Affiliate Marketing — How to Pick a Niche in 2021

5 Valuable Tips to Find Profitable Affiliate Marketing Niches

So you’ve decided to give affiliate marketing a go to make money online. The place where most new affiliate marketers fail is right out of the gate trying to figure out the best niche to choose. Whether you are promoting products with blog posts, Instagram or YouTube content, the most important first step is to ensure that you can produce content in a profitable niche that will ultimately lead to conversions and earn you money.

It seems easy at the beginning to take the first thing that comes to mind that interests you and focus all your time and attention on choosing a domain name, building a WordPress site, picking a theme and creating content. But the niche that you decide to pursue can ultimately decide whether all your hard work is for nothing or not.

Choosing the right niche is not easy. There are many factors involved in selecting a niche for affiliate marketing that come into play, such as SEO ranking potential, competition and market demand. In this article I will cover five important factors to consider when starting out in affiliate marketing and choosing your niche.

Interest

Several highly successful affiliate marketers are able to pick a niche solely on profitability factors and successfully promote products in that niche even if they have little or no knowledge of the subject. One day that might also be you, but as a beginner in the affiliate marketing space it’s normally a good idea to pick a niche that you have some interest in. It doesn’t have to be your number one passion in life, but at the start of your journey you will probably be shouldering the vast majority of content creation on your own, so you need to ask yourself if you have enough interest in the subject to avoid fatigue and burnout writing 20, 50 or 100 articles on that niche.

Successful affiliate marketers who cater to a wide variety of niches often outsource the content creation. When you’re not dealing with content then the niche topic becomes less important and these marketers are able to focus on the mechanics of the business and pick niches based solely on analysis, not passion.

As a newcomer to the affiliate marketing industry you probably are not in a position to outsource the content creation and are aiming to keep initial capital outlay low. At a very minimum your blog needs to carry between 30 and 50 posts often over 1500 words long each. Outsourcing rates for decent content range between 3 and 5 cents per word, therefore the outsourcing model could cost upwards of $3,500 just to get your site off the ground long before you start seeing any revenue.

For an experienced affiliate marketer this is a simple investment into a piece of digital real estate that they know they can add value too. They are outsourcing the content to people who have more interest and passion in the topic to generate quality articles and can focus their own efforts on the areas where they have strength through experience. Marketing, SEO, traffic generation, promotion…etc

If you are new to affiliate marketing, this is probably far too much money to spend in the early days. Even if you do have the funds to go this route, it’s not advisable in the beginning. You will make mistakes, we all do, and as a beginner when you make mistakes it’s better to be losing time rather than cold hard cash.

You are likely therefore going to be writing your first 30 or 50 articles yourself. Think about that, that’s a lot of content. These days long-form content ranks a lot better on Google, you need to go in-depth and write long, informative articles that really deliver value to your readers. The art of hashing out 300 words stuffed with big hitter keywords stopped working many years ago. People still say Content is King and while I agree with that somewhat, it conveys an out of date message. These days Value is King and value is delivered through quality content. Writing quality content is hard but if you get it right then you deliver the holy grail of affiliate marketing; Value. When you consistently deliver value over and above your competitors, you can print money.

So before deciding on a niche, ask yourself if you have enough interest in the topic to maintain the level of focus needed to write at least 30, long form, informative and value packed articles on the topic. You may find a topic in the outdoors survival niche that you truly believe could be tapped for hundreds of thousands of views a month, but if you’re a city dweller who can’t survive the morning without a frappuccino and has never set foot in the great outdoors then you’re unlikely to be able to craft quality content on the subject, let alone have the stamina to repeat that 50 times.

Longetivy

One factor that a lot of new people look over when trying to find a profitable niche is the longevity of the products that they are going to ultimately promote to generate income. This is more applicable to marketers promoting physical products, such as your typical Amazon Affiliate Site.

All products have a lifecycle. They start out new and in demand, and that demand fades over time, often when better or upgraded products are released or a competitor to the brand of product overtakes them in the market. Other products become popular based on a hype or a trend.

Trending Niches

Trending products are attractive to affiliate marketers who know how to spot up and coming trends in society. But society is fickle and easily and quickly moves on to the next big thing.

The content that you create to promote a product will only generate revenue for as long as the product is in demand. You can write the best content in the world on fidget spinners. You might get some traffic, there are over 4.5 billion users on the Internet, you can always find someone interested in anything, but your chances of building a successful affiliate business from fidget spinners is next to impossible. Why? Because the fad has passed and the world has moved on.

Picking a niche based on a trend may be very profitable in the short term. To consistently profit long term however you have to understand that you are playing the short game. Trend marketers are experts in spotting products that are undervalued and about to explode and hop on the bandwagon early. They cash in, cash out and don’t get emotionally invested. The best trend marketers know when to drop a non performing niche and spot the next up and coming product. This is a particularly difficult skill as trend marketers must bet on the next up and coming thing with little data to go from, therefore investing time and money into launching a new affiliate business around a trend can be an educated gamble.

Fast Lifecycle Products

Even if you aren’t focusing on societal trends as your cornerstone for selecting a profitable niche, you still need to pay attention to the lifecycle of the products that you will ultimately promote in your affiliate content. This is especially important for new sites.

One of the best ways to fail is to pick products that have exceptionally fast lifecycles where market demand for the product starts fading after the first year. A typical example of this is promoting mobile phones. Aside from the huge competition in this niche, it’s also very hard for new marketers to crack niches like this because the product life cycle is just too short.

Here lies an intersection between product life cycles and the Google sandbox. The Google sandbox theory is somewhat controversial amongst internet marketers, some see it as a walled garden where Google will leave your new blog posts to stew until they trust the site enough to begin to rank it. Others dispute the existence of the sandbox but still acknowledge that new content on a new site will take time for the algorithm to rank. Either way, it’s widely accepted that especially for a new site, even the best posts may take anywhere from 6 to 9 months to start ranking.

If you are a new site and looking to write content on mobile phones then you are failing before you are beginning. Even if we ignore the fact that this niche is saturated already with huge hitters like TechRadar who have the domain authority to smash everyone else to the 9th page in the SERPs, there’s another crucial reason why this niche is not profitable for a new affiliate site.

Let’s look at the maths. Most mobile phone manufacturers have very short release cycles on their models. Some models release every 6 months with their flagship phones often releasing every year. The vast majority of users are looking for content on the latest phones. Most are looking to upgrade from older models and therefore most of the interest, and therefore search volume, for a particular handset will be in the first year, after that the demand tails off.

To prove this point, open up Google Trends and search for the term “Samsung Galaxy S10”. The Galaxy S10 was released in early 2019 and enjoyed a huge spike in search volumes. But that demand quickly starts to decline. By 2020 the next model was released and interest in the S10 has all but disappeared and the search volume is in continual decline.

So if it takes Google 6 to 8 months to even start ranking your post in search results, by the time your post even starts to rank, the vast majority of your target audience has already moved on and you’ll never see that traffic.

So it’s important to find products that have a slower lifecycle where market demand will outlast the Google sandbox and beyond. Ideally products that are still in demand after 2 or 3 years will give you enough time to build up your SEO and authority to cash in on some of that search traffic. Very few products are evergreen, meaning they never lose demand, but there are plenty of product niches where demand remains high for years. These are the products you need to find as a new affiliate marketer

Purchase Value

When choosing a niche to eventually promote products through affiliate marketing it’s important to pay attention to the price point of the products or services that you are going to be promoting. Aiming too high or too low can have a negative impact on your potential earnings, especially as you are starting out with a new unknown site.

Firstly, avoid products that are priced too cheaply. If you are planning on promoting products through the Amazon Associates affiliate program you will be looking at pretty low commission rates on products that you sell. Amazon recently slashed their commission rates across a wide variety of sectors.

While some high end categories such as beauty still pay a healthy 10% commission, these are normally the toughest categories to compete with. The majority of products on Amazon now only pay between 1% and 4% in commission for each sale.

If you are promoting products on Amazon priced at $15 with a 2% commission rate you will need to drive a huge amount of traffic to your content to be able to convert enough customers to generate any real revenue. The average conversion rate for Amazon affiliate marketing is between 0.5 and 1 percent. Even when taking the higher end of that estimate you would only be making 30 cents per conversion. If your goal is to make $1,000 per month you would need over 3000 conversions in a single month. Based on the average conversion rate that means you would need a staggering 330,000 visitors per month to reach your monthly goal of $1000.

Now let’s run the same maths based on selling products priced at $250. In the 2% tier commission per sale at $250 would earn you $5 for each conversion. At that level you would only need 200 conversions per month in order to earn $1,000. At this price point you would need to generate around 20,000 visitors per month to stand a chance of hitting that goal. That’s a lot more realistic than 330,000!

It might be tempting to look at that math and think that the key to success is to simply promote the highest priced products you can possibly find. After all, if what we’ve said is true then if you promote products priced at $5,000 and above you would only need 1,000 visitors per month right? Wrong.

YouTube is awash with fake gurus talking about “high ticket” marketing, most will involve you purchasing a high ticket course to unlock the secrets of this trade. The truth is that you can make money with high ticket affiliate marketing but it’s a lot more work and the conversion rates are lower the higher you move up in price points.

Your goal as an affiliate marketer is to create content and build trust with a reader so they eventually whip out their credit card and purchase a product. It’s much easier to convince someone to part with $300 than it is $5,000. High ticket affiliate marketing requires a lot more than some well written blog posts. People need to be led by the hand, often through a series of sales funnels involving a series of trust building exercises before subtly being seduced by your high ticket offer. If you are just starting out in the world of affiliate marketing you should avoid high ticket products and services.

As a rule of thumb, looking for products with a price point between $100 and $500 is a solid foundation. Ideally you should promote products at both ends of this price range to get the most conversions.

It’s ok to occasionally promote lower ticket items when it can indirectly benefit your site, and they can be good for informative articles. For example if you are running an affiliate site about hiking boots and regularly post reviews on boots priced in the $200 range you could write an informative article on the best shoelaces for hiking boots and link to some cheap products on Amazon. The commission on these would be tiny, but that’s not the point. You use your informative articles to drive more traffic and get your more revenue generating content in front of more eyes.

Competition

It should be no surprise that competition is a key factor when it comes to choosing a profitable niche. Many people think that just because there is competition from some sites who have a lot more content and have been in the niche for a long time that there is no room for any newcomers to make a profit. This isn’t true, in fact it’s often the opposite.

Competition in a particular niche is a sign that the niche is a profitable one. Niches with very low levels of competition are often not sought after for a reason, because the market demand is just not there to make the niche worthwhile and you could very well waste your time and money chasing a niche that no one is interested in.

The trick to identifying a good niche is to analyse what the competition is doing, what kind of content they are producing and assess if you could add value to the space. Remember we said value is king. Just because you see lots of content on a particular niche does not mean there is lots of value.

If you identify a few competition sites that appear to be top of the SERPs for products that you are interested in promoting, drill down into their content and see what they offer. Do they simply post 500 word reviews and get the number one spot on Google? That’s a good indicator that there is a value gap in the market that you could fill. Is the competition delivering value by solving peoples problems and answering peoples questions? These are all things you should be considering when analysing the competition within a specific niche.

Don’t be scared by competition. It’s a sign that the niche is in demand and there is money to be made. But you won’t make money by simply copying them. Be unique and serve your audience. If you can answer questions and solve problems that your competitors are not addressing you will be adding value. When you add value to a niche, you will stake your claim on your piece of the action.

Finally, there are some very competitive niches that have an extra barrier to entry. These are known as YMYL (your money, your life). These are niches that include investing, health and wealth. Not only are these niches saturated to breaking point with content, and you would struggle to stand out in these niches, but they are also treated differently by search engines. Google holds YMYL related terms to a much higher standard than other niches and will go to great lengths to only show content it deems to be very authorative. As a new, or even established Internet marketer, these niches are all but impossible to stand out in unless you can really find some unique value to bring to the party.

Seasonality

Something often overlooked when choosing a niche is seasonality. A seasonal niche is one where the demand grows and declines at specific points in the year. Some seasonal niches are obvious, if you are promoting Christmas decorations then clearly your only profitable time of year is going to be December. However other niches have more subtle seasonal fluctuations and it’s important to be aware of these.

You can use Google Trends to get a rough idea of how seasonality affects your niche and plan around that. For example, a 5 year search for the term “camping” in the United States shows a clear peak in search volume early April that continues to its peak in mid-June before steadily declining again as the camping season comes to an end. Looking at the 5 year view gives you a pretty reliable indication of when the peak of your year will be.

Conversely, a search for the term “wood furnace” shows a steady upwards trend from September, peaking in January and falling off in February. This is because as the warmer spring weather arrives, less people are searching for wood furnaces. Some other niches might be less obvious so you should always check these metrics. For example, you might be promoting some stationary products that are popular for college students and therefore have seasonal trends based around the academic year.

There’s certainly nothing wrong with choosing a seasonal niche, but you need to factor the seasonality factor in when forecasting your earnings and planning your content. This could influence when you invest the most time into writing content. Remember that especially in the beginning it’s going to take time for your content to rank. If you are in a camping niche then you should start writing plenty of content in the fall, that will give it enough time to rank in Google meaning you should catch the seasonal wave in late spring and capitalize on those searches.

If you are able to plan around the seasonal fluxes and accept the drop in profits during the quiet months, there are plenty of very profitable seasonal niches out there.

Conclusion

I hope this article has given you some helpful guidance on things to look for when exploring a new niche for affiliate marketing. By scoring potential niches using the advice above you should be able to filter down to the perfect niche and have a good shot at creating a revenue generating site.

Originally published at https://craigdunn.info.

Software Engineer, Consultant, Writer

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