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Membership Niche Selection Tips03 September 2011

This article explains how to select a profitable niche for your membership business.

First - Look for Fanatics

The number 1 thing you have to do is find fanatics if you want a profitable membership website. 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. OK, so we know what a fanatic is, but how do we find them?

One simple idea that's easily forgotten is to scan the magazine racks when you're out and about. Because it's becoming harder and harder to keep print periodicals profitable these days, if you see a magazine on the shelves, you know it's making money. And that means there are lots of people interested in it. This is a very good indication that it's a good niche for you to go into.
Pay attention throughout the day in your regular activities. See what people are talking about on the radio, TV, at parties, in public, etc. If people are talking about it, they are interested in it. And that may also mean they're willing to pay money to learn more about it.
Again, looking in the physical world for clues you can tell there are lots of people interested in something if there are clubs and organizations around the topic. Likewise, if there are enough people to hold a convention, there are definitely enough people to fill your membership website.
What about your interests and hobbies? Chances are that if you like a certain topic or hobby, other people do, too. And, as an added bonus, it's much more fun to build a business around things you're interested in.
One simple and easy way to find out what's hot is Google Trends. This service shows you the current most popular 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.

Second - Analyze the "commerciality"

After selecting a possible niche to build your membership site around, the next step is to find out if it's a profitable niche to be in. One way to figure this out is to see if other are making money in it.

Here's how to determine if you can make money in your chosen niche

Are there blogs or forums in this niche? Take the name of your niche and search for "niche name blog" & "niche name forum" in Google to see if there is an active group of people talking about and interested in the niche. This lets you know there is a market (a group of people actively interested in the niche.)
See if other people are creating and selling product in this niche by searching in Google Shopping, ebay and Amazon. It's a good sign if there are because it tells you people are making money here.
Look at Google Adwords for the same ads are running over time. If people are running the same ad over time it means they are making money in the niche. They would not continue to spend money on the ads if there were not making a return from them.

Finally - Figure out your barrier to entry

Once you've found a niche and figured out that there is money to be made in, you need to determine if you can break into this niche. Here's how to make this determination:

Look at the product types in this niche. You want to find a niche where information products are being sold as the norm. That's because it's much easier to build a membership business around information vs. any other kind of product.
The last thing you want is a marketing filled with tons of competitors. A few means it's a profitable niche, but too many means you won't be able to take a piece of it.
Compare the size of the market versus the number of competitors. Some competition is a good sign - just make sure the market is big enough for you to join in.
How quickly do people in this market make buying decisions and are the ready to buy? Every market is different. Sometimes people are looking for information and are ready to pay for it right now. And sometimes it takes weeks, months or even years for them to make the decision to purchase.

Summing it all up

OK, now that you've figured out what niche you're going to go into. Determined there is money to be made and that the competition is not too strong to break into it. You're ready to start your membership business. 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...