[0:00]Welcome to another lesson as part of your free 6-day mini-course. Now if you've missed any of the lessons in the series, you can grab all of them by clicking on the link below or going to mywifequitherjob.com/free. Now in this lesson, I'm going to show you how to find your niche and how to source products to sell online. Now the key thing to realize when you're finding the right product to sell is that it's an iterative process. And what you absolutely do not want to do is overthink things. You don't want to get stuck in the analysis phase for too long, otherwise you're never going to get started. The other thing to keep in mind, that it's not about hitting a home run with your first product. What you want to do is find a product that will make you enough money to suit your lifestyle and all you really need is a base hit. You might not find the best product on your first try, but the key is to do the analysis and then make sure that you can make a profit. That the demand is there and that the niche is not that competitive. But overall, your goal is to find products that have enough demand to meet your income requirements, so your niche should not be too competitive and should not be saturated either. Also, you want to find products that are not readily available in brick and mortar stores, because you do not want people comparison shopping for your products. Now a common question I get asked is, how can a small niche site possibly compete against larger stores like Walmart and Target? And here's the thing about these larger stores. They have infrastructure and supply issues to deal with, and in general, it's not economical for a Target or a Walmart to carry a large quantity of goods unless there is significant demand. And by significant demand, I mean products that have broad-based appeal. So you'll notice that large stores like Walmart and Target, they generally do not carry a wide variety of very specific items. The big players like the Walmarts and the Targets focus on the hot, mainstream products, and it generally does not make sense for them to sell products that only apply to a smaller group of people. So as a result, you want to pick a niche that applies to a smaller group of people that are not on the radar of a Target or a Walmart. So here's my recommended criteria when you're looking for something to sell. One, the product should not be fragile and easy to ship. After all, we're running an e-commerce store here, and we're going to be shipping products via snail mail, so you don't want them breaking in transit. The product should also not take up too much space, and once again, because we are dealing with physical products here, the smaller your product, the easier it will be to handle. But perhaps the most important attribute of your product is that its inherent value should be ambiguous. Remember how I told you to avoid products that are readily sold in brick and mortar stores? Well the reason is because we don't want people price shopping, and as a result, you want to avoid branded products, because if there's a brand associated with the product, it's going to be easy to compare prices. And once again, you want to avoid products people can easily drive to a store and find. The product should also be timeless and not go obsolete. I once had a student of my class who wanted to sell cell phone cases. Well guess what? Every six months or so, a brand new cell phone comes out and the old case goes obsolete. And you do not want to be left with inventory that you cannot sell. So you should avoid electronics or anything that can possibly go obsolete over time. And here's the thing, when you do find the right product, you will know. And here's just a couple of examples of students in my class who found the right product and started making sales right away! Tony started an online store selling essential oil jewelry online, and after her launch, with practically zero marketing, she made $25,000 in her first 3 months and over $100,000 in her 4th month alone. The demand was there, and she's been making money ever since. Another student of my class, Sean, he started an online store selling leather working supplies. Didn't really spend much money on marketing either, and his store managed to make six figures in a little over a year and a half. So here's the thing. You're not going to find these leather working products in regular stores because it's a very specific product that only applies to a small group of people. But just because it applies to a small group of people does not necessarily mean that you can't make a lot of money selling them. And finally, I have a student Sally, who lives in the UK. Started an online store selling cross stitch supplies online. She noticed that her market was not well served in her country, so she took full advantage, launched a store and started making sales right away, and today she makes seven figures per year, and her store has been featured in the Daily Mail. Now, when it comes to finding products to sell online, the first step is to get product ideas and brainstorm. And then, you want to determine whether those ideas can actually make you money. Now there are a whole bunch of places to brainstorm products. For example, you can find products by looking at completed items on eBay. You can look on Amazon, you can use Pinterest, you can look on Etsy to get product ideas. And then once you have a couple of ideas in mind, you'll want to use a keyword tool like ahrefs to figure out how many people are searching for that product on Google, and then make an estimate of how much you can make. Then you will also want to use a tool called Jungle Scout to find out how much the products you want to sell are actually making on Amazon. Don't worry, I'm going to go over all these tools in just a little bit and tell you exactly what they do, but first and foremost, I want to show you how to brainstorm products to sell online if you have no idea what you want to sell. Now one way to brainstorm products when you're clueless is to use the opportunity finder from Jungle Scout. Not only does Jungle Scout tell you how well a product is selling on Amazon, but Jungle Scout also allows you to filter your product search to find products that meet your specific income requirements and criteria. So for example, you can have Jungle Scout return keywords and products in the arts and crafts category on Amazon that make at least $5,000 a month and have less than 100 reviews. Don't worry, in the next video after this one, I will walk you through a demo step-by-step on how to use Jungle Scout to brainstorm products if you have no idea what you want to sell at all. Another way to do research is to go on Pinterest. And what's cool about Pinterest is that you can just type in a broad topic and it will give you a list of pretty pictures where you can get ideas of what you might want to sell. So for example, I might type in travel gifts, and then Pinterest will show me a bunch of blog posts and other articles on travel gifts that you potentially might want to sell online. Etsy is actually another great place to look. You can just click on various categories and see what's selling online, and what's nice about Etsy is that if you click on the shop, it will actually give you real sales data on what products that shop has actually been selling. In any case, that's just a couple of different ways to brainstorm products online. For the purposes of today's lesson, what I'm going to do is go through a complete example of how to run the numbers for a potential product. And I've already hand-picked a product to run through the entire process with you. Knee pillows. These knee pillows sell between $20 and $30 online, and I'll go through a quick example on how to calculate demand and profitability of selling these products based on Google Search and Amazon. I'll teach you how to assess the demand and the competition on Google and Amazon and how to compare prices to see how much profit that you can actually make. Now the first demo I'm going to show you is how to use the tool ahrefs. This is what ahrefs looks like on the inside. And as I mentioned earlier, ahrefs is a tool that will show you how many people are searching for a particular keyword on Google. It will also tell you how hard it is to rank for that keyword in the search engines. So all I do is, I type in knee pillow in the keyword bar, and then ahrefs will spit out all the different permutations of knee pillow. Now there's a couple of columns here that I want to point out. One column is the search volume. This is the number of searches that are performed in the last 30 days for that particular keyword. And if we look at knee pillows, knee pillows got 4,100 searches last month. The next column is known as the KD score. KD stands for keyword difficulty, and it's basically a number from 0 to 100 that will tell you how hard it actually is to rank for that keyword term in search. Anything in the low to mid-30s means that it's relatively easy to rank for, and anything over 40 means that it's hard to rank for. And as you can see here, knee pillows has a KD score of 8, which means it's not going to be that hard to rank for. Anyway, once you've gathered this data for your keyword, it's time to run the numbers. So what we're going to do in this step is we're trying to get approximately how much money can be made if we were to rank on the front page for that particular keyword. So ahrefs tells us that 4,100 people search for knee pillows every single month. The average conversion rate for an e-commerce store is between 1 and 3%, so let's just take 2%. If you were to rank number one for that search term in Google, the click-through rate for that keyword term is going to be about 37%. That's what the click-through rate is for the top spot in Google. So 4,100 people search for the term knee pillow every month, the average selling price on Amazon and eBay is about 29 bucks. So if you do the math, 29 times 4,100 searches per month, times 0.37, which is the click-through rate, assuming you make the top spot in search, times 0.02, which is the conversion rate, that leads to about $879 per month. That is your potential revenue for that keyword, but just keep in mind that that's just the revenue for a single keyword and does not account for other search terms or other traffic sources. This is just the amount of revenue that you can make if you ranked in Google for that one keyword. Anyway, that's just a quick and dirty way to calculate your potential revenue on Google for your website. Now if you want to get an idea of how much other Shopify stores are making selling these knee pillows, all you have to do is do a search on Google. And here, it looks like the company the Cushion Lab has 463 reviews for their knee cushion, which means they probably sell a lot. Now if you want to know how much this company is making, you can use a tool called shophunter.io, and I'll show you exactly how it works. So first off, you can get a free trial by scrolling down to the bottom of mywifequitherjob.com, which is my blog, and then clicking on this link. Then, add the store you want to research to the tool. This is just a note, but this tool only works for Shopify stores, and I just happen to know that the Cushion Lab is using Shopify. Simply enter the link here and shophunter.io will tell you how much revenue the store makes as a whole. You can also get data at the product level. And according to this, the Cushion Lab makes over $1,300 per day selling these knee pillows, which is pretty good. Now the next thing you want to do is figure out how well your products are selling on marketplaces like Amazon. In order to analyze the revenue for Amazon, we're going to use a tool called Jungle Scout. Now if you want to follow along step-by-step, go to my blog over at mywifequitterjob.com, scroll all the way down to the very bottom, and then click on this link, which will give you 30% off the tool. Jungle Scout is a tool that I use almost every single day, and it's probably the most important tool for product research, and you can get it for 30% off. And then, once you've downloaded and installed Jungle Scout into your Chrome browser, we can continue on. So the next step is just to go to amazon.com and type in knee pillows in the search bar. Then, I'm going to click on this little orange box, which launches the Jungle Scout tool. And what Jungle Scout does is it takes all the products on the front page for my search, and it tells me exactly how much money that product is generating every single month. And it tells me how many reviews that listing gets, and basically how many sellers are selling that product as well. So it looks like knee pillows generates about 1,650 sales per month. And usually, my criteria is at least 150 to 300 sales, so this is well above that number. I usually like the average selling price to be at least 20 bucks, and it looks like the average selling price is around $29 here. And finally, what I like to see is an even distribution of revenue across all the sellers on the front page. As you can see here, there are sellers that are making hundreds of thousands of dollars selling these knee pillows online. So clearly, there's a ton of demand for leg pillows on the Amazon as well. Now in a subsequent lesson, I'll teach you how to use Jungle Scout to really brainstorm different products that you can sell online. But this Chrome app here for Jungle Scout will give you a good idea of how much revenue you can make if you have an idea of what you want to sell. Now the final step is to find out how much profit that you can make selling these items. And the tool that I like to use for this is Alibaba. Alibaba is a search engine for Chinese manufacturers. And they often have prices on their site as soon as you type in a keyword. So I'm just going to type in knee pillows here, and right off the bat, what you'll notice here are that the listings you find on Alibaba look almost exactly like the ones on Amazon. For example, this picture here looks almost exactly like this one, or this one. Essentially, people are taking these items from Alibaba and then selling them on Amazon at a profit. As you can see here, a knee pillow sells between $5 to $6 on Alibaba, and then they're being sold on Amazon for like $25 to $30. Crazy, right? People are sourcing this product for 5 bucks and selling it for $25 to $30. But don't get too excited just yet, because the prices quoted at Alibaba do not include shipping to your warehouse. And just as a general rule of thumb, I like to tack on at least 30% onto the sales price to find my true landed cost of goods. So for example, in this case, it's going to cost me 5 bucks, but I'm going to estimate for profit purchases that it actually cost me $6 to $7 to get it shipped to my warehouse in the United States. But even still, even if I'm getting these for 6 or 7 bucks and selling them for $25 to $30, that's still a pretty good profit margin. So after you run the numbers and you see that there's an attractive profit margin for the product that you want to sell, you want to keep in mind that you do not want to sell me-too products. You do not want to take what you find on Alibaba and just slap it on Amazon, because there's going to be a lot of copycats. You want your product to have a very strong value proposition, and you want to be the best product out on the market.
[14:37]Remember, that's your goal. Your goal isn't to just sell any product. Your goal is to sell the best and highest quality product that you can. All right, so that's just a quick and dirty way that I estimate profitability and how I find suppliers to source the products that I actually want to sell online. Now when it comes to finding suppliers, you actually don't have to import from overseas, but what you'll find is that because the labor is so much cheaper over in China and some of the other Asian countries, it is generally going to be less expensive to get your products from overseas. However, that doesn't mean that you have to source your products from over there. You can just as easily find vendors in the United States. And here are just some pros and cons between sourcing internationally versus domestically. Now in general, if you source something domestically, the manufacturing costs are going to be much higher because the cost of labor is higher. But on the flip side, if you source domestically, the minimum order quantity that you actually have to purchase will be lower, and it's going to be a lot easier to contact suppliers. For example, they're not going to be any cultural or language barriers, you don't have to ship something by boat or by plane from somewhere really far away, the lead times for manufacturer will be a lot shorter, and if you find something in your home country, drop shipping could be an option as well. Oftentimes, you can actually make an arrangement with the supplier so that you take orders and the supplier actually ships the product to the end customer. But if you do decide to source internationally, you will absolutely get the best price for your products. The only downside is that you have to order in larger quantities, you have to ship the product from overseas, which has longer lead times, and it's going to be more expensive to ship from over there. Also, since you'll be dealing with factories, the time to produce your products will be significantly longer as well. So you really need to plan ahead if you decide to source from overseas. Now if you want to find vendors within the United States, I highly recommend a tool called Data Axle. Basically, Data Axle is a database of every single US vendor, and the tool is free. But it can only be accessed at your local library. So if you're interested in looking for vendors in the US, head out to your library and just look for Data Axle. Now as a part of this 6-day mini-course, a subsequent lesson will actually walk you through step-by-step how to use Data Axle. But here are a couple of other sites that you can use in the meantime. Wholesale Central is a website directory of trade shows in the US. Worldwide Brands is a great directory you find drop shippers online, and in terms of overseas vendors, I already showed you how to use Alibaba. Another way to find overseas vendors is to go to some of the trade shows that are over there, like the Canton Fair or the Global Sources Summit that are in Hong Kong and China. Here's a picture of me at the Canton Fair. And if you can, I highly advise that you make the trip to China because it makes things so much easier. The Canton Fair is where thousands of Chinese vendors congregate, and you can easily find all of your suppliers all in one fell swoop.
[17:35]So here's just an idea of what it looks like. I snapped this picture kind of high from the fair, but it'll give you an idea of what it looks like. The fair is organized into booths, and basically, once you're there, you just go from booth to booth. And if you find something that you like, you just say, "Hey, I'd like to source that. Can you please tell me what the cost is going to be and the minimum order quantity?" And then you just go from there. Every booth will have at least one person that speaks English. Anyway, that's just a high-level overview on how to find products to sell online and how to evaluate the product to see how much money you can actually make. You can actually figure out how much that product is actually selling by using Jungle Scout to figure out how much of that product's being sold on Amazon, and then you can use ahrefs to get an estimate of how many people are searching for that product on Google. And then finally, I showed you various ways and places to actually source that product online. Now keep in mind, I offer a class that actually goes over all these steps in depth over at profitableonlinestore.com. If you decide to join my class, and if you like what I presented so far, it is actually in your best interest to not have a niche before you join, because what I found is a lot of people join my class, and they have these preconceived notions of what they want to sell, and oftentimes, the products that students want to sell are either too competitive or they don't have enough demand. But if you do decide to sign up, you will learn how to find the right niche and how to find the right product to sell, and actually, a significant portion of my class is dedicated towards this because unless you have something to sell, you can't really get started. Now as an extra value add to all my students, I actually offer to evaluate a student's product niche and give them my opinion before they get started, and that often gives students peace of mind before they begin. I'll show you how to source your products, whether it be through drop shipping, through domestic wholesale, or importing from China, and I'll walk you through the entire process. Then, I'll show you how to set up your own branded website and sell on Amazon as well. But remember, the end goal of what I teach is to start a long-term business. And in order to do that, you really need to establish your brand. Keep in mind that you don't need any technical knowledge at all to start your own website or your online store. And I will also teach you how to leverage marketplaces like Amazon as well. Now for the purposes of the class, I usually have students validate their products on Amazon and eBay, just to make sure that they're going to sell before they start their own online store website. But I've actually had cases where students during the validation phase, making six figures right off the bat because Amazon's marketplace is just so large. And then finally, I will show you how to get traffic to your own website, optimize it for conversions, and generate your own sales, and I will hold your hand throughout this entire process. If you are interested in signing up, I can honestly say that my class is the most comprehensive e-commerce course on the market. There is a library of over 450 videos that cover every single aspect of starting an online store, and as a value add, I give live lectures every single week, so you can actually ask me questions in real time. After all, starting your own business is not going to be a black and white affair. You are going to have questions that are going to be very specific to your business, and I will actually answer them live in real time, once every week. Now I can't possibly know everything about e-commerce, so periodically, I invite guest experts to come on the show. For example, I've had my buddy Zack Smith come in and talk about Kickstarter because I haven't done any Kickstarters. I've also had various Amazon experts come in and talk about Amazon, I've had lawyers come in to talk about the legal aspects of starting an online store. Basically, all these resources are available at your disposal as soon as you sign up. Now I remember my wife and I first started our online store, it was a very lonely process. So as a result, I have a private Facebook group where you can actually interact with other like-minded students. And at this point, I have thousands of students at the class, and you can easily find other students to bounce your ideas off of or to hold each other accountable for their progress. Now in terms of the class, I just want to let you know that I run it for fun and it is not a volume class. I'm not here trying to nickel and dime you, so as a result, there are no upsells whatsoever. As soon as you join, it'll just be one single fee for lifetime membership. Now personally, I really enjoy teaching the students, and it really shows in the way I run the class. So whenever you have any arbitrary question, I actually offer 24/7 email support. You can email me and I'll respond within 48 hours. Anyway, I hope you enjoyed this lesson. There are many more to come, and I hope to see you on the inside of my full blown class.
