Making Money Online

There’s no doubt that the Internet irrevocably changed the way that business works. Instead of having to use paper catalogs to sell products, businesses can now set up one website and attract customers from around the world. Using email, we can interact and do business with people thousands of miles away that we’ll never even meet. With all of the opportunity out there, it’s not very surprising that lots and lots of people are interested in learning how to make money online.

In this post (and possibly the next couple as well) I want to take a look at the reality of making money online and discuss how it’s different from what most people think. We’ll also talk about what you should know if you are interested in making money online, and what you should look into before you start.

Why Make Money Online?

To start off, let’s talk about why the Internet is such a great opportunity for people who are interested in making some money on their own. I can sum it up in four points.

Little to no money required – You can start up a website for under $20, or even for free if you want to. If you wanted to start up a traditional business, you’re going to have a significant amount of expenses before you can really get going – start up costs, legal fees, office space, employees, advertising, etc. But you can start putting up a website right after breakfast and be done by lunch.

Easy access – Just about everyone has access to the Internet. All you need is a computer and a phone line, and if you can’t get those on your own, your public library will probably let you use theirs for free.

Huge audience – According to the latest data, there are now more than 1.7 billion people online across the world. That is a staggeringly huge potential audience for your website. If you could get your product, service or ad in front of one-half of one percent of those people, you could be extremely wealthy.

And lastly, the number one reason that the Internet is so great is that it make it easy to establish passive income systems. If you set up a website and then go eat a sandwich, the website doesn’t stop working while you’re eating. No matter what you’re doing – sleeping, playing, working, whatever – your website is still working to generate traffic. That’s an incredibly powerful tool for your business that you should not pass up.

So How Do You Make Money Online?

There are several ways to go about making money online (far too many to sum up in one article) but let’s talk today about the most popular method. It’s actually fairly simple in theory, and it goes a little something like this: You make a website, people come visit your website, and then you sell them something. In this regard, having a website really isn’t that much different than running a traditional, brick and mortar business. Not everyone that comes by will buy your product or services, but if you get enough people coming in you’re going to start making sales. Let’s take a look at each of those three steps in greater detail.

Make a website – This step is really much easier than people usually think it’s going to be. You can set up a simple website using free tools available online in just a few hours. If you want to own your website, you’ll need to purchase a domain, get a hosting plan and then get some content up on it (use WordPress for getting content on your site). You can also go the free route and get a website up with Blogger or another similar service, but you won’t own your site. It’s probably better to spend $10 or $20 and get your own site set up.

Get traffic – There are several options for getting traffic to your website. You can pay for it (using Adwords or another ad network), you can use social media (such as Stumbleupon or Digg) or you can to try increase your visibility in Google and other search engines. If you are trying to make money from your website, the best traffic generating method, by far, is to rank as high in the search engines as you possibly can for your niche.

Sell them something – As with generating traffic, you have several options for monetizing your website. The quickest and easiest solution is to use Google Adsense on your site. You can also sell someone else’s product (called affiliate sales) or sell your own product directly. Adsense is a popular choice for many webmasters, but it may not provide the best long-term solution for monetization.

There’s a quick intro to making money online. I think I’ll explore this topic more fully in my next few posts.