Your ideal product or service will be one that has high-demand, and low competition.  Now that's a tough combination to find in the online world today.  But if you can find and exploit find the gaps where your potential customers can be found, and your competition is weak, then you are on the right track.

You need to make some basic decisions here as well.  You need to pick a product or service that interests you.  I personally will not do anything that has to do with Adult oriented websites.  That's a personal decision.  Gambling sites - fine.  Once again, my comfort level.

Also don't forget to use tools like google.com to help you determine how many people are competing in the same field as you.  When you do a search, you can see approximately how many hits for your words were found by the search engine.  Careful analysis of the words you use to describe your product and the resulting number of hits found by the search engines can lead you to find the unexploited gaps I've been talking about.

The only problem with this approach is that it can be arduous and extremely time-consuming.  How would you like to automate that process?  You can using a tool like wordtracker.com.  With this tool, you can find the unexploited gaps where your customers exist, and your competition does not.  Wordtracker.com can also help you optimize your wording for Pay Per Click advertising as well.  This is vital if you plan to do this type of advertising - which I highly recommend.