How to Choose a Profitable Niche for Your Online Dropshipping Business?

What is a Niche?

A niche is a specific area of interest. It could be anything from video games to knitting or even vegan food. You might have many niches that you’re interested in, but the trick is finding one that will work well for your dropshipping business.

If you are passionate about something and want to share it with others, then it’s likely a good fit for your online store. That will keep you motivated to succeed, but you have to balance that passion with data. 

You need a niche that sparks your interest so you remain committed to building a business and has the customer demand, so sales start to flow. That is the hard part.

Here are some basic steps to help you get started. Remember, there is no tried and true method. You have to struggle a bit to find that perfect balance for yourself.

Step 1 – Brain Dump Your Passions, Interests, and Experience

The first step in finding a profitable niche is to brainstorm all the things that you like to do, have done, or are interested in. This may seem like a simple task, but it’s actually quite tricky when you think about it. You can’t just write down every single thing that comes to mind because this will lead to lots of useless information and confusion later on.

Instead, we recommend that you focus on things that have some relation with each other, so they create an overall theme for your business. This will make it easier for potential customers who search for products related to those themes.

For example, let’s say one of your passions is yoga, and another is teaching children how to play chess.

These two passions could go together well because both involve physical activity and helping others improve themselves through education (and maybe even competition). In addition, both activities require patience, so teaching kids how to play chess would be challenging but rewarding work.

Open a free-to-use Google Doc and let everything fall onto the page. Pretty soon, you’ll see a theme starting to emerge of the topics and niche areas you feel comfortable exploring.

Step 2 – Research Current Dropshipping Trends

Next, you’ll want to do some research on current dropshipping trends. This includes looking at Google Trends, Pinterest, Reddit, and eBay (or any other platform you choose).

Google Trends will show you what people are searching for in relation to your niche. You can see if any popular keywords aren’t being targeted by other sellers yet and capitalize on them by creating content around those topics or products.

Pinterest is another excellent tool for researching profitable niche because it shows what products are frequently pinned within each category of interest. You can begin to judge how many times they were pinned overall, who is sharing them, and what kind of community is around the topics.

Finally, there’s Reddit, where users post questions explicitly related to topics such as entrepreneurship and marketing advice and general information about various industries, including ecommerce strategies. 

Look at your topics and read people’s questions, comments, and concerns about them. That is where you’ll find the pain points you will be solving with your dropshipping products.

Step 3 – Use Amazon to Refine Your Niche

Now that you’ve got a basic idea of what products are selling well in your niche, it’s time to find out more about each one.

You can do this by searching for the product on Amazon and checking out its reviews, sales rank, and price history. If there are lots of positive reviews, then this is an indication that people like the product and have bought it before.

If there aren’t many reviews yet, but the product has been on sale recently (or if it’s new), then that could mean demand will grow over time as more customers discover how great it is.

This is also an excellent place to judge the competition. Don’t forget, even if there are a ton of sellers in that niche, that doesn’t mean you cannot undersell or offer something unique to those target customers. It may mean you have a bit more of an uphill battle, but it isn’t impossible.

Step 4 – Use Social Media to Judge Demand in Your Niche

Social media is a great way to get a feel for the demand in your niche. You can use Facebook groups and pages, Twitter, Instagram, TikTok, and more to see how many people are talking about it.

Your goal is to find the online spaces where your target market likes to exist. If you are hoping to sell accessories for ponies, then you need to look at groups and accounts featuring these toys and see what questions they may have or what they discuss the most. The more people involved in the conversation, the higher the potential demand.

Step 5 – Do a Google Search for Competitors

Now that you’ve researched and chosen your niche, it’s time to see how well it will perform. The first step is to search for your product or service on Google. If there are no competitors in the top 10 results, then congratulations! You have found yourself a profitable niche!

If competitors are in the top 10 results, keep searching until you find something that looks like an untapped market. You want to find a niche with only 2-3 competitors at the top page, so there is room for your dropshipping store to hit the top 3 results.

Step 6 – Learn by Doing

Now that you have a profitable niche and product, it’s time to start your online dropshipping business. The best way to learn is through experience. Don’t be afraid of making mistakes. They are an essential part of the learning process. As long as you’re willing to learn from them, your mistakes can help make your business more profitable in the future.

Bonus Tip: Automate with a Dropshipping Plugin

Once you begin the process of building out your dropshipping business, it’s time to shift to how to make it the most efficient and flexible operation. You want something you can quickly scale that doesn’t require your constant attention so you can focus on expanding product offerings and improving customer relationships.

A good way to get this done is by installing our WooCommerce Dropshipping plugin. This allows you to integrate Amazon and AliExpress dropshipping processes so you can grow your dropshipping business faster.

You can manage all aspects of your store, set profit margins, import inventory, create custom emails, and more, all from a simple user interface. Pick up our plugin today and expand your ability to rapidly grow your online store.

Conclusion

We hope you’ve found this article helpful in choosing a dropshipping niche. We know it can be a daunting task, but the results will speak for themselves if the proper process is used. By following these steps and being diligent about research and analysis, your chances of success will increase dramatically.