Why Niche Validation Matters
Most ad arbitrage campaigns fail. Not because the strategy doesn't work, but because people skip validation and scale bad niches. They see someone else succeeding with "home decor" and assume it'll work for them too.
Proper validation takes 1-2 hours of research and $50-100 in test spend. Skipping it can cost thousands in wasted ad spend and months of frustration.
Without Validation
- • Spend $500+ testing random niches
- • Discover margins don't work after the fact
- • Waste time on declining trends
- • Get frustrated and quit
With Validation
- • Spend $50-100 to confirm margins
- • Know profitability before scaling
- • Focus only on growing niches
- • Build confidence with data
Check Search Interest
Is anyone actually searching for this?
Before anything else, verify that people are searching for your niche topic. A niche with no search interest means no organic discovery and potentially expensive paid traffic (people don't click what they're not interested in).
What to Look For in Google Trends
Flat or upward trajectory over 12+ months
Relative to peak interest (100). Below 25 may be too niche.
Dropping interest = shrinking audience = harder arbitrage
Seasonal niches work but require timing (e.g., "Christmas gifts")
Research Traffic Costs
What will you pay per visitor?
Your traffic cost determines the floor of your expenses. Check CPCs on the platforms you plan to use (Meta, Google, TikTok, native). Different platforms have vastly different costs for the same audience.
CPC Benchmarks by Platform
| Platform | Typical CPC Range | Best For |
|---|---|---|
| Meta (Facebook) | $0.05 - $0.50 | Most niches, good targeting |
| TikTok | $0.10 - $0.30 | Younger audiences, viral content |
| Native (Taboola) | $0.10 - $0.40 | Content-style ads, older demographics |
| Google Search | $0.50 - $5.00+ | High-intent queries, finance/legal |
Pro tip: Check CPC for your specific country + niche combination. "Personal finance" in the US costs 10x more than in South Africa.
Estimate Ad Revenue (RPM)
What will you earn per 1,000 visitors?
RPM (Revenue Per Mille) is how much you earn per 1,000 page views from display ads. This varies wildly by niche, geography, and ad network. High-RPM niches include finance, insurance, legal, and technology.
RPM Benchmarks by Niche (US Traffic)
| Niche Category | Typical RPM | Notes |
|---|---|---|
| Finance/Insurance | $25 - $50+ | Highest paying, competitive |
| Legal | $20 - $40 | High advertiser demand |
| Technology | $15 - $30 | Good balance of RPM/CPC |
| Health | $12 - $25 | Watch for policy restrictions |
| Home/DIY | $8 - $18 | Broad appeal, moderate RPM |
| Entertainment | $3 - $10 | Low RPM, needs high volume |
* Non-US traffic typically has 30-70% lower RPMs. Tier 2/3 countries may be 80% lower.
Calculate Margins
Does the math work?
Now do the math. Convert your CPC to cost per 1,000 visitors (multiply by 1,000), then compare to your estimated RPM. If RPM > cost, you have potential margin.
Margin Calculation Example
The key insight: arbitrage margins are tight. You need either very low CPC (emerging markets) or very high RPM (finance niches), or both. Most "obvious" niches don't work because others have already bid up the CPC.
Use our calculator: Instead of manual math, try our margin calculator that factors in CPC, RPM, pages per visit, and shows you the expected margin percentage.
Free Margin CalculatorRun a Small Test
Validate with real data, not estimates
Estimates are just that—estimates. The only way to truly validate a niche is to run a small test campaign. Budget $50-100 to get 500-1,000 visitors and measure actual margins.
Test Campaign Checklist
Enough for 500-1,000 visitors at typical CPCs
Enough time to average out daily fluctuations
Quality content with optimized ad placements
Google Analytics + ad network dashboard
Test different angles to find best CTR
Red Flags: Niches to Avoid
Policy-Restricted Niches
Gambling, adult content, weapons, cryptocurrency (some platforms). These either can't run ads or have restricted monetization.
Declining Search Interest
If Google Trends shows 50%+ decline over 2 years, the audience is shrinking. Harder to maintain profitability over time.
Extremely Competitive Niches
If Meta Ad Library shows hundreds of arbitrage-style ads for a niche, CPCs are likely inflated beyond profitability.
Entertainment/Viral Content
Memes, celebrity gossip, and viral content have very low RPMs ($2-5). Margins rarely work unless you have viral organic reach.
Heavy Seasonality
Not necessarily bad, but requires timing. "Tax tips" is great in March, terrible in July. Plan campaigns around seasonal peaks.