Originally Posted by Jon

First I do market research on the particular niche. Things I look for is offline mostly.
Will it be profitable?
Did it hit it's peak yet?
Are people bidding high on the engines for it ($3+ per click)?
How many competitors are there?
How much work is potentially involved?

There are tons of questions to ask yourself, and it also depends on how you plan to make money from it. Is it going to be affiliate marketing? Arbitrage? CPM? Content site? Forum? etc..