Business Ideas That Make Money Online & How Each One Works
February 20, 2020 |By Seth Barrick | Business
One of the greatest things about living in the digital age is the opportunities that have come forth for business growth and business success. Nowadays anyone can start an online business and make money from it.
Unfortunately this is just one side of the coin.
How an online business actually makes money is one of the most important aspects to be considered. Today we’re going to look at it all!
The Business Model
Before we get too far ahead of ourselves, let’s first start off by talking about the most critical facet of your future online business. The business model. This is the key to how all online businesses make money! If business growth happens too quickly without a proper business structure your online business will make money for some time and then start imploding from within.
Many people hear great ideas about starting an online business and jump in with both feet too quickly. Yes, it’s true online businesses can profit quickly, but in order for your business to last, you need to have a structure.
What kind of business are you going to be running? Are you going to start an e-commerce store or are you thinking more about services you can offer?
Once you have decided what kind of business you want to start online you can start thinking of ideas that you want to base your business off of. Keep in mind that your online business needs to be unique in order to compete well with all of the other online businesses.
Key Questions to Ask Yourself
Who is your target market?
It would be great if your online business could make lots of money by targeting everyone. Unfortunately, this is highly unrealistic. When you target everyone, your business concept (which you think is great) becomes irrelevant to a huge percentage of your customers. So instead of selling a product to everyone, maybe you focus on a targeting adults who prioritize fitness in their lives.
What needs are you trying to solve?
It’s critical to take some time to consider the problem you are trying to solve. Maybe you want to focus on providing fashionable products for your market. For instance, let’s say there are plenty of people in your chosen market (adults who prioritize fitness) that would love a fashionable apple watch band.
Lastly, how are you going to solve those needs in a unique way?
We know that your online business will make money selling a numerous selection of fashionable apple watch bands. But how you will stand out from your competitors who’s online businesses also make money selling a very similar product? Will you be different because you are donating a large portion of profits to a good cause? Maybe you’re going to offer customizable apple watch bands. Whatever you choose to do, you must realize that this is where your business will live and die.
How Online Business Make Money, Some Ideas
There are many online businesses that can make good money. Today we are going to look at just a few of the most common online business models and how they work. Although they are different in their own unique ways they all require effective marketing tactics and ideas to work.
The caveat to all of these online business models is that each of them require lots of research in order to be successful. It’s not as simple as just click, click, click. Regardless, let’s look at a few!
1. Affiliate Marketing
Affiliate marketing is a great online business model that focuses on sharing products and services with people who view your content.
Your personal testimonial of these products and services will turn your audience into converting customers and in return you will make a commission from the referral. Here’s how affiliate marketing works for businesses that make money online!
Create a relationship:
The first step in starting an online business that makes money with affiliate marketing is creating a relationship with an audience of people who will actually listen to what you have to say about a product or service. In all honesty, this can take some time and will probably be the most time consuming aspect of your online business and how it makes money.
Next, is the business you want to be an affiliate for with your online business. More than likely you will have to reach out to a business and propose an enticing offer. Businesses don’t have to let you be an affiliate for them, so make sure you market yourself as a profitable partner.
Typically companies will have an affiliate program you can sign up for. They will then give you a personalized affiliate link that you can be identified by whenever people purchase a product. Amazon associates is one of the most common affiliate programs, but there are many more affiliate programs that have much higher commission rates.
Share with audience:
The next step in the affiliate method is to convince your audience that the product or service is something that they need. There are multiple platforms that you can do this through. Many affiliates take a social media approach, but you can also blog about the product or services and lead people to the affiliate link through your website.
The most important part of this process is building trust with your audience. There are do’s and don’ts to being an affiliate. Remember, your reputation is at stake here! So make sure that what your advertising is relevant to your audience.
Engage with audience:
By this point your audience has taken your message seriously and converted on your affiliate link. It’s very important to find a way to engage with your audience and find out how their experience was.
This will help for two reasons. The first is you will learn which kinds of products your audience is interested in. This will ensure that you select profitable items to share with your audience. The second is it will help you to build trust with your audience because you are showing that you actually care about how their experience turned out.
The advertising model has a fairly simplistic process. How you make money through advertising is by renting out space to the highest bidder. One of the most popular advertising platforms is Google Ads. This is because Google is the most commonly used search engine and has a high volume of searches.
It’s important to know the difference between search ads vs display ads when using this online business model to make money. Display ads have more of a push approach, whereas search ads have more of a pull approach.
The push-pull method simply works to target either real intent or as many eyeballs as possible. With push-pull you either push ads onto as many people as possible who might not be interested, or advertise relevant content to people who are already looking for a solution to a problem.
Types of Ads
Today we are going to focus on display ads. To recap, display ads are advertisements by companies that rent space from you in order to share their content with your audience. They can pay you in one of two ways. There are pay-per-click (PPC) ads and cost-per-mille (CPM) ads.
In short, you can either get paid for each person who clicks on an advertisement, or you can get paid for the number of eyeballs that have seen the ads. If you would like to start using display ads on your website or other platforms, Google Adsense is very simple to use.
How to effectively use PPC advertisements?
If you want to use PPC ads I would suggest that you take the time to filter the kinds of ads that appear with your content. Because you’re paid per click, you want the ads to be relevant to your audience to increase conversion rates. This is somewhat of a tedious process but will pay off in the long run.
How to effectively use CPM advertisements?
If you want to use CPM ads it’s not as important to use custom filters for the types of ads that appear on your page. This is because you don’t necessarily care about the number of clicks you’re getting. In some regard, filtering does matter. If you don’t want certain ads to show up on your display network, then you should use the filtering method to exclude those types of ads.
If you want to know how to make money with an online business, dropshipping is the way! This method can be extremely profitable if you dropship the right way. Many people lose money because they don’t do enough research on their products or the target market.
Another important thing to keep in mind with dropshipping is that you have to find a niche product for a niche market. If you sell generalized products that people are typically looking for you might not do so well. In addition, the likelihood of your online store competing with a company like Amazon is not very good if you’re selling what Amazon is already selling. Make sure your products are unique to your business and you will be able to sell them for a substantial profit.
How will I get people to buy my products?
It’s important to keep in mind that dropshipping is an online store that will require you to make a website. It will also require quite a bit of traffic to be profitable. Some ways to increase your site traffic are organically through search engine optimization (SEO), or you can also use paid ads like search ads and display ads.
So how do you start dropshipping?
The first step to take with dropshipping is to find a niche market you want to sell your products to. Don’t sell to everyone or you will be too generic and possibly irrelevant to a huge percentage of your market.
Next you will want to find an industry of products you will be selling. Some common options are clothing, technology, sports, etc. The key here is to sell unique items within a popular industry that people are already interested in. For example, your online business can make money by selling customized shoelaces to teen-aged and young adult men who play basketball. For one, we know that basketball accessories is a popular industry and now you have a unique edge with customizable shoelaces.
How to create my online store?
Once you know what products you’re going to sell to which niche market, you can now create your online store. You will want to pick a website host that can support your online business needs. Here are just a few that I would recommend:
How to find my products and get them onto my online store?
The concept behind dropshipping is simply finding a supplier and buying products from them for as close to cost of goods as possible and then reselling those products to your target market.
Once you have found a supplier that you want to get a product from there are a few things to consider.
Don’t just choose a product because it is cheap with potential for big profit margins. Make sure that your products are quality products and can get to your customers in good timing. Some products from AliExpress take weeks to get to the United States with paid shipping. If you can, I would suggest doing a filtered search for products with timely shipping.
Another small suggestion would be to increase the aesthetic appeal of your website. Buy the product yourself and then take pictures of the product to use for you online store. Not all suppliers provide good photos of their products.
How do I profit with dropshipping?
The nice thing about dropshipping is that you get paid directly by the customer. Following this you place an order for the product and have your supplier send it straight to the customer’s address.
Make sure that you have multiple payment options because some people aren’t going to use PayPal or other payment software that you might be thinking of providing.
Let’s Recap! How Do Online Business Make Money
How does any business make money?
There is no absolute answer to this question. In short, every target market is different and each requires different strategies.
Just remember it’s not as simple as click, click, click! For any of these online business models to succeed, extensive research and testing needs to take place.
Each needs to have a business strategy that provides healthy business growth and success. If you work hard and remember to innovate you can have unlimited success.