Best Markets for Affiliate Marketing

The best markets for affiliate marketing are niche markets where there are products and services with little competition from large corporates. If there are large corporates active in the niche you will not be able to compete against their advertising budget.

The most profitable niche markets are where there are small business suppliers. There are potential customers looking to buy a specific product or service that you can easily refer and make a commission.

What is a Market Niche?

A market niche is a subset or section of a market. What we want is to target a niche market that is very narrow (specific to a product, service or problem), but has depth (large volume of searches or potential customers).

This is best explained with some examples.

It would be pointless trying to target a huge market like “health”. The health market is too general and covers everything.

Even if you could get a domain like health.com and have it ranking it would not make you any money as the traffic would be only browsing traffic. Your site would need very specific pages targeting medical conditions and the solutions.

You need to get down to a specific niche where there are searchers trying to find the solution to a health-related issue. The acne niche is one that may be suitable as it is a specific problem and has large number of sufferers looking for a solution. Medical science doesn’t have a simple solution for acne so this could be a good choice.

However, after further market and product research I still think “acne” is too wide and we need to specialise further. When we look at some of the different forms of acne we eventually find some candidates for a potentially good niche market that we can promote a product and make money. For example, Acne rosacea, which is the redness caused by acne.

Google Keyword Tool

A quick keyword search on Google Keyword Tool provides:

acne rosacea treatment

rosacea cure

rosacea treatments

natural rosacea treatment

rosacea remedies

These keywords have low volume but as they are very specific keywords they are more likely to be “buying” keywords. “Buying” keywords are the ones where people are likely to be searching to buy a solution to their problem.

Usually searchers don’t get down to long tail keywords (3 or more words in the keyword phrase) unless they are more serious about what they are looking for. And the more words they type into Google the more serious they are with finding the solution. We may choose to build a site around one of these keywords or create posts in an authority site.

How to Make Money with Affiliate Marketing

How People Search on Google

When people search on these types of long tail keywords you will most often find they started their search by browsing on a simple, general keyword like “acne”.

Next the searcher would have become a little more specific and searched on a type of acne, “what causes acne”, “how to prevent acne”, “how to cure acne“, etc. These are still browsing keywords but the searcher is getting more specific to finding the right answer.

Eventually, the searcher becomes highly focused on exactly what they want to know by entering more precise keywords into Google.

Someone who enters “natural rosacea treatment” would be specifically looking for a natural way of treating or curing acne rosacea. This is where you are more likely to find a buying customer. The volume may not be great but the customer has been “qualified” and is more likely to be ready to make a purchase. When I say “qualified” I mean the customer has been through the browsing and research phases of buying that we all go through.

Just think about when you buy something, like a TV. Usually you browse in the shops to get an understanding of what brands and models are available, what features they have, sizes, prices, warranties etc. Eventually, you decide on a particular brand and model because it suits your living room, lifestyle and budget. It may take you several days, weeks or even months before you decide to buy. No one simply walks into a shop and buys a product without browsing and thinking about it first.

Best Markets for Affiliate Marketing

As there are literally thousands of merchants with millions of products to choose from, many beginner affiliates find this a daunting task. Unfortunately, it is hard for me to help you with choosing a good niche and product to promote as there is so much choice.

However, here is a selection of available products and services sold by merchants. The list is not exhaustive and should give you a starting point when selecting a niche.

Now of course if you have special knowledge or skills from a hobby, sport, career or some other interest you should concentrate on finding a niche and products for those skills as it will be easy for you to develop a website.

Become an Expert

When people search for information on the internet they want to find a good site that has everything they want to know about the search topic. There are still many topics that are poorly covered on the internet and present an opportunity for affiliate marketers to create a good website to promote a product or service.

Become an expert for you niche.

There may be something you want to learn or a problem you want to solve so you could research that and become an expert. That way you are learning about something new yourself and you will be helping others with your new found knowledge. While you are conducting your research you are building your website.

I have built many websites based on a topic that I knew very little about. I actually enjoy researching a new topic and learning something new.

What are the Best Niche Markets?

Firstly, it is not the market with the lowest competition. Usually, if there is low competition that may be a sign that the market is poor, difficult to sell goods and services, and less profitable than other markets.

It’s also not necessarily the market that you know about. You may know about “doll-making” but I doubt you could make much money from that market.

It’s not the markets with the most people searching in them. Targeting keywords with high volume usually results in poor conversions as most of the searchers are just browsing the internet.

You need to find a product or service that people really want and need. The more desperate the buyer the easier it is to sell the product. If you do your research well you will avoid promoting products that fail to sell or are not profitable.

The most profitable markets are where you know with a high level of certainty that the potential customers are looking to buy a specific product or service that you can easily and profitably provide.

Attributes of a good market

• Strong demand for a product or service
• People know exactly what they want to buy
• low competition

By low competition I mean:

• few large corporations to compete against.
• few powerful authority sites
• don’t be concerned about other internet marketers.

The process of uncovering real “buyer” markets and turning them into profit is the process of creating a high profit, passive income online business. These are groups of people with such a specific requirement that all you need to do is show them the product they already want to buy and there’s your affiliate commission – no hard work, no selling, just smart online business.

Example

You may have found a business that provides software training for the Microsoft products such as Office, Word, Excel, Access, etc. The business has an affiliate program that pays 10% commission for every participant that you book into the course. So if a two-day training course costs $500 you would receive $50 for every customer you send their way.

If the business doesn’t have an affiliate program you can still contact them and ask if you can make bookings on their behalf for a commission. Most businesses would welcome extra customers even if they have to pay a commission to get them.

So to capture these customers you would build a website promoting the software training and redirect the traffic to the vendor’s web site.

What Markets are Good for Affiliate Marketers?

Health

One of the most important things in life is to have good health because without it you won’t be doing anything else. So health will always be a high priority requirement for all people. When someone has a medical problem they develop a sense of urgency and are more open to spending money on treatment or a remedy. However, you need to target medical problems that are not easily treatable by conventional medicine, eg. acne, hair loss, cellulite etc.

Wealth

Another very important thing in life is to make a living. Any product or service that helps people make money or save money will have a hungry audience that will buy products.

Home-Based Business

Any market niche telling people how get a job, start a career, get a promotion, earn more money, work from home or turn your hobby into a business will have a ready audience that will buy products that help them.

Products Not Sold in Stores

Any product or service that is not sold in stores is ideal for marketing on the internet.

Let’s face it, if I can go to the local shopping centre and buy a product for the same price as online I will buy from a physical store because I can see and touch the product before buying it. Also, if I need to return it I can go back to that store whereas returning a physical good purchased on the internet involves posting it back.

To effectively sell physical products online, the product must be cheaper than in the stores. This is not usually a problem for online businesses as they don’t have expensive store leasing costs to add on to the price of the products.

Markets to Avoid

If you are a newcomer to internet marketing you should avoid these markets as they have very high competition. It will take considerable effort and time to be successful in these markets.

• Finance
• Insurance
• Medical
• Pharmaceuticals
• Real estate
• Travel

There are too many large corporations dominating all the high-volume traffic and high-quality keywords. Also the advertising costs are very high. You will find Google PPC prices of $5+ per click which is unaffordable and not profitable for a small business.

Seasonality

When I first started promoting products online I quickly noticed how many products sold well for a while then the market went dead. Eventually the same products started to sell again.

I thought, what is going on here?

After further research I realised that many products have a seasonal sales cycle. And it is often hard to understand why. Products obviously associated with the time of the year, such as Christmas, Halloween, summer or winter will be seasonal. But many other products also have a seasonal sales pattern which is difficult to determine until you start selling the product. Although looking at the search patterns in Google keyword tool may help to understand your niche.

Market Demographics

Before you decide to focus on a niche (and relevant products/services) you need to understand the demographics of who will be interested in the product or service you want to market.

Note: This is a common area where affiliate marketers go wrong.

Why Do We Need to Know Demographics?

It is very important to try to match the product to the market demographic. In other words, don’t try to sell ice to Eskimos.

For every product or service, there is usually one main demographic (age, sex, race, education, income, occupation, children, etc.) that is interested in and potentially buys the product or service. Targeting that demographic will give you the best chance of making money. This will become more apparent later in the course when you build a website and drive traffic to it.

How Do You Determine Demographics?

Some demographics are easy to determine using common sense. For example, if you are selling baby clothing, you should be able to guess that the demographic to target is young adult females, with children, average household income, race likely to be Caucasian but African American and Asian too.

For not so obvious markets, there are some free tools available on the internet.

Sometimes the market demographics don’t tell you much but at least it is worth a look.

Another way to find out the demographic profile to target is to contact the product vendor and ask them. The vendor will most often already know what demographic converts best for his/her affiliates. Generally, if you have already made a sale, the vendor will freely give you a lot of information about the product or service. Sometimes they will even give you the product for free for evaluation purposes.

Product Selection

Note: This is a common area where affiliate marketers go wrong.

One reason why people fail to make money with affiliate marketing is that they select poor products that do not sell. Product selection is critical to making money online. Choose the wrong product and you could be wasting a lot of time and effort for nothing.

How to Select Profitable Products

Evergreen Products

I like to select products that are evergreen products. That is, the market is always going to be there and if I build a site it will potentially make money for a long time.

An example of an evergreen market is health and fitness. Whereas if you build a site around the latest model mobile phone it may make good money for a few months but will be out of date next year.

Products with Recurring Revenue

I like to target products that have recurring revenue. It is hard enough making a sale but if you can sell a product or service that is billed every month you can make a lot of money from one sale for a long period of time.

Target Larger Traffic Volumes

Try to target keywords with search traffic >2500 exact searches per month.

I like to target >4000 exact matches per month.

Also look at the volume of traffic coming from the USA as that is where the majority of buyers are located.

If you choose a keyword with search traffic >3000 exact searches per month, but the volume from the USA is only 300, it may not be a very good keyword. The best keywords have strong traffic volumes from the USA.

Note: The higher the traffic volume the longer it will take to rank as there will be more competition.

Unusual Products

Sometimes it is worth choosing unusual products that you would not normally think about promoting.

I have heard from other marketers that they have had a lot of success promoting some unusual products eg. dog’s hemorrhoidal product. You may laugh but they are making good money selling a solution to the problem.

Actually the internet is very good for promoting products relating to topics people don’t like to talk about. Many people prefer to research their problem on the internet rather than talking to family or friends.

Here are some examples of issues people don’t talk about:

• Embarrassing medical problems – hemorrhoids, gout, acne, cold sores, sweating, etc.
• Cosmetic issues – small breasts, small penis, hair loss, man boobs, wrinkles, etc.
• Dating
• Relationship problems
• Sex
• Divorce
• Going bankrupt
• Death

Market Trial & Error

Contrary to what the “marketing experts” say, I have found that a lot of marketing effort is trial and error. In fact, most reputable marketing agencies will survey and test the market before going ahead and launching a marketing campaign. As we won’t have the luxury of being able to survey and test market segments before building a website expect some of your websites to fail. This will be unavoidable and no amount of market analysis will prevent it. However, the cost of a failed website is very low – the price of the domain and maybe some link building service. View these failures as a positive because we can learn from our mistakes and become more successful in the future.

Why a Website Works

• Sometimes the keyword or product is a perfect match. The keyword brings visitors who were looking for that product and really want to buy it.
• Sometimes a product is so good it sells itself without any real effort.
• We get lucky and choose a product with low competition and high traffic volume.
• Managed to get good quality backlinks.

Why a Website Didn’t work

• The keyword only brings browsing visitors.
• There was too much competition.
• The visitors may be from second world countries and cannot afford the product.
• The keyword and product may be a mismatch.
• The keyword may attract visitors who are looking for something for free.
• The product is perceived as poor quality.