t rush the process.
- Two Approaches – Choose the right approach for you.
- Ask Questions – Be inquisitive and ask lots of questions
- Be a Super Sloth – Spy on your competition to learn more about your potential Niche
Your thoughts are important to me. Leave a comment below.