Finding A Niche – Part 1

Almost everyday there is a post on Internet Marketing Forums that reads something like this…

I am a complete newbie to the whole make money online thing. Could you please tell me how can you make money online? Can you teach me?

Looking to these questions, I will sincerely try to elaborate how to find your niche .And that too having good chances of success.. The choice of website theme is one of the most critical factors for the success of your website. It is called Niche Marketing and I am sure you would have heard about it before. So if you would like to have online success, do read further to explore the basics of  Niche Marketing.

A niche is the specific area of expertise in which you would exercise your skills; basically a niche is sort of’ a topic or theme. The main difference between a niche and a topic is that the niche corresponds to specialization and focus, leading to a smaller audience, then the broader topic. The exact specialization and focus of niche ensures a more loyal readership than that of topic. Internet can be considered as an example of topic while Blogging is an instance of niche.

Step #1: Looking For Niches

When selling a product, many people develop their product first, and then try to find a market for it. This is exactly where they commit mistake! The process needs to be reversed.

Find a market that spends money, and then find out what they want and offer the same to them.

Deciding on what product or service you will promote in a niche market should be based on a simple principle. There should be a demand for your product or service. You want to offer something that people actually need, something that will make their lives better, make them feel better physically, make them look better, or help them solve a problem.

But how can I even come to know about latest niche trends?

• Adopt a habit to update yourself about latest trends and current events in the real world.
• Give yourself time to read newspapers, magazines, both general and niche-specific,
• Watch news, listen to the radio etc.

Google Zeitgeist : Google Zeitgeist is a snapshot in time of what people are searching for on Google all over the world. It’s an interesting way to watch people. And what could be a better way than Google as it’s the most-used search engine on the Web.

To begin with, here we can check out the hottest search trends at Google Zeitgeist. At this juncture we are specifically looking for ideas only. If you come across hot topic, make a note of it and look at more targeted sub-niches later on at more specialized sites.

The Lycos 50 : The Lycos 50 provides the list of the most popular queries that search engine receives over the past week.

You can virtually predict future trends and fads, months in advance, by watching what people search for on Lycos. You can review the latest trends and look for hot topics to explore further.

Yahoo! Buzz Index : This is where you go to get in-depth information fast on the most popular searches in relatively real-time.

eBay Pulse : Another great and easy way to find a niche, and sometimes a profitable micro-niche is with eBay Pulse. eBay Pulse is a section of eBay that shows what people are searching for on a daily basis. It gives you an idea about the searching habits of people. The great thing about Pulse is that you can narrow down your search into specific businesses.

Here is what I found by navigating to a smaller category:

eBay Pulse > Business & Industrial > Office, Printing & Shipping > Trade Show Displays.

The eBay Pulse is a good place to start looking at sub-niches. All you need to do is to select the category first, then a sub-category. After that, you can look for potential sub-niches . You can also check out the largest stores as well to see what they’re selling. There has to be a reason for them being the largest stores. They must be doing something right.

I would also advise you to check out the Hot Categories Report, which is updated monthly to show you the most in-demand products in each and every category.

Now that I have some potential sub-niches to work with, I want to see how much market corresponding to these sub-niches exists. Just because a sub-niche is popular doesn’t mean people spend money on it.

Amazon : Amazon is one of the most underused sources for market research. This online hot spot is one of the most popular online shopping destinations, but it is also a remarkable free research tool for Internet marketers.

One of the best places to start on Amazon in order to find an untapped niche is in the magazine section. Here, they list over 80,000 magazines.

Magazine topics are profitable by their very nature because they only exist if a large number of people are willing to buy them. Therefore, when it comes to light that a magazine on a particular topic is existent, it shows that there is a particular group of people who are passionate about that topic and are willing to spend money on their interests.

First I specify search to Magazine search. Then I enter my niche, which in this case is Travel.

Shoot! There are way too many Magazines returned, which indicates that this niche is not specific enough for our purpose. In other words, it’s too mainstream.

The results are much better! There are definitely possibilities here.

Amazon can also be used to tap a wide range of trends. Simply check out their top-selling magazines, which are updated every day. Using the Amazon movers and shakers tool, you can tap into the latest trends before the rest of the online marketers ever think about catching up to you.

Step #2: Evaluate the Traffic Potential for the Niche

Wordtracker : Simply type in the idea you have in mind, and press the submit button. You will then be presented with a list of keywords and key phrases that are related to the subject you have entered.

Each keyword or key phrase would have an indication of the number of searches that they have gathered from search engine users. The number of searches made for a particular keyword or key phrase is a good barometer of the demand. You’d want at least 5,000 searches for your main keyword.

There is no specific number to look for, but in general I like to see at least 10,000 searches for all keywords combined, but not more than approximately 50,000. Although there are a number of profitable niches that have only a few thousand searches at Overture, but they are considered the exception to the rule.

The Google AdWords Keyword Tool : Get keyword search volume and seasonal performance data straight from Google. Unfortunately, Google doesn’t supply exact numbers, instead using graphs to show relative demand and competition levels.

SEO Book Keyword Suggestion Tool : I like using this tool because of several reasons: It provides suggested monthly regional search volumes by market for Google, Yahoo!, and MSN and churns out direct links to Wordtracker, Keyword Discovery and Google trends, all of which are other tools you can use.

After typing your keyword (e.g. surfing) into the search box, you should focus on the vertical length of the results instead of the actual search volume for the keyword.

The length of the list determines how deep you can go with this specific topic and also how many keywords you can effectively target for traffic. This is an important point: Never focus exclusively on the main niche keyword but the overall search depth for the niche topic.

Here are several other sites you can use to get niche ideas:

• Nichebot – http://www.nichebot.com
• Niche Inspector – http://www.nicheinspector.com/
• Shopping.com Top Searches – http://www2.shopping.com/top_searches
• AOL Hot Searches – http://hotsearches.aol.com
• Craig’s List - http://www.craigslist.com
• Delicious Popular – http://del.icio.us/popular
• Technorati – http://www.technorati.com

Step #3: Profit Analysis

Once you have found a suitable niche with a moderate search volume, you’ll need to run a quick check on its monetization and profit potential. We want to be as certain as we possibly can that our niche is both focused and big enough so that we’ll be able to turn a profit.

Determining the Cost of Pay Per Clicks for your Niche

Once you find a niche that you are happy with, you want to see how much pay per clicks, or PPC, are going to cost on Google AdWords.

One very useful tool for this is the Google Adwords Keyword Suggestion Tool. Just type in your desired keyword and the Google tool will return tons of further related keywords, displaying next to them, their estimated traffic, competition and search volume.

Since we can not see what the click prices will be, we will have to click on where it says ‘show/hide columns’ and select ‘Show Estimated Average CPC’. Input 100 (maximum), next to where it says U.S. dollars and then hit ‘recalculate’.

You will then have a estimated earnings per click on every keyword, but most of the time the real value is half of what’s displayed; so if a keyword says it’s going to earn 2$/click on an average it’s actually worth only 1$. For a more advanced look, on how much money a keyword can produce, you can consult the Google Adwords Traffic Estimator.

By now you should have found a profitable niche market. There are plenty of sites you can use for research in addition to the ones above, but they are usually niche specific. These sites will help you to research practically any niche market effectively. Once you have this process down, you’ll be able to do this very quickly.

In Next Post, I will be highlighting some ways to find out who your target audience should be.