There’s a lot of information out there about how much traffic you should be looking for when it comes to choosing a niche, but most of it is focused on information or affiliate sites. While this is still helpful, it can be a bit trickier with e-commerce because there can be much wider variations in conversion rates and profit margins from product to product than with sites that make their money from advertising clicks.

A general rule of thumb that we use when looking for a new product or niche e-commerce site is that you should be looking for around 2000 local exact match searches between your top two keywords when using either the Google keyword tool or Longtail Platinum. Having said that, we have profitable sites with less traffic, but these are generally very low competition markets that also have a higher than average profit margins, and we are a bit on the fence at the moment as to whether or not we hang on to them, or sell them and focus on the bigger fish.

We did conduct a couple of experiments with sites that have sub 1000 exact match searches, but even when these rank at number one, they’re not really giving us enough traffic to make it worth our while at this time, and it’s unlikely that we’ll go down this path again, particularly when we’ve entered quite a few niches this year with more than 4000 (some significantly more) exact match searches that still meet our low competition criteria as well as our product and profit criteria. When you’re sitting there with a niche that gets 1000 searches per month, and it’s costing you just as much time and money to rank as a site that gets four or five (or fifty) times that traffic, you do start to wonder if they’re worth worrying about.

One of the reasons that we sometimes end up with these smaller niches, is because I start to get discouraged when I’ve been looking for days/weeks/months, and haven’t found any niches with good to great traffic (that also meet all of our other criteria). This is when I start to think, “Oh well, I’ll just settle with this low traffic niche instead, because all of the great niches must be taken”. My experience is usually that just after I settle for the low traffic niche, and spend time and money getting it off the ground, I’ll go and stumble across a great niche, and then kick myself for “settling”. We are constantly amazed by how often we stumble across these “treasure” niches lately, as I have been regularly searching for new niches for the last 18 months, yet we are still coming across better and better niches, and I still wonder how on earth we didn’t come across them before. If you are starting to believe that there are no more niches, think again! They may not be easy to find, but they can change your life, and are worth the effort. Never settle!