Successful Online Selling
 

The 4 Step Method for Selecting a Profitable Online Auction Niche to Enter

selecting a profitable niche onlineThere are plenty of people on eBay who simply sell whatever it is they can buy cheap - one week it might be dog leads, the next it could be computer mice.

They don't specialise in any one market, and whilst they may still make some money, they are not building a business that will benefit from being a specialist for a certain group of customers.

If you focus on one particular niche, you'll understand your products better and write better listings on eBay. You'll get to know what your customers want, and provide the right items at the right price.

They'll come to see you as the expert in that market, and the trust and loyalty that comes with that, will mean plenty of repeat business.

So if you're aiming to become a specialist in a particular niche, what are the 4 steps you need to take to make sure you are selecting a profitable niche to get into?

1) Less competition - Some people think that the best way to find a profitable niche on eBay, is to find the most popular items, and then sell those.

Unfortunately, this is probably the opposite of what you should do. Sure, these items are in demand, but if you choose a market like iPods or Nintendo consoles, there will be too many competitors.

You'll struggle to beat their prices, and it will be virtually impossible to get yourself established as specialist in that niche.

Whilst there are unlikely to be any markets on eBay that have no competition, look for niches where there is less competition to start with.

Look through eBay's categories and make a note of those that with fewer listings. It doesn't mean they will all be profitable (we'll look at that next) but it does mean it will be easier to establish yourself.

Try and focus on categories and markets that interest you, or you know something about, as it will help you get started and make it more enjoyable.

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2) Passionate buyers ready to spend - A market with less competition will be easier to get established in, but you need to make sure it has plenty of customers who are willing to spend money.

The best customers are those who are passionate about something, or have a problem they want solving. These two things will make them get their credit cards out, if you have what they need.

Focus on niches with these passionate and needy customers, they might be related to specialist hobbies, or common everyday problems. Check the completed listings for these categories.

What you want to see is items selling well for both the auction and Buy It Now formats - then you know you have customers that spend money.

3) Multiple, linked products - Next, you want to understand the potential of the niche you are looking at.

If your market consists of just one product that sells well, and everybody is selling it, you're not really any better off than the sellers who just move from product to product, just selling what they can source cheaply.

You're looking for a profitable market, not a just a profitable product. You want to make sure there are plenty of different items that are selling in this market, which are all linked together somehow.

That way, you can sell multiple products in to the market, and when you sell one product, there is the chance sell other, complementary items to your customers.

This is how you become a specialist, and get a reputation for being the seller to go to in a niche.

This just requires a bit of lateral thinking to look at a niche and consider all the related products you could supply.

finding a reliable supplier4) Reliable suppliers - Now you know what to sell, and have found people to sell to, you need to find a reliable supplier who can provide you with the right products, at prices that mean you make a healthy profit.

This is probably where you're going to have to do quite a bit of work, for the simple fact that if it was easy to find these suppliers, other sellers would already be in the niche.

Be prepared to search out the best wholesalers (taking all the usual precautions to make sure they are legitimate), accepting that this will probably mean you have to avoid the first few pages of a Google search.

Speak to manufacturers directly to try get the best deals, or ask them for their authorized wholesalers to make sure you get a reliable supply.

Generally, the harder it is to find a supplier for a product you know is selling, the more profitable it should be when you track one down.

Finding the right niche to get in to so you make a profit, is almost a science, and it means you're going to have to do some research if you want to get it right.

However, if will be time well spent, and should be easier if you follow these 4 key steps.

Bear in mind that the marketplace, as well as what customers want, is constantly changing, and a niche might not always be profitable.

Stay ahead of the game and regularly look around for new niches to sell to - to reduce your exposure, as well as increase your profits.

Free eBay tools, like eBay Pulse, can help, but when your business is up and running, you might want to look at more in-depth, paid for tools like Terapeak and Salehoo's Research Labs.

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