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Money Making Business Models for the Internet
By Ben Holmes
How Will YOU Make Money? There are three reasons that people don't make money on the Internet:
1. Lack of knowledge
2. Lack of focus
3. Lack of action
I really can't help you if you're unwilling to take action, but the first two reasons I can walk you through. So follow along! A lack of knowledge is quite easy to fix - all you have to do is fail. Or more precisely, be willing to appear that you've failed. As Thomas Edison said: "I have not failed 700 times. I have not failed once. I have succeeded in proving that those 700 ways will not work. When I have eliminated the ways that will not work, I will find the way that will work." I've failed more times than I can count with Internet business - yet my success today would have been impossible without me learning what doesn't work. You will too - you just have to have the willingness to dive in and learn. Much of what you need to know is widely available on the net today - you have to learn the concepts of making money on the Internet, and then apply them. First you must figure out just how you want to earn money on the Internet - let me cover a few of the major online business models: 1. Sell things on Ebay.
2. PPC to CPA or Affiliate programs.
3. Membership Sites
4. Creating Your Own Ebook/Script Product.
5. Affiliate Marketing with Articles & Website. I've tried all of these at one time or another, and all of these methods can earn you substantial amounts of money - but you will discover that one of these will be the one that you are suited for - so let's go through the pros & cons of each method - so that you can focus on the method that you choose. 1. Sell things on Ebay: This can range from finding things at garage sales and putting them up on Ebay - all the way to ordering pallet lots, or products from overseas suppliers - there's many ways to find products to sell on Ebay.
Potential: $1,000-$5,000/mo is average. Exceptional sellers can break $100,000/yr.
Time Required: Between 1-10 days.
Startup Costs: $0.00-??? Can be virtually nil - you can begin with items around the house that you no longer want, and parley that into purchasing wholesale. You can even sell via 'drop-shipping', where you only pay after your customer has paid you.
Pros: Extremely fast return - you can have money today if you put up a 'buy it now' listing. Even with auctions, you'll have money in just a week's time - and this sort of speed is nothing to sneeze at - it's by far the fastest of the 4 methods. There's no limit to the amount of money you can make, although your ability to stock, warehouse, package, and ship will put some limits... your niche will also limit you to an extent.
Cons: Difficult to come up with good products that have a decent markup - you'll constantly fight to develop new supply sources - and competition will keep driving your prices down. Ebay has recently (2008) been creating some very anti-seller policies, which make it difficult for you as a seller to have a good business. As well, Ebay will constrain the way you do business, and take a healthy cut of your profits. If Ebay decides, they can shut you down virtually instantly - as they did to me - I had a gross of around $1,000/mo. taken away when Ebay decided not to allow downloadable products anymore. It's dangerous to allow any one entity to have such overriding control over your income. Outsourcing any of your work can generally not be done - so your income is partially controlled by your time. If you stop working, you stop earning... this isn't true of the other methods listed below.
2. PPC to CPA or Affiliate programs. Using PPC (Pay Per Click) search engines to send traffic to a landing page - where you monitize by CPA (Cost Per Action - such as a person filling out a credit application) or Affiliate programs such as those found at ClickBank or Commission Junction.
Potential: $1,000-$5,000/mo is average. Can easily exceed $50,000/mo if you are good.
Time Required: 2-6 months.
Startup Costs: $1,000-$3,000 or more. Not only payment for an ebook or membership site to help you learn the business, but your startup capital to pay for the traffic you get from a PPC search engine has to absorb your losses as you learn.
Pros: Fairly fast return - you can have money within weeks or a month at the most, provided that you have a successful campaign. Successful PPC campaigns can be 'ramped up' to produce even more money. Once you have successful campaigns in place, you need only occasionally 'tweak' them to keep a good income - good campaigns generally don't stop producing money quickly. PPC to CPA/Affiliate programs can earn you five figures or more each month... very lucrative if you do it right!
Cons: High startup costs - and you will lose money while you learn the business... although the rewards can be commensurate with the risk. You must have the ability to put up really great landing pages - you have no leeway for poor conversions, since you're paying for each visitor. This business model is the riskiest one of the five business models listed here.
3. Membership Sites. This involves purchasing and gathering together a large quantity of ebooks, scripts, videos, and articles that all relate to a particular field - sell customers a monthly fee to access to this material, and keep updating the membership site with new material.
Potential: $1,000-$5,000/mo is average. You can 'rinse & repeat' this method for more money.
Time Required: Between 1-3 months.
Startup Costs: $500-$1,000. Domain Name, Hosting, Autoresponders, Advertising costs and product costs.
Pros: Reasonably fast return. You can build up to a four figure income within a few months - and the re-occurring nature of your income allows you to take breaks from time to time.
Cons: Advertising will be a heavy expense; you have to find new members to replace those who leave, for even the best membership sites can retain members no more than 6 months to a year. You'll have to constantly search out new material to keep the members happy.
4. Creating Your Own Ebook/Script Product.
Potential: $500-$5,000/mo is average. Potential to break a million a year on a great product.
Time Required: 3-6 months.
Startup Costs: $100-$3,000. If you don't have the skills, product creation, copywriting, and landing pages can be outsourced. You'll need a Domain Name, Hosting, and Autoresponders. Advertising & product costs can range from nothing to expensive.
Pros: Slow return... but great income if you have a successful product. Many products on Clickbank earn their owners incomes that make them millionaires within a year or two.
Cons: This method requires a great deal of work upfront, and you may find out that months of labor has produced an ebook or script that no-one wants.
5. Affiliate Marketing with Articles & Website. This method is forgiving of poor copywriting and landing page creation - since all of your traffic is developed by free methods. By putting up a website, and driving traffic with free methods such as article writing and good SEO practices, you can earn a reasonable amount of money.
Potential: $1,000-$5,000/mo is average. Exceptional understanding of the market, a good niche, and lots of work can push this into 6 figures a year or more.
Time Required: 3-6 months or more.
Startup Costs: $0-$100. You can actually build up a reasonable 'empire' without spending any money, but I highly recommend that you spend enough to have your own website as a 'base of operations'.
Pros: Although this method will take the longest time to develop a reasonable return, it's an extremely dependable income when done correctly. Outsourcing can be done on much, if not most of the work involved. Once you have a successful business in place, very little work is required to keep it running well and producing great income. Once this method is well developed, you can expand by moving into PPC to develop more traffic.
Cons: Very slow to start producing reasonable amounts of money - you can expect to go several months at least, and perhaps a year or more before seeing four figure monthly incomes. You will also spend more time than any other putting this business model into place, but once it's producing a good income, you'll work less to maintain the income than on the other business models.
The business model I've settled on should be obvious to the membership of BurningKnife, I'm a fan of this last method - affiliate marketing. Study these business model summaries, and judge for yourself which one you seem most suited for - then focus all your action on just that one single method. You'll make more money faster by focusing on one method than you will if you scatter your activity among too many competing money-making ideas. |
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This intel was contributed by khadaji
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May, 2012
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