There are three common problems when it comes
to finding a lucrative niche for an online business. And the reason why they're problems is
because there's conflicting, yet valid points to each side of the coin. Problem #1: passion vs. profit. One group of people will say to pursue
something you're passionate about... Or else you will fail. And the other group will say to follow the money
because passion isn't going to pay the bills. Problem #2: low vs high competition. One party swears that low-competition niches
are the only way to go because you can get traffic faster and you won't have to compete
against behemoths with bottomless wallets. And the other side says that you have to go
for high competition niches otherwise, you're limiting your earnings potential. And problem #3: micro vs. broad niches or
the age-old question: "How niche should I go?" Now, finding a niche that's right
for you isn't a coin flip. And there is no magic formula that's
going to give you that answer. And that's because there is no
generic solution to these problems. Finding and choosing a niche will come down
to a mix of personal and business decisions. So in this tutorial, I'm going to show you
how to find a niche for your online business, vet and research that niche and actually choose
one that's going to meet your personal style and business goals. Stay tuned. [music] Alright, so before we get into solving these
problems, there are 2 things we need to do first. #1. Define what a niche actually is. And #2. Talk about how to find niches. And the answers to the three problems I just
discussed will help you to actually choose a niche. So let's get on the same page and
talk about what a niche is. Simply put, a niche is a segment, or
a smaller part of an industry. And this segment has a community
with their own specific needs. For example, backpacks for hiking is a niche. Backpacks are a segment of the larger industry
of bags and luggage and the audience is hikers which has a pretty big community. Now, whether you want to monetize through
t-shirt sales, affiliate marketing, or whatever, all of the research methods and principles that
we'll cover today can be applied to your business. But because we can't cover every possible
business model, for this tutorial, let's say that we're looking for niches
for an affiliate website. This way, we won't need to discuss things
like the cost of inventory, logistics, etc. Alright so let's talk about some
ways to find a niche. The first way is to dig into a competing website's
traffic and financial information. There are website marketplaces like Flippa
and Empire Flippers where sellers are required to include traffic and financial information. So assuming you have no idea what kind of
niche you want to enter, you can get started by going to Flippa.com. And since we're looking for affiliate ideas,
I'll hover over browse, then content, and choose to look through blogs. Next, I'll filter for just revenue generating sites. Now, after skimming through results,
I came across this listing. And right away, you'll see things like the
site's age, monthly profit, profit margin, and monthly page views. Scroll down a bit and you can see the revenue
breakdown over the past 12 months. Scroll a bit more, and you'll see data that's
been imported from Google Analytics. Now, to get a very basic understanding of
profitability, you can take the average profit and divide it by the average pageviews. So that would work out to around
three cents per pageview. Again, this is just a very general way to
understand how much money you could make if you were to rank for the same topics in the
same niche with the same monetization method. Alright, the second method is to use Google
ads data as a proxy to commercial value. And this can be done using a metric like
Traffic Value, which is an SEO metric available in Ahrefs' Site Explorer. And traffic value estimates the value of
a website's organic traffic if they were to pay for that same traffic through Google ads. So in this case, our blog gets around 300,000
monthly search visits and the value of that traffic if we were to pay for it through Google ads
would be over half a million dollars per month. And that's because SEO and digital
marketing are pretty lucrative topics. So basically, this method is based around
the theory that if advertisers are paying top dollar to appear for these keywords, then
there's likely going to be commercial value. Alright, so to find niches with high traffic
value, you can use a tool like Content Explorer, which is a searchable database
with billions of pages of content. Now, if you have a general idea of the area
you want to create a website around, then enter that in the search box. But in our case, let's say that we're open to
any niche but we want it to be an affiliate site. So I'll search for "amazon associates," because
people often include some kind of Amazon affiliate disclaimer on their pages. Next, let's set a website traffic value filter with
a minimum value of 5,000, meaning, websites that show up should be getting at least $5,000
worth of monthly organic traffic if they were to pay for it with Google ads. Now, to filter out these mega sites like Amazon
and CNBC to name a few, we can set a Domain Rating filter. And Domain Rating is an Ahrefs metric that
represents the overall strength of a website's backlink profile. And it's generally a good way to
filter out highly authoritative sites. So let's choose the Domain Rating filter and
set it with a maximum value of something reasonable like 40. Next, let's set the "One page per domain" filter
since we only need one result to see a website's total traffic value. From here, you can skim through the results
and just eyeball the domain names to see if there are niches or industries
you can tap into. Alternatively, you can go to the websites
tab to scan through the top 100 websites. And again, let's sort the table
by Traffic Value. And just from eyeballing the domain names,
this one seems to be related to sleep, another on pies, and one related to vegetarian
or vegan diet plans. Now, the domain names will give us
a general idea of a product or industry. But if you want to dig deeper, you can research the
pages that are actually sending these sites traffic. So I'll click the caret beside sleepdelivered.com,
and head on over to the Top Pages report which shows the pages that send the most
search traffic to the site. Now, if you have the experience, skills, and
resources, going after a ton of sleep related products at once could work out well for you. But if you don't then you might want to stick
with one product to create content around. For example, looking at this website's top
pages report, you'll notice that the majority of pages sending organic traffic
are related to bed frame reviews. So this might be something
worth exploring further. Alright, so if you go through these two methods
of finding niches, you should be able to jot down a bunch of interesting ideas
for your site. So let's move on to the next and perhaps
most important part of finding a niche for your online business and that's to
research and vet it. Now, in the vetting stage, you'll want to
get more detailed information on your brainstormed list of niches. This way, you won't be committing to anything
without knowing exactly what you're getting yourself into. So the way I like to vet sites is in two buckets. The web bucket and market bucket. The web bucket includes things related to your
website like how you'll get traffic to your site and how competitive it is
to get that traffic. Understanding this information will ground you in
reality by understanding your competition better. Now, the market bucket includes things related
to the industry and products you'll be recommending or selling. So that would include things like sustainability
or the overall trend of the niche and seasonality if any. Understanding these factors will ensure
you're not entering a niche that might fade over time or has already faded. Alright, let's talk about figuring out
how you'll get traffic to your site. More specifically, I'm talking about
optimal traffic sources. Paid ads, social media, and search engine
optimization are just a few traffic sources that tons of websites use. And they're all great but they each
come with their pros and cons. Paid ads are great if you have the money to
spend because you can literally get traffic to your site within an hour from
setting up your campaign. Now, the downside is that you
have to pay for web visitors. And the moment you stop paying,
you'll stop getting traffic. On top of that, you're adding a potentially
sizable expense which makes being profitable more difficult - especially if you're
selling low-ticket items. Now, social media traffic can be
great because it's free and fast. But if you don't have a big following, then it's
tough to actually get traffic from these networks. Plus, a huge downside is that the shelf-life
of social media posts tend to be very short because most social networks are designed
to surface new and fresh content. As for search engine optimization or SEO,
traffic is free, passive, and consistent. But the downside is that it takes longer
to actually rank your pages compared to the other two traffic sources. Now, the primary traffic source you choose
should be a blended decision of your timeframe, resources, expertise and your competitors'
main traffic sources. So to find out your competitors main traffic
sources, just search in Google for a keyword that's relevant to your business. So as an example, if we were to go with
the bed frames affiliate sites, I'd search for something like "best bed frames." And from here, I'll just skim the results
for a website that looks like it's solely about sleep or sleep products. So I'd ignore sites like Gear Patrol and
the New York Times and focus on a website like sleepfoundation.org. Next, I'll take that domain and
enter it into Similarweb. As you can see, they get well over 5 million
monthly visits to their site and if we scroll down, you'll see that nearly 90% of it comes
from search engines or via. SEO. So if I were to create a competing website,
that's the traffic source I'd focus on first. Alright, the next thing in the web
bucket is traffic competition. And this will boil down to the main
traffic sources you're going after. Let's keep running with the bed frames example. Since we've established that search traffic
is likely the best traffic source to go with, we'll need to look for two things. #1. Is there enough search demand in this niche? And #2. How hard will it be to actually
rank for these keywords? After all, if you can't rank for relevant
queries in your niche, then you won't get any traffic. Now, the best place to find this information
is with a keyword research tool like Ahrefs Keywords Explorer. So to get started, just search for broad topics
related to your niche, so I'll search for "bed frame" and "bed frames." Next, go to the Matching Terms report which
will show you keyword ideas that include your broad topics along with each
query's monthly search volume. And we also provide a keyword difficulty
score which estimates how hard it'll be to rank in the top 10 of Google. Now, since we're creating a hypothetical affiliate
website, we want to find a mix of informational content and product comparisons. So to narrow in on these queries, I'll click
the Include box and search for words like "how," "what," "who," "when," "where,"
'best," "vs," and "review." Finally, I'll set the "Any" toggle since I'm
good with keywords that include any of these words and hit Apply. And just from a quick search, it looks like
keyword difficulty scores are low to mid competition and with a cumulative search volume
of over 100,000 just in the US, it seems like there's plenty of search demand around
just "bed frame" related queries. Now, there's a lot more that goes into analyzing
competitors and search engine results pages. But rather than turning this into an SEO tutorial,
I recommend watching the keyword research module in our SEO course for beginners
where I go deeper into these things. I'll link those videos up in the description. Alright, let's move on to the market bucket. And again this is where we're researching
things related to the actual market, industry or product like the long-term trend of
the niche and any seasonal factors. To do this, just go to Google Trends and type
your niche or product in the search bar. So I'll search for "bed frame." Next, you'll want to choose the country
where your target market will be. So I'll choose the United States. And finally, I'll set the time frame to the longest
option to get a high level view of searches for this topic over time. And interestingly, there's actually a clear upward
trend for people searching for bed frames. Now, as for seasonality and other factors, it
seems like bed frames are popular year round. But what's interesting is that searches in July
and August consistently spike every single year. I'm not sure the reason, but it may be worth
noting for your promotional efforts. Now, to give you an example of seasonality,
look at the trend for the query, "garden hose." There are huge spikes starting in the spring
as the weather gets warmer and searches start dipping towards the end of summer and into
the fall and winter as the weather gets colder. This is what seasonality looks like. And niche sites that are season or holiday
dependent will have lower revenue in the slower months. So if this is the niche you're entering, beware. Now, with these methods you should be able
to find plenty of niches with profit potential. But everything we've discussed to this
point is purely about finding. And finding niches usually isn't a big problem. It's choosing the niche that often prevents
someone from starting their online business or persevering through the rough patches. And this brings us back to the three problems
in choosing a niche: profit vs. passion, low vs. high competition, and micro vs. broad niches. Let's tackle these problems head on because
your answers will actually help you choose and stick to a niche, increasing your
probability of success. So let's talk about the battle between
profit vs. passion. Plain and simple, you don't have to love
your niche in order to make a profit. But from my experience, it's a lot easier to make
money doing something you enjoy rather than doing it for just the money. Because what I've personally found is that
while I can start a site and get traffic to it, money alone isn't enough motivation
for me to want to grow that business. On the other hand, I know a few very successful
people who create niche sites on topics they don't care about and they're not
driven by money. But a key difference here is that these people
are driven by marketing and creating great teams to build new sites for them. In other words, they may not be passionate
about the niche, but they are passionate about the process. So the answer to profit vs. passion is going
to come down to what you're driven by and/or your level of tolerance. Alright, the next dilemma is about choosing
a low vs. high competition niche. Now, because earnings potential for an online
business heavily relies on traffic, your decision should be based on a balance of your skills
in marketing, your resources aka. your bankroll, and the level of competition
you'll be up against. But I also want to make a note that niches aren't
necessarily exclusively low or high competition. There's often a mix of topics with
varying levels of competition. So if you're starting a new site, a viable
strategy is to start with lower competition topics, even if they may not be super-commercial
until you've built your brand and website authority. And from there, you can start going
after more competitive topics. We have a video on assessing ranking difficulty,
so I'll link that up in the description. And finally, is the age-old question,
"how niche should I go?" This question is strongly connected
to the problem we just solved. It'll largely come down to your skills,
resources, and the level of competition. But to help you come to a more solid answer,
in general, I think it's worth starting as niche as possible with the intention to expand
and go broader. Here's a simple exercise. Think of your niche in a hierarchy
and where it fits. For example, you might want to go
after a niche about bed frame reviews. And within this niche, you can talk about the
best wooden bed frames, the best adjustable bed frames, the best bed frame for
people with king-sized beds and so on. And you can even go deeper and review specific
models of these products, adding another layer to your hierarchy. Now, a website with bed frame buyer's
guides isn't exactly a tiny niche. But it's also not huge. Meaning, you're eventually going to come
to a point where the hierarchy ends. So at minimum, I think it's good to be
able to build at least two levels down. But what's even more important is that you
have the potential to actually niche up. For example, bed frames fall into
the category of sleep products. And so do pillows, mattresses, and sheets. And each of these products can have
their own mini hierarchies of subtopics. And if you're able to successfully execute on each
sub-niche, you can create a super-authoritative website covering lots of topics that
are highly relevant to one another. Best of all, as you build your authority in
each of these niches, the next sub-niches you tackle will only grow faster because you'll
be building a stronger brand and website authority. So rather than asking yourself, "how niche
should I go?" you should ask yourself, can I expand my topic hierarchy by branching
out to related sub-niches? So take a look through your list of niches,
ask yourself these personal questions and you'll be well on your way to finding
and choosing a niche. More importantly, you'll have a better chance at
starting your online business on the right foot. Now, if you enjoyed this video, make sure to
like, share, and subscribe for more actionable marketing tutorials. I'll see you in the next one.
