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The fundamental purpose of any business is to fill a need or solve a problem. When evaluating a niche website or affiliate marketing opportunity I find that it is very helpful to define the need or problem that I am trying to solve. This helps me better understand the true opportunity. By this I specifically mean the demand. Without demand you don't have a business, regardless of how cool the widget may be.
You must be able to establish demand and a compelling benefit or the niche you want to target will be a non-producer.
As an example, one of my niche websites offers headlight restoration kits for cars with plastic headlight lenses. The majority of cars manufactured since the late 1990s have plastic headlight lenses that yellow from exposure to the sun and scratch easily. The yellowing not only looks bad but also reduces light performance. This is a safety issue.
Replacement headlight lenses range from $150 to $600 each. At an average cost of $25 per restoration kit, my niche website saves automobile owners an average of $425 (versus the cost of replacement). Restoration is also faster than headlight replacement; an additional savings.
Purpose: Provide easy-to-use kits that restore lighting performance and appearance while saving the average car owner $425 on headlight lens replacement.
If you can describe your business purpose that concisely you are well on your way. If it takes more than thirty seconds to tell someone what your business does then it's too complicated. If you can't define the purpose of your niche then you are well advised to move on and keep looking.
If you take the time to establish demand and a compelling benefit for a niche in advance you will quickly sort the wheat from the chaff and begin making some good bread.
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