How to find a profitable niche on Amazon in 2023
If you are starting in the Amazon Associates world, you will surely face one of the main dilemmas that any newbie faces: what do I create my first website on?
The answer is: it does not matter, as long as the niche is profitable So the second question is: how do I find a profitable niche on Amazon? That’s what this guide is about. Keep reading!
- 🤔 How to know if a niche is profitable?
- Good balance between price and commission
- Good number of searches per month
- Limited competition
- Expansion possibility
- Persistence over time
- Seasonality or non-seasonality?
- 🎯 How to choose the best niche for affiliate marketing?
- Step 1: Do not be biased
- Step 2: Categories and population groups
- Step 3: Product Navigation
- Step 4: Target and calculate profitability
- Step 5: Search for Keywords
- Step 6: Adjust the profitability calculation
- Step 7: Evaluate competition and start publishing
🤔 How to know if a niche is profitable?
Before explaining how to find a profitable niche, let’s talk about the characteristics of profitable Amazon niches. That way, you will know what you have to pay attention to, and everything will be easier for you. Let’s begin.
Good balance between price and commission
First of all, a good Amazon niche is characterized by having an acceptable balance between commission and price. This aspect is fundamental, and many people do not consider it. Many SEOs despise 3% commission niches because it is too low. And that is a mistake.
We think we are being scammed when we see a 3% commission. “It is too little”. Well, it may not be much, but if the product is expensive, 3% can be profitable.
Therefore, do not look only at the price or commission of the product. The important thing is the combination of both.
An electronics niche (3% commission) that sells €300 high-end products can be as good as a fashion niche (10% commission) that sells €90 products.
In both cases, the average sale is €9. Therefore, do not fall on the bias because this or that category offers a very low commission from your perspective. Instead, evaluate how many dollars or euros you will get for each sale and then compare it with the visits you can get and the competition you will have in the SERPs.
Good number of searches per month
Naturally, the second important point is the number of searches per month. As much as you have a product that pays very well and is very expensive, if you only sell one per month, it will be difficult for your niche to be profitable.
Most profitable niches get a few thousand searches per month and at least 200 visits per day. From there on, a niche can be reasonably profitable. Not enough to have a salary, but enough to have an acceptable bonus.
Keep in mind that you should look at the joint searches of main Keywords, the secondary ones, and the long tails. If you only look at the top searches, it can give you the feeling that all niches are bad. That’s wrong. You must make a good list of Keywords and see how many total searches the niche has.
Thirdly, you should have limited competition in the SERPs. Neither much competition nor any competition at all. Yes, that’s right, no competition is not a good idea either.
Unless you are very convinced that the niche you have found is something new and will have a lot of sales while nobody has realized it yet, it is most likely that if nobody is in that niche, it is not profitable.
We have niches plagued by SEOs with their websites competing for the first position at the other end. Making a place for yourself in those niches is not going to be an easy task, and it is going to require a significant investment as well, so it is probably not the best idea.
The best thing for you is to find a niche with a fair balance. Two or three websites to compete with means that this niche is potentially profitable but, at the same time, is easy to beat if you put effort into it.
It can also be interesting to attack those niches in which there are only single pages of general affiliate websites when it comes to SERPs but no website specifically dedicated to the niche.
This means that the niche is profitable, but no one has yet entered to compete specifically in it (many times, as we see large websites with a page dedicated to said niche, we do not attack it when, in fact, we can easily beat that great general website by creating a specific website).
Another point that characterizes good Amazon niches is their expansion ability. That is to say, the ability to attack other surrounding niches when we have already positioned the original we had in mind.
This does not always happen. Sometimes we think we have a good initial niche and, actually, it is not, so investing more to make it grow is anything but worth it.
However, at other times, the niche works, we reach the top positions, and it starts to generate good money. At that moment, we have to ask ourselves if it is a good idea to expand it (sometimes we can, while sometimes we cannot).
A good niche has the characteristic of being able to expand, but, at the same time, it depends on you. So you have to leave the door open to do so when the time comes.
For example, if you create a niche dedicated to bedsheets and call the domain “sheets.top”, it is difficult for you to expand it to mattresses, pillows, etc. Of course, you will be able to do so, but the domain name is already specifically focused on sheets.
In that case, it looks a bit strange (although it can still work).
That is why, if you create said niche of sheets, it is probably more worthwhile for you to create a branded website from the beginning, calling it, for example, “sleepbetter.top”, and deal only with sheets at first.
When the time comes, you can expand itto other goods related to sleeping, and it will not be weird. Furthermore, the extra strength provided by EMDs has been reduced; you do not lose too much by not including the keyword in the domain.
Persistence over time
Another characteristic of good niches is that they are persistent over time, which means that it is not a one-day flower. Instead, the niche will be able to continue operating in three years without the fashion of the product you are selling having gone out of style.
Careful! Sometimes, it can be interesting to attack a fashionable product that is going to disappear over time. But, if you are just starting, you should not get into these types of niches because they are more difficult to know how to manage, when to let them die, when to sell them, etc.
The best thing you can do is attack stable niches over time. In other words, it is better to sell sheets than satisfyers since the latter will stop selling after a while because a competitor will emerge. The best example is GoPro cameras (rather than adventure cameras).
Seasonality or non-seasonality?
Seasonality is different from persistence over time. It means that the product you are selling is only sold during one period of the year. For example, air conditioners and fans are sold in summer, not winter.
These types of niches are profitable and interesting because, although they do not leave money constantly throughout the year, they compensate for those months without sales in boom months. Furthermore, they are usually less competitive niches because people prefer money month after month.
If you attack seasonal niches, you can create a winter niche for each summer niche, thus compensating so that when some are in low hours, others will be in high hours.
However, think that seasonality is not only referred to winter and summer. There are particular niches, like perfumes, that only grow for a couple of weeks a year (usually before Valentine’s Day and before Christmas).
If seasonality implies that sales will occur in a few days a year, you should consider if the money you will get during that short time they are at their high point is interesting enough.
🎯 How to choose the best niche for affiliate marketing?
Now that we know what characteristics profitable Amazon niches have, we can get to the core of the matter: How can I find profitable Amazon niches? So let’s get into it!
Step 1: Do not be biased
As we said, you should not be biased. That 3% commission niche may be profitable, and that 10% commission niche may not. So do not ignore any kind of category just because the commission is low.
Furthermore, we also recommend that you make value judgments. For example, you must assess if you want to sacrifice profitability for your moral integrity since it is your decision. The important thing is that you do it consciously and know what disadvantages you start with.
But wow, that’s a secondary aspect. The main one is that you do not have a bias about the profitability of niches. Analyze as many as you can and, with data in hand, make a judgment about which niche is more profitable.
You will be surprised that, many times, 3% niches are profitable while the 10% ones are not (among other things, because 10% niches are often related to fashion, which, by definition, is changeable).
Step 2: Categories and population groups
The second step you must follow is to look at the different categories and think about the population groups within each category and subcategory. SEOs do not do this. Usually, what they do is enter a category, look at products, and see if they like any of them.
That’s a way of doing things, but many opportunities are lost. So we consider it better to think of population groups to sell things.
For example, you can enter the sports section and imagine what population groups are there. To begin with, you have all sports; then you have those who do adventure sports, those who do water sports, those who do mountain sports, those who go camping, those who do fitness, etc.
You have many population groups, and even within each group, you can have subgroups. Therefore, it is important that you list as many population groups as possible based on the categories’ suggestions.
Why is it better to base yourself on population groups? Well, because they will allow you to create more brand-oriented websites (which, as we said before, are the ones that allow you to expand later), and because you will have a target to talk to, with the possibility of creating a community.
Niches oriented towards a single product or a small set of products are very aseptic. But, on the other hand, if you dedicate yourself to a specific group, that website will have a soul, which will be positive for your business.
Also, when targeting a population group, you are not limited by Amazon categories. That is only the starting point, but for example, going back to sports. Imagine that’s where you get the “outdoor camping lovers” group. You will sell them tents and trekking poles, but you will also sell them camping gas and mosquito repellents.
Do you get the idea? You focus on a lifestyle, interest, or hobby, which cuts across all Amazon categories. This cannot be done if you only search for products within a category.
Finally, the advantage of attacking population groups is that, in the future, you could not only dedicate yourself to recommending products and monetizing with affiliation, but you could also create informational posts that monetize with advertising or even infoproducts.
So, without a doubt, targeting population groups instead of products or categories is a great idea.
Step 3: Product Navigation
Once you have the population groups, you must browse the products and point out those that fit into the population group.
Obviously, you can also pre-list (it is a good idea). But, even so, it is recommended that you browse the products and see which ones there are because many you did not initially have in mind will surely appear.
Step 4: Target and calculate profitability
Start pointing out the products you find for the different population groups selected. The idea is that, for each population group, you have a good list of products fitting that lifestyle, hobby, or interest. For example, a list of 20 products.
Then, do the profitability analysis by looking at the average price of each product and calculating your commission, then write it down.
Step 5: Search for Keywords
After the abovementioned, you must search for the Keywords related to those products. Generic keywords, secondary and long tails. All Keywords. Write down the total sum next to the calculation of profitability that you made.
With this, you will have all the data needed to finish making the right adjustment to see which of those products and those niches (that is to say, population groups) will be profitable.
Step 6: Adjust the profitability calculation
A good way to calculate profitability is:
- Total searches * 0.1 * 0.02 * Price * Commission.
That is to say, imagine a product has 10,000 searches per month adding all keywords, it is worth 100 euros, and they pay you a 6% commission. So:
- 10000 * 0.1 * 0,02* 100 * 0,06 = €120
The first thing is the searches; then we apply a 0.1 because, of all those searches, we will only pick up and send to Amazon approximately 10%, then we apply a 0.02 because, of the people we send to Amazon, only 2% will buy. And finally, we apply what we will charge for each sale.
Calculations do not have to be extremely tight. The important thing is to assess returns. So if we make €90 or €150 instead of €120, it does not really matter.
Do this with all the products on your list, and you will have a good approximation when it comes to the profitability of your niches and products within them.
Step 7: Evaluate competition and start publishing
Now it is time to start publishing, and the best thing is that you do it based on competition. We have already explained what competition you should look for: Not too much, not too little.
With that in mind, all you have to do is rank the products within each niche based on their profitability and competition in the SERPs, then do the same for all niches as a whole.
You start by publishing the least competitive niche (population group)and, within that niche, the least competitive products. Then you set up the second least competitive niche and start with the least competitive products.
Keep doing so until you have 3, 5, or 10 niches. Depending on how much work you can take on (it is better to attack several than just one because not all of them will work).
Once you have made all the niches that you plan to attack, go to the first one and publish the following products in order of profitability and competition in SERPs.
And so, little by little, you add items to your niches,knowing that you have the best calculation between profitability and competition.
Thus far, our guide on finding profitable niches for affiliate marketing on Amazon. We hope you consider it useful and find many niches with which to start earning money. Surely, with little practice, you will find great opportunities still untapped.