Last week I stumbled upon a niche that was perfect for the basis of a new business. I was looking for something and noticed I wasn’t quite getting what I wanted so I started to wonder if other people were having the same problem. So today I wanted to share with you a quick way to work out if a new business idea is viable.

Here is a quick formula that Eben Pagan talked about recently. I think it’s a good way to test a potential business so here are the 3 questions he asks about a new niche and the tools I recommend you use.

1. Is my prospective client experiencing pain and urgency or irrational passion (or both)?

If they aren’t, then you need to motivate them to buy your products. So it’s a lot easier if the motivation comes along with the client. This is basically a judgement call on your part, how motivated do you think the market are?

In my case, I was sure the market was extremely motivated based on the niche and past experience with similar areas. So tick.

2. Is my client proactively searching for solutions?

If people aren’t searching for a solution then you have to track them down and motivate them again. So you need to work out how many people are searching for solutions in your potential niche.

Luckily there are tools for this, so go straight to the Free Keywords Tool at Word Tracker. If you have an account, even better, but this will give you a good indication of how many people are searching for your potential keywords.

Make sure the number of searches is at least 15 per keyword (preferably a lot more!). You have to make a judgement call on how much traffic you need to make your business model work. Also allow for very low conversion rates in your analysis. A 1% click-through rate to your website and 1% sign-up rate should not leave you overly optimistic. Of course you should be able to do much better than that!

3. Does my prospect have few or no perceived options?

Searching for your terms in Google, how many both organic and Pay-per-Click (PPC) competitors do you have? At this point you probably want to remember that ranking well for your keywords will probably take a year or longer so you’ll be competing in the PPC section on Google.

If there is weak PPC competition you may be on to a winner. Remember there are a lot more ways to market your website but Google Adwords gives you a cheap and easy way to buy traffic at the start.

Now it’s time to test your niche.

How to Test Your Niche

The quickest and easiest way to test your niche is to start a PPC campaign for the keywords you’ve uncovered. The step-by-step process is:

1. Buy a new domain or use an old one.
2. Create a simple landing page with an email sign-up offering something of value.
3. Create a small guide or a few web pages that would be valuable for your niche. Preferably in the vain that your product would be.
4. Create your PPC campaign and point it at the new page.
5. See how many click-throughs and sign-ups you receive.

After a week or two you should know whether you have a viable business on your hands. My PPC campaign went live on Saturday and on Sunday I knew I had a strong potential market. For an idea, here are my first day figures. On two similar keywords:

• 535 people had seen my ad (impressions)
• 34 people had clicked through (6.35% click through rate)
• 2 people had signed up for my ‘newsletter’ (5.88% conversion rate)
• A 2.24 euro cost per conversion (0.16 euro cost per click)

So, based on no optimisation these figures looked pretty good to me. Also, the landing page I made wasn’t very strong either. At this point I need to sell an ebook or similar for 27 euros to 1 in every 12 people that sign up to break even on the first sale.

But of course I have plans to increase the lifelong client value with more products and a membership website with a monthly fee. As long as I offer great (valuable) products then I’m sure I can keep most of my clients as the competition is very weak.

Other Important Notes

I thought this might be useful to those people who want to set up an Internet business. It’s also a good method of research for those with existing businesses to do market research. Don’t take the figures to heart as they’re only an example of what I thought was a good opportunity.

People will have success with better and worse figures. The moral of the story is they got out there and did it. This provides you a quick, cheap, and easy method to test your new ideas and see which one you want to pursue.

And, as always, a good business has a solid passion and purpose (see the recent video blogs below). I’m not encouraging you to go out and use this system as a get rich quick scheme because those will ultimately fail. Two other important questions I always ask myself are:

1. Am I passionate about this subject?
2. Does this business have a purpose that will last 100 years or does it fit within the purpose of my  existing business?

Feel free to ask any questions in the comments, I’ll be only too happy to help.

With visitors zipping about all over the Internet, it’s hard to get anyone to slow down and chat. From webpage to webpage they surf, instantly forgetting what they’ve just seen.

So if you want a visitor to return, you need to help them out a little. You need to get a visitor to commit to staying in touch with you, whichever way they want.

Why

If you don’t capture a visitor’s attention long enough to get their contact details, you’ve lost them forever. Sure, some might return on their own steam, but the percentages rank against it. How many times have you tried to remember some great website you found information on…but the name escapes you.

Internet Marketers have all sorts of tricks to capture email addresses and then sell, sell, sell to that list. But that’s not we’re about. If you’re lucky enough to be entrusted with a visitor’s email address, you should treat it like your own. Always offer the visitor value, never try to sell them to death!

How

The obvious one is an email capture box for a newsletter but there are other ways to stay in touch with your visitors. For example, they can subscribe to your RSS feed of your blog. This way the always get the latest information you’re publishing through your website.

[Note For those of you who don't know what a RSS feed is, click on the orange square in the top right, then use Google Feedreader to subscribe to this blog for free. Have a play around and save yourself hours visiting your favourite blogs each day.]

And don’t forget the power of social media to stay in touch with visitors. Have them sign up to your Facebook Profile and Pages, Twitter, and other profiles around the web.

Homework

Think about how you communicate with visitors and capture their information. What other ways could you do it? Remember to give your visitors as many options as possible.

It amazes me how many small businesses never bother to plan or work out where their business is going. But then I see the results of those businesses and it all becomes clear.

If you don’t have a strategy for your website and business, you’re literally going nowhere. The people that have an idea in their heads of what they want to achieve and how they’ll do it are moving in the right direction. The ones that actually bother to write it down blow everyone out of the water.

These are what success stories are made of!

Why

We all know most small businesses fail. We’ve seen the statistics and don’t want to become one. Well if you look at the reasons for failure, most of them can be tied to poor planning and management. What does that mean? They didn’t have a strategy to be successful.

Having a strategy isn’t about being successful anymore, it’s about surviving! It just so happens that having a strategy also makes for hugely successful businesses. Not a bad benefit, eh?

How

Planning doesn’t have to be the complicated techniques laid out in business books. It can be quite simple, but it still takes a little bit of thought and effort. I’m sorry, but Santa still hasn’t trained the elves how to do all your planning for you, along with make your products and services…you still need a little involvement in your business.

But all you need to plan is two things:

1. A goal
2. A plan to reach that goal

At the end of the day, it’s not that tricky! Work out where you want to go and how you’ll get there…surprisingly simple isn’t it?

Homework

Write down your goals and actions you’ll take to get there. For a more comprehensive idea of what to do, check out the new article in the Free Members Only Section: Action without Strategy wears out the Hamster.

The most important thing is to just do something, anything, that will contribute to building your website.

It always amazes me how many people don’t measure their website statistics. Even those that do have statistics programs in place never look at them. As they say, you can’t improve it if you can’t measure it. I’m never sure exactly who ‘they’ are…but they seem smart…

So measure it!

Why

Measurement allows you to work out where you can start improving. Right now, you probably don’t know how many visitors you have a day or how many of them are buying from you because of your website.

Doesn’t that sound like important information to have? “YES” I hear you cry! Good kids!

Seriously, measuring your website is easy as pie. It’s a lot easier than half the things you should be measuring in your business. Maybe even than 77.3% of the things you should be measuring.

It’s also interesting because most people in small business forums are asking how they get more website traffic. Well, if you’re not measuring all the different aspects of your website, how do you know where the problem lies? Sometimes it’s not in the traffic, it’s in the message your website delivers.

So no more excuses, let’s get measuring…

How

My favourite way to measure things is the free one. Thanks to some great free tools out there you can now measure your website’s results without it costing you an arm and a leg. Which is usually a good thing as you’ll need those arms and legs to create your products or provide your service.

If I was you, I’d pop over to Google Analytics and install that. It gives you a wide range of measurements for your website that may open your eyes to some major problems. Some clients I’ve worked with have had hundreds of visitors a day that they didn’t even know about. So you can guess what happened when we changed a few things around…sales increased instantly.

Sales mean money, and money means more holidays in Spain, which is always a good thing.

You could also find out if your web developers already installed a statistics program that you can use. But I’d still install Google Analytics as well for the detail it gives you.

Homework

Nothing tricky, go and install Google Analytics. Wait a few hours and start exploring your website statistics. Then make a point of doing it on a regular basis to check the improvements you’re making.

I talk a lot about getting your website right before trying to drive masses of traffic to it. But one of the problems when improving your website is knowing whether something is really an improvement.

Personally, I can take a small business website and instinctively know how to change the text to draw a visitor in. This is just something that comes with learning how to write good copy. But once you get to that point, how do you take it to the next level?

Remember how I always talk about the importance of measurement…well this area is no different. You can actually measure a webpages results and work out how well it is converting.

I’m not talking about just what sales copy converts visitors to customers, I’m talking about getting truly specific here. Let me explain.

Remember how each webpage has a purpose, a goal that you want the user to reach? Well that means, for every individual webpage, you can measure how many visitors reach that goal. And there’s even a free tool to test what webpage is better.

So go into your free Google adwords account and look at the “Website Optimiser” tool (more information here). This is one very powerful, and very unused tool from Google that your website can’t do without.

With it, you can change the content on a single page, and test what works better. You can change your homepage text to see which copy delivers your “Most Wanted Response (MWR)” from your visitor. You can change pictures, headlines, even complete layouts if you wish.

Can you see how this might be powerful? You can now test different variations until you find the one that keeps visitors on your website. And then test different variations of the best one, until your website is a conversion machine.

So go, have a play and see what you can come up with. Now you can really put your copy writing skills to the test! Good luck!

Webceo is a useful piece of free software I stumbled upon the other day. Of course, by free, it has an initial offering that is free and you pay for the extra functionality. However, the functionality of the free version is very good and I’m putting it on my “must have” list for search engine optimization tools.

The most useful functions I think are the ability to analyse keywords by number of daily searches and competitors and to analyse your pages for particular keywords and get feedback on how to improve.

I recommend you check it out as it’s very easy to use and will help take your optimisation to the next level.