Many would-be entrepreneurs get stuck on the most basic of questions before they’re even out of the gate with a new business. They know they want to make money online but they have absolutely no idea how they’re going to do it.
Often these same entrepreneurs will have a list of niches and maybe business models that they’ve been thinking about trying but they’re not sure how to narrow that list down to the top choice that they’ll eventually focus on for their new business.
When you get right down to it, this same stumbling point and resulting paralysis is actually felt by most people when they contemplate going into business for themselves. They ask questions like:
- Am I getting into the right niche?
- Am I choosing the right business model?
- Is this something I am going to enjoy?
- What kind of income can I expect from this niche?
- How much competition is there going to be?
- How much time will I have to spend to reach my income goal?
- Will I be able to establish myself as an expert in this niche?
- How much is it going to cost to start my business?
These are fundamental questions that you’d better answer before you think about products to sell or you start building a web site or spending money on promoting your business idea.
So here are my suggestions to begin narrowing down the field if you haven’t decided on your business topic yet. These ideas aren’t new, they’re not secrets and they are not my original ideas . . . but they are universally effective:
1- Have you visualized what kind of business you want to create?
Are you going after a million dollar business or will you be happy making $5,000/month? Do you visualize having employees working with you or are you a committed solo entrepreneur? Do you see yourself working 50-60 hours per week in your business or do you want a lifestyle business that takes 20 hours per week or less to run? You see, the answers to these questions are going to allow you to cross some subject ideas off your list right now.
2- Have you done your niche research?
If you haven’t, you’re not starting in the right place. Some niches will support the kind of business you envision; other niches won’t. Some niches are extremely competitive and present a great challenge to entry. Others will be easier to break into. Again, the likelihood of success in any of the topics you’ve been considering will become more apparent as you thoroughly research the niche market. I would think a 30-minute dive into niche research in each of your subject markets would be time well spent and you will see where the best opportunity lies. After you’ve identified the one niche that you’re going to enter you should jump into the marketplace again and do more thorough research knowing that this is the place you’ll be setting up shop.
3- What do you really enjoy doing?
Could you be happy immersing yourself in every one of the topics you’ve included on your list? Surely, some of these topics hold your interest better than others. You see, entering a subject niche that you really enjoy will help you to focus on becoming an expert in that topic without feeling like it’s an agonizing drudgery. You will look forward to working in the niche every day. It’s critical that you keep up your spirits and enthusiasm for the subject … especially in the early lean times when the business isn’t producing much and as a new entrepreneur you are more likely to give up or question if this career is really for you!
4- Where does your past training, schooling, and work experience lead you?
One of the key elements of a great business is owner knowledge and expertise for his/her business subject. Granted, you can learn what you need to know in most niches in order to become an expert. But believe me, it really does help and give you a tremendous head start if you already know and understand the topic. Do you already speak the industry jargon? Do you have experiences and dealings in the niche that you can share with other? Do you have friends, contacts, sources of information in the niche that could be an advantage to you as a business owner? If so, the niche is a prime candidate for your consideration. But don’t be blinded by your mastery of the subject because lots of people have specialized knowledge in subjects that don’t monetize well.
5- Where does your passion lie?
This is related to #3 above, but a little different. Are you really jazzed up and excited to get going on a particular business? Is it something you like to delve into anyway (despite wanting to create a business in the topic)? The fact is this: business owners that really have a passion for what they do seem to be contagious. It’s easy for prospects to get excited about something if they see the genuine love and excitement that an owner has for what he/she does! Passion for your subject means you’ll willingly keep up with the latest news, events, changes, and happenings in the niche and want to share those with your like-minded customers and prospects.
6- What is the outlook and trend for each of your potential topics into the future?
You don’t want to sign on as the captain of the Titanic in your chosen niche! You don’t want to invest you time, energy, and resources into creating and running a business in a niche that is dying or even slowly drying up. If you’re really in business for the long haul, you need to understand that your efforts are going to be rewarded for years to come. Some niches are evergreen. Subjects like health, exercise, travel, relationships, dating and marriage, small business, self improvement, making money, etc, are always on people’s minds. A great resource for determining subject appeal to the masses is Google Trends.
7- What are the barriers to entry in these niches?
Finally, it’s critical to be aware of barriers that could potentially thwart your business creation hopes in particular niches. Are there licenses that need to be gained in order to become respected or qualified in the niche? Is the cost of entry for needed software or product creation going to be more than I can comfortably handle? Is the niche already saturated to the point that I can’t identify a unique position in which to place my business? Is the business subject seasonal, limited in any way (geographic, cultural, etc), or not socially acceptable? Is the business subject something that is blackhat, underground, sleazy, hateful, discriminatory or of bad taste? (I would caution everyone to stay far away from subjects like porn, gambling, lotteries, anything illegal, immoral, or in any way in poor taste.)
So I’ve given you seven “filters” to run your ideas through. If you are serious about starting a real business, apply each of these filters to your list of potential subjects and it will soon become quite apparent which topics you should eliminate and which you can confidently move to the top of your list.
After you finish this little exercise, you may still have two or three ideas that have risen to the top and pass all the tests. Don’t fret. It may be that any of them that you choose will lead you into a nice profitable business. What you’ll have confirmed is that any of these remaining topics can serve you well. Just choose one and be on with doing some detailed market research!
A word of caution: Don’t try to juggle two or more new businesses at the same time. Sure, you can add multiple streams of income later, but only focus on one until it is running profitably and giving you the income you want. Don’t dilute or water down your efforts at the outset. It’s very difficult to divide your attention and become profitable when you’re trying to figure out how online business works!
To your online business success!