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How to Pick a Profitable Niche

Written by Trent Brownrigg  · March 9, 2009

I don’t know why so many internet marketers think that there’s some kind of hidden secret to being successful at making money online. If you didn’t know better you would think there was a secret money making manifesto buried under John Reese’s house or something like that. Well, I’ve got news for you; there is no secret to making money online!

The same is true for finding a profitable niche market; there is no hidden secret to that either. The process is actually quite simple and in this post, I’m going to give you the basics of niche research. Follow this simple niche finding guide and you shouldn’t have any trouble finding a profitable niche for you to focus your internet marketing efforts on.

The first step in the process of picking a money making niche is to just find something. It can be anything, it really doesn’t matter what it is as long as you find a starting point. Think of things that you or your friends are interested in, or stuff that you often see being sold online. If you can’t think of anything just go to eBay and check out what the hot selling items are there.

After you find a possible niche go to the Google Keyword Tool and check the niche to see how many searches there are for the main keyword phrase related to it. Chances are you’ll get a large list of related keywords from the search. It will show you how often each one is searched for every month on average.

After you have the keyword list, go through each of them one by one and plug them into the actual Google search engine to see how many competing sites there are. Use quotes around the keyword phrase so you only get sites with exact matches. Since there will probably be a lot of keywords you don’t have to check them all, just several of the main ones.

Now, let’s say a keyword phrase gets an average of 1000 monthly searches and you found there are 10,000 competing sites. There’s a simple formula you can plug these figures into and get the Keyword Efficiency Index (KEI). The formula is (monthly searches / competing sites) X monthly searches. If the KEI is 100 or greater the niche is typically considered to have profit potential. In our example it would be (1000/10,000)X1000 = 100, so it that niche is a potential money maker.

Finally, you need to find out if there are any products being sold in that niche and any Adwords campaigns being shown for the keywords. If there are, this is more evidence that the niche could be profitable because most people won’t take the time to create a product or pay for ads if there’s no money in the niche. But even if there aren’t any products or ads it could just mean that you found a completely untapped niche. The potential still exists that it’s a money making niche, however it’s not likely that you are the first to find it, so you might need to do more research if that ends up happening.

As you can now see, niche research is not very complicated and there aren’t any hidden secrets to it. Anyone with basic computer skills can find a profitable niche if they really want to. It basically boils down to finding out what people are searching for, seeing how much competition there is, and figuring out if products exist within the niche. If everything looks good, the money making potential is probably there.

No, I’m not kidding, it really is that simple!

Dedicated to your success,
Trent Brownrigg
Helping aspiring entrepreneurs find home business ideas since 2003.

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5 Responses to “How to Pick a Profitable Niche”

  1. wilhb81 on March 9th, 2009 11:47 pm

    100% agreed with your thoughts here, Trent. As long as we’ve picked the right niche, and with the proper strategies and efforts, we’ll soon generating lots of money…

  2. MMO Experiments on March 10th, 2009 3:22 pm

    Finding niches that make money and don’t have high competition is the key – more so than simply finding a profitable niche. But finding niches like that is not very complicated either – just a lot more time consuming.

    All you do is create a lot of sites and see which one works! Again, this isn’t complicated – just time consuming.

  3. Meaghan on March 11th, 2009 3:03 pm

    Thank you for the advice. This will be very helpful!

  4. Deutschland Spot on March 12th, 2009 12:12 pm

    Great article. I guess I will look for profitable niches this weekend. Thanks again.

  5. Keurig on April 24th, 2009 2:45 pm

    You are absolutely right. If you are not in a profitable niche, it really doesn’t matter what you do, you won’t make money. I think picking the right niche is THE most important thing you do…just my 2 cents