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Ecommerce: The Full Guide to Dropshipping Part 2

In part 1 (found HERE) of our guide to drop-shipping, we began narrowing our search down for a specific product to sell. This requires attention to detail as it will either make or break your dropshipping endeavors.

Just to recap, in Part 1, we covered how to choose a market, then how to find a niche within that market that fits a specific need or want that consumers have…..

Breaking it Down Further; Finding a Micro Niche

There are literally millions of websites that were created in the hopes of earning money online. Some failed, but many others were successful. Some continued to grow and literally dominate their niche within the market. We want to avoid these monstrous cash cow sites as much as possible.

The chances of a brand new site going toe to toe with a site that pumps countless funds into marketing and most likely has a full service team in operation 24/7, is not likely to end well for you.

If you simply wanted to sell furniture online, you’d be up against billion dollar money makers like Wayfair, Overstock, and Macy’s. Why would a potential consumer choose to shop at your site when such massive and well respected entities already exist?

So instead of picking a fight with a giant, you’re going to want to pick a fight with the smallest person / website in the room! That ups the likelihood of your success. That is why breaking your niche down EVEN FURTHER is so important.

What exactly quantifies as a micro niche? Say for instance you actually did want to sell furniture online. A micro niche of this market would be to focus on a specific type of furniture such as Italian leather reclining chairs with built in refrigerators. Not only will there be less overall competition, but consumers will see that you specialize in a certain type of furniture and consider you an authority.

This will also allow you to focus your future SEO and PPC efforts instead of spreading yourself out too thin and potentially losing profits. It’s much easier to rank for keywords that are all similar; Italian leather reclining chair with refrigerators, refrigerator chair that reclines, Italian leather refrigerator chair that extends, are much more focused than if you chose a broad niche.

Researching Your Micro Niche

Researching your micro niche is essential to ensure that the products within this area of the market are actually worth selling. To do this, we’re going to use a few fun internet tools.

Google Keyword Planner – Google’s keyword search function is now only accessible if you sign up for an Adwords account (don’t worry, it’s free). All you will need is a gmail email account to sign up.

Google’s keyword planner will allow you to find popular searched words that have been typed into Google. This is an awesome way of not only finding areas within your niche that you may not have thought of, but it will allow you to see how often they are searched for.

Unlike the old keyword tool, the keyword planner will give you historical statistics for exact match keywords. It will also allow you to view the general level of competition that keyword faces to get ranked within Google’s search function.

How to Use Google Keyword Planner To find Micro Niches – Once you have an idea of your niche, begin typing in relevant brands, products, and words. They planner will give you a whopping 800+ options to choose from.

Begin looking at the related words. Within this list you want to target words of products that fit a specific criterion:

  1. Low / Medium Competition – We will dig deeper into this shortly
  1. High cost per Click (CPC) – A high CPC means that the word is targeted for ads by a lot of retailers. As long as the competition is low, it is a solid choice because people will only be willing to pay for higher CPC rates if it is selling. Anything around of higher than $1 CPC should suffice.
  1. High Search Volume – This means that people are looking for this product. However, if it receives too much traffic, then the competition level may be higher than what is shown in the Planner. Try to look for a search volume of over 10,000 but no greater than 50,000. Of course these numbers are not absolute. There may be a great micro niche product out there that is fairly expensive, with a great profit margin and only receives 5,000 monthly searches, but sells 4,000 times a month.
  1. It Needs to be Relevant – You’re looking for specific products, not cool keywords.

At this point you should have a general idea of a micro niche you would like to target and the products within that specific micro niche.

Analyzing Competitors

There are numerous free tools that will allow you to view your potential competition to see if it is worth trying to compete. You’ll want to see how strongly a site ranks for your micro niche. The stronger a site’s SEO, the more difficult it will be for you to overcome them in rankings.

As much as 75% of search traffic clicks on the #1 ranked site for a search term. If you fail to get your site towards the top of a page, you may be missing out on some serious traffic.

SEOquake and WebRank SEO – These are Google Chrome / Firefox extensions that you can find online and attach for free. These will tell you almost anything you would want to know about competitor websites.

Do a quick Google search for your newly found micro niche products and these tools will analyze numerous components that are essential for SEO. You will be able to view the number of links pointing towards their site, which is an indication of popularity, which Google takes into consideration when ranking.

It will also show you a strength number of 0-5 (5 being the strongest). You want make sure that the majority of the sites are a 0-1. If you have several sites in the 3-4 range, it may be difficult for your site to overcome them.

Keyword Analysis – SEOquake has a cool feature that allows you to click on any specific page of a site and see a general overview of the SEO strategy being employed. It will provide the targeted keywords and keyword density, which may yield some really juicy keywords that you never though of.

Look at the Layout of the Top Sites – If a site is engaging, is tough to navigate, or looks neglected, then, they will be easier to outrank as a newer, sleeker, site will be preferred by consumers.

Look for Amazon Products in the First Few Spots – Despite Amazon being the highest rank, its product pages are generally easy to pass in ranking. Meaning, if the top spot for your selected product shows an Amazon page, it is an indication that the other websites selling that specific product are relatively weak.

This is just a general overview of what you can do to see how strong your potential competitors are. Once you begin working on your actual site, then you should spend more time on reverse engineering what your competitors have done to become successful and what it will take to overcome them within the SERP’s.

In Part 3 of our exciting installment, we will go over where to find manufacturers that will allow you to sell their products on their site, and what to look for to avoid being scammed. This is by far the most difficult step for site owners to master.

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About Sean Donahoe

Sean is one of the most recognized industry leaders in business and marketing. As a popular speaker, author, consultant he has helped over 50,000 students world wide find success in their businesses and has consulted with Fortune 500 companies and businesses of every size grow and thrive...


  1. Greetings Sean This part 2 of finding a niche and the new keyword tool from google is really out standing in a way that it shows a lot of people how to pick a ecommerce niche and move forward. And make a great business.

    Research is the main key to finding something we like to do. To make more money and live our life the way we want to.

    All The Best

  2. Wow amazing quality Sean as always, you really explain the Micro Niche clearly. As all experienced marketers know the low hanging fruit is the easiest to pick.

    Why make things difficult the K.I.S.S. acronym works really well, Keep It Simple Stupid

    Thanks Sean

    p.s. I love your slider that comes out bottom right “You may also like” is that a plugin, if so what’s the name of it?

  3. Another good post Sean great information your sharing here. I found many different ways to research eBay listing and find ways to beat the completion.

  4. Very cool………Sean shows how you can do all this research with tools that cost very little or no money. This is what I like about Sean, even though there are very expensive tools to perform this kind of analysis, he shows you how you don’t need a large budget!

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