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Niche E-commerce Sites: Less Competition Equals More Profits

July 8th, 2009

The easiest way for the average person to make money online is with an e-commerce site that sells unique and hard to find products. If you have thousands of dollars to stock a wide variety of products, and a practically unlimited budget for advertising, then a niche e-commerce website is not for you. However, if you are looking to start an e-commerce site with low startup costs that can compete with large established online retailers, a niche e-commerce site is your best chance for success.

Your first step is to find a niche that you are familiar with and can capitalize on. Think about your hobbies, your passions, or the kinds of items you like to collect. For example, if you enjoy a particular type of craft, are the supplies you require easy to find at a local store? If not, consider selling them on a niche e-commerce website. It will be easy for you to decide which supplies to sell and how much people are willing to pay for them. If this is not feasible, try selling the finished product. Your goal should be to sell a unique product that is not available in local stores. If your passion is animal rights, consider selling health and beauty products that are not tested on animals. Having pride in what you sell should be reflected by your website and its products.

It may be tempting to offer a wide variety of popular products to appeal to a majority of online shoppers, but this does not work well for new e-commerce websites. Compare Google’s search results for “children’s clothing” vs “girls handmade denim skirts”. Top online retailers such as Wal-Mart and The Gap dominate the search results for children’s clothing. These companies have spent millions in advertising dollars to build their brand. An e-commerce website will not be able to compete by offering just “children’s clothing” without spending a fortune on advertising.

While “children’s clothing” may be a much more highly searched keyword, long tail keywords like “girls handmade denim skirts” convert visitors into buyers more often than popular searches. A person searching for children’s clothing may be looking for nearby stores that are having a sale this week or a clothing size chart. A visitor who arrives at your site by using a specific, long tail keyword search is more likely convert into a sale. Short tail keywords are broad generic search terms while long tail keywords are narrow, specific searches. A new e-commerce site will have an extremely difficult time ranking high in a search engine for highly competitive, short tail keywords. It is far easier to achieve a high search engine ranking for a long tail, specific keyword.

A profitable niche website is run by someone who knows the subject matter inside and out. According to Google, content is king. It is easier to write fresh, new content if you are knowledgeable about your product. Your e-commerce website should not only sell products; it should also reflect your knowledge and experience about your niche. Articles about your niche and highly detailed product descriptions will convert more customers into buyers. Your website will appear more trustworthy and informative.

Niche websites have another benefit that can bring free traffic to your site: forums. Join online forums and discussions about your niche. Make sure you have something useful to contribute, and follow all the rules about posting your link. You will find many other people online who share your interest and may become potential customers. Forums can also provide excellent free market research. Pay close attention to which products people who share your interest are buying, and which products are hard to find.

Besides for being more profitable, a niche e-commerce website can be more rewarding as well. You will be dealing with products you enjoy and customers who share your interest and value your products and knowledge. This should encourage you to add fresh new content and new product lines. This is the best way to keep your customers coming back for more products.

Constant Content author “Webhick” has produced eight articles and two sales.

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