Over the last couple of years, I’ve earned a couple hundred thousand dollars on the web. I’ve been privileged to coach some people along the way to help them get their own business off the ground and have decided to share some of the secrets of earning real money online on this blog.
There isn’t any magic to making a lot of money on the web – and it isn’t easy. Though it isn’t easy, you will probably find the elements I describe here as fairly simple. Making money online is the same as making money anywhere: you create a product people want to consume and you figure out a way to monetize it. In this article, I’m going to explore 6 ways to earn money online. These aren’t all of the ways to earn money on the web, but this covers many of the ways you could earn an income. The trick is learning how to take one of these methods to generate money and creating a niche you can earn a living in. I hope these posts help you do that.
6 Ways to Make Money Online
- Sell a “Real” Product
- Sell a “Virtual” Product
- Motivate Someone to Buy a Third Party’s Product, aka Affiliate Sales
- Free, Advertising Supported Content
- Lead Generation
- Service/Subscription Based
1. Sell a “Real” Product
If you’re reading this post, you likely have purchased a physical product online. Though major retailers such as Amazon.com and Buy.com dominate this sector, there are a lot of opportunities to sell physical goods and earn a significant income. You can do this through your own store, or by selling through other services such as Amazon.com.
Selling Products on Other Sites
Amazon.com and Buy.com allow third party sellers to list products on their site. You pay a commission to these sites when you make a sale, and on Amazon, they will even warehouse and ship products for you. This provides a very low need for infrastructure for your company and you can earn a good profit by undercutting Amazon’s prices.
Where Do I Purchase Products to Resell?
There are a number of options which we’ll explore in a later post, but you will need to find a wholesale company to purchase product from. For books, this is one of the major distributors such as Ingram Book or for computers and electronic equipment, it’s a distributor such as Tech Data or Ingram Micro. You can also try purchase quantities of product from marketplaces such as Alibaba.com or eBay, but those we know who have gone this route have had more difficulty.
2. Sell a “Virtual” Product
Unlike physical products, virtual products are electronic in nature, such as ebooks, MP3s, videos, or memberships to a site. These can range from a 99 cent song, to a $25 royalty free image, to custom whitepaper reports costing thousands of dollars each. You’d be surprised how many billions of dollars of electronic goods are sold each year.
You can produce your own products or outsource production to a third party. I have written my own ebooks and have outsourced tutorial development to ghost writers, finding success with both methods. In a later post, we’ll explore how to develop virtual products and post them for sale.
3. Motivate Someone to Buy a Third Party’s Product: Affiliate Sales
There is an opportunity to earn commissions on product sales (both physical and virtual) by referring buyers to sellers. When the buyer purchases a product, you earn some percentage of the total purchase. The actual amount paid out depends on the product and the seller. Successful affiliate marketers can earn thousands of dollars a month. I know some who earn tens of thousands of dollars each month through affiliate sales.
4. Free, Advertising Supported Content
The most popular method of earning money online is creating content which you monetize through advertising. There are a number of advertising networks you can use to sell ads on your content – the largest is Google Adsense. You can also sell Internet advertising yourself or through your own sales staff. This usually requires either a lot of traffic (pageviews/unique visitors) or a very niche topic area. Selling ads yourself is very lucrative, but you have to manage both the business side and the technical side – implementing your own ad server or outsourcing it to an adserving service.
5. Lead Generation
Many industries and companies will pay for qualified leads for potential clients. You can create a site which is designed to acquire qualified leads and then sell these leads to companies who will cold call the lead to try to convert them into a paying client. This is very industry or niche focused – there are only some industries which pay good money for leads and the task in starting this kind of site is making sure your niche will pay enough.
6. Service/Subscription Based
The final Internet business startup we will explore is creating a service or subscription based site. This will provide a service to consumers or businesses and earn a monthly or annual recurring revenue stream. Many services work on the freemium model – offer a free service with paid upgrade options.
You Can Do It!
I want to encourage you – it’s not too late to start an Internet business. I am launching new businesses all the time and the pie just keeps expanding. Look at Facebook or GroupOn, in the scope of things, both very young businesses now worth billions of dollars. You can do it! You can start a successful business. We’ll explore how together!