Identifying a profitable niche is critical in having a successful business of any kind. Whether you are selling products from a brick and mortar location or you have an online shop or service based business, doing research to identify a good niche is a must.
Many aspiring entrepreneurs and small business owners are often misled or misguided on what it takes to do effective and successful market research that uncovers a profitable niche to tap into.
They are told that all you need to do is a bit of keyword research and that’s it.
But the truth is that keyword research may not be the best place to look at for niche and market research. Here’s why:
Keyword Research Is Only Half Of The Story
Keyword research only paints a picture of what keyword phrases people are using in the search engines to search for answers to their questions…
Not what products they are actually buying.
Just because a group of people search for specific terms or brand names does not mean that’s what they ended up purchasing.
That’s a key distinction many entrepreneurs and business owners tend to gloss over.
Now, I don’t mean keyword research is not an important part of your marketing. The right keywords will drive traffic to your website and this is key to generating sales and revenue.
However, this is a completely separate marketing component that you must tackle after you choose your niche.
Look In The Right Places
If you’ve yet to identify a great niche, you can’t move forward with optimizing the right keywords to drive traffic to your website.
When looking for a profitable niche marketplace, your primary focus should be looking for proof of a group of hungry and rabid buyers that want to exchange their money for a service or product (information, physical or digital).
Without this crucial qualifier, you may have the greatest product in the world, but you may be lacking a market to sell it to.
In this post I will share with you a couple of tips and resources you can use which will give you a running start to uncover if a truly, profitable marketplace exists before you go for the gold and put all your resources into a website, product creation and other related expenses.
Once you establish that you have located a market that seems to have potential, then you really have a worthy reason to do some keyword research to find out what keyword phrases people use to find the market you have chosen.
Let’s take a look at how you can identify a profitable market…
One of the best ways to find signs of a truly profitable marketplace is looking for a magazine in that industry. If a publisher has enough money to print and circulate a full color magazine, there are most likely advertisers that support the funding of the magazine’s ability to circulate all the copies which most likely means there are sales being made by those advertisers.
Now, this may bring you to question whether there is too much competition in a marketplace with so many advertisers selling in a magazine.
In fact, it’s a great sign to have competition….
Competition means that there is a demand for the product or service. Actually, if there is very little competition, you may (1) not have adequate product being sold in that space; or (2) not have a marketplace to begin with. The larger the competition is, the larger the piece of revenues you will be able to grab.
There are two incredibly huge marketplaces that are massively trafficked, move a lot of product and are great places to find what people are really buying.
On eBay, you can look through a list of the most popular products people are buying through auctions or from eBay stores that vendors have set up.
To get a better idea of what are hot items and niches, be sure to look at completed listings inside of eBay, NOT what’s for sale. Doing a search for sold items not only tells you how many units we’re sold but the prices shown from different vendors.
This is invaluable information to have as someone who wants to invest in purchasing physical products to sell.
Another really big marketplace is Amazon and it’s not just for books.
You can find just about any product and name brand that is a mover and shaker. Again, look at the most popular products in those categories that catch your attention.
Digital products have a great appeal to entrepreneurs for a couple reasons….
Selling digital products do not require any inventory.
These products usually carry high profit margins
As an affiliate marketer you can also benefit from these high profit margins.
Just browse through categories on sites like Clickbank.com and JV Zoo and you’ll instantly find the top sellers of digital info products, software and subscription services which are located right at the top listings.
If you are considering digital products and affiliate marketing, I highly recommend you get the right type of training to help you understand the business model and how to get access to high ticket commissions with the affiliate marketing system.
Once you gather the adequate information and you’ve chosen your niche, you will then have to decide if you will:
Create an online store that ships out physical products and merchandise (requires inventory)
Sell merchandise through eBay auctions or their online stores (requires inventory)
Create a site that represents vendors as an affiliate (requires no inventory)
Create your own product, service or software for a digital product (requires no inventory)
You can then build out a site with a simple product offering, find some low cost keywords to use in a Google Adwords Pay-Per-Click campaign with a minimal spend of $50 to test the market and see if you have a winner.
If the initial test results pan out, meaning that you pulled a profit from your test, you can invest more energies, conduct more extensive keyword research and expend more advertising dollars. If the test results do not pan out, find another market until something sticks.
I hope you found this post valuable. If you did, take a couple of minutes to leave me a comment down below. And if you think this post can be of value to your friends, please go ahead and share it on Facebook.
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