So, you want to start your own online business. You know
you have to create your own website, start your own ezine
and generate traffic to your site before you can make sales.
So far so good. But... sales of what, exactly? What do
you sell?
Fortunately, the options are many and varied. Basically,
though, everything falls into one of two categories...
products or services. We're going to take a closer look at
a few relatively easy options for when you want to get
started and get started NOW.
> PRODUCTS
What kinds of products can you sell from your website
assuming you don't already have something available?
Your best bet is anything that can be delivered digitally
such as software and information products.
When it comes to selling software or information products,
you have three basic choices:
1. you can create your own product from scratch, e.g., by
writing a software program, a cgi script or an e-book;
2. you can join affiliate programs and sell products already
created by other people and earn a commission for every
sale;
3. you can join a multi-level marketing (or network
marketing) plan; or
4. you can acquire resell rights for products already created
by other people and keep 100% of the profit.
Option 1. is a must-do. Eventually. But when you're
itching to get started, you don't want to have to wait the
3 or 4 months it takes you to write your ebook before you
can launch your online business.
Option 2. is great for a quick start but you're working on
commission. Someone else is getting the lion's share of the
profit for your hard work.
Option 3. is a good choice if you're a natural networker.
For more information about MLM and whether it might be
right for you, check out my article "Not MLM!... Why Ever
Not?" at http://www.ahbbo.com/notmlm.html.
Option 4. (along with option 3.) is where the real money
is, at least compared to option 2. Acquire the resale
rights as well as the product and you're not working on
commission any more you're working for serious profit.
Where do you go to acquire products that can be
delivered digitally with full resale rights? There are several
good sources but here are a few tried and true sources,
each excellent places to start:
eBookPublications
http://www.ahbbo.com/ebookpublications.html
eBookWholesaler
http://www.ahbbo.com/ebookwholesaler.html
FreeToSell
http://www.ahbbo.com/freetosell.html
> SERVICES
What kinds of services can you sell from your website?
How about advertising space in your ezine or on your
website? How about a members-only area of your site,
access to which requires payment of a membership fee?
> Advertising Space
Since you really need to be publishing an ezine on a
regular basis to stay in contact with, and generate, web
site visitors, it makes sense to make money from something
you already have to do anyway. Selling advertising space
is a good revenue-generator.
Don't try selling your ad space until you have a minimum of
1,000 subscribers or so. Until you get to that point by all
means offer free ads in your ezine though. That's a good
way to generate subscribers and get your readers used
to seeing ads in your publication. Ad swapping with other
publishers during this period (and beyond) is also a good way
to generate new subscribers.
Once you reach the 1,000 mark, you can start offering
your ad space for sale. The days when you could publish
an ezine with a classified ad section of 20 or 30 ads are long
gone. Ezine readers are much more savvy and discerning and,
as a result, ezine advertisers are much more selective and
will look for ezines that run few ads and which place them
strategically amongst the content, or "meat" of the ezine
itself rather than being stuck in a great glob that nobody
reads at the end.
Think also about sending solo mailings to your list as
another source of revenue. Be particularly circumspect
when it comes to these mailings, however. Solo mailings
are very effective when targeted to the right audience
and so advertisers love them. Ezine subscribers have
varying attitudes towards them though. Some will
immediately unsubscribe from an ezine that sends solo
mailings. Others will accept them so long as the ezine
itself is worth receiving.
Personally, I don't worry about losing subscribers just
because I send solo mailings. The acceptance of solo
mailings (which are, in my case, limited to one per week)
is the price I ask my subscribers to pay to receive my
ezine for free. The advertising revenue I receive is how
I pay my costs and make a profit. If people aren't
prepared to receive a solo a week in exchange for the
ezine then they'll unsubscribe and that's fine with me
because they're not prepared to make a fair exchange
and were never going to buy from my advertiser anyway.
There are no hard and fast rules when it comes to
pricing your ads. Basically, you want to achieve some
measure of equilibrium between supply and demand. If
you have more demand for your ad space than supply,
increase your prices until demand is in line with supply,
do not increase the number of ads. The more ads you
run, the more you dilute their effectiveness for your
advertisers and the less likely your advertisers are to
place repeat business with you. In other words, by
taking a short-term increase in profits, you sacrifice
the longer-term profitability of your business. You're
cutting off your nose to spite your face.
Conversely, if you can't sell all your ad space, reduce
your prices. Try and get to a price point where the
demand for your ad space is roughly equal to your
supply. If you have an occasional ad spot vacant
don't worry - just run an ad of your own instead. But
if you regularly find yourself with half your ad inventory
unsold and you're not running an excessive number of
ads, this is a signal your ads are overpriced and it's time
to reduce your prices or make the strategic decision to
run your own ads instead of others'. In fact, in many
instances you'll make more money from your ad space
by advertising your own products and services than you
will from selling the ad space itself.
How to set your price? As I said above, there's no hard
and fast rule. Whatever brings about equilibrium between
supply and demand. My own pricing formula is $5 per
1,000 subscribers for a single classified, $10 per 1,000
subscribers for a sponsor ad and $20 per 1,000 subscribers
for a solo. That pricing structure is right for me but may
not be right for you.
Your pricing will also be influenced by how specific or
general your target market is. If you publish an ezine on a
relatively esoteric subject with a small but highly targeted
market, you'll be able to sell your ad space for a higher price
than you will if you publish an ezine on a really general
subject (such as "internet marketing") with an extremely
large but also undifferentiated market. For this reason,
it's not the size of your list that dictates your advertising
pricing, but rather how targeted your list is to the subject
matter of your ezine and your advertisers' products and
services.
Similar principles apply when it comes to selling advertising
space on your web site.
Bottom line: advertisers want and will pay for results, not
how many subscribers you have on your list.
> Paid Subscriptions
Paid subscriptions are another good way of generating
income, whether they be for your ezine or web site.
A great resource if you want to go this route with your
ezine is Monique Harris' Paperless Newsletter (see
http://www.ahbbo.com/paperlessnewsletter.html ).
As far as your website is concerned, by utilizing password
protection you can effectively cordon off areas of your
website for paying members only. This requires some
technical set-up but your webhost will generally offer some
sort of basic password protection capability. For more
advanced systems, you'll need to get hold of a specially
designed cgi script for this function.
When it comes to pricing your subscription services,
although no doubt there are exceptions to the rule, the
better approach is to charge a monthly access fee rather
than an annual fee. A monthly structure allows you to set
a relatively low initial price, thereby making the decision to
sign up more of a no-brainer for your subscriber, and it also
gives you a recurring monthly income. It's also possible to
charge more overall than you could under an annual
structure. For example, most people would not hesitate to
pay, say, $9.95 for monthly access to a site they perceive
as valuable, especially knowing they can cancel at any time.
But those same people may hesitate if that initial investment
was $120 ($9.95 multiplied by 12 months).
With the appropriate payment processor and software,
subscription fees can be set up to be automatically charged
to your subscriber's credit card each month unless and until
they cancel.
> THE ROLE OF CONTENT
These are just a few of the options available to you to
generate income from your own online business. The bottom
line with respect to all of them though is the quality of your
content. It doesn't matter how good your product line is if
people have no reason to visit your site in the first place.
So, put first things first. Pick a subject matter for your
site that you are passionate about. Do the hard work of
creating a truly valuable resource for people interested in
the same thing. Publicize it to death. Publish an ezine on the
topic, again with high quality content, to draw them to and,
more importantly, BACK to, your site again and again and
again. Then, and only then, will you have a chance to get
your product or service in front of them. Then, and only
then, will you have a chance to make the sale.
There's no disputing that the main reason we go into business
is to make money. If you don't have this as your objective,
then you're engaging in a hobby, not running a business. But
when it comes to doing business online, the reality is that you
have to give before you can get. So give your site visitors
what they're looking for. Do that and they'll visit you again
and again and refer their friends. Do that and you'll actually
have customers to sell your products to. Don't do that and,
although you may have the greatest product or service in the
world, no-one but you will ever know about it.
About the Author
Elena Fawkner is editor of A Home-Based Business Online...
practical home business ideas for the work-from-home
entrepreneur. http://www.ahbbo.com