I always hear these stories about dot com entrepreneurs earning fortunes online. I’m curious… how exactly do websites make money?
There are many, many different ways that various dot com amateurs and professionals make money online. People in the Search Engine Optimization, Marketing, and Website Promotion games can often be particularly creative in coming up with new ways to monetize their offerings. To give you an idea of what goes on in this field, here are 5 basic ways that the proprietor of a web site can earn money:
1. Advertising
The most obvious way that sites make money is through various forms of advertising:
- Banner/Image Ads: Prime real estate on a web site can be devoted to banners and other images of various sizes.
- Text Ads: A text link, possibly accompanied by a short description, is displayed on a site. Text ads are often contextual in nature, meaning that they appear on sites with related content. If you are looking at a site about white water rafting, there is a high probability that you may notice and click on a link advertising rafting gear for sale.
- Video Ads: Video ads are a fairly new evolution of the online advertising space. With the widespread prevalence of broadband Internet connections, advertisers are now within the capacity to serve up video ads without severely burdening their audience with long load times.
With these types of advertisements, the publisher (site owner) is often paid either for the number of times each ad is displayed, or for each time the ad receives a click. Other payment methods include compensating the publisher when their visitor takes a certain action, such as purchasing a product or signing up for a newsletter.
2. Affiliate Sales
Many web site owners take advantage of the fact that most online retailers (e.g. Amazon.com) will pay out a commission on sales they refer. There are a few ways that webmasters go about affiliate sales:
- Site owners write product reviews, which include links to buy those products. If a visitor ends up buying a product as a result of that review, the site owner will be paid a commission.
- Site owners operate their own store. The store features their own branding, and is stocked with items provided by one or more online retailers. Each purchase from the store earns the site owner a commission. Amazon and Zlio both offer services that enable site owners to build their own custom online store.
3. Sponsored Posts
Writing sponsored posts is particularly common among many bloggers. Companies looking to get exposure for their products and services will often use a site like Review me to hire bloggers. For a fee, those bloggers will evaluate your product or service in front of their audience. Depending on the traffic levels and authority commanded by the blogger, these sponsored posts may result in additional sales, users, and exposure.
4. E-book and Subscription Sales
Some site owners who create original content that addresses a common need may choose to publish a small portion of that content, and then sell the complete package through a downloadable e-book, or some sort of subscription-based system such as an e-mail newsletter. This is a pretty straightforward process — users pay a fee, and the site owner supplies the content.
5. Membership Fees
A site that provides a valuable service may charge a membership fee for access to premium features. An example of this approach is Flickr. A free Flickr account is limited in terms of how many photos, photo sets, and other features can be uploaded/created/used. For a $25 annual fee, Flickr users can have these limits increased, and some are even eliminated entirely.
