This article explains how to select a profitable niche for your membership business.
First - Look for Fanatics
The first step in developing a profitable membership business is to find a market with fanatics in it. What's a fanatic? It's someone who is so excited about a certain topic that they will spend their time and money on information about it. Now that we know what we're looking for, let's talk about how to find them...
- Look at magazine racks. This is an often overlooked, yet extremely simple way to find niches that people are interested in. It's becoming increasingly difficult to run a print magazine. So if you see one on the shelves you know they are making money, which means that there are enough people interested in what they're saying to make it profitable. That doesn't mean definitely that it will make a good membership business, but it's a good starting point.
- Watch and listen for fanatics in your daily life. Pay attention to conversations, social events, TV, restaurants, public places to see what people are talking about. If people are talking about it, they are interested in it. Which means you can start a membership business providing information on it.
- Don't forget about clubs and organizations. If there are enough people to to build a club, there are certainly enough people to start a membership site on the same topic. By the same token, if enough people are interested to hold a convention on a certain topic, you can definitely find enough people to build a membership business around that same topic.
- What about your interests and hobbies? Chances are that if you like a certain topic or hobby, other people do, too. Making money is fun and it's even more fun if you can do it in a niche you're excited about.
- One simple and easy way to find out what's hot is Google Trends. Google Trends tells you the most popular current search terms. These topics are the hottest topics because lots and lots of people want information about them. Hot topics that people are excited about make great niches for your membership website.
Next - Figure out if there's money in it
Once you found a potential niche or topic to center your membership site around, you need to figure out if you can actually make any money in it. The quickest way to find out is to determine if others are profiting in your potential niche.
Here's a punch list for figuring out if anyone's making money in your niche:
- First go to Google and type in the name of your niche followed by "blog" and "forum". If there are blogs and forums related to it, that's a good sign. This tells you there are people who are actively interested in your niche.
- Check Amazon, eBay and Google Shopping to find out if others are making and selling products in your niche. What you're trying to figure out is if anyone is making money in this niche, and if people are selling products it means they are making money.
- Watch Google Adwords for a period of time and look for ads the run again and again. Adwords ads are expensive, so people only run them repeatedly if they are profitable. And to be profitable, they have to be selling products and making money.
Finally - Figure out your barrier to entry
OK, so you found a hot topic and you know other people are making money on it. Will you be able to get involved and do the same? How do you gauge the ease of entry?
- Product types. What kind of products are being sold in the niche? You're looking for a niche that sells info products. The easiest membership website to create and maintain are information membership sites.
- Competition. How many other people are trying to sell to this market? You want to start in a market that's not completely saturated with competitors.
- Unless the market is just so big that it doesn't matter how many competitors there are, you want to limit the competition. So evaluate the size vs. the competition.
- How quickly do people in this market make buying decisions and are the ready to buy? Some niches are made up of people who require lots information and have a very long lead time, and some markets are filled with people who will spend lots of money right now.
At this point you've figured out what niche you're going into. You found your fanatics, you know they spend money and you're confident there's room in the market for you. If you've followed along with these steps you're success in practically guaranteed. The only thing left to cover is exactly how to run your membership business...