Make Money Online

Roughly seven years ago, I began experimenting with making money online. Before that, I didn’t know anything about creating websites, marketing, affiliate programs, or anything of the sort. I just wanted to know if it was indeed possible to have cash flowing into my bank account while I slept. I began to do some research and saw all types of crazy schemes that people used to generate income through the internet. Eventually, I got started writing for a company called Associated Content (which got bought out by Yahoo! and is now defunct) which paid me money based on the number of views my content would generate. At first, it was a few bucks a month and eventually grew to a few dollars per day. It wasn’t a lot but it confirmed for me that I could get paid outside of the hours (and during) the hours I went to my job each day.

I quickly realized two important things from this experimentation with passive income generation. First, that if I wanted to create enough money to live off of, I’d have to scale up my operations. Secondly, I learned that it would be necessary to diversify my income streams because they could be turned off at any point in time, much like getting fired from a job. That is what happened with that original Associated Content cash flow stream, it paid out monthly for a few years, and then the site was shut down from its then current form.

These lessons were very important for me to understand viscerally. Many people believe that having a good job is the key to financial independence and with the right career path, luck, savings, and investments this CAN BE true. However, it isn’t guaranteed. As with everything, there is risk involved and the intelligent course of action is to minimize risk through diversification. People tend to carry this thinking over to generating residual income, as well. They are constantly on the search for one big idea or fail to ever attempt getting started making money online because they don’t have that ‘big idea’, which will generate mountains of dough every day, and allow them to do whatever they want to with their lives.

OK, ask yourself. What’s more secure, creating one website that generates an extra $1000 a month or having twenty sources of income generating $50 a month from each? Obviously the second and it’s none too difficult creating less than two dollars a day passively and can easily be replicated again and again. It would simply take the time and effort to create these streams or pay to have them created on your behalf.

For this post, I want to present to you, what passive income is and some different sources of creating residual money. In future writings, I will get much more in depth on how each of these can work towards making one financially secure/independent but for now let’s focus on the 30,000 foot view of things.

Also, please don’t get discouraged when you are starting out making small amounts of money. Keep at it and it will grow. You will learn so much by working consistently for years and not treating this type of thing as a get rich quick scheme (although you potentially can, get rich relatively quickly with the right skills/ideas).

There’s nothing wrong with creating a page on a website that makes $2 a month in revenue and only took you an hour to create. Yes, you may make $20 an hour or more at your day job but that $2 for the webpage can grow and/or continue in perpetuity. After a year, you’ve made $24 for that hour and you’re still getting paid for as long as that webpage gets traffic. I have work I did 5-6 years ago, which has generated and still is generating thousands of dollars in income, and only took around an hour to complete. That’s the idea, to create streams of income, which flow towards one another to create a river that doesn’t dry up.

 

What is Passive Income?

I’ve seen some debate as to what qualifies for money being truly passive. However, just to keep things simple, I am going to define it as revenue that is being created while you go about your day and aren’t actively working on it. Now, of course there are varying levels of passivity. Some streams of money require no work after the initial action, while others may require simple maintenance, and others require fairly consistent attention (but still less than a full time job).

I never particularly cared about having to do some upkeep or whatnot in order to maintain or grow my ‘passive’ income, as it was still better than having to go to a job each day and only get paid for the hours I was there, doing that job. That’s the main difference and the best aspect of creating income sources for myself, money is coming in while I’m simply existing as a human being and it doesn’t matter if I’m being ‘productive’ in the traditional sense. I can sleep, workout, go to the beach, have sex, or whatever else and that cash is still trickling in by the minute.

Your ultimate goal with passive income doesn’t have to be quitting your job and doing (basically) nothing. These sources can also be used simply to stir up supplementary income, sort of as a mini pension plan or something like a yearly vacation fund or simply designate the small income you generate to pay off your monthly phone bill. You can scale this thing to as large or as small as you’d like.

Personally, I wanted to create the freedom of not working in an office each day and the ability to do (most of) what I want to with my time, without having to completely sacrifice other areas of my life. I do still have a job, which pays me, regular non-passive income. The cool thing is that I work remotely from wherever I have internet connection, I get to learn the details of running a business without risking any of my own capital, further diversify my sources of money, and send a high percentage of what I make into an index fund held in a retirement account…which, generates dividend income…oh look! Another source of future wealth!

That is another interesting aspect of residual money, you can use it to create even more of it by utilizing the wonderful concept of compounding. For example, there were websites that I have owned, which threw off steady streams of extra cash each day and every week or month (depending on the payout structure) this money would be deposited into an account. I would then take this money and use it as investment capital for buying shares of companies I was interested in. Most of these companies, also paid dividends to me as a shareholder, which was either used to purchase more shares or pooled into my brokerage account to help buy shares of other companies that I felt were of better value at the time. So, my residuals were used to effectively purchase more residuals, further expanding and diversifying my income.

This can go on and on, until a complex web of holdings has been assembled, that is hard to screw up once it has been assembled. Sure, a company may go bankrupt. Your website may lose it’s traffic. Your books sales might tank. BUT all together, the many streams of income which you have created will continue on, barring some cataclysmic disaster. That’s the beauty of diversification, if one falls, the many will pick up the slack.

 

Passive Income Generating Sources

I’m going to first briefly cover some more traditional streams for residual income before moving on to the online variety, which generally takes less money to get started up. Not saying I’m any kind of expert in the investment options, I’m presenting here first. These are some things you’ll have to take the time to research and learn about on your own.

Equities

One of the most common sources of generating passive wealth is by investing money and buying stock in already established companies. Obviously, this is what many retirees have done either directly or indirectly through some work-related retirement plan. This method is also one of the best methods to generate long-term passive income and wealth creation.  It does however, take capital in order to get started. The cool thing, is that it is completely non-discriminatory, if you can get the cash, you can own the stock and immediately start getting dividend income (assuming the company pays one, otherwise, money will be generated  only through price appreciation of the shares). So, if you had 1 million dollars today, one could easily construct a diversified portfolio of well-run blue chip stocks that paid 3-4% per year in dividends…giving the owner $30-40 K a year in pre-tax income.

Awesome, right? Obviously, the challenge is investing the money over long periods of time and through price appreciation and/or dividend reinvestment, have a substantial net worth in the future. For most, this will hopefully occur by retirement age but if you can generate more money earlier in life, the process can be sped up much more.

Another aspect of this, is that, most people don’t have the temperament to hold individual stocks long-term or even the know how of buying shares at a rational price. A lot of people panic sell, buy shares at horrendous valuations, trade in and out of positions, and trigger endless taxes and fees. All of which, ends up cancelling out most of their good decisions, and lead to getting sub par returns. The choice for most people looking to invest in stocks should then be some kind of low fee index fund, that they simply contribute to each month without having to do much research.

For those, who are willing to learn and do the work of buying individual securities there are many low or no cost options to get started. For example, Loyal 3 is a website which offers free buying and selling of dozens of major company’s stocks. The minimum investment is $10. Also, there are direct stock purchase plans (DSPP) and dividend reinvestment programs (DRIP), which are offered directly from corporations as a low or no cost way to invest as a small investor.

Bonds, MLP’s, REITS, ETC.

These are some other investment vehicles, which can generate passive income:

• Bonds (corporate bonds, government bonds, municipal bonds, etc.)
• Master-Limited Partnerships…probably should ignore these unless you absolutely know what you’re getting into.
• Real Estate Investment Trusts (REITs)
• Peer to Peer Lending
• Mineral Rights…again, not something the vast majority will ever need to know about.

 

Real Estate

While direct real estate ownership can be somewhat simulated through owning REITs, real estate can be a great source of ‘passive’ income for those who have the talent and work ethic to develop the skills. This could of course be anything from houses, condos, hotels, industrial complexes, etc. Now, of course, if you’re a landlord you have plenty of work to do with your properties but you can always give up a portion of  your profits and outsource this work to a property management firm. All of this is outside of the scope of this article, though.

 

Online Streams of Passive Income

Now we can get into the passive income sources which don’t necessarily require large amounts of capital or even any upfront money at all. These are the things which we can create online in order to further build out our streams.

 

eBooks

I mention this one first because it can be done completely for free. All one needs to do is write the book and upload it to a platform such as Amazon Kindle. You can set the price, give Amazon their cut of the sale, and have a built in audience of users who may be looking for a title such as yours. Once it’s uploaded and ready to go, the income stream is completely passive, and money is deposited into your bank account each month.

Naturally, there can be expenses involved in any advertising or book promotions that you may want to do. However, it can also be done without any costs and promoted in other ways.

What skill set does this require? The ability to string together coherent thoughts on a topic. You can also pay someone to ghostwrite a book for you but I have no experience with setting up that kind of thing.

Ask yourself, do I have any specialized knowledge or unique takes on a topic which may be helpful to others? Any life experiences, which can benefit potential readers who currently face the same issues? Perhaps, you’re just a damn good storyteller and you have want to release a novel or series of novels. Figure this stuff out, plan it, and make it happen.

For instance, the one ebook that I’ve released thus far, “Game Without Games“, relates my experiences with dating and women when I was in my late teens and early twenties. I approach it not from a ‘how to’ approach, rather, relating these topics to my own personal philosophy on life. I was banking on the fact that there’d be other young guys who were in similar situations and could benefit immensely from having what I learned distilled down to them, without having to go through it themselves.

Now, I did get a bit lazy with the promotion and was working on other projects in lieu of that. But it is something with which I could ramp up the income fairly rapidly, with some concerted effort. Most of what will drive sales on Kindle is getting enough reviews and popularity so that your book is featured on other pages, “Customers who Bought this also Purchased…” section. Once you reach a certain saturation point, sales will be at least pretty consistent.

Are ebooks a big money maker? Possibly. Though even if you only sell 3-4 copies a day, you’d be around 100 copies per month, multiplied by 70% profit on each copy sold and you’d have at least a steady income of hundreds of bucks per month.

 

Websites

Niche/Authority Sites

It is easy to get the idea in one’s head, that if I simply build a website, that I can make lots of money off of it. Well, the truth depends on what kind of website you create and how you plan on monetizing it. I’ve talked to plenty of people over the years who had started their own personal blogs, worked on things for a while, and then became disheartened when they weren’t creating a self-sustaining money stream.

The problem with a personal blog is, even with good traffic, how are you going to monetize it? Sure, people come to your website to read an article but are they ready to buy something because you mentioned it in an article about your last family vacation? Probably not.

Two very simple questions you can ask when brainstorming website ideas are:

1. Does this help solve a problem for someone?
2. Does this condense information into manageable chunks for people who want to know?

A classic example of a website which solves the first question, is one built around how to get into better shape. People may need to lose weight or build muscle (problems) and the website would offer up solutions to these problems. The website owner could then offer workout/diet plans, personalized coaching, and make money off of advertising.

An example of the second question could be something like a website which reviewed cameras. People who are shopping from cameras want things broken down for them and made easily accessible, so they don’t have to scour the internet in search of specs and reviews on every single type of camera they may be interested in. Folks are busy and they want things simplified so that they can make easy decisions. This type of website can be monetized with ads and affiliate links to some place like Amazon, that sells digital cameras…any time someone clicks your link and buys something, you get a commission.

Since we are talking about creating passive sources of income, these website will need to be geared towards creating ‘evergreen’ content. This means that, the content on the website is relevant for long periods or time or basically forever. People are always looking to get into shape, so, a fitness website is always relevant. A post about dieting is still valuable after 5-10 years. Meanwhile, a blog about topics such as sports or celebrity news, always need to be updated because the content is only relevant during that news cycle (and tougher to monetize), which kind of defeats the purpose of having a residual income stream.

These types of websites can be created by you or by purchasing an already existing website through a broker or auction site such as, flippa.com. The good thing about just buying an already existing site is that, it already has traffic, useful content, and is often already generating money. Often times, you can get a website for cheap which has solid traffic numbers but it just poorly monetized by the owner, and quickly get sizable returns on your investment by making a few simple changes to things like advertising placement or improving upon affiliate product promotion.

The whole creation of websites, creating content, getting traffic, etc. is something I plan on tackling in depth in future posts and I don’t want to make this one 100,000 words in order to cover all of those topics. As such, I’ll leave it at that for now and move on to other aspects of online passive income.

• How to Set Up a Website on Hostgator
• How to Find Niche Website Ideas

Ways to Monetize a Website

• Advertising (ex: Google Adsense)
• Selling Advertising space directly to an individual company
• Amazon Associates
• Install Viglink
• Clickbank Product sales (affiliate programs, ebooks, etc.)
• CPA offers (If someone signs up for an offer you get a commission)
• ebooks
• Personal coaching
• eCommerce store
• paid membership (create exclusive premium content)
• Create digital products
• Create an online course/class
• Create an app for smartphones
• Consulting/Business Services
• Rent Your page to another business (ex: Ranking a website high in Google search for local dentists and then renting the page out to dentist offices in that area for a monthly fee)
• Referral commissions
• Building email lists (not a direct monetizing method but can be used to market the other options on the list)

 

Drop Ship eCommerce, Private Label, Fulfillment by Amazon

These are some of the methods of passive income creation, that I am least familiar with but, I thought that I’d mention them anyways so you can explore them further on your own.

We are all aware of eCommerce stores and making purchases online. Obviously, it can be a very lucrative business to get into. However, one of the issues holding many people back from starting down this path is the idea that they would need lots of start up capital and then having to warehouse their physical product stock, which may or may not sell.

Another way to approach this type of business does exist. By utilizing third party companies to handle the stock and shipping for you, you can avoid having to interact with the customers or dealing with the hassle of shipping physical products.

To put this in clearer terms, let’s take a look at a basic example: You want to sell t-shirts. You have designs created and a market you wish to target. In order to create your own t-shirt line, you can create a store on a platform such as Shopify, find a supplier who will print t-shirts on demand, and upload the products to your store. Now, when a customer buys a t-shirt the supplier prints that shirt and ships it out to the customer (you carry no stock, the shirt only gets created when someone buys it). The supplier gets paid for their services and you get sent the profits without having to deal with any aspect of the sale beyond getting traffic to your store.

That’s the basic idea of it. How much work is involved on the upkeep and interactions with the customers will be entirely based on the structure which you set up. It is arguable how ‘passive’ this method is, although, so much of the work can be outsourced (usually for a fee) that it is entirely plausible that one wouldn’t have to do much to have a successful and mostly hands-off business model.

Fulfillment by Amazon

One could also set up a very similar model of private label creation by leveraging the power of Amazon’s customer reach and fulfillment abilities. With this method, you wouldn’t even need to create a website.

Here’s a simple skeleton structure of how this works:

• Search on Amazon for potential products which you could sell. Something that is fairly popular but without much competition.
• Once you have an idea for a product (or line of products: for example, a line of yoga equipment/accessories)
• Utilize sites such as Ali Express or Alibaba in order to source a supplier to manufacture your products. You can work with them to create labels and put your logos/graphics on the product. Thus, a private label brand is created.
• The supplier then ships the products to Amazon distribution facilities. Amazon’s website can walk you through this.
• You upload the products to your store on Amazon.
• When customers buy the products, everything is handled through their Amazon accounts, and Amazon ships it out + takes care of returns.
• Your profit is what is left after paying the manufacturer and Amazon takes their cut. The money is sent directly to your account.

This method does require that you research heavily to find the right product niche which actually creates sales, source a reliable and inexpensive supplier, and have a large enough profit margin to make it worthwhile. Yes, it takes work to set up but once you’ve got things running smoothly, it’s pretty automatic. Plus, once you have a supplier nailed down, its pretty easy to work with them to get another product created…thereby expanding your product line and sales (people will often buy related products together, so if you have the ability to bundle multiple products, it can be a seriously profitable business).

 

YouTube Videos

There are many people who have become celebrities off of YouTube and have managed to carve out a solid full-time income from it. Once the video is created and uploaded, there is really no work to be done except to let the view pile up (maybe some promotion). Creating videos consistently, raises the odds that at least one of them will be a hit, and allow those viewers to discover your other content.

Becoming a YouTube partner and collection advertising revenues is really easy to set up. Although, it can be a good source of revenue, it often isn’t until you have a serious amount of traffic and even then it won’t be boatloads of money (in most cases). The great thing about YouTube is that you have a built in audience which you can direct to explore your other content on a website, promote your ebook, product, or service, or any other way you can think of to monetize your viewership.

 

Conclusion

I hope that this post has answered some of your basic questions about passive income and has given you some things to ponder as to how you will proceed into generating your own monthly residuals. Remember, that not all passive methods are entirely passive, and most will take some level of work up front to set up properly. However, once you have done so and have cash finding its way into your bank accounts each month, it won’t particularly matter too much that you might have to do some work in order to maintain it. This doesn’t have to be a path towards a job-free existence, it can serve as income diversification in order to protect you from the downsides of life and make it easier to enjoy some luxuries that your 9 to 5 might not be able to furnish you with, on its own.

 

In the last post in my passive income series, I went over how to get ideas for a niche website. In this post, I want to discuss how to set up a website step by step from scratch. In order to set up a website, you will need a host (most of whom cost under $7 per month). I use Hostgator for all of my websites, so I will be relating this from the point of view of that company’s perspective user. I will take you through the domain buying process, selecting a plan that works for you, how to set up WordPress, and any other incidentals that I come across so that you can set up a website and get to work quickly.

Choosing a Domain Name

This is the most important step of this process, after choosing the niche you intend to tackle. I’m not going to go into detail about choosing a domain name in this post, however, this is something you need to strongly consider before moving ahead.

If you are creating a website solely for affiliate (money making) purposes then the ideal is to use the keyword in your title. For instance, if you are creating a website about swimming goggles, then the website should have some variation of ‘best swimming goggles’, ‘top swimming goggles’, or ‘best swimming goggles for (activity) in the title.

If, however, you are creating a personal blog then you will want to consider something that is brandable and memorable. This site, is in the personal development niche, but doesn’t really fit the typical niche site mold. In a case like this, I utilized the word development in my domain name, and somewhat targeted the keyword ‘personal development blog’ but you won’t find me on the first 10 pages of Google for that search. My traffic comes from other sources and the content of my individual blog posts, so for a more personal site the main keyword targeting in the domain name really won’t be all that important.

How to Set Up Your Website

1. Choosing a Hosting Plan

The first step will be to Hostgator’s website and sign up for an account. From there you will need to get a hosting plan that best fits your needs. Hostgator has three options: Hatchling, Baby, and Business.

Hatchling is for those who only plan to host one domain on their servers.

Baby is a few dollars more a month but you can host as many websites as you want.

Business plans come with a few extra perks such as a Private IP address. (ecommerce websites)

I started out with Hatchling but quickly needed to upgrade to the Baby plan because I wanted to create multiple websites and therefore multiple streams of income. It’s well worth the extra money to get yourself a Baby plan because you’ll be able to have an unlimited number of sites and will only have to purchase individual domain names after that.

I recommend using Hostgator because everything has always gone smoothly with them. The one time I had a problem with processing a domain I bought, I used the online help chat and my issue was resolved really quickly and professionally. They didn’t give me any run around or make me wait forever.

2. Choosing a Domain Name (For Keeps this Time)

After you choose your plan, Hostgator will ask you to provide a domain name. Now, you can either register a new domain name through Hostgator (they will tell you if your domain name is available) or if you already own a domain name there is an option for that as well.

Once you have gotten your domain name, Hostgator will ask for your billing info and other payment information (pretty self-explanatory).

3. Hostgator Sends You an Email

After you register your domain name and do all the payment stuff, Hostgator will send you an email with all of your information for your website. THIS IS IMPORTANT INFO (so write it down and save it).

Your control panel link that they send you is what you will type into your browser in order to get access to and set up your site initially.

Your name servers are important because they are what you will need to be pointed properly in order to access your website once it’s up. No one will be able to visit your domain if the name servers aren’t correctly pointed. If you registered your domain with Hostgator they should be pointed correctly, if you bought a domain from somewhere else or it’s screwed up for some reason then read this information: http://support.hostgator.com/articles/hosting-guide/lets-get-started/dns-name-servers/what-are-my-name-servers

4. Go to the CPanel

Using the link that Hostgator send you, sign into your Control Panel using your name and password.

The CPanel will have a whole lot of options and things that you can explore later. For now, scroll down to the section entitled Software/Services and click on Fantastico Deluxe (the one with the smiley logo).

5. Fantastico Deluxe

In Fantastico Deluxe, we will be installing WordPress for our website. WordPress is really simple to use and highly customizable with widgets and plenty of support to help you out.

On the left hand side of Fantastico under the section called Blogs, click on the WordPress option. Once the new page loads, click on where it says “New Installations”.

On the next screen, choose your new domain from the drop down menu, this will be the site you install WordPress on. Leave the field called “Install in Directory” blank. Then fill out the rest of the information as required. Click on install WordPress.

6. Accessing Your Site

WordPress is now installed on your site. In order to access and begin work on your website type the following into your internet browser:

“yourdomainname”(dot)com/wp-admin

So for instance, if you registered the domain name as booblestooble(dot)com then each time you want to edit the site or add new information you’d log in at:

“booblestooble(d0t)com/wp-admin”

Conclusion

You are now ready to begin work on your website. By default WordPress will give you a template that your blog will use until you change it. You can upload a free template to your site or buy one that has all the bells and whistles a regular website will have.

I will go further into customization and what kind of widgets your WordPress site will have but this should get you started with at least setting up the website and the whole registration process.

Further posts in this series:

Finding Niche Website Ideas

How to Make Money with a Niche Website

How to Create Passive Income Online

Making money online can seem like a daunting process to those who have never built a website before in their lives. Don’t worry yourself too much, because I am going to walk you through this adventure step by step and try to help you avoid the pitfalls of this passive income game that I’ve learned through first-hand experience. The singular most important part of this whole process however, is to make sure that you choose the correct niche market to enter and to choose a proper domain name. Choosing the wrong niche or not having a clear idea on where to take an idea to will yield you little to no results and leave you frustrated. So, with that in mind, this next post in our series is going to explore the idea of how to get ideas for a niche website and start the planning process. Read here on How to Set Up a Niche Website Step by Step

A great idea for a niche website should be one with few competitors, one that has the potential for lots of traffic, and finally one that has a chance to be built upon further.

Create a List of Ideas

Grab a sheet of paper or open up a word processor and start listing any idea you have for a potential website or a potential topic to blog about. You don’t need to be specific at this time, just build this list until you have 20 or so potential targets. Examples could include: Fashion, sports, cell phones, running shoes, tablet computers, etc.

Now, those ideas on the list are probably very general broad terms searches. On this large scale let’s see who dominates these sorts of general categories:

Sports- ESPN

Fashion- Vogue, other major fashion magazines

Cell phones- Sprint, Best Buy, AT&T

You get the idea. We aren’t going to try and compete on these major broad term search terms but we are going to use them as an example of how you can dig deeper and shift your focus to something more competitive.

Write About What You Enjoy

On that list, if you wrote it out, how many of those ideas about things you enjoy personally? A niche website doesn’t have to be about something that you enjoy but it helps the process a lot. I’ve built other sites and have written articles for other people on topics that I honestly had little interest in and getting the work done was like a chore for me. While this website isn’t a niche website, I really enjoy writing and creating new ideas to share for it and because I haven’t limited myself in the topics I can choose from I can write for as long as I feel like. If this is your first rodeo, then it might be a good idea to get the hang of the process by finding an idea that interests you and that you wouldn’t mind writing about in the future.

Solve a Problem, Offer a Solution or Aid

People are constantly searching for ways to solve their everyday problems. What a good niche site does is inform them on how they can go about solving a problem (free blog posts) and then offers a way to help aid them or outright solve the problem (product or service). Some things will naturally get a lot of traffic but make no money. You can have a funny meme picture on your website that gets 100,000 views in a day but you probably won’t make very much money or none at all off of it. You have all of these people coming to your site in order to alleviate boredom NOT to solve a problem. You need to really think about and research different problems that people face from each of your niche ideas and determine if there is a way to ultimately monetize that. If not, then the niche isn’t the one for you.

Build Around a Proven Product

In the internet marketing world, niche websites are generally built around a product or type of product. In the case of our cell phone idea, this would be a review site of the best smart phones or something like that. When people buy products online they are looking for information about those products including the features and what sets them apart from their competitors. If you can find a niche, around a specific type of product and get some good traffic going, you can then make a good deal of money through affiliate links that link to that product.

How this works in practice with our cell phone idea. Topics to write about could include:

Smart Phone Reviews (Individual phone model reviews)

Best Smart Phones Under $200

Best Smart Phones for Teens

Best New Apps

For each of those posts you would write a full article and include a link to those particular cell phone’s product page on Amazon (if you’re enrolled in their affiliate program)

You continue to write these blog posts that target smaller questions and searches within that larger niche. (Note: Don’t actually do a cell phone website unless you’ve got a really unique idea, it’s a really crowded field with fierce competition.) Also, you cannot buy a domain name and use a company’s name for instance, ‘buyapplecellphonesforreallycheap’, is copyright infringement because it uses the Apple name without permission.

You can gather further ideas for your niche by heading over to Amazon or going on forums about your topic to look for ideas about what people are buying and what they are talking about. Using those two sources you can get a good idea of what kind of product you can link to from your site and plenty of ideas in regards to what you should write about.

Go for the Low Hanging Fruit

This means that you should try to find and explore a niche which has little competition and thus is ripe for the taking. I know of many marketers that go after something in the fitness niche but too often it’s in regards to how to lose fat or put on muscle fast. Both of which have plenty of traffic but lots of competition. Meanwhile, I’ve seen other fitness orientated site which were built around specific types of sports supplements which probably averaged around 1,000 searches per month but were easy to rank for and found an eager buyer looking for information. Try to find a small segment of the market that isn’t being paid very much attention to and you can be become the person who addresses every single aspect of that niche and get all the customers for yourself.

There are some terms that you should be familiar with if you are going to run your own niche website and they are short-tail and long-tail keywords. Search engine searches are based on the keywords that users type in when they are looking for something. A search term such as ‘best diet’ is considered a short-tail keyword, it is both a compact and highly competitive keyword. However, most search terms are long-tail keywords in which the user is getting more specific with the results they desire. An example of a long-tail keyword would be ‘best diet to lose fat in three months’.

Long-tail keywords are the key to finding a way to be profitable in niches. While you may not be competitive for a really high search volume keyword like fat loss, you certainly write blog posts that target the long-tail keywords such as ‘fat loss diet plan for men vegetarians’. Having 50 or so of these smaller target blog posts allows you to encircle the more competitive keywords and syphon some of the search traffic they never think to reach. A good way to find long-tail keywords is to start typing phrases that relate to your niche in Google and start writing down what the keyword suggestion menu is telling you. Sometimes, you really hit a home run.

Don’t Paint Yourself into a Corner

I like to choose niches that have plenty of topics to write about or that I can easily expand into other related topics once I’ve built some traffic and morph it into a larger authority site. Having a niche site about windshield wiper blades might be able to make a bit of money but it would be pretty tedious and how much can you really write about them?

Picking a narrow niche might work well to get some search engine traffic but will it make you that much money? It could if it’s the right niche, however, you might have nowhere to expand the site after that and you’ve pretty much reached the limit for that site. I like to have the goal of at least writing 50 blog posts over time for my initial niche idea and then writing related topics to expand my reach and potential profit.

These are just some of the ways you can come up with an idea for your first niche website. Take your time with this part because it can mean all of the difference between having a steady passive income each month or having your affiliate account sit at zero each and every day.

In my last post about creating passive income, I gave a general overview of how you could start to make money online, mostly through working for other people. However, I also mentioned the creation of your own ‘niche’ website as a great way to make cash. Building your own website is probably the best way to either start your journey towards entrepreneurship or simply pay off the bills every month by having some amount of money deposited into your bank account each month. Believe me, it’s a great feeling when you know each month you’re going to receive some amount of money from work you did three or four years ago! This process is not always the easiest and usually success doesn’t come overnight, however, if you dedicate yourself towards learning what to do and sticking to it you can begin to generate substantial passive income for yourself. It may be a small amount at first but remember that the sky is the limit in terms of earning potential. With this post, I want to lay out the basics of building a niche site from scratch to set the stage for future articles that will delve deeper into the information you need to know to hit the ground running.

What is a niche website?

A niche market^[1] is the subset of the market on which a specific product is focusing. (Source: Wikipedia)

So a niche website is that definition in website form. For example, if you build a website about dogs, you are in the ‘dog niche’. Meaning, your website will be exclusively about dogs and dog related products.

Niche vs. Authority Websites

Ok, sticking with our example about starting a website about dogs, an authority site would be a website that encompasses multiple aspects about dogs from how to adopt dogs to dog training.

A niche website about dogs could be about simply dog training and nothing else. See the difference?

Micro vs. Macro Niche Sites

A niche website can be broken down further into smaller niches within the more general niches, this is referred to as a ‘micro niche’. So, a micro niche site for dog training could be something along the lines of ‘dog training for ugly dogs with low self esteem’….haha that’s a really micro site and would be worthless, but you get the idea.

Now that those kinds of questions are out of the way….

How do you Make Money from a Website?

There is a multitude of ways that one could monetize a website and if you can generate traffic (more on this later) you surely make a little something, even if you have yet to optimize you site. Let’s take a look at some of the most common ways you can make money from your website.

Advertising

The most popular and probably the most lucrative options for websites (at least initially) is by signing up for Google Adsense. Google Adsense is an advertising system that I’m sure you’re aware of, and as a website owner you can places ads on your website that earn you money each time someone clicks on an ad.  Adsense is the first way I started to make money when I launched my first website a few years back and it continues to bring in revenue to this day. Some websites have higher click through rates than others so niche selection can be important if this is going to be a main source of getting paid.

Beyond Adsense, there are other services that offer advertisements, especially in-textual advertisements. I’ve used these types of ads and honestly they don’t generate very much income, even when you have heavy traffic, as the amount per click is usually pennies.

Another option for advertising is selling advertising space on your website to companies who are relevant to your niche. You can work it out so that they pay you a lump sum each month for the privilege of advertising on your website. This will only become an option once you have some serious traffic built up but can be a great source of revenue.

Affiliate Sales

Before the internet, if you wanted to sell products you had to come up with one on your own or at least have some start-up capital to become a wholesaler. Nowadays, if you have a website you can sell other peoples products either directly on your site or in the form of an affiliate link. Affiliate links take the traffic that your website generates and sends it to someone else’s product or sales page, so that the traffic can hopefully make a purchase.

The great thing about being an affiliate is that your only job is to promote the product and you can sit back and collect the revenue. For each sale you generate, you will receive a portion of the profit, while the creator of that product deals with the customer service and shipment.

There are many sites which offer signups to become affiliates. Clickbank is a popular website that deals mostly in the realm of digital product sales like ebooks on how to lose weight for example. There are also places like Linkshare and Pepperjam who handle the affiliate programs for major corporations such as Apple.

Amazon.com has a very popular affiliate program called Amazon Associates. It offers associates a certain percentage of the sales (usually 6.5% to start, I think) for any item a person from your website buys in their entire store. So for example, if you have a website about dog training and you link to a book on Amazon about training dogs and a person clicks your link and ends up buying a watch instead, you still get paid! Many niche sites are built strictly around promoting products on Amazon and letting the profits roll in. Unfortunately, some states are no longer allowed in the Amazon Associates program (including mine L ), which sucks because it leaves a lot of potential money on the table, so check to see if yours is included in the ban (a majority aren’t). You can still find other affiliate programs that will work even if Amazon is not an option, you just have to look for them.

Selling Your Own Product/Service

There are many niche sites that end up going the advertising and affiliate routes but find that often what brings in the big bucks is selling their own product or service directly. For instance, if you decide to build a fitness website you might consider your own ebook training program about ‘how to lose fat fast’ or if you’re a personal trainer you might consider selling your own coaching services by the hour or something like that. This can be a goldmine and the start to your own business if you play your cards right.

Donations

Yep, you can even monetize your site by having a button for people to donate through PayPal or some other service. This is really only an effective strategy if you provide people with lots of free value and they truly appreciate the effort or advice you have given them. So if you create a site about iPhone cases, then it probably won’t be a very profitable option for you, so I’d stick with the affiliates and ads in that scenario.

Where do I Create a Niche Website?

There is a difference between a free site and a hosted domain that you paid for beyond just the fact that you paid for one and not the other. That difference is the fact that with free blogs you are limited as to what you can do by that services terms and conditions as well as their customization options.

Free Blogs

You can go to WordPress.org right now and start a blog for free. However, you cannot put up Adsense ads directly on your free blog (maybe you can now but it used to take some coding skills to make it happen and it was against the rules). I think you’re allowed affiliate links as well but overall your options are limited.

Google’s blogger features the implementation of Adsense so if you can build the traffic to your free blog you might make a bit of money off of the advertisements.

Your free blog will also have the address bar issue which doesn’t look all that attractive if you are trying to build an actual business or long-term revenure….’yoursitename’.wordpress.com or ‘yoursitename’.blogger.com looks a whole lot less proper than ‘yoursitename’.com. Plus, the self-hosted websites seem to do better in search engine rankings which means more traffic for you and potentially a whole lot of money.

Hosted Websites

In order to have your own personal website you must register a domain name and buy a hosting plan from a service provider. A domain name will run you about 15-20 bucks a year to register but you can usually find some really good deals for your hosting plan that will save you a bunch of money. I use Hostgator to register and host all of my websites. I bought a hosting plan from them that allows me to create as many websites as I want. If you want to run a website, you will have to spend money to register the domain and for the hosting plan (hint: most hosting plans are under $10 a month, mine was like 5 or something ridiculous like that. Seriously, it’s like buying a drive-thru meal each month, without getting fat). Treat is like an investment and recoup your initial outlay as soon as it’s feasible; my hosting plan has paid for itself and then some within a short amount of time.

Final Thoughts

This has been a very basic overview of what niche websites are and how you can utilize them to make passive income. Later posts in this series will cover specifics on how to choose a niche, domain names, how to set up a website, free plugins, how to build traffic, etc. I’m going to try to break all of this stuff down for you guys to the best of my ability. This is a personal development blog, so I figure that I should kick some of my knowledge about making money online in between my other topics. So stay tuned.