This post is about finding niche markets without too much competition and good enough earning opportunities. So if you want to create a product / service catering to a new niche, but don’t know which one to enter, read on.
1. Pick the main market first
The first step is to decide which general market is it that you want to target. Is it diet and weight loss? Productivity and time management? Software development?
If you have a hard time picking a main market, you’re in big trouble. Go with what you love (if you haven’t found your passion yet, you can do it here) or stick with what you know (your expertise).
If you really need ideas for markets, go to magazines.com and see which magazines exist. If there’s a magazine, there’s a market for it.
2. Narrow it down
Now we need to narrow it down. Remember that a niche is very specific and does not satisfy the whole market… just one very specific segment of that market. So your job in finding niche markets is to come up with those specific segments.
A good way to do that is to play the ‘one level deeper’ game. Let’s say your market is fitness. People interested in fitness might want to get:
- six-pack abs,
- bigger biceps,
- firmer butt,
- leaner body,
- stronger arms
… and so on.
Now each of these listed items is already the fitness market narrowed down. Let’s continue the ‘one level deeper’ game. Let’s take the 3rd item on the list, butts. Why might somebody want to work on their butt? Different potential reasons could be:
- get rid of cellulite,
- people with a small hiney want a bigger butt,
- people with a flabby butt might want a smaller, firmer butt.
Getting a smaller butt is different from getting a bigger butt – the motivations behind them are very different. You would have to sell these products differently, touch different emotional buttons.
Another way to ‘go deeper’ is changing the target group: butt workout for men vs butt workout for women. Butt workout for moms, teenagers or people in their 50′s. All of these would be different niches.
How many levels deep you have to go depends on the niche. The bigger the niche, the more likely it is that you should go after a sub-niche. At every step evaluate steps #3 and #4. If the search volume and competition are too big, you might want to go deeper.
3. Evaluate search volume and trends
Your best friends here are two free tools by Google: Google Insights and Google Keyword Tool.
Basically what you want to do is see how many people per month are looking for keywords related to your potential future niche. So if we continue with the butt example, we can see the search volume for possible candidate products:
Note: Always ignore the 'broad match' results. The truth is somewhere between phrase and exact match.
So we can see that ‘butt exercises’ has the most search volume and way more people want a bigger butt than a smaller one.
Bear in mind that even if you get the #1 spot in Google for all of these main keywords (which is gonna be hard work), the traffic you’ll get is gonna be around 50% of the search volume at best. You’ll want to push for long tail.
Remember that the majority of these searchers are looking for free information and not a paid product. So make sure you provide some.
But what’s hot and what’s not? Google Insights will tell us.
It seems that ‘butt exercises’ is slowly going down (but not too much) and ‘butt workout’ is on the rise, as is the ‘get a bigger butt’ market. So while those 2 niches have lower search volume, they have more future potential than the current reality.
A neat thing about Google Insights is that it will show you related top keywords and also top emerging keywords:
This is very good information for your long tail SEO blogging strategy.
What’s a good enough search volume? A very rough estimate would be this formula (it only works if you’re good at SEO):
- Add together the ‘phrase match’ search volume of the top 10 best keyword phrases (no single-word keywords, please).
- Divide this by 3 or 4.
- What’s 2% of the number you’ve got? That’s how many sales you might do per month if your copy and price are right. But I wouldn’t bet on it.
4. Check out the competiton
Now that you have picked out some candidates for niches, time to see who’s playing in this sandbox already.
Save yourself time and don’t go into overcrowded markets (unless the competition sucks). So what you want to do is go to your best friend Google and start searching. Use all of the keyword phrases you can think of that someone would use when searching for this particular solution.
Make a list of potential competitors. Ignore the sites that do not sell products (articles, content-only blogs etc).
If you’re in the information marketing field, it’s a good idea to go to Clickbank Marketplace and see what you can find there as well.
Evaluate competition:
- How many backlinks do they have according to Yahoo! Siteexplorer? Make sure to choose ‘entire site’ and ‘except from this domain’. If it’s under 2000 links, you can beat them. If it’s over 10 000, might want to reconsider. If it’s only a few hundred or less, you’ll kick butt.
- How good is their site? If it’s amateurish, good for you. If it has one of those 3 miles long salesletters, even better. Is it optimized for sales? If not, good.
- How good is their SEO? Check their title tag and other elements of optimization for search engines. Is the site optimized? Are they using long tail? Are they blogging? If not, you can beat them easily.
What you want is a niche where there are preferably less than 5 serious players. This of course depends on the general search volume of related keywords. You might not want more than 2 competitors in a tiny niche and might be able to handle a few more than 5 in a bigger one.
If there’s no competition (which is hard to believe, search harder!), you’ve either got yourself a goldmine or a niche where there is no money to be made.
5. How easy is to market to this niche?
Another important piece of the puzzle is to figure out how easy it will be for us to market to people in this niche.
What you have to do is find places – forums, blogs, social networking sites / groups etc – where your target market hangs out. So if your niche is women in their 70′s with bad knees and you come across a forum where they all talk about their bad knees, you’ve found a way to reach your audience.
The more established places there are for you to reach the people you’re after, the easier your life is. You won’t shoot in the dark anymore, but can advertise on well-aimed media and join in on the ongoing conversation.
So there you go.
Oh, and a really good tip: go for languages besides English. Sure, most internet users speak English, but for instance Mandarin and Spanish are not too far behind (and rapidly growing!). Competition in those markets is way low. Partner with a native speaker (Google Translate ain’t gonna help you here) and cash in on those foreign language markets.
Got some other neat tricks for finding niche markets? Let us know in the comments.
Image credit: gerlos
