How To Pick A Profitable Niche
If your goal is to start a lifestyle business so you can eventually quit your day job, then picking a profitable niche should be high up on your list of important things to do.
This is because not all passion-based businesses have customers who'll pay for solutions to their problems. So, to avoid months of chasing a market that doesn't want or need your products or services, a little research beforehand will let you know that you're heading in the right direction.
The following post will provide you with a few simple steps for selecting a profitable niche that you can be passionate about.
What Is A Niche?
All markets can be further divided into smaller market segments with specific interests and demographics, which are called niches, target audiences or market segments.
A niche consists of a group of people who have been identified as having similar problems, similar interests or similar traits; and a range of products and services is then focused on meeting the specific needs of the audience.
Put simply, a niche is a highly targeted segment of a market; and it's the arena where new and small online entrepreneurs have the best chance of succeeding online.
A niche market can be comprised of:
- A demographic group (gender, age, location, education, income, etc)
- A psychographic group (activities, interests, opinions, etc)
- Particular needs (specific problems, etc)
A niche is best served by identifying a set of core issues that your audience is facing so you can provide targeted solutions through your products, services and content creation.
In short, the role of a lifestyle entrepreneur is to serve your niche, helping your audience solve their problems while providing the best online experience as possible.
Finding The Balance Between Passion & Profit
The idea behind following your 'passion' is that you're more likely to stay motivated during the inevitable ups and downs of building your online business.
Passion can mean something you're interested in, something you're knowledgeable about or an activity you enjoy participating in. Passion can also translate into a problem area in your life that you have a unique perspective on.
So, how do you find the balance between your passion and a profitable niche?
Use the simple steps below to get started...
Step 1 – Identify Your Passion
To identify your passion, start by asking yourself: What topic do I want to focus on creating the best content for?
The easiest way to find a topic you're passionate about is by “scratching your own itch.” Make the decision to become an expert on the thing that frustrates, inspires, or occupies you the most. Go deep into your topic, and focus on finding an audience to serve with your passion.
Once you've identified a topic you're passionate about, it's time to do some research...
Step 2 – Does Your Passion Have Income Earning Potential?
To find out if your passion has income earning potential, you need to investigate if there's an audience (or niche) that will be interested in your business venture. Some quick research online will give you enough information to establish the following...
Is Money Being Spent Online?
All you're looking for is proof that other entrepreneurs are making money in your niche. To easily find this proof, do a Google search on your passion and review all of the top websites that come up in your search results.
Here's what you're looking for:
- Paid Advertising on the Google Search Results Page (advertisers are paying money to get traffic to their websites in this niche)
- Advertisements on the blog (the website owner is making money from ad clicks in this niche)
- Products being sold (the website owner is making money from product sales in this niche)
- Membership sites (the website owner is making recurring monthly income in this niche)
Links to Amazon, Clickbank or other affiliate websites (the website owner is making money from affiliate marketing commissions in this niche)
If your research yields checkmarks in the majority of the items listed above, it's safe to say there's an audience online who you can target with your online business.
Step 3 – Starting Your Lifestyle Business
Now that you know your passion has income earning potential, it's time to focus on creating an audience and monetizing your solutions.
This phase of your business will take time to become fully functional as you find your voice, gain your expertise, and build your audience's trust. With time, consistency and a dedication to serving your audience, your lifestyle business will grow solid roots in your niche – and this is when your ability to earn a living online becomes a reality.
So, it's time to build your audience around your passion and connect them with the solutions they need.
Here's how to get started...
Does Your Niche Have Passions Or Problems?
You need to identify what type of niche you're entering so you can monetize your solutions.
What you're trying to establish in this phase is whether your audience is avoiding pain or seeking pleasure. This information will be vital to creating content and promoting solutions that fit your audience's needs.
Identify which category is dominant in your target audience:
This group of people have issues or problems in their lives and they're urgently seeking solutions. These people are trying to avoid some sort of pain – financial, spiritual, physical, emotional, etc.
The solutions that you provide to this group of people must help them move away from their pain and closer to their desired state.
This group of people are very passionate about a particular topic or activity and get great pleasure from doing it. These people are seeking pleasure – recipes, retreats, lifestyle, video games, etc - and they're willing to invest their time and money on their passion because it makes them feel good.
The solutions that you provide to this group of people must help them move closer to their pleasure and assist with expanding their passion.
The Business of Passions & Problems
Taken together, your goal is to discover the recurring themes that are important to your audience so you can deliver the best solutions.
To find the recurring themes in your niche, conduct a Google search on your 'passion' and start taking note of what's important to the people in this audience by scanning the blog posts, comments and advertisements.
While you're on your competitors' websites, you should also assess what you like, don't like, and what you can do differently or better – this information will help you stand out from the crowd.
Keep in mind, your research doesn't end with a Google search, it's actually just the beginning. As you dive deeper into your niche, you'll use social media groups, forums, magazines and everyday conversations to discover new ways of delivering value to your audience.
When you're able to truly understand your audience's problems, challenges, pain points, aspirations, and desires, you'll be able to deliver content, products and services that speak directly to your audience. By doing so, a new world of profitable opportunities will constantly open up to you.
Are There Products You Can Promote As An Affiliate?
The quickest way to make money in a niche is through affiliate marketing. With affiliate marketing, you earn commissions promoting other people's products and services right away.
Use the affiliate networks listed below to see if there's a range of products or services you can promote to your niche.
Remember - everything that you say and do through your online business should be aimed at helping your audience get what they want – solutions to their problems.
With this in mind, look for affiliate products that will deliver value to your audience so they can get where they want to be in their lives.
Here are the affiliate networks that I have personally used. They're easy to sign-up for and offer a range of solutions for a wide variety of niches:
Investigate the products and sign-up as an affiliate if you see any products and services that you would use yourself.
Using Your Passion To Create A Profitable Lifestyle Business
Whenever you start a business, it's necessary to do some preliminary research on your industry so you have a good grasp of the territory you're about to enter.
Do the research, and commit to connecting the dots between your passion, your audience and what your audience values. And when you have a good understanding of what your audience wants - go for it!
It's the only way to truly know that you're on the right path.
Wrapping Things Up
When you're following your passion, sometimes there'll be a clear answer staring you right in the face, and other times you'll just have to follow your gut instinct.
Whatever path you choose, if your goal is to serve your audience with the best content, products and solutions you can provide, you will create value – and your income will be a direct result of the value you provide to your audience.
So, identify your passion and find a niche to target - and when you strike a balance between your passion and profit, your lifestyle business will really on a roll.
Do you have any insights for selecting a profitable niche? Please share your wisdom and tips...