Why You Should Start Small But Think Big When It Comes to Making Money Online

Here’s another brilliant, and unsolicited guest post from our buddy Brian. He offers more great insights into how you should approach your market research. Thanks, Brian. Great stuff as usual. - Mark

Whenever people ask what I do these days, I just tell them I’m a drug dealer.

I know, I know - I’m copying Tim Ferriss, but it’s far easier than explaining what I actually do.

I work in a niche that no one else in the internet marketing game knows about. There’s nothing about it on affiliate networks (I’ve looked), and although there are “real” companies with products and services, they don’t know anything about online marketing.

I used to think there was something wrong with me because I wasn’t promoting ringtones, fat loss, dating, or making money online offers.

But over the past year, I’ve realized how beneficial it was to start out in a truly niche market.

The Problem With Starting in a Huge Market

Having spent almost the past decade in Silicon Valley, I’ve seen firsthand some incredible companies.

All of us have probably dreamed of founding the next Google - or at least climbing to the top of the internet marketing world.

But it takes a very long time to succeed in a huge market saturated with competitors. That’s true regardless of whether you’re trying to start a real company, or simply trying to rank for a keyword with 1 million searches per month.

Although I’m in a very niche market, my most general keyword still gets a couple hundred thousand searches per month. I now rank on the first page of results, but it took me over a year of dedicated effort to get there.

If you look at the successful people in large markets, most have been there for a long time. They’re not “better” than you, they may not have more content than you, but they have been around longer than you.

The Advantages of Starting Smaller

I fell into my niche randomly - it was just a topic I happened to know a lot about, and one day I decided to start writing about it.

This proved to be a good decision. Within a year’s time I was able to completely dominate the market. Sure, there are other companies out there, but online I am the only game in town.

When people ask questions via social media now, they’re always pointed directly to me - because there is no other competition online. I don’t even have to proactively market myself anymore.

In my earlier article, I wrote that one of the big challenges with starting an online business is the lack of immediate feedback - unlike being in school or working for someone else.

Although it’s still not “immediate,” the feedback you get in a smaller market comes more readily and therefore motivates you more effectively.

The Problems With a Smaller Market

The main problem with starting in a smaller niche? The market size can be limited.

You need to do some testing before you jump in blindly - if there truly is no competition in whatever market you’re thinking of, that’s probably a bad sign.

In my case, there was competition - but I saw an opportunity because most of it was offline.

Your market doesn’t need to be worth hundreds of millions of dollars or billions of dollars to be lucrative. Mine is a fraction of that size and I still make a five-figure monthly income.

But you do need to be sure it’s a niche in which people are actually looking for solutions and/or buying products.

How to Think Big Even in a Small Market

Even though my niche is small, I’ve expanded across several different sub-markets.

Let’s say you were going after dog training keywords. That’s not even what I would call a “small market,” but let’s just go with it.

You might start by going after one dog breed or one behavioral problem, and then expand into other breeds and other problems. Each time you expand, you have an existing audience and links that you can use to make your next venture more successful.

Many people new to making money online try too many projects in wildly different areas, putting a half-hearted effort into each of them.

But that doesn’t work for me. I’d rather start with Coke and expand into Diet, Cherry and Vanilla rather than trying to launch a soft drink business, a line of clothing, and a night club.

And Sometimes Think Even Bigger

Even if you start off in a small market, you don’t need to stick with that niche forever. You could use what you’ve done as “proof” to show what you can do and to attract other partners to work with.

I’m doing that right now - I’m working with a partner to create an offline business (think: live training boot camps) to go along with what I do online.

But to do that, you need to have “proof” that you can succeed first. And that’s much easier to get in a small market - just as long as you think big the whole time.