Start an online business: Choosing a niche product
Part one: Choosing a niche product
More and more people are looking for an alternative to the nine to five grind. They desire an alternative to the demanding world of big business and corporate hierarchy and bureaucracy; this is especially so in the current economic climate where officially 15 million Americans are unemployed. One way to achieve an alternative or even secondary income is to pursue an online business.
Your initial thought maybe to go out an invest in a brick and mortar business with physical assets. This, however, could be a fatal mistake because your goal here should be to go in to business with the least amount of upfront cash, or make the most bang for your buck so to speak - that is, at least initially. What one has to realize is that more than half of all start ups fail in their first year of business, according to various sources. Therefore, it is in your best interest to begin slowly with: little capital, a great idea with lots of profit margin, and a desire to succeed. If you succeed, your return on investment will be large, and you will predominantly work from home and will have little overhead.
I have found over the years that the best option for opening an online store is to have a niche product. A niche product is a product that is sold by a relatively small group of retailers/suppliers so there is less competition in it than in other products. Everyone wants to sell something they like - the smart thing, however, is to sell something others are looking for but have a hard time finding. This enables you to be in a position to have products that are cheaper to market and have better profit margins (i.e. The difference between the price you sell an item and the price you obtained it for).
Niche products are cheaper to market online for the simple reason that there is less competition in advertising them. A Google search of mp3 players will bring up a huge list of adwords (Google advertising on the top and right side of page), where as a niche product like Arachnid Dart Boards will only pull up a small group. Online advertisers usually bid for ad position, and so a person willing to outbid the others will have their ads displayed more to potential customers. This can turn in to a costly bidding war overtime if the online market is saturated with retailers of a certain product. This is where being the only player in town will reduce your advertising budget. Furthermore, if you decide to hire a SEO company to help improve your site's search engine ranking, having a niche product will help because they have to charge based on keyword competition. So, if there is a lot of competition for your product, and therefore competition in search results, they will require more time and money to help you achieve better results. A good SEO company can charge several thousand dollars initially plus several hundred a month to maintain your search engine position. If you pick a niche product you won't have to spend so much money.
By: Alan Neville
More and more people are looking for an alternative to the nine to five grind. They desire an alternative to the demanding world of big business and corporate hierarchy and bureaucracy; this is especially so in the current economic climate where officially 15 million Americans are unemployed. One way to achieve an alternative or even secondary income is to pursue an online business.
Your initial thought maybe to go out an invest in a brick and mortar business with physical assets. This, however, could be a fatal mistake because your goal here should be to go in to business with the least amount of upfront cash, or make the most bang for your buck so to speak - that is, at least initially. What one has to realize is that more than half of all start ups fail in their first year of business, according to various sources. Therefore, it is in your best interest to begin slowly with: little capital, a great idea with lots of profit margin, and a desire to succeed. If you succeed, your return on investment will be large, and you will predominantly work from home and will have little overhead.
I have found over the years that the best option for opening an online store is to have a niche product. A niche product is a product that is sold by a relatively small group of retailers/suppliers so there is less competition in it than in other products. Everyone wants to sell something they like - the smart thing, however, is to sell something others are looking for but have a hard time finding. This enables you to be in a position to have products that are cheaper to market and have better profit margins (i.e. The difference between the price you sell an item and the price you obtained it for).
Niche products are cheaper to market online for the simple reason that there is less competition in advertising them. A Google search of mp3 players will bring up a huge list of adwords (Google advertising on the top and right side of page), where as a niche product like Arachnid Dart Boards will only pull up a small group. Online advertisers usually bid for ad position, and so a person willing to outbid the others will have their ads displayed more to potential customers. This can turn in to a costly bidding war overtime if the online market is saturated with retailers of a certain product. This is where being the only player in town will reduce your advertising budget. Furthermore, if you decide to hire a SEO company to help improve your site's search engine ranking, having a niche product will help because they have to charge based on keyword competition. So, if there is a lot of competition for your product, and therefore competition in search results, they will require more time and money to help you achieve better results. A good SEO company can charge several thousand dollars initially plus several hundred a month to maintain your search engine position. If you pick a niche product you won't have to spend so much money.
By: Alan Neville
Source...