Choosing a niche to enter is always tricky, which I’m sure is where a lot of affiliate marketers, including myself, have gotten tripped up. The problem is, that making a site and marketing it can mean a lot of work, time, and possibly money, so you want to be sure you have the best possible niche to enter. It can be really hard for new affiliate marketers to finally take the plunge and start in a niche, unless they are absolutely sure they will make money.

In my opinion, it’s virtually impossible to predict for sure if a niche will make you money. That’s why so many people fail to get started; they just can’t be sure, and will always search for the perfect niche on the silver platter. I’ve definitely been there myself, it’s tough to put so much energy into something, with no guarantee of success.

But what I’ve been finding lately is that there are actually quite a few good ways of getting better estimates of a niche’s profitability, and therefore lowering the risk of poor to no returns. If you simply scale things down, you can get quite a bit of info before starting a super huge project right off the bat.

So here are a few tips I’ve been taking to heart in researching some potential niches of my own:

Demand - Are There Buyers?

First things first really, there has to be buyers in your niche. Making money online equates simply to selling; you need people to be willing to give you money (or their information, CPA style) to make money. So while traffic estimates and all that are good, they mean nothing without buyers.

Profile your potential visitor, and ask yourself if they fit the profile of a buyer, or better yet, a “desperate buyer”, meaning someone who is in a situation that needs an instant remedy, and is willing to pay for it. An example of a buyer would be someone searching for a TV Show DVD Box Set, a desperate buyer would be someone searching for Computer Virus Removal.

A good place to check and see if a niche has buyers, is to check forums or even Yahoo answers. You can see here the kinds of questions people are asking, and if buying something fits their solution.

What I have been doing more lately is using Hexatrack to watch and see which advertisers are constantly paying for ads. If they are advertising consistently, the chances of them making money are high, and therefore their visitors (your target market) fit the buyer profile.

PPC can offer some nice short term testing solutions, instead of investing too much time with SEO trying to get ranked, only to find your market is no good. A few months back, I wrote a 2 part post on Targeting Long Tail Keywords; this could help you find some nice easy terms to rank well for in SEO, with which you could do some SEO style market testing with articles or Squidoo lenses.

Competition - Are You Outmatched?

Competition can actually be a good thing when investigating niche markets, in moderation that is . Obviously the first thing you want to make sure is that you can actually enter the market without completely getting stomped on by super competitors. If the first page of search engine results for your niche is full of authority sites, that might be a problem. If PPC is filled with huge sites bidding dollars a click, you might be in trouble.

Sure a lot of obvious niches aren’t worth trying, especially if you aren’t someone with tens of thousands of dollars to invest (which I assume you aren’t ), but there are still plenty of good, more specific niches you can target. The best part is that these smaller niches generally have better ROI potential than broader ones!

Competition can be a great gauge of niche potential, since like I mentionned above, if people are say bidding high on PPC keywords, they are surely making money. An even better metric is if you see that these people are affiliate marketers themselves, then you really have good chances here. Hexatrack does a great job at helping you keep tabs on these ads, and sorting out which of them are affiliate marketers just like you.

No competition can be a good thing or a bad thing. It can be good if you stumble upon some untapped market (although, there may not be any affiliate opportunities), but also bad because it can just mean that people have tried and failed to make profits in this niche.

Interest - Will You Invest The Energy?

I hate to use this piece of advice, as it is a commonly used saying that top marketers will crap all over, but it’s actually something to consider, especially in the early stages of your affiliate marketing endeavors. You should target a niche that you are interested in, at least enough that you will be willing to invest the energy into it.

That’s because in the early stages, chances are you will be doing a lot of the work yourself, whereas later, you can outsource a lot of the non-marketing aspects (content creation to be specific) with your profits. It will be a lot harder to progress if you really don’t like what you are working on. If you have even the teeniest lazy bone or procrastinating tendency (which 99% of us do), you will find it 10x harder to get moving.

So hopefully these tips will give you some ideas on what to look for before starting with a new niche. The most important thing to remember from all this is that you will never know for sure if a niche can make you money. Even if all these signs point to yes, there may still be a no, and vice versa. That’s why it’s a good idea to carry out small scale tests and experiment often. You may just find yourself a goldmine!

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