The right niche is the biggest secret to online money-making and those internet marketers who are capable of identifying profitable niches will make the most money online. One trick that most successful internet marketers will not tell you is how to identify the most profitable niches.

So how can you accomplish this seemingly simple but very fundamental procedure in online money-making? First off, let us define what a niche is and then walk through the all important process of choosing a suitable niche that you can operate in.

What is a niche?

A niche market is basically a small market that targets a particular segment or demographic. For example, you can have a niche based on domain names, green hosting, electronic cigarettes, used cars, car rental, or any other topic that represents your interests. It is important to take note of the fact that there exist sub-niches within the defined niches.

For example, if you have the niche “green hosting”, you might have a sub-niche or micro-niche such as cheap green hosting or green hosting reviews. This simply means that within the general niche market of “green hosting”, there is a smaller market segment which is highly targeted and who will be simply searching for sub-niche “cheap green hosting” instead of the general “green hosting” topic.

How do you choose the right niche market?

There are many ways in which you can go about this. The process can start with brainstorming ideas regarding your interests. You can simply list your general niche market ideas and then eliminate them one by one so that you are left with a niche idea in which you have the most confidence in. This should be a niche market where you are confident you will be able to add value to your customers.

Choosing a profitable niche-keyword research

Keyword research will be the last step which you will need to undertake in your search for a profitable niche.  Here you have to master the right keyword tools and how you can use them to achieve optimal results.  Some of the most effective tools for keyword research include Google Adwords Keyword Research Tool, Wordtracker.com, and Google Insights for Search and MarketSamurai.com.

The criteria for the most profitable niches will be determined by several variables including search volume, cost per click, competition and local search trends. The most profitable niche is one that will offer you high search volumes and low competition. However, these are not always easy to find so you must have a reasonable compromise. The third integral factor that you will need to evaluate in a profitable niche is whether or not it has a high cost per click.