Note: This part is very important and most sellers don’t spend enough time on this. You can imagine: if you choose a difficult niche, your effort could be wasted. I would recommend spending at least a few hours to even a few days in choosing a good niche.
In the perfect scenario, you will sell in a niche that has high demand, low competition, with profitable digital products that you can create easily.
But the perfect niche doesn’t exist.
The best thing we can do is to find one as close as possible to give us the best chance to succeed.
Don’t try to create a new niche with no proven demand and sales. The approach we are taking here is to put our own spin on what’s already working.
For choosing our niche and product ideas, we will use a market research tool called Alura. It’s very useful in going through a large amount of data quickly on Etsy and identify potential great niches.
One of the reasons I recommend using it is that it shows an estimated number of sales (monthly sales or total sales), which can really help in finding great products that shoppers actually buy. It’s not completely accurate because Etsy doesn’t provide this information (Alura claims about an 80% accuracy), but it’s still very useful.
Sign up to Alura for free here
Once you have signed up, download their Chrome extension. It’s their product research tool that we will use to identify bestselling products and low competition keywords.
Once the Alura extension is installed:
We will be using the Chrome incognito browser when doing our research. This is because, as you may know, search results on Etsy is heavily influenced by personalisation. Using the incognito browser will eliminate that. I would recommend closing the incognito browser and open a new one about every 10-20 searches to eliminate personalisation affecting the search results.
Open Etsy in your incognito Chrome browser. Click the Alura extension icon and sign in your Alura account.
Use the digital product idea generator from the previous chapter to choose a starting keyword to use in this research.
There are a few indicators of high demand product on Etsy:
After you search a keyword, click the Alura extension icon and a window should open with information about the products. Scroll down the product list to load more products to analyse.
Sort the products by monthly sales, and you should be able to spot some popular listings.
I would consider products with over 50 monthly sales to be popular. Sometimes there will be standout listings with over 200-300 sales a month. It’s a good idea to mark down those listings.
We will go through this process with an example. Let’s start by searching ‘weekly planner’. Once I sort by sales in the Alura extension, I can see that the top listings are all ‘digital planners’.
So, I do another search for the keyword ‘digital planner’ and find that there are many listings with ‘bestseller’ and ‘trending now’ badges, which indicates that the demand is high:
And I double check with the Alura extension. Many of the listings have an estimated monthly sale of over 50, there are some that are estimated to sell over 400 per month!
Repeat this process a few times with different starting keywords to identify a list of digital products with high demand.
It's possible to do the above steps without using Alura, though it would be more time-consuming. Please refer to Etsy Niche Discovery System for the method.