Internet millionaires have sprung up everywhere, but have you ever wondered how do you make money from a website or blog?
You may have read about people who have set up successful blogs and are living off of the proceeds of these digital goldmines. Well I expect you’ve also wondered, ‘How do websites or blogs actually make money?’
The truth is there are a variety of strategies and methods of doing this, but in this article we are only going to look at 2 key areas, that will help the money flow into your piggybank once you have set up a successful website:
- Pay Per Click Advertising
- Affiliate Marketing
Pay Per Click Advertising (PPC)
Do a few searches in Google and you will inevitably come across a site, which has a Pay Per Click banner, usually prominently positioned towards to the top of the page.
For example if I do a quick search for ‘Asian Cuisine’ then pretty much every site on the first page of Google has a PPC ad banner included. Examples of these are shown below:
People are making money from websites using different advertising programmes such as Google’s Adsense programme.
The idea behind this is all about ‘contextual advertising’ and providing advertisements targeted towards the content that the user is searching for.
For example there may be a company that has just released a new brand of wok, so they’re going to want to advertise on a website related to the content, in this case ‘Asian Cuisine’.
The advertiser will use something called Google Adwords ,where they bid in an auction style to have their ads shown on sites and pages, which rank well for a particular keyword. So for each keyword like ‘Asian Cuisine’ they put in a price that they are willing to pay Google every time that someone clicks on the banner. This is often referred to as the ‘Cost per Click’ or ‘CPC’.
The website will need to sign up to the Google Adsense programme, and then dedicate a section of it’s site to display the Google Adwords advertisements. Depending on which keyword the page ranks well for, depends on which advertisements are displayed here.
- The advertiser pays a fee to Google for placing its add and every click through received
- Google receives a commission for every click (32%)
- The website receives a commission for every click (Currently 68%)
So you can see already, that if you have a popular website receiving a lot of traffic for a keyword that advertisers want to display their ads on then you can receive a steady stream of income.
In the case above, the keyword ‘wok’ has a cost per click of ‘£0.86’ and has 8100 monthly searches in the UK.
Lets assume you got number 1 position in Google for this. This would mean that approximately 32% of visitors who search for the keyword ‘wok’ would click through to your site from the search results page = 2592 visitors per month coming to your site.
Lets then assume for this example that you get a click through rate (CTR) of 5% – so out of your 2592 visitors, only 5% will click on one of the Google Ads on your sit = Approx 130 visitors per month will click on the ad.
This brings in a total revenue of £111.80 per month (130 x £0.86 )
However, after Google has taken its cut this leaves you with a grand total of £76 per month
Now, this may not sound like an insane amount of revenue, however, if you multiple this across a number of keywords and potentially a number of sites, then the numbers start to add up.
I’ve written another article specifically around keyword research, that goes a lot deeper into this topic, but there are 3 key factors that you need to look at:
- How many visits per month does the keyword receive?
- What is the value (CPC) for each keyword?
- How easy is it for you to rank in the Top 10 in Google for this keyword?
This is definitely something worth looking at an there is a whole industry in creating ‘niche websites’, which focus solely on making money through advertising, but we’ll come back to them in another article.
Things to remember
- AdWords is the programme that advertisers use to promote their products and
- AdSense is the publishing network, which pushes the AdWord advertisements to the relevant websites
- AdChoices is just a link on the advertising unit to find out more information about the advertising network and how to set your advertising preferences.
What is affiliate Marketing?
According to our friends at Wikipedia, affiliate marketing is “a type of performance-based marketing in which a business rewards one or more affiliates for each visitor or customer brought by the affiliate’s own marketing efforts.”
In laymans terms this means that you get paid for promoting someone else’s product on your blog or website.
Usually this works by placing an ad or affiliate link on your site, which links to the affiliates site where the visitor will either enter the purchase funnel for a product or register for a service.
The affiliate links on your site will have your own id so you track the user through the purchase funnel and will usually receive a percentage of whatever they spend on the site.
There are usually 3 types of affiliate marketing programmes available:
Cost Per Sale (CPA)
This is where the visitor who is referred to the affiliate then goes ahead and purchase a product or service from the affiliate, and receive a percentage of the sale in commission
Cost Per Lead (CPL)
This is when the user of your site is then taken to the affiliates site where they complete some kind of form. This could be as simple as leaving your email address or as complex as filling out a longer survey, but each time this is fulfilled on the affiliates site, you will receive a commission
Cost Per Click (CPC)
We discussed this earlier with Google Adsense, but in this case, this is where you get a commission from the affiliate as soon as they click through from your website and land on the affiliates website
How do I become an affiliate?
In most cases there are no barriers to entry to joining an affiliate programme. You simply need to:
1 – Find an affiliate programme that is related to your product.
You can either do this by joining one of the affiliate networks that a lot of the big brands use like Commission Junction or you can try searching for an independent affiliate programme (Just type in ” [your topic] affiliate”)
2 – Join the affiliate programme and create your unique affiliate links.
Am example of a Commission Junction link would be:
In this example, the number ‘123456’ will be your affiliate site ID and the number ‘789789’ will be the destination page on the affiliate site
3 – Add your affiliate links to your site
Try to avoid plastering these all over your site and only add them in places, which will be useful to your visitors. Otherwise your visitors will get annoyed and you’ll end up with loads of affiliate links, but no-one to look at them!
Setting up affiliate links on your site really is as simple as that, but of course, they key is getting enough relevant traffic to your site in the first place to click on those links. If you haven’t done it yet have a quick squizz over my Keyword Planner article, which gives some useful tips in getting the right traffic to your website or blog.
So how much can I earn through my affiliate links?
Well, how long is a piece of rope??? This depends on so many factors that it’s hard to put an estimate on this, however, there are some things that will help you get a feel for the type of online earnings you will be taking home
1) How much traffic is coming to your site, to pages where you have the affiliate links?
2) Earnings per click (EPC)
You should be able to get this from most affiliate programmes and is a simple formula (Commissions received divided by referral clicks), which tells you how many of your visitors that you send to the affiliate programme go on to purchase. For example if you send 100 visitors to a site and 1 person purchases something worth £10, then you have an EPC of £0.10
3) Average Order Value (AOV)
This isn’t freely available with all affiliate programmes but if you can get the information it is a useful metric to understand your potential earnings.
4) Commission Levels
The amount that an affiliate is willing to pay your varies wildly between products and affiliate programmes. It can be as much as 50% for some digital products, but generally, it will be a lot less than that.
Your first Top Tips for Affiliate Marketing:
We’ll look into affiliate marketing in more detail in a later article but some of the key rules are:
- Only ever promote products that you are genuinely interested in or would buy yourself
- Don’t try to sell the products, but recommend them instead
- Make sure that any affiliate links are placed in the right context. They should be related to the theme of the article, rather than just strewn around your site
- Always be clear that you are getting a commission from these links