Here's a quick method that will give you a pretty good indication without having to spend large amounts of time and money on task.

Step One :

This is a fairly obvious step - find out if other marketers are spending advertising dollars in that niche. If they are, you can be pretty certain that it's a profitable niche.

Why?

Because savvy marketers "don't" spend money on advertising that doesn't show a profit.

You can check this out quickly on "Pay Per Click" search engines like Overture and 7search where advertisers pay each time someone clicks on their listing.

Let's check out an example.

For demo purposes I'm going to search on keyword "snoring" because I have a project in progress on subject of "how to stop snoring without surgery".

Now go to http://www.content.overture.com/d/ and type in "snoring". When you arrive at results page click on "View Advertisers' Max Bids" at top right of screen. A new window will open up asking you to enter a code to access information. Enter code and submit it. On page that comes up you will find bidding range for our search term - higher top three bids more profitable (and competitive) niche is likely to be.

In this case top three bids on Overture (at time of writing) for keyword "snoring" are : $1.50, $1.47 and $1.46 - based on this we can be pretty sure that there is a viable market for niche products on "snoring"

Step Two :

OK now let's take this a step further and find out what search terms (keywords and keyword phrases) are being used to find our niche subject on Overture.

Go to : http://inventory.overture.com/ and type in "snoring". This returns a list including :

snoring 27352 stop snoring 8211 snoring cure 3308 snoring remedy 2366 cause of snoring 2186 snoring treatment 1233 snoring solution 1133 snoring problem 800 prevent snoring 623

... and a whole lot more. The numbers indicate number of times that each of those keywords/phrases have been requested in previous 30 days.

Step Three :

Next we need to find out how many competing sites there are for each of our keywords/phrases. We're going to do this on Google - but first we need to decide what number of competing sites is acceptable for our niche subject.

As with any subject, opinions differ widely.

Rosalind Gardner (Super Affiliate Handbook) does not consider anything under 100,000 competing sites to be a viable niche.

For example, a realtor with a web site in Minneapolis is likely interested in advertising on search terms such as “homes for sale” and “sell my home.” The only problem was realtor would have to advertise to everyone in country who happened to type those terms into search engines. This was wasteful and ineffective because vast majority of visitors clicking through to site would not be qualified visitors since they lived outside realtor’s regional market.

At that time, only work around to this was to include a regional qualifying term next to each search phrase, so instead of advertising on term “homes for sale” realtor would have to advertise on “Minneapolis homes for sale.”

What about prospective clients who live in Minneapolis, but only type in “homes for sale?” They’re likely just as qualified for realtor, but it there wasn’t a way to target this type of searcher. The gap between forcing advertisers to use regional qualifying terms or advertising to a national market was finally closed this spring by Google.

Local Targeting