A Free Approach to Measuring Market Demand

A Free Approach to Measuring Market Demand

Measuring the demand for a product idea is a critical step in The Market-First Approach to Startups. Here is a free, multi-step process for gauging the potential of a niche using publicly available tools.

Step 1: Brainstorm Keywords with Google AdWords Keyword Tool

Start by using the Google AdWords Keyword Tool to brainstorm a list of potential keywords related to your niche. Use the "exact match" option to get a more accurate sense of search volume for specific phrases.

Step 2: Estimate Potential Traffic and Revenue

Using the search volume data, you can create a rough estimate of your potential traffic and revenue. A common rule of thumb is to:

  1. Halve the search volume: The AdWords tool tends to overestimate traffic.
  2. Multiply by four: This accounts for traffic from long-tail keywords and other sources (Understanding Traffic Sources).

This will give you a ballpark number of monthly visitors. You can then use an estimated conversion rate (Estimating Website Traffic for a Niche) to project your potential revenue.

Step 3: Assess Keyword Difficulty with SEO Logs

Use a free tool like the SEO Logs Keyword Difficulty Tool to get a rough idea of how difficult it will be to rank for your chosen keywords. This will help you to understand the competitive landscape.

Step 4: Perform a Sanity Check

The free tools are not always accurate, so it's important to perform a manual sanity check. This involves:

  1. Googling your keyword: Look at the top-ranking pages and assess their quality.
  2. Checking PageRank: Use the Google Toolbar to check the PageRank of the top results. A high PageRank indicates strong competition.
  3. Viewing the source code: Look for signs of on-page SEO, such as optimized meta tags.
  4. Checking domain age: Use a Whois tool to see how long the top-ranking domains have been registered. Older domains often have more authority.
  5. Analyzing backlinks: Use the Google Toolbar to see how many other sites are linking to the top-ranking pages.

By combining the data from these free tools with a manual sanity check, you can get a reasonably accurate picture of the demand and competition in a niche without spending any money.