Google Keyword Tools: Here's a quick way to evaluate a potential business idea or niche market and see if it has legs: Look at what people are paying to advertise on its keywords. Typically, where there are high pay-per-click bids, competition in the natural search engine results is also high. Maybe too high. If you can't afford to compete for a top spot in the sponsored listings for the most desirable keywords, should you even bother with this market?
Well don't give up just yet. Many PPC advertisers make exactly the same mistake aspiring online entrepreneurs do: They aim too broadly. They pay ridiculous amounts of money to get listed in the top spots for keywords that are far too unfocused and simply won't convert. Knowing that, you can take advantage of pay-per-click data to determine if you've found a viable market or not--before you get mired in an online business with no potential. Use the free Google AdWords Keyword Tool to see how many searches are being done monthly per keyword, and how much advertisers are spending per keyword for a top position in the sponsored listings.
You'll get a list of keywords similar to the ones you've entered. By default, you'll see the cost per click for the top three positions in the Google Sponsored Listings. (To see the cost per click for lower positions, enter a maximum CPC bid of 25 cents in the box next to the currency choice.) You probably can't compete in this market if all the keywords in your chosen area are upwards of $1. If all the advertisers are willing to pay a dollar or more per click, at a 1 percent conversion ratio--which is pretty decent--they're paying $100+ per customer. So you're looking at one of two possibilities: It's a saturated market. Stay away, no matter how attractive the global search volume looks for each keyword. It's going to cost you too much, and you don't have the experience to compete. It's too broad to be a niche in the first place. In this case, you've got an opportunity to narrow your idea down to a laser-targeted niche. Try looking through the list for "clusters" of keywords that all point to the same problem. Then you can generate additional keywords from those and see how the numbers will look. This refining process is a big part of finding a golden niche.
Google Keyword Tools: Here's a quick way to evaluate a potential business idea or niche market and see if it has legs: Look at what people are paying to advertise on its keywords. Typically, where there are high pay-per-click bids, competition in the natural search engine results is also high. Maybe too high. If you can't afford to compete for a top spot in the sponsored listings for the most desirable keywords, should you even bother with this market? 