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The first step to building a business is choosing a niche. This is just as true for building a “brick-and-mortar” business as it is for those who want to work from home. The same goes for the make money online crowd, and creating passive income streams.

The simple truth is you can’t build a business without knowing what business you want to build.

And that is where your niche comes in.

What Is A Niche?

The easiest way to define a niche is “a targeted market”.

Outdoor Market
Each stand at this market focuses on their own niche. Their business is different than all the others.

What that means is that a niche applies equally to the business and the intended customer. “Sweater vests” are an example of a niche product. People looking for sweater vests are the niche market.

Note that I defined a niche as a targeted market.

Continuing with our sweater vest example, we have an article of clothing. Clothing is a market.

Narrowing that down a little, we get to men’s clothing. Men’s clothing is another market, or niche, and more targeted than just clothing.

We can narrow that down more to men’s sweaters, and reach a very targeted market.

One more step down the line and we reach men’s sweater vests, an ultra-targeted niche.

So, we really zeroes in on our target market, and chose a very specific product. That means we’ve found a great niche, right?

Well, maybe not.

Choosing A Good Niche

Shoes is good. Sandals would be TOO targeted.

While it is true that a niche is a targeted market, there is such a thing as too targeted.

We’ll keep going with sweater vests.

Think of a clothing store like JC Penny. They sell clothes. Lots of clothes. Men’s. Women’s. Boys’. Girls’. Casual. Formal. Pajamas. Lots and lots of clothes. And they do great business.

Now, think of a clothing store just for men. (I don’t know any names off the top of my head. I’m cheap and buy my clothes at Walmart!) There are plenty out there. They don’t carry as many products as JC Penny, but they carry more men’s products than JC Penny. They can do this because they are focusing on a smaller part of the larger “clothing” market. “Men’s clothing” is their niche, and they also do great business.

We can get more specific still and find ourselves a men’s suit store. Again, this store may not carry the sheer number of items as the men’s general clothing store, but they will have more suits and related attire. This is because they have narrowed their focus and specialization to an even smaller segment of the market. This business will also do well, because they can cater to their specific market better than the more generalized clothing retailers.

All three of these businesses will do well. And each of them may offer sweater vests.

So we narrow our market further and open a sweater vest store.

Do you think this store will do well? After all, it is targeting an even more specific segment of the market.

Be Specific, But Not TOO Specific

The truth is, a sweater vest store is not likely to do very well. Their market is too specific.

Yes, someone interested in a sweater vest might visit this kind of store. Might.

But chances are, someone looking for a sweater vest is also looking for a shirt to wear under it. Perhaps pants to create a whole outfit. It isn’t likely he will want to go to one store for the sweater vest, and another for the shirt and pants.

Similarly, ladies aren’t likely to buy a skirt at a store that only sells skirts. They are going to want a top to go with it. Maybe shoes, too.

So there is the chance that someone looking for a sweater vest plus something to go with it will pass your store entirely.

On the chance that they do choose to buy that sweater vest from you and the other parts of their outfit elsewhere, because your focus is so narrow you lost the potential sales on the pants, shirt, or shoes.

Yes, you want to narrow down your market.

Yes, you want to be specific.

Just be careful that you aren’t so specific that you lose business before you even start.

How To Choose A Niche

Happy Business Owner
Love what you do, just like this business owner!

I’m sure you’ve heard the advice, “Follow your heart”. It’s been around… Well, forever!

That’s why a lot of authors write about subjects they are familiar with.

That’s why people who love working on cars open garages.

That’s why chefs open restaurants and write cookbooks.

These people have a passion, and they followed their hearts to build a business.

You can do the same thing.

Literally anything can be turned into a business, especially online.

Computer repair.

Beauty tips.

Dog Grooming.




You name it, you can make a business out of it.

Maybe you’re thinking “Hey! I came here for information on how to make money online. How can I possible do that with dog grooming?”

Well, it’s true, you can’t groom a dog online.

But you can teach people how to groom their dog. You can give them tips. You can post how-to videos. You can recommend the best products. And you can do all of that online.

“So how do I make money like that?”

With affiliate marketing.

If you don’t already know what that is, click here to learn about affiliate marketing, and how you can make money online. We will also cover making money online with affiliate marketing in a later lesson.

For now, all you need to know is that if you are passionate about a topic, there are affiliate programs out there that will allow you to make money at home, on your computer, writing about your passions.

Work From Home Writing What You Love

Comfy Typing
Write what you love, and learning is simple!

We are really only scratching the surface of how to make money online at this point in the lessons. That’s okay, because we’re just getting started.

And starting your business begins with choosing a niche.

You need to know what your business is going to be before you can build it. Your niche is your business, and only you can decide what that is going to be.

Since our primary focus with these lessons is affiliate marketing and making money online, your business is going to center around your ability to write about your niche.

There are many directions you can go with this:

  • Instructional/How-To
  • Product/Program Reviews
  • Advice/Inspiration

The list goes on.

Write what you love, and love what you write.

The money part will come later.

“Can I Really Make Money With Any Niche?”

The short answer, yes.

The slightly longer answer, some niches will be more profitable than others.

Your best bet as you just get going is to focus less on the money, and more on learning to build your own business.

If the first niche you choose is something you absolutely love, but you don’t make a lot of money at it, you’re still making huge steps toward building a profitable online business. Maybe you aren’t making a lot of money, but you are learning how to create your business framework.

It will be the skills and habits that you learn while working on the first niche that help you progress faster with the next one.

Maybe your first niche is very profitable. You can keep building it to make it more profitable. Or, you can let it keep earning where it is and start working on another business niche. Do you know what that would mean?

You’ve just created your first passive income stream!

The money will keep coming in with very little effort on your part.

And that is our ultimate goal when we decide to make money online.

Choosing Your Niche – In Review

We’ve discussed that a niche is a targeted market. Your niche is what you offer, and the people you offer it to.

You know that you want to be specific in selecting your niche, otherwise it will be very difficult to target your potential customers.

You also know that you don’t want to be too specific, or you will lose potential customers for closely related products or services.

A niche that you are passionate about will be a business that you can learn to build with ease. Even if it isn’t super-profitable, what you learn by working with a niche you love will pay off HUGE in the end.

For the time being, pick a niche you really love. You probably already know enough about it to build the full framework for a successful online business.

As we move forward, you’ll learn how to turn your niche into a business. By the end of this series of lessons, you’ll also know how to choose a niche based on profit-potential, even if you know nothing about it, and turn it into a whole new business.

In our next lesson, we will discuss domain names. That’s the URL of your website, and the first thing that people see when they see your business. In essence, your domain is your brand.

It would be great if you could rate this article, and let me know what you thought in the comments below. Ask questions. Tell me what you would like to see added to the site!

As always, thanks for reading, and the best of luck in your journey to financial independence,


If you ever have any questions, you can contact me here.

P.S. Are you serious about learning to make money online? If so, take a look at my Wealthy Affiliate Review. It is an amazing training platform that also offers hosting, domains, live help and support. You can start for free, and even get to build to websites at absolutely no cost!

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