In order to make sure your membership business is profitable, you have to select the right market. Here’s how.
First – Look for Fanatics
If you want your membership business to be profitable, you have to find a marketing with fanatics in it. Simply put, a fanatic is someone who’s willing to spend time and more importantly money on a topic they are interested in. Here’s how to find fanatics:
- One simple idea that’s easily forgotten is to scan the magazine racks when you’re out and about. Because it’s becoming harder and harder to keep print periodicals profitable these days, if you see a magazine on the shelves, you know it’s making money. And that means there are lots of people interested in it. If they can make money in a print version, you can probably make money with a membership website.
- Watch and listen for fanatics in your daily life. Pay attention to conversations, social events, TV, restaurants, public places to see what people are talking about. If people are talking about something, they probably want to know more about it. And this means there may be a market for information about it.
- Don’t forget about clubs and organizations. If there are enough people to to build a club, there are certainly enough people to start a membership site on the same topic. Likewise, if there are enough people to hold a convention, there are definitely enough people to fill your membership website.
- What about your interests and hobbies? There’s a good chance that others are interested in these things, as well. Making money is fun and it’s even more fun if you can do it in a niche you’re excited about.
- Another fantastic way to discover what people are interest in is Google Trends. This service shows you the current most popular search terms. These are the things people are actively searching for in Google. They’re searching because they want information. Building a membership business around things people are actively searching for is a great way to ensure your success.
Second – Analyze the “commerciality”
OK, so you’ve got a great idea for your niche membership business with lots of fanatics. But will they actually spend money? The quickest way to find out is to determine if others are profiting in your potential niche.
OK, how do we figure that out?
- Are there blogs or forums in this niche? Take the name of your niche and search for “niche name blog” & “niche name forum” in Google to see if there is an active group of people talking about and interested in the niche. This tells you there are people who are actively interested in your niche.
- See if other people are creating and selling product in this niche by searching in Google Shopping, ebay and Amazon. What you’re trying to figure out is if anyone is making money in this niche, and if people are selling products it means they are making money.
- Monitor Google Adwords to determine if people are running the same ads for weeks in a row. If they are, this means they’re making money on these ads – otherwise, they’d stop running them. Which means there is money to be made in your niche.
Finally – Figure out your barrier to entry
OK, so you found a hot topic and you know other people are making money on it. Will you be able to get involved and do the same? Here’s how to make this determination:
- Product types. What kind of products are being sold in the niche? You’re looking for a niche that sells info products. That’s because it’s much easier to build a membership business around information vs. any other kind of product.
- The next thing to look at is the competition. You don’t want to try to break into a saturated marketing, so figure out how many people are already selling in this niche.
- Size vs. Competition. Some competition is good. It means that this is a profitable market. And as long as the size of the market is large enough to support the competition, you’re fine.
- How quickly do people in this market make buying decisions and are the ready to buy? Every market is different. Sometimes people are looking for information and are ready to pay for it right now. And sometimes it takes weeks, months or even years for them to make the decision to purchase.
Putting it all together
So far, we’ve talked about exactly what it takes to pick a great niche: One with a hungry crowd of fanatics, who are ready to spend money on information about their topic. And you’ve determined your barrier to entry is small enough to give it a go. If you’ve followed along with these steps you’re success in practically guaranteed. The only thing left to cover is exactly how to run your membership business…
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