How to Find a Profitable Micro-Niche to Market Online
This is an article based on a similar article I wrote about traffic conversion in 2009. Using proven, repeatable techniques there is little risk and great rewards involved in blogging for profit. Peter Drucker in Innovation and Entrepreneurship: Practice and Principles writes, “Entrepreneurship, it is commonly believed, is enourmously risky…[but]…entrepreneurship should be the least risky rather than the most risky course,” because of how entrepreneurship, “by definition, shifts resources from areas of low productivity and yield to areas of higher productivity and yield.” Much work has already been done for us in the form of innovating processes and software tools, which eliminates risk. There are two key phases to the process:
- Research and Analysis – Identify a micro-niche inside a penetrable market that has profitable products that people are already selling.
- Marketing and Testing – Promote the products and test the results. If the traffic and/or conversions do not meet thresholds in a given time, start over.
The rate of success with this method is anywhere between 1 in 6 to 1 in 10 and marketing and testing can take anywhere from 1 to 30 days. Success is defined as more money coming in than is going out each month and that includes all opportunity costs (time that could have been spent making money in other activities). Tracking is critical not only with the data of the results, but with the finances and time spent.
Rules and Metrics of Phase 1 – Research and Analysis
According to The Thirty Day Challenge (now called simply, “The Challenge“) micro-niches are identified as the #1 keyword receiving at least 80 clicks per day and websites containing that keyword being less than 30,000 globally. At least 3 keywords other keywords within the micro-niche with similar criteria must also be identified, if not, start over.
The top 10 search results for the top 4 keywords has to be penetrable within the time allowed. Metrics to consider are:
Test 1: If the competition has a young domain age, a low number of back-links, and does not exist in any of these directories, then the market is penetrable. If the opposite is true, stop and start over.
Test 2: Check to see that related products are both available to be sold and are being sold by others. If either is not true, stop and start over.
If both of those tests pass, then make sure the products are giving a referral amount that you deem acceptable. If not, stop and start over. You now have products in a penetrable micro-niche that are profitable to sell. Move on to Phase II – Marketing and Testing.
Phase II – Marketing and Testing
Begin by setting up a place to place your products. This is where your marketing efforts will point back to. It can be a Squidoo page, a Blogspot Blog, or WordPress running on your own domain. If you are using Blogspot or WordPress, install Google Analytics to track traffic. If using Squidoo, there are tracking mechanisms built into the site. Once you have a place to put your products, begin writing copy (content) for the site. You will need to write the following:
- Ad copy for the products – if using Market Samurai, there are built-in features for helping with this, but you can do it manually too.
- Create posts (or pages) about the keyword subject matter within the micro-niche.
- Next, begin to create backlinks to your site by placing links to the domain, the blog posts, and the the product pages on social bookmarking, social media, and in blog comments in your related market. Be sure to add links from .edu and .gov domains. You can search Google specifically for blogs on those domains manually, but you can do this semi-automatically with Market Samurai too.
Track the incoming page hits on Google Analytics. Testing for viability can begin only after your product’s page is receiving at least 200 hits per day. If you are not getting 200 hits per day, then try these things first:
- Increase the number of blog posts on and off the site using other services like hubpages and squidoo – then promote all of the new posts again.
- Make sure you are promoting on at least 30 different sites for each post – you can use services like ping.fm or trafficbug to assist with this task.
- Pay to have your site listed in the Yahoo! Directory.
- Pay for Google Adwords or Bing (Microsoft) AdCenter.
- Add pictures with descriptive text to get hits from search engine’s image searches like Google Image search.
- Add video to Youtube with links and comment on other videos in your micro-niche.
- Make sure you are posting to Twitter and Facebook regularly and engaging in conversation, not just promoting.
If after 30 days or at your own set threshold, you are still not receiving 200 hits or more per day, your product is not viable. Quit and start over. You have just found one of your 6 to 10 failures. If you do have over 200 hits per day, but are not getting conversions, first try changing out your ad copy, images of the products, and/or placement of the two on the page. Refer to Dan Kennedy’s sales letter technique. If after changing all three of these variables and still your revenue is below your expenses, then start over. If not, you have a profitable business. Consider selling it for ten times it’s worth and starting over using Flippa.