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This article is part of a series of posts that make up the “How to Start a Blog” guide. If you want to read this series from the beginning, start here.
Now that you’ve done all of the hard work in building up great content, it’s time to leverage your traffic to make money.
There are many different ways to make money on your blog, but for the purposes of this article we’ll focus on five main categories:
- Advertising – allowing companies to pay you to place advertisements on your site. Not usually the most lucrative revenue stream, as you typically need thousands of visitors to start making more than a few cents, but one worth considering – especially as the site gets larger quantities of visitors.
- Affiliate Programs – companies pay you to refer customers to their site. When the customer buys a product or service, you get paid a commission. When done correctly this can provide some of the most lucrative and consistent income streams.
- Physical or Digital Products – create and sell physical or digital products related to the topic of your blog.
- Consulting – people and businesses are willing to pay well for advice and expertise that helps them improve their lives and businesses. If you are an expert in your field, using your blog as an online resume to sell consultation services can be a great way to make money.
- Building and Selling – once you’ve built up a blog that has some traffic and revenue, you can sell that blog and start another one. There are several websites that act as brokerages for buying and selling websites.
Let’s break down all of these categories in detail and talk about some of the best ways to get started in each.
Advertising
In 2005, Alex Tew, a student from England, came up with the idea to create a website whose sole purpose was to sell 1 million pixels for a dollar per pixel in order to pay for his college expenses. This website was called “The Million Dollar Homepage” which quickly became a success. Whether he had stumbled across a gimmick or brilliant marketing, Tew was able to create interest and demand, eventually leading to a bidding war for the final 1,000 pixels which ended up selling for $38,100. Curiosity about the unique concept and advertising opportunity drove advertisers to buy up “real estate” on his website.
Advertisers are trying to get their product in front of as many people as possible, especially if those people are likely to buy their product. We can apply this understanding of the motivation behind advertising to come up with a strategy for maximizing our advertising earning potential.
If we look at this as an equation it looks something like this:
Number of Viewers * Viewer Relevancy (price per [x] viewers) = Advertising Revenue
In order to maximize your earning potential, you can increase the number of visitors to your site or find advertisers that more closely align with your topic/visitors.
If everyone visited your website every day, you could charge a lot to advertisers. This is Google’s strategy almost exactly. And as a result (at the time of this writing) Google is the #2 or #3 most valuable company/brand in the world. Google makes billions and billions of dollars every year from advertisers, precisely because Google has so much traffic each year.
And the company that beats out Google (and Apple, if you’re curious) as the #1 most valuable company in the world? Amazon. Why is that? Because people go to Google to find information, which may lead them to buy a product or service from another website. But people go to Amazon to buy something. This brings us to the second part of the equation: viewer relevancy. Amazon is able to charge advertisers much more because that advertising is so much more likely to result in a sale. So where is Amazon going to spend its money for research, development, and new initiatives? On either bringing more people to its site (think Prime day, Black Friday deals, Amazon Prime music/movies/etc.) or on making it easier for people to make the purchase (faster delivery, single-click purchasing, easy/convenient returns, etc.).
You can do that too. Focus your time on driving more traffic to your website, and/or focus your time on finding advertisers whose target customer base most closely matches your target audience. If you have a blog about shoes, Nike is likely to pay you a lot more for advertising than Best Buy. Last time I checked, Best Buy doesn’t sell shoes, but I haven’t been in a best buy store for a while.
Some of the main advertising platforms include (in general increasing-revenue order): Google Adwords, Ezoic, Mediavine, and AdThrive. However your best advertiser may not be one of these more generic platforms. See if you can find companies that specialize in products or services that closely match your site’s topic.
A word of caution: many blogs will slap ads and pop-ups everywhere, even right from the first day of the site’s creation. If done in excess, your website will run at a crawl, your content will be confusing, and the small audience you might have will disappear. This is a balancing act. Consider building up the traffic by providing real value and great content before you consider tapping in to advertising.
Affiliate Programs
Typically affiliate programs depend on the size of your audience as well as the category that you’re in. This is similar to advertising in many respects, but rather than an advertiser paying you in hopes that they may eventually get a sale from their electronic billboard they’ve placed on your site, you get paid a commission when someone actually buys something. This can result in dramatically higher percentages than advertising will give since you only get paid if an actual sale occurs.
Amazon is essentially the king of affiliate marketing, which is a huge factor in their success. They’ve been able to successfully “double-dip.” Like Google, they get paid for advertising, but in addition to that Amazon also gets paid for product fulfillment. Most of the products that are on Amazon that are “fulfilled-by Amazon” are not actually created by Amazon. Amazon manages the shipping and warehousing costs, and charges the product owners for this service. This allows Amazon to collect a much higher commission on product sales than if they were listing the products only.
On the opposite end of the spectrum, Amazon will pay you for sending customers to their site when customers purchase products. Since Amazon has such a wide variety of products, there’s a high chance that they’ll have some product that will match something you’re talking about in your blog. Since Amazon has so many products and because they’ve made it so easy to purchase and receive products, it’s worth looking into signing up for the “Amazon Affiliate Program.”
However, many blogs will stop at an “Amazon Affiliate Program” and 100% of their affiliate traffic is sent to Amazon. Likely you can find other partners that pay higher commissions or even recurring commissions. Amazon continually revises its percentage structure for the affiliate program, and (spoiler alert) has consistently lowered those percentages over time. Check out their commission chart to see a breakdown of the various categories to see if it’s worth it for you.
It’s worth it to spend some time finding and comparing alternative affiliate programs. Another affiliate might pay you 10-50% commissions while Amazon is only offering 3% for the same products.
Physical or Digital Products
Some of the most profitable time you can spend on your blog is in building products. When you build your own products, you can control the pricing, profit margins, and advertising platform (i.e. your own blog). You can’t control the demand for your product or active visitors to your blog, but there are some things you can do to help these factors as well.
Your website analytics information will be incredibly valuable in determining what type/topic of info product will be best for your audience. Look at page views and comments to see what drives the most traffic and where you have the most interest.
You can also conduct a survey with your email group to figure out which type of product your audience would be most interested in.
Here are a few ideas for products that you could make for your blog:
- Books
- Audiobooks
- YouTube videos
- Merchandise
- Print-on-demand products
- Online courses
- Downloadable Software
- Etc.
The key to providing a product your audience will be happy to pay for is to provide the most value possible for your audience. Prove that you can provide value in the “free content” that you offer through blog posts, and then provide even more value in your paid products.
Consulting
Over the course of building your blog, you’ll have researched and written about many topics and will eventually become an expert in your field (if you’re not already one to begin with). That expertise is incredibly valuable – especially in business settings – and people will pay for convenient access to that expertise. This is where consulting comes in. You charge hundreds or thousands of dollars per hour for your time in consulting.
As your blog and influence grow, so does the amount you can charge for consulting services. Just last week I charged a colleague $0 for advice – true story. Just imagine the money I could bring in if I was to bring in 1,000 such deals. OK, but seriously, you can make a lot of money in consulting. I have made hundreds of dollars per hour in business and website-development consulting.
Usually the goal of a profitable blog is to get out of the rut of trading time for money, as ultimately time traded for money can only scale linearly. However, I’ve found consulting work to be incredibly rewarding – both from a personal/relationship development standpoint, as well as from a financial standpoint. Consulting is great early on, before your blog is making a lot of money from other means. Consulting is also great as a “side hustle” of sorts to keep things interesting or to generate large spurts of cash.
Build and Sell
The final form of monetization we’ll discuss is the “build and sell” strategy. In this strategy you build and sell websites (fully baked or template only): ecommerce sites, blogs, domain names, etc. The goal is to build a valuable piece of intellectual property that you can then sell to an interested buyer.
Let’s talk about company valuations. Different types of sites, amount of traffic, and monetization strategies yield different valuations. Generally the more passive and recurring the revenue, the higher the valuation multiplier, which essentially is a number that you use to calculate what your company/blog is worth. Valuation multipliers are typically represented based on monthly profit figures. For websites I’ve historically seen them range from 1x to 60x.
So a website with a long history of affiliate and ad-based revenue with almost all traffic coming to the site organically is likely to get a much higher valuation multiplier than a site that was just started, getting its revenue from physical products only relying heavily on paid social media and PPC marketing.
A conservative estimate then would be around 30x. So you can take the net profit from your blog today per month and multiply it by 30 to get a conservative estimate of what you might be able to sell your website for. For example, if your blog is generating $5,000/month, you can likely sell it for $150,000 or more.
Two of the largest website brokers are Flippa.com and Empireflippers.com. You can run a search on either of these websites right now to see what’s selling today and current market trends for pricing and industry.
Side Note: If you’re wanting to get a jumpstart on your blog or website, you can also purchase websites from other people that have done the legwork. This can be a great way to get up and running quickly, but be careful! Make sure you do as much research as you can and use a reputable website broker-dealer.
Conclusion – Where to Go Next?
Remember that the best monetization strategy for your blog will depend on your audience and specific niche. A website that does really well with advertising may not do so well with affiliate marketing, and vice versa. As you build out your blog, keep monetization in mind, and spend the time to find quality revenue streams for your blog.
This wraps up this series on “how to start a blog,” and hopefully gives you everything you need to start your own blog.
If you have questions about what tools to use to build your blog or are looking for additional educational resources about building blogs, I’ve prepared a “Blog Resources Page” full of great resources to get you going.