Tips and Tricks to Successful Niche Selection – Part 1

In this three-part guide you’ll be introduced to several niche selection techniques that you can use to find profitable products to sell. In Part 1 we will review what makes a good niche and then explain the details of how to find a profitable niche. In Part 2 we will review some powerful tips on how to refine your list, so you can pick out the best products and begin to narrow you’re your list. In Part 3 we go over how you can verify that your product ideas will actually sell. You will find that once you are done implementing the steps outlined in these three posts, you will have found a number of products that you could sell for a profit.

A Summary of the Niche Selection Process

None of the tips outlined below are difficult but they do require patience and a little hard work. The niche selection process starts with goal setting. This is because before you start this process, it’s a good idea to let goals guide your decisions. The planning process becomes much easier when you know what you are trying to achieve.

Once your goals are clear, you’ll then begin brainstorming to generate a lot of great product ideas. When you’re done brainstorming, you’ll begin to refine your list and evaluating them to make sure that your products will actually sell. This process will be made easier with the help of some useful and powerful third-party tools that you’ll learn about in this three-part series.

During this process, it’s easy to get lost in the weeds. To get you back to reality, we’ll list some important common-sense questions to help you look at the big picture to ensure that you’re still headed in the right direction.

There’s no magic bullet in niche selection so make sure to allow your interests and passions to guide you while you take a systematic and data driven approach to selecting your chosen niche. After all, you want to sell something that you find interesting.

Tips and Tricks to Successful Niche Selection

Proper niche selection is important if you want to create a successful business. You want a niche that can deliver sustainable profits for the long term. A profitable niche is important in any business model, whether you plan to sell your own private label products, or you plan to drop ship everything. While there are a million ways to find a profitable niche, in this post we’ll review some of the most effective ways to discover the best products to sell.

Before we begin I’d like to set your expectations about the niche selection process. Let me be the first to say that this is easier said than done. The tips that are outlined in this document won’t pick your products for you. That will be your job. You will need to use some creativity and critical thinking to uncover the best products to sell. Niche selection will require you to do a lot of focused research, have patience and commit to making decisions based on data rather than emotions. If you do these things you will be successful.

What Makes a Good Niche

Ideally, a good niche has the following characteristics:

• Products that are in demand
• Low competition
• Healthy margins
• Sells year-round and is not seasonal

These four characteristics may seem obvious enough but finding products that satisfy all four points may be harder than you may think. However, this task will become much easier if you follow the techniques outlined below.

How to Find a Good Niche

How do we possibly go about finding products that have high demand, low competition, healthy margins and that you can sell the entire year? You just have to approach the challenge in a systematic way. A good place to start is to review your goals to see how much money you’re looking to make before you embark on this process. When you start with the end in mind, you’ll have a better idea of the road ahead. Getting a good sense of your goals will put you in a better position to start brainstorming so you can generate a few ideas and get your creative juices flowing.

Letting Your Goals Guide Your Decisions

One of the best ways to start the niche selection process is to start with the end in mind. In other words, think about the goals that you’re trying to achieve and work your way back. Ask yourself, how much profit would you like to get at the end of every month. Will you need just a few thousand dollars just to help pay some bills or will you need to generate several thousand dollars to expand your business? One of the simplest ways to determine your profit goals is to conduct the “10 x 10 x 30” calculation that many online retailers talk about these days.

The 10 x 10 x 30 Strategy

This strategy basically goes like this. Imagine that you have found a product that will give you $10 net profit after you pay all fees and costs. If you’re able to sell just 10 pieces of that product per day, then you’ll earn $100 in profit every day. If you do this for 30 days per month, then that product will make you $3000 profit per month. Not bad if you’re just trying to make a little extra cash. This is easier said than done but it doesn’t necessarily have to be that difficult to achieve either.

Therefore, depending on your profit goals, all you need to do is ramp this up to reach whatever profit number you have in mind. For example, if your goal is to reach $15,000 profit a month, then you’ll need to find 5 products that follow the 10 x 10 x 30 strategy.

Also, it goes without saying that these are just averages so if you find a product that gives you $50 profit per order, then you just have to adjust the math. The point is that if you’re just looking to make a little extra money, you don’t need to search the earth to find a good product. You can narrow your list to the products that follow the 10 x 10 x 30 strategy. On the other hand, if your profit goals are much higher, then you’ll need to adjust your math and look for products that will get you to your goal more realistically. At least with this strategy you can narrow down your search, so you can conduct your research more efficiently.

How to Brainstorm to Find GOOD Product Ideas

The next step after goal setting in the niche selection process is to begin brainstorming some product ideas. At this stage there are no bad ideas. Don’t limit yourself when you brainstorm because a crazy idea can often spark a new and practical idea down the line.

Start by making a list – again, there are no bad ideas at this point. Here are some good ways to generate ideas:

• The Daily Touch List: For 24 hours write down everything you touch.
• Browse eBay: Browse eBay in different categories and write down anything that jumps out at you.
• Amazon Best Sellers List: Browse the Amazon Best Seller List to see what’s currently hot.
• Popular Shopping Sites: Browse QVC, HSN and other popular websites for ideas. Look to see what they are currently featuring to see what’s selling well.
• Infomercials: Watch late night infomercials to see if there are any wiz-bang gadgets that interest you.
• Solve People’s Problems: Listen to conversations and pick up ideas from people’s passions, hobbies, problems and struggles. Think about how to solve these problems for people.
• Look Within: Write your own list of passions, hobbies and problems. Ask yourself, what problems did you have to solve in the last three months? Where there any products or services that you used to address these issues?

At this point, just keep writing down ideas from eBay, QVC, HSN and the Amazon Best Sellers list. The more the better. It’s a good idea to begin to categorize your ideas to see if you can find any themes or related products. Take a step back and see if you can look at the big picture to see if any big ideas jump out at you. Once you feel that you’ve done an adequate amount of brainstorming and you’ve found the categories that you like, it is time to begin to refine your list. This is what we will go over in Part 2 where you’ll be introduced to a number of effective techniques to analyze your list by using the power of Amazon’s data to profit for yourself.

Conclusion

In this guide we went over a number of powerful niche selection techniques. We reviewed what makes a good niche and then we explained the details of how to find a good niche. We started this process by letting our goals guide out decisions. The planning process becomes much easier when you know what you are trying to achieve.

Once your goals are clear it helps to brainstorm so you generate a lot of great product ideas. This is the time where you let your ideas flow, so you don’t limit your creativity. After brainstorming you begin to refine your list by using the tips outlined in Part 2. Refining your list will allow you to narrow things down so you can begin to verify that your product ideas will actually sell. Product verification is what we will cover in Part 3 because all your work and money will be wasted if you don’t find products with a good chance to sell.

As you travel down this journey, it’s easy to get lost in the weeds. Don’t be afraid to pause along the way to evaluate your progress. Remember, there’s no magic bullet in niche selection so taking a systematic and data driven approach will help you significantly increase your chances of success. At the same time, don’t forget to allow your interests and passions guide you. At the end of the day, you’ll want to sell something that interests you and you believe in.

Now, let’s move on to Part 2.

Business Consulting Services: If you’re a small business owner looking to start or improve an online business then let me show you how to benefit from my experience. I have helped several online resellers grow their businesses by developing an online strategy to sell on Amazon, eBay or any other marketplace. Call me at 310-574-2541 or email me at Pez@Pezlogic.com for a complimentary business review.