Let’s talk about niche selection. This is very important to ensuring the profitability of your membership website.

First – Look for Fanatics

The first step in developing a profitable membership business is to find a market 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:

• Here’s something you may not have considered – magazines! We’re so internet-based these days, it’s easy to forget about them. In today’s economy, running a magazine is tougher than ever – some of the best ones are going out of business. So if it’s on the shelves, it’s making money, which means there is a big market interested in this topic. That doesn’t mean definitely that it will make a good membership business, but it’s a good starting point.
• Pay attention throughout the day in your regular activities. See what people are talking about on the radio, TV, at parties, in public, etc. People generally talk about things they are interested in. Which means you can start a membership business providing information on 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. By the same token, if enough people are interested to hold a convention on a certain topic, you can definitely find enough people to build a membership business around that same topic.
• Think about the things that you are interested in. There’s a good chance that others are interested in these things, as well. And, as an added bonus, it’s much more fun to build a business around things you’re interested in.
• One simple and easy way to find out what’s hot is Google Trends. Google Trends tells you the most popular current 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.

Step 2 – Determine the financial feasibility

Once you found a potential niche or topic to center your membership site around, you need to figure out if you can actually make any money in it. An easy way to determine this is to figure out if anyone else is making money in this niche.

Here’s a punch list for figuring out if anyone’s making money in your niche:

• 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 lets you know there is a market (a group of people actively interested in the niche.)
• Search Amazon, Google shopping and eBay to see if people are creating and selling products in the niche. It’s a good sign if there are because it tells you people are making money here.
• Look at Google Adwords for the same ads are running over time. If people are running the same ad over time it means they are making money in the niche. They would not continue to spend money on the ads if there were not making a return from them.

Finally – Figure out your barrier to entry

Once you’ve found a niche and figured out that there is money to be made in, you need to determine if you can break into this niche. Here’s how to make this determination:

• Look at the product types in this niche. You want to find a niche where information products are being sold as the norm. The easiest membership website to create and maintain are information membership sites.
• 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.
• Compare the size of the market versus the number of competitors. Some competition is a good sign – just make sure the market is big enough for you to join in.
• How ready is the market for marketing messages, and how willing are the fanatics to buy. Some niches are made up of people who require lots information and have a very long lead time, and some markets are filled with people who will spend lots of money right now.

In Summary

At this point you’ve figured out what niche you’re going into. You found your fanatics, you know they spend money and you’re confident there’s room in the market for you. Now that you’ve prepared properly, you’re success is 99% guaranteed. How to actually run your membership website is the only thing left to talk about…