Philip Kotler described niche marketing in terms of prerequisites. He said that businesses looking to exploit a niche must ensure:

1.That there is a clearly defined need.
2.That the niche is potentially big enough to be profitable.
3.That the niche lacks any real competition.
4.That the niche has potential for growth.
5.That the target market has money to spend.
6.That you have the potential to dominate the niche.

The above prerequisites were specifically quoted for offline business but the main principles remain the same. In terms of competition you should be looking as a minimum to be on the first page of Google for your chosen keywords, anything less will simply not be profitable.

Keywords

When targeting a niche market it is important to understand which keywords you will be focusing on to drive the majority of your traffic. The keywords you select should be buying keywords, and not general browsing terms – they should be focused and exact. While the general terms can generate huge amounts of searches, they will be the most difficult to rank for and convert a smaller percentage than more targeted search terms.

Lets look at an example:

You have chosen to promote products in the 3D TV niche, and are looking for relevant keywords to ensure you can compete within this evolving market. The Google Keyword Tool shows the following data relevant to the niche and product you are potentially going to promote.

3D TV: 201,000 exact searches per month
Samsung 3D TV: 40,500exact searches per month
LE40C750: 18,100 exact searches per month

You will see that browser keywords typically will send you A LOT more traffic; however, they’re not only much harder to rank for, but won’t make you anywhere near as many sales as a “buyer” keyword like “le40c750”. In addition the optimization of your website for these long tail keywords will still contribute to your websites ranking for the short tail keywords.

Analyzing competition

When considering your competition the size of the organizations you are competing against plays a lesser role than you may expect when trying to compete in the offline world. In niche marketing the main aim is to rank in the organic SERP’s. If you can read and understand your competitions SEO efforts when looking at their overall strategy (especially with regards to the keywords you are looking to target) you will begin to fully appreciate whether the opportunity for you to dominate is there.

SEO specialists argue constantly about which SEO factors matter and which do not; I look at the basic level indicators, which will at the very least provide me with an idea as to how much understanding my competition has of these factors, and whether my competition is targeting my keywords specifically or whether they are their to make up the numbers. The main factors I consider are:

Domain

Does the ranking page contain your target keyword in the domain name?

While a keyword rich domain will not  ensure you remain top of the results an exact domain definitely gives you an advantage. How would other websites link to a site called LE40C750.com, compared to generaltvreviews.com?

Title

Does the ranking page for your target keyword contain the keyword in the page title?

This is arguably the most important meta data to  get right- this will tell the search engines and visitors exactly what your website is about, and form the basis of all content, descriptions & SEO to follow.

Keyword Meta Tags

Does the ranking page contain the keyword in its meta keyword tags?

It is thought that the keyword meta data does little to improve your ranking for your chosen keywords amongst the modern day search engines, however i still use these and it can provide great insight into whether your competition are specifically targeting the keywords you are currently researching.

Description Meta Tags

Does the ranking page contain the target keyword in its description meta tags?

Meta description tags can have a great effect on your company. Despite having no impact on rankings directly (debatable), they benefit you in a wider marketing context.  Meta descriptions will be the first piece of information that an online searcher will see when they search for something that your business has to offer, and when you are competing with thousands of other companies for attention. They are effectively acting as an advert for your company, and should be approached with the appropriate level of importance.

H1 Titles

Does the ranking page have an H1 title on the page using the target keyword?

H2 Titles

Does the ranking page have an H2 title on the page using the target keyword?

Yahoo Backlinks & Anchor Text

Consider your competitors backlinks. Use the yahoo backlink function (site:www.yourdomainname.com) and analyze what links they have, and what their anchor text is. If your domain is LE40C750.com and your competitors are not targeting this term within their backlink anchor text you may be on to a winner.

By monitoring your competitors backlinks you can dissect a lot of their overall SEO strategy. Consider where these links are coming from and why, also consider whether you can obtain links of a similar or better standard.

Page Rank

Pagerank is dead! But it can still be a good way of determining which sites have authority, and how much.

Many sites with low PR can still rank well in SERP’s, but if your niche is consumed by PR3+ sites maybe reconsider.

ALT Tags

ALT tags can help your quest to rank for your chosen keywords, and many do not use these to there full capability.

Do your competitors use the ALT tags? And if so, do they use them so they are targeting their keywords? I believe good uses of these tags to be something along the lines of [alt="keyword-image"] – while this may not be the correct use of this tag, it will certainly help you target your keywords more effectively.

SEO specialists will express their disbelief that I am summarizing there whole industry into 7 factors. Let me assure them I am not; I use these factors to understand the strength of my competition only. If all ten websites on the first page of Google are using these to their full potential I would probably move onto another niche idea, and if the top two pages were I definitely would.

What is a niche market?

A niche is simply a segment of a larger market. There are certain advantages that come from targeting a niche market rather than a wider audience when considering possible affiliate marketing projects. Concentrating on a niche market enables you to offer those with only an interest in that particular subject, product, or service a more in depth analysis of the subject than a larger firm would be able to provide, which in turn creates a great opportunity for you to compete with the larger companies.

Just because you target niche markets does not mean you are small fry, larger organisations can sometimes also target niches of a larger market; The concept of niche marketing can be well understood by the following example: A number of television channels cater to the need of a particular niche; for example, sports channels like Sky Sports, ESPN, STAR Cricket, target a niche of sports lovers.

The best niche to enter is always one that you have an interest in, and this is especially true if you plan to build a popular content based website. If you are creating an affiliate store or comparison website you can afford to take little steps into the unknown, but an active interest will ensure you remain attentive for the long term.

Affiliate Niche Research

Niche research is a bit of an ambiguous term that I believe sometimes confuses those new to affiliate marketing; and can mean anything from the initial finding of a niche to the determination of whether a specific market will be profitable. In reality what is termed as niche research is nothing short of due diligence.

As an affiliate marketer your most precious commodity is your time, and you will want to ensure that for this time you will be compensated accordingly. It is therefore important to select the correct market; by ensuring that there is an interest in the product or service, by understanding what competition you will be up against, and by ensuring there are adequate merchants to promote. When you have concluded that the above market conditions are right you are ready to consider entering the market.

Finding An Affiliate Marketing Niche

If like me you start your niche research from a totally blank canvas, and have no specific market in mind then there are a number of ways to engage with the population and sometimes even pre-empt the next big craze, fashion accessory, or computer gadget. There are also many untapped mature markets available if you look hard enough.

Newspapers & Magazines

Newspapers and magazines offer a good way to engage with both the general population and those with specific interests, they can also help signal the beginning of major trends. Advertisements within these magazines and newspapers can also provide good insight into profitable markets by companies that have already done the ground work.

Trend Blogs

There are a number of blogs dedicated to monitoring exactly what you are looking for, it is a good idea to sign up to their RSS feeds and ensure that you are the first to read (and act upon) their trending information. Much of the information offered is not specific to the internet but can help you keep that vital step ahead of your competition. Many of these blogs offer both basic information and a premium area. Check out these blogs for some great trending information:

Trend Hunter – This is a trend blog based in Toronto Canada, they boast over 31million page views per month and claim to be the world most popular trend community. Trend Hunter Pro offers over 91,000 micro trends.

Springwise – These trend seekers claim to scan the globe for business venture ideas that are ready for regional or international adaptation. Springwise have a network of over 8,000 trend spotters in over 70 countries worldwide.

Trend Watching – This is the website of an independent trend researching firm with hundreds of spotters in over 120 countries. The company offers a great free monthly trend briefing.

Squidoo

Squidoo is a content site that many underrate in terms of aiding your market research, however it provides a very useful insight into what is currently popular, and what people are searching for online. The Squidoo homepage acts as a directory of their most read (and most searched for) lenses, which can provide some very surprising results. I certainly didn’t know that that that many people were interested in finding out how to marry a millionaire!

Shopping.com Consumer Demand Index

Now this is a neat trick that will help you take advantage of real hard data taken from true consumers. This is best used to promote either an individual product type or a genre of product. With the Shopping.com Consumer Demand Index we can view the most searched for products in any specific category; from this list you can not only determine a suitable type of product or product genre, but you can also run the keywords (as listed) through Gtrends and establish if the market is worth going after.

MySimon.com

MySimon, a comparative shopping website, offers a great page for finding affiliate marketing niches on its Top Searches page. Click on any category and start browsing down the list of keyword niche ideas. This tool is very similar to Shopping.com’s top searches page and is equally useful for finding niche marketing ideas.

Ezinearticles (or similar)

Ezinearticles.com and other online article directories can provide some great ideas, but you really need a method for interpreting the data; many of the articles on these sites are never read so it can be difficult to determine which articles (if any) receive a good amount of traffic and are of genuine interest to their chosen target audience. I have a great trick that can help you sort the great ideas for a niche from the poor.

Copy and paste the following into Googles search bar.

site:ezinearticles.com “This article has been viewed 1000..100000″”Article Submitted on:” “.2010

This will show you all the top articles so you know what is hot. Obviously you can change the numbers.

While niche research may sound like an exact science it is certainly not, even the most successful affiliate marketers crash and burn on occasion. I spend days if not weeks deciding on a the right topic that is going to take up so much of my life from then on. Many of my best ideas have come from throw away comments made by strangers, drunken conversations with friends, and even dreams (unfortunately this is a side effect of affiliate marketing).

Is There An Interest In Your Niche?

When you have found a niche idea that you believe has potential it is time to ensure that there is an active interest for the topic, and that the active interest extends to the web. At this point you must try to keep an open mind as your niche may still fall flat; this will happen if during further research we find that there is not an interest, there is an interest but the competition is too strong, or the merchants available are not relevant, below standard, or provide a commission rate that will be difficult to profit from.

There are a number of free ways to ensure that there is an active interest in your topic, product or service that will ensure you will have an audience that will buy your products.

Blogs & Forums

It is a very good idea to use Google to find out if there are any ‘very’ active blogs and Forums discussing your niche. This will not only prove that people are interested in your proposed topic but also show that people are passionate about it. If you intend to be marketing a product or service this will ensure that your niche caters to a need and give hints as to whether they are active buyers.

Google keyword tool

While all to often people criticise this keyword tool, it makes sense that it is the best most accurate tool available – after all if Google doesn’t have the data, nobody does! Using this tool will give you an idea as to the volume of traffic your proposed keywords will potentially attract.

You can find the tool here.

I find it best to change the mode from broad to exact match to ensure you are only considering potential readers or buyers that are absolutely certain about what they are looking for- this is in my mind even more important if you are planning using a strong keyword rich domain (although your domain may not have yet been considered).

When considering interest in terms of traffic (which is basically what you are doing with the Google keyword tool) it is worth remembering that even in first position you will not receive the full amount of visitors that the tool gives you. There has been much research done on the topic and as a rule of thumb I would consider the values listed to the right illustrating the percentage of searchers that visit your site dependent on your first page position (although these will vary from market to market).

If your main search term can be profitable in its own right, the market will certainly be big enough when considering other keywords and longtail variations.

EzineArticles

To expand on the trick mentioned above, you can add a keyword to the beginning of your search string to find out if there are popular articles for your niche.

DIET site:ezinearticles.com “This article has been viewed 1000..100000″”Article Submitted on:” “.2010

Conclusion

No method of choosing a niche market or estimating potential traffic will be infallible, therefore you can only assure yourself that the signs are good and that you have done everything within your power to ensure you have researched properly. Although I have provided methods, these are merely suggestions for you to build on. It is important that for your successes you can take all the credit, but also important that for your failures you understand what went wrong, so you can improve on it next time.

I hope this article has been informative and has provided you with some insight into ways you can use the web to both find niche markets and determine interest in these niches. Please join me next Wednesday when I will be covering how to accurately research your competition, and determine whether your niche has the potential to be profitable.