A "Magic Formula" To Tell If Your Niche Business Idea Will
Snowball Profits or Bomb ...Even Before You Create Your
Info-Product!
by Dr.Prashanth Shivanna, copyright (c) 2005



"NICHE!" It's all the craze right now online. There's a
small fortune to be made by selling niche products
online to tightly targeted niche markets - from
information products to software to hard goods.  But
many 'wanna-be' Internet business people waste their
time, effort and moony pursuing ideas that were doomed
from the beginning because they were trying to fish in
a pond with no fish!

Do you want to know exactly how successful internet
marketers assess the potential profitability of a niche
business idea even before they create a product? Then,
read this...

STEP #1: Select the keyword phrase that best describes
your proposed product area. The easiest way to do this
is to ask yourself, "What would I type into a search
engine if I was looking for the information contained
in my eBook"  For example, if you wanted to write a
book about "How to Stop Smoking", the phrase that best
describes this area is: 'stop smoking'

STEP #2: Calculate your Market Demand (MD)  Don't
worry, this isn't as complex as it sounds! All you have
to do is go to the Overture search term suggestion tool
at:  http://inventory.overture.com/

Type your search term into the Search Term Suggestion
Tool and click the arrow. The numbers that come back
show how many times this search term and related terms
were entered by internet users in a single month.  For
example when I typed in 'stop smoking', it shows that
49363 people searched for the words stop smoking in a
single month. (Searches done in Jan, 2005)

Add up the Count numbers for all your 'related' Search
Terms. (For example.. stop smoking, quit smoking, etc.
This gives you your Market Demand (MD)  When I added up
the Count values for all the related Search Terms I got
a Market Demand Of 167,078. So for 'stop smoking' MD =
167,078  STEP

#3: Calculate your Visitor Profit Potential (VPP)  This
is really easy as well. All you need to do is go to
Overture's View Bids Tool at:
http://uv.bidtool.overture.com/d/search/tools/bidtool
and enter your search term. When the results come back,

View Advertiser's Max Bids. Take the number 3 bid as
your VPP.  For example: When I entered the term 'Stop
Smoking' into Overture and viewed the advertiser's max
bids, the third highest bid was $1.56  So for 'Stop
Smoking' VPP = $1.56  STEP #4: Plug your numbers into
'The Magic Formula!'

*************************************************
Potential Monthly Profit = (MD x 1.5/100 x VPP)
*************************************************

[The reason we multiply the MD by 1.5% is because as a
rule of thumb, it is possible to attract at least 1.5%
of most markets to your website.  The Visitor Profit
Potential (VPP) is based on the idea that the value of
the third advertiser bid in Overture is an indication
of the profit per lead as set by the market.]

So, for 'stop smoking'...  Potential Monthly Profit =
(167078 * 1.5/100 * $1.56) = $3909.62  Result? ->
http://yseh.com/stop-smoking  Now, $3909.62 a month is
nothing to sneeze about. It certainly makes a
comfortable living. But if you still insist... go
create 5 such mini-sites and you'll have five streams
of solid income!  Simple but Profound -- Isn't it?

This formula gives a good estimation of the profit
potential of different markets.  Want more examples?
Let's say that you had two ideas for potential new
ebooks:  (1) Porsche restoration (2) Digital
photography  If you didn't know better you might just
go with the idea that you are most interested in. This
is like selecting a pond to fish at because it is your
favorite place to sit rather than because it is the
best place to catch fish.

OK, let's put the magic formula to test  eBook Idea #1
- "Porsche restoration"  Market Demand (MD) - "653"
Visitor Profit Potential (VPP) - "$0.07" Potential
Monthly Profit - "$0.69"  eBook Idea #2 - "Digital
photography"  Market Demand (MD) - "170234"  Visitor
Profit Potential (VPP) - "$0.89"  Potential Monthly
Profit - "$2272"

So according to the Magic Formula, it would be a waste
of time effort and moony writing a book about Porsche
Restoration.  Of these two areas, digital photography
appears to be the most profitable...  You don't have to
know why the magic formula works. All you really need
to know is that it is a very valuable tool used by some
of the leading Internet marketers to find popular
markets and have profits snowballing EVEN before they
create any product!

Now that you know the 'Magic Formula', go funnel your
*million dollar ideas* into it and see if it will
snowball profits or bombs fast and hard!

---------------------------
Dr.Prashanth "quietly" earns a decent living from his tiny little niche
websites. Visit his niche resource site at:
http://yseh.com/resources.htm for a FREE Report that shows how to
create and sell niche info- products, without you having to write a single
word!

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