How To Choose A Profitable Niche In Affiliate Marketing

The first thing that you ought to do before starting an affiliate marketing website is to pick a niche. It seems like a simple process, except that many beginners get stuck. 

I’ve seen many affiliate marketers, (including me), failed in their first venture because they got their niche wrong.

It was either too broad, too narrow, or not profitable.

You don’t want to spend months building content only to find out that it’s not worth the effort. Therefore, you ought to take enough time to figure out what’s the best niche to work on that will ultimately generate reasonable profits. 

What Is A ‘Niche”?

The term niche can be confusing for newbie affiliate marketers. There are so many definitions thrown on the subject. 

Some say a niche is a group of people that you’re targeting while others equate niche to products.

For me, it’s better to think of a niche as a group of people facing similar problems that you’re trying to solve.

A group of late 30s men looking for an ergonomic chair is a niche. The same goes for gamers looking for tips for acing Mobile Legends.

When you think of niche as problems to solve, you’ll get a better direction when developing content strategies.

Considerations When Choosing A Niche

Now you get the rough idea of what a niche is, you’ll need to pick one for your website. It’s easier said than done when you have so many ‘problems’ that need to be solved. 

Affiliate marketers are always in a dilemma when choosing a niche. Often, there are two sides of a coin that you need to choose from. 

Hobbies vs Problem-Solving

There are niches that are more inclined to hobbies and there are those that are needs-based. For example, these are hobby-based niches:

• Pocket drones
• VR games
• Woodworking

Then, there are problem-solving niches like:

• Weight loss
• Food allergies
• Dating apps

The strategies used in hobby and problem-solving niches are different. When you’re working on hobby niches, you’re appealing to a group of people who share a similar interest, has the budget, but may not be as ready to spend.

You’ll need to build rapport with the audience before to are convinced to buy the products you’re promoting.

Problem-solving niches have a sense of urgency where the audience is longing for a solution and ready to buy into your offering if there’s a hint that it could solve their problems. 

For example, people would go to the extent of signing up for different weight-loss programs to shed off excess belly fat.

But that doesn’t mean you should dismiss hobbies niches. When you’ve proven to be one of ‘them’, you’ll find fellow hobbyists return to your site as loyal readers. Once convinced, they are likely to purchase new products or services that you promote in the future.

So, which types are more profitable? Both are if you can keep the audience engaged. 

Passion vs Expertise

Often, you’ll get the advice that you need to be passionate in what you do in order to be successful. 

In affiliate marketing, it’s better to start with a niche you’re passionate about. That’s because it could be months before your works bear results.

While it’s sound advice, I’ll also suggest you consider a niche where you’re already an expert. This is particularly true if you wanted to go into an industry like finance or online marketing.

You’re much more convincing when developing content based on experience, rather than scraping off your competitor’s sites.

For the same reason, I’ve put off building this affiliate marketing site for 5 years in order to do justice for my readers.

Ideally, you’ll want to work on a niche that you’re passionate about and good at. 

Evergreen vs Trends vs Seasonal 

Evergreen niches are niches that are always going to be around as long as ever. They are not bound to seasonal demands, trends, or current circumstances. 

Here are the top evergreen niches:

• Health
  • Anxiety
  • Weight loss
  • Back pain
• Relationship
  • Dating tips
  • Divorce prevention
  • Match-making
• Wealth
  • Make money online
  • Affiliate marketing
  • Investment
• Sports/Hobbies
  • Basketball shoes
  • Gym equipment.
  • Lego products.
• Technology
  • Headphones
  • AR/VR
  • Blockchain

On the other spectrum, you have niches that are based on trends. 

For example, plant-based meat is a trend that has skyrocketed in 2019. It’s hard to predict if it will last or disappear after a few years.

You can still be profitable with a trending niche if you plan and execute your strategies in a timely manner. 

There are some niches that are on a downward trend, and you’ll want to avoid at all cost. Here’s the trend for PS3, which has been replaced by its successor.

Creating an affiliate marketing site around PS3 will be a good idea in 2005 but definitely not in 2020. 

Some niches are seasonal, which means you’ll generate sales only when the products are in season. A website promoting snow shovels and winter products is in a seasonal niche. 

You can still make money on the seasonal niche despite the periodic interest of the audience. 

Personally, I prefer working on evergreen niches. The beauty of evergreen niches is that you’ll have sales throughout the year. You don’t have to worry about the interests dying out over time. 

Avoid THIS Niche If You’re New To Affiliate Marketing

The Health & Wellness industry is worth $4.2 trillion globally. Imagine if you could only tap into a tiny share of the market. 

It is an evergreen niche and people are getting ever more health-conscious.

Yet, as lucrative as it is, you shouldn’t venture into the health niche when starting out as an affiliate marketer.

Not if you’re depending on Google for search traffic. 

In 2019, Google has made drastic changes to its search algorithm. It now prioritizes the E-A-T factor, which stands for Expertise, Authority, and Trust. 

Google prioritizes medical content that is produced by authoritative sites. This means if you’re not a doctor, medical expert, or working under a health organization, your content is unlikely to rank on Google. 

I know this from experience as my first site is in the health niche. I’m close to making $1,000 per month before Google yanks the carpet off. 

If you’re keen on exploring the health niche, I’ll suggest promoting non-medical products. This means stay away from drugs, supplements, and such. 

You can focus on secondary products such as blood pressure monitors, wheelchairs, and hearing aids. 

5 Steps To Choosing A Profitable Niche

I’ve built 3 websites over the past 4 years. All of them are generating a stream of income. I must admit that I’m clueless about choosing a niche on my first site.

But I’ve drastically improved as I work on my 2nd and 3rd site.

I’ve picked the brain of some of the best affiliate marketers, and tweak them to into a system that suits my style.

Here it goes.

1. List out possible ideas

Obviously, it’s easier to work on a niche that you’re passionate about than one that you’re not. So, list down your hobbies and areas of interest that will get you excited. 

Are you a collector of Marvel comics? Or do you spend hours on the guitar? 

It is quite possible to turn your hobbies into a profitable niche. However, if you’re not one pursue such interests, your niche ideas may come from what you’re good at. 

Perhaps you’re the top marketer in your company and you’ve explored every marketing apps in your industry. 

Or you could be a chef, with years of experience whipping up the most delicious dishes. 

Sometimes, brilliant niche ideas are born from problems you’re facing in daily life. Been keeping pests from your lovely gardens for years?

You can share your experience and turn it into a niche idea.

At this point, you don’t want to worry if the niche is going to be profitable. Just list out every idea that you can relate with. 

2. Identify your target audience

It’s not enough if you’re the only one interested in a particular subject. For any niche to be profitable, you’ll need to have a sizable audience.

For example, you could be fascinated with rustic earthenware mug but if there aren’t enough people with the same interest, you’ll have difficulty promoting the niche. 

So, how do you know if there’s a community out there sharing the same interest?

The answer lies in searching through forums and groups on social media on the subject. Find out if there are conversations revolving topics in the niche. 

Quora is my favorite spot to hunt for signs that the niche is generating enough interests. I’ll search on topics like ‘Yoga’ and check for questions asked by the members.

It’s obvious that yoga is a topic that is worth looking into. 

You can also search for groups at Facebook to find out if there are existing communities for the particular niche. 

Spare some time to visit these forums and find out what are gets the crowd going. You can identify pain points and trending topics, which can be useful in your marketing strategy. 

3. Pick the right products to promote

The profitability factor of your niche depends on the products that you’re promoting.

It depends on:

• Price of the product
• Visitors traffic.
• Commission rate
• Recurrence commission

Price & traffic

Let’s assume that you’re getting a 10% commission on the products in your niche and you want to make $1,000 per month.

If you’re promoting a $20 yoga ball, you’ll need to 500 sales to reach the figure. Meanwhile, a leg stretcher machine at $200 will only require 50 sales to generate $1,000 a month. 

Some marketers would argue that it’s easier to sell a cheaper product than an expensive one. However, what they’ve left out is that you’ll need 100 times more traffic to generate the required number of sales.

As far as I’m concerned, promoting an expensive product requirest the same effort as cheaper ones. It’s also easier to get 50 sales than 500 in a month.

I’ll suggest that you identify a handful of high-ticket products in your niche as they are going to be the difference between a $100 month or a $1,000 month.

Commission rate

You’ll also want to take note of the commission that you’re making per sale. Many affiliate marketers who are promoting physical starts at Amazon.

It’s undeniable that Amazon is a beginner-friendly platform, but with its recent commission slash in April 2020, it wasn’t as attractive as it was. 

Here’s what Amazon’s affiliate commission looks like now:

The commission cut was drastic. A site promoting essential oil, which falls under Health & Beauty, now earns only a 3% commission instead of 6% before the cut.

Still, if you’re a new affiliate, I’ll suggest starting with Amazon. That’s because it’s easier to get approved by Amazon than private vendors when you’re not generating substantial traffic.

At the same time, you want to look for vendors who are offering better commissions than Amazon. 

Searching for affiliate programs is easy. Just type [product] + “affiliate program” on Google and you’ll find vendors offering it.

Check out the commission rate for Rocky Mountain Oils. You’ll earn between 9% to 12% with a 60 days cookies.  

It doesn’t take a math wizard to figure out that it’s more profitable promoting Rocky Mountain Oils directly than on Amazon. 

The difference between 3% and 9% is huge. 

Recurrence commission

If you’re selling a product, it’s going to be a one-off transaction. Even if it’s a $1,000 item, you’re only going to get paid one.

Meanwhile, there are affiliate programs that pay recurrence commissions. Usually, these affiliate programs are for online courses, memberships, and digital subscriptions.

It’s always a good idea to promote services that offer recurrence commissions. Once your referrals have signed up for the service, you’ll get paid every month or annually.

Here’s the commission rate for a VPN service.

The cost of the VPN is $12.99 for the monthly package. Once you’ve successfully referred a client, your monthly earning is $3.90. 

With 100 referrals, you’ll be earning $390 per month. 

Now, this is only a recurring commission for a low-ticket product. ClickFunnels, a high-end funnel building solution for marketers, is priced at $297 per month for its most popular plan.

It has a commission rate of 40%, which means you’ll make $118.80 per month for 1 referral. It only takes 9 referrals to hit the $1,000/month threshold.

Manually searching for affiliate programs is quite tedious. If you’re part of this affiliate training program, you’ll have access to this Affiliate Program Search tool.

It returns affiliate programs that are related to the keyword and their commission rate. 

4. Conduct keyword research

You’ve identified the audience and products. Now, you’ll need to lead the audience to the product. 

My favorite strategy is SEO, where I build content and rank them on search engines. The beauty with this approach is that you’ll keep driving traffic long after you’ve finished building up the site.

I’ve stopped working on my first site since 2018 and it’s still bringing in visitors and sales.

To be successful with SEO, you’ll need to conduct keyword research. It’s a process that identifies search phrases queried by users on search engines.

For example, if you’re promoting yoga products, you’ll want to know which are the topics that people are frequently searching for.

Google has a free keyword planner that helps you to do that. Here’s the result for the phrase ‘best yoga mat’. 

The limitation with Google keyword planner is that it doesn’t provide precise monthly searches and competitors. 

As such, you’ll need a better keyword planner that’s optimized for affiliate marketers. I’m using one that’s included in this affiliate marketing training program. 

Knowing the potential traffic, competitors, and SEO difficulty makes it easier to craft the content strategy.

You’ll want to spend a couple of hours researching keywords that are related to the niche, that is not overly-competitive.

Usually, you’ll want to target longer search phrases, as they are more specific and less competitive. 

Here’s one with higher SEO score, which means it’s relatively easier to rank.

Your keyword strategy shouldn’t only revolve around product-based phrases. It should also include information-based keywords like this:

Save the keywords on a spreadsheet and you’ll have a rough idea of how your SEO content strategy looks like.  

5. Competitor Analysis

It’s always prudent to check out who you’re against in your niche. If you’re up against giants like TechRadar for all the profitable keywords, you may want to tweak your traffic strategy or consider a different niche.

Outranking giant authoritative sites isn’t impossible but it takes longer to do so. Sometimes, it’s better to pick a less competitive niche or keywords.

At the same time, you’ll want to have some competitors in the niche. It proves that the niche is profitable. 

Here’s how I identify keywords that are not too competitive and prioritize them for my content pipeline.

1. Download the Moz toolbar. It’s a Chrome extension that allows you to view the DA of websites. DA stands for Domain Authority. It’s a score given by Moz that indicates the authoritativeness of the site.

2. Turn on the Mozbar.

3. Search for the keyword on Google. Here’s the result for ‘best yoga mats for sweaty hands’.

4. Look for sites that have DA < 25, particularly affiliate sites. An affiliate site can achieve DA 25 within 2 years, provided that it publishes and promote content regularly. 

5. There are at least 3 pages on the search result with DA <25. If these sites can make it to the first page of Google, it’s very likely that you could too.

Once you’ve identified keywords that are reasonably easy to rank, you’ll want to prioritize them. They could start driving traffic to your site within weeks even if it’s relatively new. 

By identifying easy-to-rank keywords, I’ve managed to build pages that attract 100+ visitors per week in a niche monopolized by authoritative sites. 

At the moment of writing, the site is barely 1 year old with 35+ articles. 

Final Thoughts

You’ll be tempted to rush through the niche selection process and start building content for your audience. 

Don’t. 

You’ll be investing considerable time and money to grow a brand new website. It may take months or years, depending on how much time you’re dedicating into it.

As you’re going to be in the game for the long haul, you may as well spend a few days running through the steps and ensuring you’re in a profitable niche that’s not too competitive. 

The effort will spare you the frustration of taking home a lesser piece of pie while others are making more profit with lesser works.

Once you’ve identified your niche, you’ll want to set up a website. I’m hosting all of my sites on this affiliate marketing training platform, where they are automatically optimized for speed and security. 

My #1 Recommendation (Free Access)