Making Money - Making Money

Three basic ways of making money

There are three basic ways in which you can make money by internet trading. In these ways I am not including any of the sideshows like ebay shop trading or lead capture and resale.

These are three straightforward and proven ways of making money.

Building a Made For Adsense site (MFA)

This is the easiest way to do it. Though the returns are potentially not as great as either affiliate marketing or an ecommerce store.

The principle is simple. Build a content website with plenty of readable and interesting content and then strategically place your adverts on the page in the places where they are most likely to get clicked on.

Sounds easy?

Well really it is. Where most people go wrong is that they forget the content bit!

Content, Content and more useful content

Lots of interesting and informative content will pique the readers interest and give them a thirst for more information. Instead of providing outbound links on the page that the surfer can click you make sure that the only prominent out bound links are the google ad's

The google ad's themselves come as a small script which is easily configurable using the google interface so you don't need any real programming skills for this.

Brainstorm your target niche

What you DO need is a good idea for a content site, the ability to be able to write the content or get it written for you and the time to keep adding content on a regular basis.

One person should be able to produce two really good adsense sites in a calendar year whilst holding down a dayjob.

Two years from now you should have four sites and more revenue than your dayjob easy.

See Creating an adsense site

Affiliate Marketing

Many people see affiliate marketing as some really complicated monster that needs fighting with hundreds of different web tools. but that's really not the case.

At it's very basic you simply copy the idea above (creating a content site) and instead of displaying advertising you replace those ad's with outbound links containing your affiliate ID.

Patience required to analyse statistics.

For most people the problem with making this work is that they don't have the ability or patience to be able to analyse their traffic. If you don't know the difference between "hits", "uniques", "visitors" and "unique visitors" then you need to know it to be succesful at affiliate markeitng.

Where as making a Contextual advertising site (google adsense) relies more on the abilty to be able to drive enough traffic and provide enough unique content to generate revenue, affiliate marketing draws on the ability to "pre sell" a product before passing the consumer to the product site.

Affiliate marketing is about "preselling".

If you don't pre sell the product properly then you will end up sending hundreds of unique visitors to your affiliate program which result in no sales. This is when people figure that affiliate marketing does not work.

It's hard enough to get traffic and to then send that traffic to another site and not get paid for it can make it seem like a worthless task. This is why an advertising site is better for a beginner, because at least they get paid for the clicks they generate - irrespective of what happens on the site they send the traffic to.

See Creating an affiliate marketing site

Building an Ecommerce store

Make sure you include stock in your budget:

Let's look at what is involved here.

Firstly you are going to need stock to sell and that stock needs to be kept somewhere.

Secondly you are likely to need capital to fund that stock. And don't underestimate the amount of capital required for this.

Let's take a ficticious lingerie site which seems all the rage to build at the moment. If you have five product ranges each with five products then you have 5*5 = 25 products. Let's make it easy and say you have small, medium and large sizes. 25 products * 3 sizes = 75 items to stock.

Now we need say three colours of each item. 3*75 = 225 pieces.

How many do you want to keep in stock of each? Five to begin with?

5 stock items * 225 pieces = 1125 items. Lets say they have an average wholesale cost of £5 each. This gives you a capital outlay of 1125 * £5 = £5,625 and that's just to keep a barebones minimum stock level. A good days trading would wipe you out. Figure on 50k as a good starting stock capital for an exercise like this.

Of course you can organise dropshipping whereby you pass the order to a third party to fulfill but that really defeats the object of an ecommerce store. By packing up and dispatching your own goods you get to include brochures and upsells within your packaging and establish branding.

Practicalities of building the site

There are some really good ready made packages which will allow you to get started with a minimum of fuss. I'm thinking of something like http://www.oscommerce.com/ which is a free script developed by hundreds of developers all over the world. Also see http://www.zencart.com

However, before you rush in, take these factors into consideration:

Some Programming required

Firstly shopping cart scripts are notoriously difficult to customise in design terms. It's never easy to make a nice looking shop. Many of the oscommerce shops look samey samey because of this. You'll need an experienced designer if you are going to make a good attempt at this.

Secondly, inputting all of the data and configuring the myriad of options can be extremely time consuming. Never mind testing the payment interface and all the under the hood stuff.

Thirdly you really need someone on the team who understands how a mysql database works and how to put information into and out of it quickly. They'll need a good grasp of PhpMyadmin (see creating a database) and excel. Also if they can set up an ODBC connection so that you can administer the database using something like MS Access then it's a big step ahead.

If you are really insistent that an ecommerce store is your way to riches then you need a team of two or three people to do it with you. Just taking photos of all of the products can take weeks.

So to summarise:

A: Made for adsense site

Pro's: Easy to set up. Single payment source. Easy to stay focused on producing content.

Con's: Good content can be difficult to provide.

See: Build an Adsense Site

B: Affiliate Marketing

Pro's: easy to set up, huge revenue potential

Con's: Merchants can go bust, need targeted traffic to make it work properly.

See: Build an Affiliate Site

C: Ecommerce site.

Pro's: Can make a lot of money once it is set up and humming along.

Con's: Too many to mention. Overheads, expertise required, programming, costs.

So you've chosen your money making way? Now you need a working environment.

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