Print out the Affiliate Masters Course, find a quiet, comfortable spot and read it several times.
Spend a lot of time thinking carefully about this and jotting down notes. You're planning a business, so don't rush it. It's very important.
You'll probably avoid Internet marketing topics because that field is so overcrowded and competitive. It's much easier to succeed if you locate a less competitive niche.
Choose a topic that is easy to write about.
Even if you've already chosen a niche, I urge you to read the Affiliate Masters Course. It might make you change your mind.
You can follow your passion or chase the money. With luck - and a bit of keyword research - you may be able to do both.
Examine your potential competitors
If you're considering building a site about hiking boots, type "hiking boots" (using quotation marks) into Google and Yahoo! and carefully examine the top 10 sites which appear in the search results.
They're your real competitors. Can you create a better, more interesting, more useful site? Can you think of a new angle, a new approach?
Do those top 10 sites all have high PageRank - say 6 or more? If so, you'll have to work really hard to get in the top 10.
Let's say the top 3 sites in Google are PageRank 8, 7 and 6. If so, you'll probably have to work hard for a couple of years or more to outrank them. I'm not saying it cannot be done, but it will require either a great deal of work, or a very innovative, eye-catching approach.
You can quickly check the PageRank of your potential competitors by using Seochat's free online tool - http://www.seochat.com/seo-tools/pagerank-search . Type in "hiking boots" or whatever and you'll be able to see the PageRank of the top 10 sites.
Do those sites all have the phrase in the title? (The title is the words that appear at the very top of your screen when you visit a site.) If not, you may be able to beat them.
How many links do your potential competitors have?
Do your potential competitors all have thousands of links to them? This is important, because links are important to search engines. You need good, relevant links to your site. To find out how many sites are linking to a site, use the free Yahoo! Site Explorer. Go to http://siteexplorer.search.yahoo.com - and login (set up a free account if necessary).
Type the URL of the site you want to explore.
Click on "Explore URL".
Click on "Inlinks".
Modify your search to make it more useful. Select the options to show Inlinks "except from this domain" and "entire site". This will exclude internal links and show you all external links that Yahoo! knows about to ANY page of the website.
Don't decide definitely on a niche topic until you've taken the next two steps...
Next step : Choose profitable niche
