What is a niche?

According to Merriam-Webster's Online Dictionary a niche is described as "a place, employment, status, or activity for which a person or thing is best fitted... a specialized market".

Have you noticed that despite the closing of many businesses in these harsh economic times, the local hobby train store is still around? That the 'hole-in-the-wall' eatery is thriving? Or that trends such as scrapbooking can start with a bang and still close within a year when four similar businesses start up in the same area?

The online business world reflects the same trends as experienced in the offline world - often with faster turnover and startup rates. Those who promote a product or site that targets a small, select audience can tap into a market that is otherwise being under-served. Despite the limitations of the client base, the targeted nature of the business creates a devoted and active market - the aim of any business.

HOW DO I FIND A NICHE?

Finding a niche requires diligent research. Whether you have access to software that harvests and sorts information or you take a manual approach you must first start with ideas.

First, list the things you like to do and what you have specialized knowledge about.  Examples may be golf, car enthusiast, quilting, photography, dog training, etc.

With a pen and paper (or computer,  if that's more comfortable) brainstorm a list of businesses, products and industries. Create a list of keywords and  phrases you think would be used by individuals looking for these items online.

Use a software program such as Wordtracker or a free resource such as the Google Keyword Tool to find keywords for your niche that have a high amount of traffic.

Although a programs like Wordtracker and the Google Keyword Tool makes it easy to find details such as how many sites compete for that market, you can also do your own research.

Concentrate your attention on question phrases such as "how do I..." or "where can I...". These questions will clue you into potential markets that need servicing.

Type one of your keywords into search engine. What questions are being asked?  Are people willing to pay for answers?

What sites come up? Do they provide answers or solutions to the problem? How are they making money? Can you see an opportunity to service these individuals?

Finding a niche can open the door to a profitable online business. Research the market and be certain that your product or service is valuable to this group. Find forums or groups that target this audience and pay close attention to their concerns.

If you can help these people you WILL make money. The best of both worlds!