How To Identify Profitable Niches for Your Business

By Eric Ackley

When you start a business, you have to decide what to focus on. If your business idea is too broad, you run the risk of diluting your effort, and becoming ineffective. So, you must narrow your ideas down to small, manageable areas, and work on one at a time. After you have that one area making a profit, you can look at expanding into another area you have identified.

This is one of the key factors to home business success. Narrowing down the target market makes success more achievable. So, how can you identify profitable niches for your home business?

First, ask yourself, what fires you up? What is your passion? What do you do during your free time? Which subject do you have vast knowledge about? Another way to approach this question is to ask your friends what they think you are good at. Think about the problems your friends come to you to solve. Can you make a business around that?

The answers to these questions will lead you to your niche area.

Once you have decided what your business niche will be, you need to find the competition, and analyze what areas they are working in or not working in. First, type your niche keyword into a search engine. This will give you a list of your competitors, and indicate if they are local or nationwide competitors. Write these down, and look at each of these competitors to see what they offer, or don't offer.

Each browser should have an option to "view source" of the document. Using this feature, you can find what keywords the competitor is using. Write these down also.

Now you have a list of your competitors, and the keywords they are using to attract web visitors.

Using a keyword search tool, find out how many searches are being done on each keyword. Look for areas where there is little or no competition. You want a keyword that has some searches,but not too many. This is a judgment call--too many searches means too broad a niche, but too few searches will mean little profit potential. The volume of searches for the keyword indicates the interest or demand of the particular market you are targeting.

At this point you have identified a niche market that is something you are passionate about, has little or no competition, but has a high level of interest among web surfers. The next step is to determine what you can offer differently from your competition.

Based on your knowledge of the niche, and the intel you have gotten by reviewing your competitors websites, is there an overlooked area that you can capitalize on? Is there something that you can do better than the competition? Is there an underutilized aspect or unmet need that you can fill?

Name your niche market. Make sure your name is clear about what you do; don't confuse your potential clients with some obscure name. Try to put your keywords into your niche title; this will help later with search engine page ranking.

Now, you are ready to develop your new products and market them for your home business!

Eric Ackley is a home business consultant, former business owner and employee. His website, http://www.myworkathomesite.com, is dedicated to full- and part-time home business opportunities.

His blog, http://myworkathomesite.com/wordpress, has other free articles and information regarding starting and running a home-based business.

Article Source: http://EzineArticles.com/?expert=Eric_Ackley