- 67% of millennials prefer to shop online than in a physical store.
- There are no goods to dispatch when you sell intangible products such as eBooks.
- Affiliate marketing can be lucrative and there are no transactions to deal with.
- There are much more ways to earn money online!
Ever since the internet arrived in our lives it’s proved to be something of a gold-rush for entrepreneurs. The biggest and most successful ones – think of Amazon’s Jeff Bezos – he may now be a billionaire with riches beyond the dreams of even the most ambitious of us. But that’s not to say that there aren’t still plenty of opportunities to make big money online – you just need to know how to go about it.
There are a number of basic options for making money online, they include but are not limited to: selling goods, both intangible and physical, offering services, selling information, becoming a reseller and becoming an affiliate marketer.
This article will give you a few areas to explore but before then it’s worth looking at the key principles that lie behind success.
Passive Income vs Non-Passive (Linear Income)
There are two basic ways of making money, through passive income and non-passive income.
Passive income can be simply defined as money that is earned without being actively involved. This means that there is the very little effort required by the receiver of the income. So for instance, authors enjoy profits for many years without working. The same is true for music artists, their music can continue to make money for a long period of time after its recording. Similarly, renting out an apartment is also a passive income. Through opening an online retail store it even provides you with the opportunity of making money while you sleep!
Non-passive (linear income) involves trading time for money, this is how the vast majority of the population earn their money. Those earning linear income are paid based on the amount of work they do. When non-passive earners stop working, their income stops. Therefore linear income requires continued work and there is a cap on the earnings, it is like any regular job if you do not attend you will not get paid.
Set up an online store
The internet has been accused of many things, not least sounding the death knell for the high street – and it’s not surprising that online retail is such a successful field to get into. For example, statistics show that 67% of millennials prefer to shop online than in a physical store and the majority of Americans believe it’s the best way to shop.
If you’re planning on being an independent retailer it is important to identify a niche in the market, ideally one that you’re interested in yourself. A great example of this is Net-a-Porter, a web-based designer fashion retailer set up by Ms. Massenet and Cath Kidston. They began their online business in 2000, a notoriously difficult time to start an online business. Fast forward 10 years and their company were purchased by a Swiss-based luxury goods conglomerate and an American private equity firm for a combined total of up to £450m.
If you want to set up your own store it’ll be a question first of choosing a platform like Shopify or Magento and personalizing it to your needs and, in all cases, it will be a question of also working out the logistics of how you’ll store stock and fulfill orders.
Become an eBook best seller
If the issues of storage and despatch seem like they may become too much of a headache then maybe selling more intangible items like eBooks, information or software would be a better idea. You won’t need storage space and all purchases can even be delivered directly to customers online.
If you’ve got a way with words then maybe you could even launch yourself as an online author like Kerry Wilkinson whose crime titles have even outsold big names like Lee Child and Stieg Larsson.
Become an affiliate marketer
Another very popular way to make money online is through affiliate or referral marketing. This involves acting as an introducer who brings customers to businesses and earns a commission, usually between around 4% and 8% for doing this. The advantages are easy to see. There are no goods to despatch, no transactions to conduct and no customers to deal with. The disadvantage is that if no-one clicks through and becomes a customer of the sites you’re affiliated with there’s no income.
One area that relies quite heavily on affiliate marketing is the online casino. Israeli, Avi Shaked, was one of the first netpreneurs, in 1997 he founded 888casino, one of the most successful online casinos. He has earned a fortune from this brilliant site and, while you probably won’t make quite that large a fortune, there is a good chance you’ll do well.
The way it works is simple. You enroll and register with the casino’s affiliate program, the casino then has to accept this request, if they do accept you will then receive access to the casinos’ affiliate banners, links, graphics, and images. Following this, you then receive a unique ID number that is appended to the link that points to the casinos’ website. Through using this tool casinos can identify the traffic that comes from each of their own individual affiliates. However, affiliate marketing is a performance based compensation model, meaning you will only be paid a certain percentage of commission for those customers that deposit money with the casino.
Most online businesses offer an affiliate program, this is usually found at the bottom of their site. Amazon offers one of the biggest affiliate programs, it is hugely successful.
It is through this method that Joshua Chan made his fortune, he was the founder of a site that simply offered reviews regarding online casinos. Through taking advantage of the affiliate marketing scheme the site has now grown and it now offers information about all aspects of gambling with a significantly bigger team than what he started with.
Other ways to make money online
Of course, there are much more ways to make money online – far more than we have room to go into here. Two of the most popular are to earn money for filling in online surveys or, for the more technically minded, by managing Google AdWords campaigns for clients. The former will only offer a modest income but there’s far greater potential with the latter, as well as a range of charging methods including by the project, hour or even click. Google AdSense allows you to host ads on your site. The highest bidders then feature on your site, following this you simply allow Google to sort the rest as they bill the advertisers and networks responsible for the ads. Google share around half of their revenue from the ads with the host website, this ensures that passive income can be extremely lucrative for website owners.
Whatever you do it’s also worth remembering that everyone has to start somewhere.
So who knows where that germ of an idea you may have now could take you in just a few short years’ time?