Researching A Niche For Profitability
As you begin researching a niche there are obviously different things that you must consider such as checking whether there are enough searches for the niche and whether the level of competition is is something that beatable. While researching a niche you should take some extra time to see how profitable it will be for you by looking at what kind of products you can promote, a.k.a Affiliate Marketing.
I usually recommend two options here, the first is Clickbank digital products and the second is Amazon. These sites perfectly complement one another because Clickbank lets you sell information products and earn commission and Amazon lets you earn commission on physical products. What’s more is that both sites give you an insight to how well products sell and how profitable they can be.
It’s always worthwhile checking Clickbank because they often have products that you can promote that are $37 or more and let you earn as much as 75% commission – just a single sale a day can give you a significant income boost. What you need to look for on a Clickbank product is a high gravity. This number basically means how well it is selling in comparison to other products in its category and can help you choose the best converting product to promote – ie. A product with a higher gravity is selling more than one with a lower gravity.
If you are considering a niche and find that the relevant Clickbank products don’t have a high gravity this could be a warning sign that the niche is not profitable enough.
Once you’ve found a product on Clickbank you should look at Amazon for physical products that might be available. The great thing about Amazon is that they give you some very useful insights, even though you might not realize it at first. They tell you the sales rank of the product within the category it is in, so it helps you to choose just the best (read: proven) sellers to feature on your site. You will want to sort the products by the best sellers too as there is no point sending traffic to a product that doesn’t sell as well as another product – it’s just a waste!
The second bit of invaluable information you get given is “how many people buy this product after viewing this page”. This statistic is a goldmine for affiliates because it tells us exactly what percentage of people will buy this product if we send visitors to this page. There is a hot topic of discussion in many Internet marketing forums on what kind of percentages you should look for, but the middle ground seems to be 70%.
To put this in to perspective, if you send 100 visitors to a listing, you can expect 70% of them to buy that product, although in reality this number will be much lower as Amazon has a 24 hour cookie and many people will probably come back at a later date to buy the product.
Again this is only one method that you can use while researching a niche to give you an extra insight in the profitability that the market segment holds.
Cemil Ozcelik
www.OnlineBusinessBlackbook.com © 2009 - 2010
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{ 6 comments… read them below or add one }
Hi Cemil,
I find that researching a niche and trying to determine whether it will be profitable or not is one of the hardest things to do. It’s all about choosing the right niche and finding the best product to market in that niche.
Thanks for the great tips on Clickbank and Amazon. I’ll certainly give them a go.
What a great way of researching a niche. You are right – so much can be learned by going to Clickbank and Amazon. By the way, I didn’t know Amazon’s cookie only lasted 24 hours! Thanks for post.
It was a move that they put in place some time ago. I believe at the time there was plenty of social commentary on the matter, however I don’t think that it has diminished the Amazon Affiliate program to badly.
Some useful tips Cemil. I remember seeing some of those figures on Amazon years ago, and they seem like great indicators of potential conversion rate. It also seems that Amazon could be helpful in identifying complementary products to promote.
One other great thing about ClickBank is that there are third party data aggregator sites that can help drill down into some of the data on ClickBank products. For example: http://cb-analytics.com/ and http://www.cbengine.com/
Hi Tom,
Great tips on the aggregator sites – these are definitely worth checking out.
Hi Cemil,
I find your tips very helpful however since I’m not a big Affiliate Marketing fan, I might have to skip that idea of marketing but what concerns me that much is the timeless profitability of a chosen niche based on your analogies from both networks.
I think some niches that might be selling like pancakes today may not sell tomorrow or in the near future while some niches that are hard to get into has a better chance of staying for good.