Best Internet Business Ideas – Selecting a Killer Product

by on March 2, 2012

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In my last post I detailed the three essential elements of any online business system: product or service, offer and traffic.

In this post I’ll be focusing on the “product” portion – the specific steps necessary to choose a product giving you the highest level of confidence in your ability to compete and make a profit.

So let’s say you have an internet business idea, meaning you want to sell something of value (either a product or service) to the hard won visitors of your site. When selecting a product there are three core considerations:

Are there enough people searching for my product?

Are the competition levels low enough that I can get my site ranked for the keywords that I’m targeting?

Is my product something that I can actually source and make a profit?

Let’s discuss each in turn…

Are there enough people searching for my product?

You may believe that you’ve discovered a killer product for the best internet business, but until you actually prove that there is significant demand for it, you run the risk of wasting a lot of time and money developing a site that doesn’t make any money. You need hard data – proving that people want your product.

A good rule of thumb is to target a keyword for your niche product (or a set of keywords for related products) that will generate about 300 visitors to your site per day. You will want to design your site around a set of keywords for SEO purposes.

Three hundred visitors per day is a good number to target, as if you manage to convert just 2% to sales with a commission of just $20, you’ll still manage to make $3,600 per month.   That’s very obtainable goal and just with this one site you’ll make $43,000 per year!

To determine if your product keyword is going to generate 300 visitors, you’ll need a tool that can verify search volumes.

The Google Keyword tool is a free tool that is widely used.  I’m not going to go into detail in this post on how to use the tool, but there are plenty of tutorials if you search Google.

One thing to keep in mind when using the tool is that Google tends to overestimate search volumes. You might want to half what Google returns with their tool to get a better estimate.

Keyword Blaze is another excellent tool that I recommend. You can get a free copy here, just by subscribing to my blog.  This tool provides an additional benefit in that it evaluates how difficult it will be to rank for your keywords based on your competition.

Which leads me to my next topic…

Are the competition levels low enough that I can get my site ranked for the keywords that I’m targeting?

Getting your website ranked in the search engines so that people can actually find your product can be tough going; especially if you pick a set of terms that are too competitive. Your goal should be to get to the first page of Google which means that you’ll need to be in the top 8 search results for your keywords.

There are a number of free tools that can help you evaluate your competition. Most operate in the same way in that they identify a list of alternate keywords based on a seed keyword to try to determine the few gems that have the least competition.

One tool that I highly recommend is Market Samurai as it provides the most in depth analysis.

Keyword blaze is another great tool – it  has a very intuitive interface and assigns competition levels a numeric ranking, making for easy comparisons.  You can get a free copy of Keyword Blaze just by subscribing to my blog.

Another method is to use a free toolbar called SEOMoz. The toolbar removes a lot of the complexity by boiling down the analysis to just two variables: “DA” (Domain Authority) and “PA (Page Authority). DA is the overall ranking (between 1-100) of a domain, and PA is the ranking of an individual page. How SEOMoz actually determines these rankings is their secret sauce, but these metrics are extremely useful when trying to gauge your competition.

When searching Google for your keyword – look at the first 10 results. If you see two websites with DA and PA rankings under 40 or so, you can most likely get your website ranked given a decent SEO effort.

Now for the final question…

Is my product something that I can actually source and make a profit?

The first thing that you’ll want to check is “commercial intent”. Are other sites advertising your product based on your search terms? This is easily done, just look for Adwords advertisements in the search results for your keyword.

The next thing you should examine is the logistics of order fulfillment. Does your proposed product weigh 500 lbs posing all sorts of shipping difficulties? Can you get a distributor or manufacturer to drop ship for you without fees that ruin your profit margin?

You should also take a look at the top 5 other sites that are selling your product. Go to the order page and see how it’s priced. Do these sites include free shipping? Can you get a price from your supplier that allows you to sell it at about the same price and still make a profit?

You want to shoot for a minimum profit of $20 per sale. If you cannot achieve this with your supplier and shipping costs, you should probably move on and begin to evaluate a different product.

Hopefully you found this rather long winded post to be helpful when evaluating your internet business idea. In my next post I’ll be going over the “offer” or how to sell your product.

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