Unlocking The Niche Code Part 2

 Unlocking The Niche Code

(How to Research the Moneymaking Capabilities of a Niche)

A Step-by-step Approach to Finding the Best

Niches in which to Market a Product or Service

Part 2

Time to scope it out a little further.

We want to be as certain as we possibly can that our niche is focused enough but big enough, and that the people in that niche spend money.

So next I head over to the Overture Resource Center (http://searchmarketing.yahoo.com/rc/srch) and click on the “Keyword Selector Tool.”

Then I enter my niche and see how many times that keyword and all related keywords were searched in the previous month.

I like to see at least 10,000 searches for all keywords combined, but not more than, say, 50,000 or so (although I do have profitable niches that have only a few thousand searches at Overture, but they are the exception rather than the rule).

For “latch rug”, you can see that this market is just too small.

Remember that Overture searches are for Yahoo and their partner sites, so to measure the number of searches on Google, I usually estimate between 5 and 10 times this number to come up with Google’s searches. Also, depending on the market, I've sometimes found Overture’s figures somewhat inflated, so bear in mind that the number of actual searches might be lower.

If I’m happy with the number of searches for this potential niche, I next want to see how much pay per clicks (PPC) are going to cost me on Google Adwords.

For that I use Overture’s “View Bids Tool.”

I want to make sure I won’t have to pay more than a dollar or two per click on average, but of course what you can profitably pay for PPC will depend on your product’s selling price and how many you can sell.

Again, at this point I’m just trying to get a snapshot or pulse of this market.

Plus, the bid process also tells you a little about the moneymaking opportunities of a market. As a loose rule, if the max bid results are between 30 cents and $2.00, it’s a good indicator that people are making money in this market. I call this my “magic window.”

Over $2.00 means that the competition is too fierce for my tastes, but depending on your market and eventual product selling price and demand, it may make sense for you.

To check on the companies that are bidding on my keywords in Google Adwords, I use http://www.googspy.com.

One relative newcomer as a research tool is Google Trends (http://www.google.com/trends).

There’s lots of useful information here. You can see that the news volume is synced with the search volume, and several notable news articles are displayed, along with where they occurred on the timeline.

In the lower section, you can see which countries, cities, and languages made the most searches. Be aware that the indicators are normalized, meaning they are adjusted for that region’s population. For example, South Africa has about 44 million people, compared with the U.S.’s 295 million. So the U.S. may have performed more actual searches, but after the adjustment is made, South Africa comes on top for this search term, which is “fly fishing.”

In the upper-right corner of the page, you can switch regions (e.g. if you wanted to check the U.S. only), and you can change the time period.

For example, notice below how I changed the time period to a single month. See any cyclic trends there?

You may have noticed that searches for this topic tend to spike every Friday, going into the weekend, and then fall again during the week.

This information may be useful if you are going to advertise with Google Adwords, and you’re launching a firesale or other limited time campaign, because you’ll want to schedule your campaign around one or more of those spikes.

Some markets have different patterns, so it’s useful to be aware of them prior to launch.

Another great use for Google Trends is if you are trying to decide between two different niches. If you enter your search terms and separate two or more with a comma, Google will compare them for you

Very useful.

The work is already done for you. You just need to put it to good use. As you can see above, piano is too broad a niche. It has a high amount of searches, but the bids for PPC traffic is too low. As a result, I would suspect that people are generally not making a lot of money with that search term.

Remember, high volume + low PPC bids = low click through rates and even lower conversions.

Fly fishing, on the other hand, does have PPC bids between 30 cents and $2.00, so money is likely being made there. However, the search term itself is too low. Unless you have other keywords for that niche to add additional traffic, I would steer clear from there as well.

There are several other sites I use as well to get niche ideas, and especially to narrow the niche and discover potential information the market wants:

Nichebot - http://www.nichebot.com

Shopping.com Top Searches –http://www2.shopping.com/top_searches

AOL Hot Searches - http://hot.aol.com/hot/hot

Google Groups - http://groups.google.com

Craig's List - http://www.craigslist.com

Delicious Popular - http://del.icio.us/popular

Dig - http://www.digg.com

Google Catalogs - http://catalogs.google.com

Google Suggest – http://www.google.com/webhp?complete=1&hl=en

Technorati - http://www.technorati.com

Also, I'll do several targeted searches in both Google and Yahoo (for example, on the subject of "hobbies").

Finally, I’ll see what existing digital products are being sold in my target niche at the Clickbank Marketplace (http://marketplace.clickbank.net).

HINT: If you want to see how your competitor’s sale pages have evolved over time, the Wayback Machine is a great place to do so (http://www.archive.org).

And of course I will always Google my keywords and check out the competition in the Adwords ads. In this case I pay special attention to the ads that sell information products (or services like mine if I’m selling a service).

Some of the ads will be irrelevant as far as competition goes.

Ok, the next thing I'll do is check how many magazines there are on the subject of my chosen niche.

There are two places I go online for that:

Magazines.com - http://www.magazines.com

and

Amazon –

http://www.amazon.com/exec/obidos/tg/browse/-/599858/

At each site, I search by category to find the magazines in my niche.

Part

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Free: 18 Ways to Create $10K Niche Products