Everyone is on the hunt for a great niche. This is one of the things that tends to stump people who are just getting started, and also the thing that long-term internet marketers never stop looking for.
The initial response I generally hear is "They're all taken!" or "There is too much competition!" or "How can I ever compete with what's already out there?"...
The truth is it's not that competitive at all. That's a general statement of course, but its in reply to a general question. What I mean is that there are plenty of good niches left. Its just a matter of what you plan to offer... and how.
Even a saturated, competitive niche is full of opportunity.
Some markets may appear super-competitive or even "saturated" at first glance. But the truth is, very few of the websites or advertisements you see are true potential competitors. Much of what you see is going to be low quality bottom-level attempts at marketing that you can easily rise above with reasonable effort (and often, minimal effort).
Worst case scenario, if you have a fairly competitive niche in mind, look at ways you can leverage the power of your competitors - instead of competing with them directly.
Lets say that you are interested in a niche, for example, that is full of aggressive affiliate marketers. They have a solid claim on the first 3 pages of search engine results, and the advertising costs for pay-per-click are out of range. At first glance, you might toss that idea and move on.
But if you 'think outside the box', you might see the opportunity that lies in that scenario. The solution is to create a product, or write a report, and appeal to the affiliate marketers that already have a claim on that niche. What better way to leverage the competition than to have them making sales for you?!
Before you knock that idea, let me just say: it's much easier to write a 20-30 page report than it is to create and market your own affiliate site.
Another great example is Blogs. You might think there are thousands and thousands of blogs out there - why would I want to start one of my own?
While its true that there are a lot of blogs online, its also true that most of them are junk. There are thousands and thousands of low quality blogs and abandoned blogs. Of those that are regularly updated, a certain percentage are actually high-quality unique content. And even those are spread across various niches.
There is actually more of a call for good blogs, great websites, unique content and new publishers than you might initially realize. People who hunt and fish 'religiously' for example, subscribe to a variety of magazines on those topics, and watch any good television program on the topic.
If you look at my bookshelf and magazine rack, you would notice a wide variety of authors and even topics - but all under the same general niche: business, success, entrepreneurship. Does anyone really pick just one author or one publisher - or even one website? No. In fact, I'd be willing to bet that this is not the only marketing/business type blog that you read or subscribe to either...
There is still plenty of room online for new publishers, great content, good offers, interesting slants, cool websites... yes, and even new competition.
Stop worrying about competition - and start figuring out how you can become it. Or even better - how you can leverage it.