To ensure if you can turn your passion into a profitable business, you ought to do your RESEARCH. Doing your research is an added security to turn your passion to a profitable business. As a new entrepreneur, it is critical not to miss this step because many people may think their idea is brilliant but it is just their personal opinion.
Please don’t! Follow my advice, do your research and avoid making any assumption when choosing a niche.
I have to admit, I love being a detective (My husband said I am a stalker) because doing my research allows me to know who I can follow closely and learn from them. Basically, learning closely from their business model, sales funnels and persuasive writing sales speech.
“Success leaves Clues” by Tony Robbins
So if you are a green entrepreneur, it is advisable to follow an existing business models, never create a new one.
Take ”Subway” food franchising business model as an example. Have you ever wonder why there are so many Subway outlets? Because it is a PROVEN profitable niche business and people just love the healthy sandwich.
Investors buy Subway franchise licensing because they know the business model works for many years in many countries.
Right, I know Subway franchise is not a good example for you as it costs a bomb like probably a half a million? I’m not sure but I know it’s costly…. But you get my idea.
So to start off, think about a few ideas (Profitable Passion) that you have in mind, preferably three ideas to start with and do your research.
Pick the idea that is profitable, a topic you are comfortable with, and that you can foresee yourself talking about it in the next few years or so. At the same time, do consider if the product or services you are offering will be a sustainable business, meaning it will still be profitable niche in the next 10, 20, 30 years.
How To Research To Choose a Profitable Niche
Thanks to the internet, you can now do your research online anywhere and anytime.
You can go to Goggle keyword planner, Amazon, Magazine stands, Clickbank, forum, Facebook group to do your research.
There are basically 3 things you need to research on:
- Whether it is a profitable business.
Are your target audience willingly to spend money on the niches?
- Any demand on the passion you picked?
How many people are searching on the topic (Passion)?
- How competitive is your passion in the market?
Any competition? Competition is a good sign! Love your competitor! The more, the merrier, just be differentiated and you will succeed from the marketplace.
#1. Using Google Keyword Planner For Research
You have probably heard of Goggle keyword planner but nevertheless, I am still going to cover this as I don’t want to leave anyone behind. Google keyword planner is the most popular tool which almost every businesses love to use. Although the tools is meant for keyword bidder but it many marketer likes to use it for researching purposes.
It is a FREE search tool that provides statistic data on the number of people searching for the keyword. You just need to simply type in the keyword and the results will came back in a few second time.
Step 1: Before you start, you need to create an account (Free) with them. Then you will be able to sign in to Adwords.
Step 2: Next, you select “Search for new keywords using a phrase, website or category” after you arrive Keyword Planner Tools page.
Step 3: Enter the keywords you think your audience will search for. For instance, if you are in the Birthday party supplier niche, your audience may search for “Birthday decoration”, “Children birthday party supplier”, “Baby shower party decoration” and more. Type in those keywords that you can think of.
If you are targeting only certain location, let’s say Singapore. You might want to select Singapore as the location.
Step 4: There you go, now you will see the no. of average monthly searches sort by Ad groups. Next, you select “Birthday Decorations” which allow you to view more insight to see what are the keywords the audience are searching for.
Here you can sort the highest keywords searched by clicking on “Avg. monthly searches”. This will provides you a pool of keywords results used by the audience.
Yes. It is that simple.
Goggle keyword planner allows you to check:
1- The no. of searcher looking for the keywords per month. It will help you make the critical decision whether you should proceed to build your pillar of success.
2- The trend of the keyword in the past 3 years- This is optional, depending on the niche you choose.
3- How to choose your keywords for your website, blog post etc.
4- Searches by mobile trends/ Breakdown by device, location or coverage.
5- And a lot more if you are creative enough.
#2. Using Amazon For Research
Amazon started off in 1994 as an online bookstore, but now they sell almost anything there. Doing your research at an established and popular e-commerce platform (with reviews of course…) is a great way to have a deeper understanding on what your customer are looking for in the niche. Beside that, you can also research on how competitive the marketplace is but I am not going to cover this in this session.
Sometime, it is not always about focusing on the product but rather we should find out what the customer really wants. Thus, it is wiser if you can listen to what the customer have to say.
I strongly encourage you to spend a day or so doing your research here.
Amazon allows you to find out how profitable the niche is. Basically, you would need 3 data to conclude your own analysis whether the niche is profitable and check if the demand is there. You start off by picking the best hot selling niche product that is most relevant to your idea and start your analysis from there. The 3 data you need are the item price, the number of customer review and the date the product is launch.
Here is an example:
Let say I would like to target WordPress for beginners.
Step 1: By searching “Wordpress for beginners” under books section brings me a total of 280 results, whao… that is a lot.
Step 2: Now, you sort them by “Most reviews” and the #1Best selling “Wordpress To Go book” will be shown.
Step 3: The book cost $9.97 with 302 customer review. Wait a seconds, have you ever wonder how many people will actually review something after they made a purchase? 302 customer reviews doesn’t mean that 302 customer has bought the book. Amazon does not provide the data how many customers have bought the book, but you can do your own estimation here.
In one of Mark Ling’s free e-book I read. He mentioned that he does not have the exact statistic, nobody has it but he said it is something like 1 in a 1,000. So this would mean 302,000 have bought the book!
Next, you need to find out when the book is launched. And again Amazon does not tell you when the book is launch. So you would need to do your estimation again.
Step 4: Click > See all 302 customer review
Step 5: Once you are at this page, click > Sort by “Most Recent”
Step 6: Now the reviews are sorted by date. The most recent reviews are shown on the first page and to see when the book is launch, you can click the last page to check on the first review date. Although it is not the exact launch date but we can use the first review date as an estimation.
Step 7: Here I have all 3 data: Book cost $9.97, with an estimation of 302,000 buyers since the book was launch on Jan 2012. That is a total of 40 months since the book was launched.
Note: This research was done on April 2015 when I wrote this.
How much was the sale per month?
(302,000 Buyers × $9.97) ÷ 40 months = $75,273
That was $75,273 worth of sale per month!
Let say the estimation was not accurate.
It is 1 out of 100 people who will provide the review.
(30,200 Buyers × $9.97) ÷ 40 months = $7,527
Not bad right?
Even if $7,527 monthly sale was not your goal, you could just increase the price or increase the marketing channel to promote the book.
Extended research to consider:
Next, I will be discussing about “Star rating” and “Look inside” which is not really relevant to the discussion section here, but it is well worth looking at it after you decide on a profitable niche and you may want to do some extensive research here.
Star rating: The star rating is an indicator of how happy the customer feels on their purchase. 5 stars means very satisfied and 1 stars means not satisfied. You will be able to find the customer feedback here together with the star rating since they are given at the same time when they did the review.
What you can do here is to find out what feedback the customers gave on 1 star and 5 stars rating. What do they like about the product and what they don’t like about? You can do this by filtering the stars to check on the positive review and negative review.
Find out what majority of the people like about the product so you will know what the customer really want which you can emphasise that on your product. So let say if there are quite a number of people giving the same negative feedback, can you improve on it or otherwise?
Look inside – If you are doing your own digital book, read this. Search for at least 3 bestselling book for your niche. “Look inside” for their “Table of Content”, find out what topics they are covering which will help you generate some ideas in structuring out the outline of your book.
#3. Using Clickbank For Research
Clickbank is an affiliate network that helps connect creators of digital products and marketer who can help share and promote their products to a wider audience. Most of time, new entrepreneur does not have their own digital e-book to sell, so they look for digital products at Clickbank marketplace to promote which allows them to earn up to 75% commission.
Once you are more experienced and have your own digital product to sell, you can consider placing your own product in Clickbank marketplace to create a wider network so other marketer will promote it for you.
Don’t worry if this is your first time hearing of Clickbank. Clickbank is a trustworthy website which have been around for over a decade.
Okay, I shall go back to our main discussion.
Step 1: Head to Clickbank marketplace:
To find out how your niche is doing, first go to the marketplace found on www.clickbank.com.
Step 2: Check the gravity Score:
Let’s take affiliate marketing as your niche for an example.
You type in affiliate marketing in the search box and at the same time, filter the gravity score (GRAV) between 30 – 100+. I will tell you why in just a bit…
GRAV is a unique calculation although nobody knows how Clickbank did the calculation but the numbers are generated over the past 12 weeks from various affiliates who had earned a commission. It tells you what products are “Popular” at the moment therefore you need to also consider finding a high gravity score (Grav). I don’t have any experience in promoting Clickbank product yet but many affiliates recommend promoting a product that has at least 30 Grav or more. Thus, a good range to start is between 30 -100+
Sometime you will be surprise to find 20-50 products that has high gravity. This tells you how profitable the niche is and in addition a high gravity means that there is a lot of competition promoting the product. But don’t worry even if you are a new in promoting, competition is good because it shows that the product is converting to sale!
If you want to promote as an affiliate marketer, you can try learning from Affilorama. They have a Grav: 59.98 which you can consider learning and promoting at the same time.
Anyway if you decide to promote for anyone, do remember to always check the sales page before deciding to promote it. Or if you can, buy the product yourself and review it or…. you can write to the author to see if he/she can give you Free access to try out first before promoting.
The reason behind is you don’t want to end up promoting something irrelevant to your website or something that most of your customer may not be benefitted from which could hurt your relationship with them.
Now you know how to search for a profitable niche. Next, it’s your turn to find out if your niche is profitable.
There are 23 product categories and sub categories that you can check from but here is a complete list.
Beside from Clickbank, you can also check out from www.jvzoo.com and www.cj.com. They are also a trustable affiliate network.
When you visit the big magazine stand in town, ever notice the type of magazine available in the market? From fitness and health, beauty, digital camera, Interior, cooking recipes, business & investing, motoring, parenting etc..
These types of magazine has been in the market many years back because it is a passion that many people have been following on and it is clear that people are willing to spend on. It is only in the recent years that magazines such as Iphone, Android, PhotoPlus etc are added to the rack as it has become a hot passion in the marketplace.
If your passion has a magazine in the market, you are good to go.
Extended research to consider:
Now pick up any magazine that is similar to the passion you have in mind.
Look at their content page, what is being covered? What topic is always being discussed? Sometime it will give you some inspiration to build the pillar of your blog (Learn more at Business Empire)
Who are the advertisers in the magazine (Is your website relevant to attract these advertisers?)
Facebook group, Twitter fanpage or Forum
Depending on the niche you are planning to go for. For instance in the golf, information based products or world of warcraft gaming niche, you will come to realized that a strong profitable niche will have a Facebook group, Twitter fanpage or forum and anyone is free to join. If you do your research and found that your niche does have a strong follower’s fanpage in any social media platform or forum, you are good to go.
One thing to note is, it doesn’t have to be Facebook or Twitter. There are many others social media platform like instagram, Youtube or Pinterest etc… it really depends on the fans preferences on the social media platform they are using. For instance, in the fashion industry, the audience might prefer to use instagram and in the cooking industry, the audience might prefer to use Pinterest.
So long as you can find a big and strong follower fanpage for your niche, you are way to go man…
Extended research to consider:
There’s a couple of advantage by joining your competitor’s forum, Twitter fanpage or Facebook group in your niche. It allows you to build your network there, make new friends or share new tips. You could even read the questions and comments these people had posted in the group or forum. If you are able to identify a common problem or pain that these followers are facing, you could probably have a new opportunity to provide a solution to the new niche.
Also, it could provide you an inspiration to write for an article for your next blog post in your website.