Picking Winning Niches
There are good niche site ideas, and there are bad ones. Some niche sites are just never going to be effective – and sadly, they’re the ones that people pick the most. Making money. Building a lifestyle. Ten things to do in London. The sort of examples a guru gives you that in real life are massive authority projects, or ideas that are never going to make money like “Best paperclips online.” Put those out of your head and use the article I linked to so you can generate some ideas. Then we’ll move on.
There are good niche site ideas, and there are better ones.
What’s your niche site idea goal?
Your goal will determine what sort of niche site you build. If you’re building a general interest niche site that you’re happy to have earn no money whatsoever, then you can pretty much ignore this post.
If you want to earn a certain amount, then you have to choose wisely.
With the niche site challenge, I’m looking to build websites that have a $500 a month potential. That’s a very high figure as far as niche sites go. I know a couple of guys who have relatively passive niche sites that earn $1-2k a month, but those are a rarity. Most niche websites will make a lot less than that. $6k a year, or $500 a month is a strong income for a niche site.
This is one of the challenges I’m facing early on with the niche site challenge: You have to think ahead. There’s no point in writing a niche website for 99 cent e-books if I want my site to make $500 a month. Here’s the math:
- Amazon affiliate program: 10% (This is for ease of mathematics.)
- Price of product: $1 (Again, easy figures.)
- My commission per item: $0.1
- Target goal: $500 per month
- Sales needed to hit target: 5000
- Assuming a 1% Conversion Rate, Visitors Needed: 500,000
Nobody is running a niche website with half a million views per month. At least, if they are, I’m not aware of them. Besides, if you get half a million visitors per month, you should be earning a lot more than $500.
Let’s run the figures with a better product:
- Amazon Affiliate Program – same as above
- Goal – same as above
- Price of product: $100
- My commission per item: $10
- Number of sales needed to hit goal: 50
- Assuming a 1% conversion: 5000
Just by picking the right niche, we’ve increased our odds of succeeding massively. 5000 visitors is still quite a lot of visitors, but it’s not the unfathomable half-a-million viewers we needed in the last example.
Also, with a good niche site, we can get above 1% conversion rates. This brings us back around to picking a niche site winner.
Picking A Winning Niche
I know I’ve written about these things before, so I’ll keep this part brief. To pick a winning niche, you need three things:
- High ticket products that cost enough for you to make a commission
- A big enough market for sales
- A good affiliate program.
I’ll add a fourth thing to that, which is relatively low competition. I’m not so bothered by this, but it’s always better to have an unsaturated market than a saturated one, providing the above three things are present (in most markets with no apparent competition, one of those things will be missing. Watch out.)
The Importance Of Picking A Winning Niche
You might think that $6000 a year is a lot of money. I think it is when it comes to passive – or mostly passive – income. The way I’ve planned things for now, I’ll be writing maybe twenty-to-thirty sales letters for each niche site and perhaps even less. That’s about twenty hours work per year, add in the how-to articles, the site design and other stuff, and we’ll double the time commitment. That $6k return still looks very good.
However, six thousand dollars isn’t enough to live off. That’s why the niche site challenge is a part-time project: You’re going to be doing something else for the majority of your time. Picking a losing niche is fifty hours or more that you’ve wasted.
If you pick a niche in which you’re only going to make $10 a month, then that fifty hours or so of work you’ll do on the site is not so great a time investment.
If you’re planning on something less realistic like the niche site challenge where you have twenty-eight sites to start, then you really don’t have time to pick duds. If you want to pick twenty-eight and succeed with all twenty-eight, then you really have to do the work upfront in order to make sure your niches are good before you start.
Final Thoughts
The challenge has started. I’ve found some niches which I think are going to be good. On Day One, I’ve spent about an hour and a half finding some niches, doing some preliminary keyword research (i.e. basically putting the niches into a keyword tool and making sure they’ve got searches) and writing down some products to review. Tomorrow, I’ll probably check the keywords for the products to make sure they get searches. That’s less crucial than the overall niche numbers, but it’ll be nice if I can get some long-tail searches for just the product names.
Anyway, day one done and that’s how I’ve picked my niche site topics so far.