Finding a Profitable Niche
Note: It’s important you read every word in this article. There is NO FLUFF! Finding a profitable niche is a process, requiring mostly brain power. It’s pretty simple math after that.
I think the biggest problem people are having with making money from adsense and affiliate programs is not getting traffic, but finding a profitable niche. I’ve heard countless stories in forums from people who get tons of traffic, but are still not making money because they are earning pennies per click and/or their click through ration (ctr) is low. This is particularly a problem when doing adsense arbitrage since you are paying for your traffic!
The first thing you need to do is pick a niche. Finding a profitable niche requires some brainstorming on your part. Generating a list of potential niches is the hardest part. It’s pretty simple math from there. All you need are three things - a reasonable intelligence, google adwords, and google adsense accounts. Using the google keyword tools in your adwords account will give you estimated cost per click and estimated number of clicks.
Three areas that are generally high paying niches include finance, insurance, legal topics, and health, i.e. Mortgages, car insurance, personal injury lawyers, and weight loss just to name a few. The reason these pay well is because there is tremendous competition. This is where you need to put your brain to work and do some research.
Let’s start with finance. What are things people finance? Stuff that people usually don’t have the cash for. This typically includes buying a home, a car, doing home improvements, or buying a boat. For some people, it’s just paying their bills, hence the advent of the payday loans. I bet many of you didn’t even think of “paying bills”, did you?
I’m gonna pick finance -> car loans. Now go to https://adwords.google.com/select/KeywordToolExternal . Type in “car loans”. You should get like 200 related keywords and phrases about car loans.
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WOW - 200 keywords! Now I’m gonna sort these by “Search Volume” from highest to lowest.
Now Scroll down until you see the competition level drop off. Meaning the green bar in the third column is half or less full.
Ah Ha! “car credit loans” looks like it has decent search volume, but has about half of the competition.
This will now be my starting point. I will now use this keyword and seed the keyword tool again.
Now look. “bad credit car loans” gets the most search volume, with relatively low competition!
So far so good! But is there money in this niche? Lets look. Click on the drop down menu called “Choose data to display” located above the keyword list. Select and change it to “Cost and Ad Position Estimates”. It will then show you as small box asking for CPC bid amount.
Type in $10 and hit “recalculate”. Now try to estimate the lowest cost to get the #1 position. To do this, you need to try different dollar amounts. If you put in $1, then you get position 4-6. If you put in $5, you get positions #4-6. If you put in $10, you get positions 1-3. BINGO. Now work your way down, $9, $8, $7, $6, until you lose that top position and it shows #4-6 again. In the picture above, I stopped at $7 before loosing the #1-3 position. I then write down the $ amount, which in this case is $5.88.
I then try to estimate the lowest cost to get the #4-6 position. Never put in less than $1. The numbers get very unreliable for some reason. So I put in $1, and guess what? I’m still in position #4-6 at a cost of $0.60 cents! That is a $5.28 spread. I usually go for 10 to 1 spreads, but this is close enough, especially since I know this is a highly competitive niche.
Now you need create and optimize your landing page for “bad credit car loans”. Setup a campaign using that single keyword “bad credit car loans” in parenthesis. Then bid $0.60 and setup a budget of $5.00/day.
You should get about 10 clicks per day. Assuming you have a great landing page, you should be making some affiliate sales. My affiliate pays $12/lead. If you have adsense on the page, you should be getting very high ctr of 40-60% since this is a very targeted niche.
I can tell you that not all of you will succeed with this example. You need to learn how to create a highly optimized landing page and write effective ads optimized for the landing page and keywords. Sometimes changing just one word in the ad will make a big difference!
I just wanted to teach you how to start finding profitable niches. I do very well in the bad credit car loan niche. My campaign cost about $15/day, yet earned $26/day. End of April, my net profit was $357 - split between adsense and affiliate sales.
The trick is to find 10-20 niches like this. It’s not easy, but there are no secrets. Just a little brain power and sweat.
If you need some help thinking of a niche, check out these popular keyword lists:
- AOL Hotsearches Find out what’s hot
- Ask IQ Weekly top searches
- Lycos 50 Weekly top 50 searches
- Google Zeitgeist Search patterns, trends, and surprises
- Search.com Top Searches Weekly top 1,000 searches from Search.com
- Technorati Popular Top searches and popular blogs
- Yahoo! Buzz What the world is searching for
May 7th, 2007 at 8:55 pm
Finding a Profitable Niche - Free Detailed Tutorial…
Note: It……
May 10th, 2007 at 2:32 am
I just started an adsense / adwords arbitrage campaign. The method I was taught differs tremendously from what you wrote in your blog. But, it’s always good to learn many tactics. BTW your post is quite impressive.
Specifically would you mind elaborating on the following points?:
You give and example of how you find words, like “bad credit car loansâ€, with decent Adwords traffic and relatively low competition. Your estimated minimum CPC is $.60 for the 4-6 positions while the minimum CPC for positions 1-3 is $5.88. Your spread is $5.28.
Considering Adwords Discounter (https://adwords.google.com/support/bin/answer.py?answer=6302&topic=29) and how ads are ranked (https://adwords.google.com/support/bin/answer.py?answer=6111&topic=115) how can you be so confident you would receive your spread in an arbitrage scenario?
After all the, the CPC bid given by the Google Adwords keyword tool, may not reflect what the advertiser is actually paying in Adwords. In fact, it could be considerably less if the advertiser has a high quality score.
Also, considering that your arbitrage profits are directly dependent what advertisers are bidding in the content network, how can you be so certain to receive your spread since:
1 Advertisers can bid lower in the content network,
2 The highest bidding advertisers may opt out of being in the content network all together.
3. You only get a percentage of the adsense click. Consensus is %40-%60.
Are you able to consistently get %40-%60 CTR?
Lastly, do you use Google’s search, or Google content network, or both for Adwords?
May 10th, 2007 at 11:03 am
Hi, these are very good questions. The simple answer to all your question is to test and your results may vary.
However, there are a couple of things I should emphasize. I always look for spreads of 10-1 as a start. The higher the spread, the better the chances of turning a profit and buying your keywords for less.
To answyer your questions by point:
1. Advertisers do bid lower on the content network and sometimes they opt out. However, in extremely competitive markets, this is usually not the case. I know for a fact that one of my sites that I advertise in adwords costs just as much on the search network as it does on the content network. So I adjust my bid until I land around position 7-8. This keeps my ad on the first page and costs about 1/5 of what a position 1-3 would cost.
2. To determine if the advertisers you want have opted out or appear on your website, use the google preview tool and compare those advertisers with the ones in the search results. You should see the same advertisers in the highly competitive markets. If not, then you know they’ve opted out.
3. I agree with you here, I’ve read the same thing on payout. However, I would add that I’ve also read payouts are affected by your quality score. Also keep in mind that some advertisers may block your website from displaying their ads depending on what region and/or countries they pick.
4. Per Google’s TOS, I can’t reveal my CTR. So all I can say is if your ctr is less than 40%, you’re gonna have a hard time turning a profit.
5. Lastly, I use both the search and the content network. I have a few campaigns that run content network only. The content networks are the most profitable for me. Running on the search network provides valuable data when starting a campaign, so I usually start with both. Then drop the search network entirely if need be.
I’ll try and write up another article addressing some of your questions in detail. A few examples and screen shots would clear things up tremendously.
Thanks for reading and participating!
May 22nd, 2007 at 10:07 pm
[…] since you are paying for your traffic!” Detailed steps with images and directions here: Finding a Profitable Niche for Adsense Arbitrage What do you think? Add your thoughts or other suggestions below. __________________ Your […]
July 19th, 2007 at 4:52 pm
Niche Marketing Tutorials & Steps to Create Affiliate Niche Site…
Decided it’s time to add some new tips and resources to your niche marketing arsenal. So here is some good info I think you’ll find useful. Kevin at …
July 19th, 2007 at 5:00 pm
New Tips and Tricks for your Niche Marketing Arsenal…
Decided it’s time to add some new tips and resources to your niche marketing arsenal. I took some time today and brainstormed a list of tasks that I do when I create a niche or authority site.
……
July 23rd, 2007 at 8:17 am
What do you do when you have found your niche?
I would first like to introduce myself as a new member of bigsensation, and really impressed by the depth of knowledge that is found here in regards to niche marketing.
AS CEO of World Dating Partners, it is a subject that I am fanatical about and have spent millions in development, in trying to create an accurate niche based system for the dating world, which is based on a complex filtering system, in order to cater for affiliates and other companies to accurately develop a niche for themselves as a white Label. I know that the dating industry is saturated with staright dating sites, that are targetted generally, and there are some systems that calim to be able to create niche markets for you.
A warning to all those that are in this business or any other. Is that…
If the affiliate can create a niche market of their own, then this the mark of a niche system.
Unfortunately their are few of them around and for good reason, which is the cost and the technology involved in doing this.
I’m afraid I don’t know as much about Adwords and finding niches as I should, but… I do know about niche markets, as a consultant for Jupiter in Niche markets and speaker at many international events, the next will be at Ad:Tech London this September
As far as I am aware there are four component.
Interests
Language
Ethnic
Geographical
A combination of these, researched in varying ways can find you a niche that has not been used or is not competitive.
some examples of this would be
transgendered dating, Internationally and nationally
South Africa - A huge market with so much potential
In using our system, you can discover these niches yourself, buy researching statistics and demographics with admin, which was originally devised for specialists who work with niches or companies that need a niche to fit into their demographic as a dating service.
With Dating sites, the highest converting niches that we have are those that have incorporated sites, that have a combination of web site components that fit the niche exactly and create the perfect combination.
These are
Design to fit your target
A filter of members that are precise and fir your niche
Language or multi languages to fit your market
content to back up your site to show its relevancy
Currency that give your members a feeling of community when geographically based
A good tracking system to refine your accuracy
ability to add other tracking systems for measurement
The ability to analyse data to discover other niches
The ability to create Parent niches in order to sell to sub niches
My apologies I have not meant to come across as a way of promoting ourselves, but rather to give some clues as to what you need to do in oder to maximise on a niche, this could be with any other system.
Thanks for letting me participate and I hope I can add further info later and niches from a web sites perspective.