For Gold, Peace, and Freedom


10 Steps for Building Profitable Niche Sites

March 31st, 2011

Today is the fourth anniversary of Karlonia.com, and after crunching the numbers on site statistics and revenues at the end of this month (and quarter), one thing has become abundantly clear: my niche sites are outperforming the eclectic ones by a wide margin.

To give you a sense of the large differences in efficiency between the two models, I have one finance-related niche site that has just topped $800 per month in revenue but contains only 20 pages of content and has not been updated for more than a year (other than approving comments posted by visitors). I also have several other narrowly focused sites that are moving through the $20-$100 per month range with approximately the same amount of content and no new posts for several months.

By contrast this eclectic “Internet marketing blog”, in spite of having over 1,460 posts with daily updates for four years and an average article length of 795 words, has seen its revenues moving mostly sideways within the $400-$500 per month range for almost two years. When we factor in the extra time and money spent on article procurement, daily postings including the necessary editing and proofreading, and attempting to monetize hundreds of pages with many different topics, the greater efficiency of the niche site model in terms of overall amount of revenue gained compared to the total expenditure becomes obvious.

So after several months of debate, I have finally decided to put this site into a “semi-retirement” mode, which means that posts will be much less frequent but I will still actively maintain the site, including approving comments, responding to contact form submissions (except for spam or garbage), and of course paying the bills. While I reallocate my time toward building a larger empire of profitable niche sites, you can benefit from my experience because I have prepared an article that provides a blueprint for building these types of sites. When program owner Michele Ballard requested more information on making money from AdSense last month, this triggered one of my epic email replies, which gave me a chance to explain this process in a way that I hope almost anyone with a computer and Internet connection can follow. By coincidence there happened to be 10 steps. The rest of this post is a slightly edited version of my reply.

The SEO/AdSense niche site method is something I could literally write a whole book about, and in fact many Internet marketers have made thousands of dollars by creating, promoting, and selling such books. For the sake of brevity and time I will try to keep this as short and simple as possible for now, while still providing you with enough information to help you understand the basic process of setting up a revenue-producing niche site. Although I am leaving out lots of “nitty gritty” details here, if you are actually interested in this topic you can always post your questions or suggestions in the comment section, or you can send me an email through the Contact page and I can help you with some of the finer points of this particular endeavor.

1. The first step is to choose a topic, or more specifically a keyword phrase, for a new site. This keyword must meet a couple of important criteria. First, it needs to represent something that people will actually pay money for and is attracting at least a small pool of advertisers (generally this will be a product or service, or perhaps an interest category with several known related products/services). Second, the keyword must be something that you have a realistic chance of ranking well for in the search engines. This means that your chosen phrase will need to be somewhat specific and will probably contain at least three words. For example, trying to rank for “Amazon” would be an exercise in futility, but if you go for something like “where to buy Amazon gift cards” or even just “Amazon gift cards” (yes, I have actually made money with these kinds of pages here at Karlonia.com even though this is not a true niche site) you will have a decent chance of picking up some traffic and revenue.

2. Register a domain that matches your chosen keyword as closely as possible. If you can get an exact match with the .com, .net, or .org extensions, this is very good and will usually give you a significant boost in gaining traction with the search engines. Otherwise you should still try to include the keyword in the domain somewhere, perhaps with another word before or after the targeted phrase.

3. Do a little more keyword research on your main topic and find a few related phrases that can also pull in some traffic with relatively low competition in the SERPs (Search Engine Results Pages). Fortunately, Google has been nice enough to give us one of the best tools out there for doing this kind of keyword research.

These additional phrases will become the topics (and often the titles) of other article pages on your new niche site. Most good niche sites have between five and thirty pages; it is possible to have more than this of course, but you will probably be entering the realm of multiple subjects at this point.

4. After your domain has been registered, it’s time to set up a hosting account. I like to use HostGator for this because they allow an unlimited number of multiple sites and domains to be set up and run from a single account, which means that you can have lots of sites but only have to pay for one hosting fee. It doesn’t matter if you have one site or 200 — the cost is still the same. You can easily find HostGator by clicking on the banner in the upper left corner of this article.

5. After your hosting account is set up, point your new domain at your host’s server. You can usually do this by logging into your domain account and changing the nameservers to whichever specific name corresponds to your host. For example, for HostGator the nameservers are NS1357.hostgator.com and NS1358.hostgator.com.

6. Now it’s time to actually set up the site. I use the good old WordPress blogging format for this because it’s very easy to set up (especially with HostGator’s Fantastico option), you can easily edit and publish new pages whenever you want, and you can allow comments from other visitors, which can substantially increase the volume and reach of your content. Of course there are other options for setting up your site with all sorts of pros and cons for each alternative, but as I mentioned previously, I am going to leave out lots of detail here to prevent this post from getting ridiculously long.

7. Once your basic site structure is set up, you can begin composing and editing the articles that will fill out your site’s content. Depending on your patience, skill level, and starting funds you can either write these articles yourself or outsource the work to another person or company for a small fee. When I started my original blog at here at Karlonia and for approximately the first year and a half thereafter, I actually wrote all of the articles myself. The only exceptions were a few newsletter style posts where I used blocks of content that were sent to me as email newsletters and then included a custom title and introductory paragraph in order to target the keywords.

However, with the establishment of a daily posting schedule, the task of writing high quality, original articles every day in addition to doing all of the keyword research eventually became tedious and exhausting, so I began to discover the wonders of outsourcing. This was a major leap forward in my blogging career because once I began to outsource most of the time-consuming parts of building and maintaining the site, my time was freed up to do other things like coming up with ideas for new niche sites and getting a good handle on the overall finances.

8. After your content is posted and you have used up all of your available keywords, the next step for most people will be promoting the site, which basically comes down to acquiring something we call ‘backlinks’. As the name suggests, these backlinks are links from other sites back to yours. In most cases, it is best for the clickable text of these links, which in SEO parlance we call ‘anchor text’, to match up with your favorite keywords and post titles of your site, although it is okay for the text on some of these links to vary somewhat by just using the site name or a plain URL.

These backlinks can be procured by many different means, including article directory submissions, social bookmarking, profile links, forum signature links, blog commenting, blogrolls, and links in the body text of other websites. As with the content, this can either be done manually by yourself, which will quickly become tedious if you need to obtain many backlinks or have many sites to promote, or you can outsource these services to others for a small fee. As you might suspect, I generally prefer to outsource this because collecting backlinks is one of my least favorite chores. However, this is actually one of the most important steps because unless you are very fortunate and have keywords with particularly weak competition, getting good backlinks is an essential part of achieving search engine rankings that are high and broad enough to bring in sufficient traffic and revenue.

9. Once the initial content creation and promotional chores are done, you can move on to the relatively easy part of this whole operation, which is setting up the monetization and tracking. Monetization with this model, at least in the beginning, is accomplished with the decidedly non-labor intensive process of pasting in some AdSense code, or the code of another contextual ad network like YPN or Chitika. With the basic WordPress blog setup I usually keep it simple and just paste the code at the beginning of the body text of my articles, which makes the AdSense ads appear underneath the page title but just above the article itself. This is usually one of the best ad positions for attracting good clickthrough rates. You may also want to consider placing a banner-sized ad near the end of your articles in order to catch some “last minute” clicks from people who actually read through your article and are about to leave the page.

Depending on your exact keywords and content, another option for monetization is the strategic placement of affiliate links from places like Amazon, Clickbank, or Commission Junction. With the right kinds of traffic and targeting, this can add a substantial amount to your overall revenue and make you less dependent on a purely AdSense-based income. I usually wait until my published pages have been indexed by the search engines and are drawing traffic before I place any affiliate links into the articles, however, because search engines generally don’t like to see lots of affiliate links on a brand new page with content of an unknown quality.

Tracking is also quite simple and consists of setting up a Google Analytics account, entering the domain to be tracked, and pasting the relevant code supplied by Google Analytics into the footer file of your site. As with most other aspects of setting up a website, there are other options for the statistical tracking and recording of your traffic data, but this can become quite complicated and is best dealt with in a different article.

10. Unless you run into some unexpected technical problems, you can pretty much sit back and have fun after all of the above tasks are done. A certain amount of patience is required before you start to see significant amounts of money rolling into your bank account. Generally speaking, it takes six to twelve months for backlinks to be fully credited by the search engines and for your rankings to rise up to their natural level as determined by the various algorithms. After your sites begin to pick up some traffic, you can analyze your website statistics and make adjustments to your future activities as you deem necessary.

Other than repeating the process with more sites to gain additional revenue, very little actual work is required after your site has been fully published and monetized. Your basic maintenance tasks will be monitoring the comments and contact form submissions on your network of blogs so that you can delete or block anything that is obviously spam or garbage while allowing legitimate comments that are relevant and actually add to your content. You will also need to remember to pay your hosting bills and renew the domain names of your successful “keeper” sites. A surprising number of webmasters forget about such mundane details and inexplicably end up throwing away revenue streams that are almost entirely passive. However, as long as you are capable of doing some basic research and avoid doing anything that is incredibly foolish, the life of an SEO-based website publisher can be an educational, rewarding, and ultimately very comfortable experience.

4 Responses to “10 Steps for Building Profitable Niche Sites”

  1. comment number 1 by: Ireland5

    Ok, this could be exciting….maybe readers have some ideas for niche topics? Could you let everyone know what/when you launch a new site?

    Hope we continue to see some new articles here - not one a day, but maybe a few each month. Good luck with the new niche sites - keep us posted! Let’s see….a good topic???????…um….

  2. comment number 2 by: Eru

    Hi Karl,

    It’s so good to hear about the success story of your sites after 3 long years I guess. :) I always love reading such posts from you that gives an insight into the working of SEO. I do know about the niche sites and their working to a certain extent, but this definitely added onto my knowledge. I want to take a plunge and try out my hand at them but I’m a little technically challenged, so had been apprehensive. Btw, can you give me an idea about how exactly can we explore the revenue potential of a particular niche? And how many exact searches on a keyword signify that we should take the plunge and try ranking for that keyword, or if the competition is too steep to even try?

    Also, as a writer I would want to collaborate with a webmaster, for a partnership on the revenue generated from some sites may be. I do have sound knowledge of affiliate sites and link building too. I can write decent landing pages and product descriptions too. Can you guide me if there are sites where I can find some genuine webmasters for this?

    Would be looking forward to your reply and next post. :)

  3. comment number 3 by: Karlonia


    A good way to explore the revenue potential of a given niche is to go to the Google keyword tool (there is a link to it in the post above under #3) and look at the values for CPC (Cost Per Click) after typing in a main keyword of the niche. I will look for a core group of related keywords in the column (at least five or so, although it’s usually more) that have a CPC of at least $1.00 before I will explore the niche further. Higher is better of course — I have had some niches with at least one or two keywords with CPC values above $4.00, which means that there is a potential to get $1 or higher AdSense clicks.

    On the other hand, if all you see in the whole column are low values of 5 cents or 10 cents, this means you have a “dud” in terms of revenue and will probably need to try a different keyword. Although you can still build a site around such a niche if the volume is good and you really have a passion for it, your AdSense click values will be lower and you will need a high volume of traffic to your site in order to collect substantial revenue.

    Another way to get a very general idea of whether your niche could be profitable or not is to simply go to Google and bring up the search results page for your niche’s primary keywords. Look to the top (above the actual results listings) and right of the page — this is where Google’s sponsored results, currently labeled simply as “Ads”, may be displayed. If there are at least five of these, and especially if you have several pages of such ads displaying, this means that there is a notable market for products and services related to this topic and there are advertisers paying money for relevant clicks through the AdWords platform, which is the primary prerequisite for generating income from AdSense clicks. Generally speaking, higher numbers of Google ads on the page translate to higher click values because these advertisers must bid against each other to have their ads displayed in relatively high positions on the page. To get a more specific idea of what these click values might be, you can use the keyword tool and look at the numbers under the CPC column as I mentioned above.

    For search volume, I look for at least 1000 per month on the main keyword (this will usually be the subject of the home page of the future niche site) and at least 100 per month for the auxiliary or “cousin” keywords that will become the topics of the single posts and article pages whose URLs are not the home page of the site. Again, higher is better, and higher rankings for your site will usually mean that you can obtain a larger share of that volume.

    To gauge competition, a quick and easy way to do this is to bring up the Google search results page for your keyword, click through to the sites of the first five results (in Firefox you can do a middle click on the mouse wheel and bring them all up in tabs), and look at the PageRank of each page. If they are all showing PR 3 or lower, this is very good and usually indicates relatively weak competition, which means that it will be easier to obtain higher rankings. On the other hand, if most of them are PR 5 or above, competition will be much more difficult. If this occurs, you can try a more specific keyword in the niche and see if you get less competition, or simply choose a different niche altogether.

    Another thing to look for in the search results is whether you have mostly root domains (home pages) or mostly subpages (Web pages other than the home page) in the top 10. Most product-based niche keywords with weak competition will have lots of subpages, often with little content other than the product listing, from places like Amazon, Nextag, or Bizrate near the top, sometimes with article pages from major article directories like EzineArticles.com, ArticlesBase.com, etc. mixed in. Keywords with stronger competition will have mostly home pages from well-known authority sites dominating the top 10, which means that it will be very difficult for your new site or page to get in there.

    For the second part, what you are describing seems similar to what is called a Joint Venture (JV) offer in the Internet marketing world. JV partnerships can be profitable if you find the right person and your skills match up well with the other partner’s projects and ideas. Sites like the Warrior Forum and DigitalPoint have sections of their forums where you can post such offers and probably get some sort of response. You can also go to your favorite search engine and try keywords like “webmaster forums” and “Internet marketing forums” to find other promising venues for further promulgation of your proposal.

  4. comment number 4 by: Steve

    I’ve had a similar experience with making most of my money with a couple of sites and the rest only make a pittance. I think it really boils down to subject matter.

    With my case I make much more money from topics that have a higher earnings from google ads. You can focus on those topics, but they can be highly competitive.

    I think the best way to go about niche sites is to have a few subjects that aren’t that competitive to get a good base for earnings every month, and then focus a couple of sites on very competitive subjects. It might be difficult to rank well, but the rewards are worth it.

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