Choosing the Right Product

by Alex Ang on 29/08/08 at 1:00 am

When you first begin your online business, the first and biggest question you will ask yourself is…what am I going to sell? Points to consider when deciding the answer to that question are:

• Is it light and easy to ship?
• Is it a digital good that is downloaded (e-book or software)?
• Is it perishable or fragile?
• Does it have to be seen and held (designer fabrics, perhaps)
• Is there sufficient demand to make your venture profitable?
• Does it have little competition from big online companies (niche products)?

The last two characteristics are the ones that can be difficult to pin down. Here is a generally accepted way of arriving at an idea of how big the demand and competition is for a product.

If you have a particular interest in some products that meet the above criteria, great, but do not limit your probe just to items you like. You are looking for a niche product with relatively good demand (adequate to make it profitable), but without big competition.

One way to see what the demand is for products you are interested in is to look at search engines to see how often people search for the product you are considering.

The result of all this research should be that one or more products will fit into a niche market – products with some demand, and relatively little supply. For the best results, focus on one niche product category, and offer a wide selection.

That way, you can become the best online source for that specific category. For example, instead of providing general craft supplies, offer the widest possible selection of needlepoint kits. This strategy will also allow you to rank higher in search engines because you can optimize your pages for fewer, more specific, keywords.