You've probably read the stats --- over two-thirds of new businesses fail in the first year.  What the pessimists don't tell you is that the businesses that make it through the perilous period take off like a rocket in subsequent years.  Our chicken waterer business is now six months into its second year, and is showing a 400% increase from our first year profits.  (This is a big part of the reason why our blogging has been a bit slow lately.)

Part of the increased profit is simply due to a steep learning curve.  We were making it up as we went along last year, but this year we're putting all of the tips and tricks we compiled in Microbusiness Independence into play, with predictable results.

The other reason our business is doing so well this year is because the internet rewards people who keep active websites for long periods of time.  You can hire an SEO master, and Google will still look at you a little funny for the first six months.  Over time, more and more people will naturally link to the useful information on your website, and before long you'll get comments like I did this week in response to my note on a Livejournal community:

That just made my day.  I can tell you that I have absolutely never, ever been called a Rockstar before --- capital letter no less!

I stumbled across Lionsgrip traction pads in a very surprising manner --- searching for information about chicken feed.  When googling for homemade chicken feed formulas, I kept ending up on a very useful site with several recipes.  Finally, I decided to poke around and see who had compiled all of this information about chicken feed, and I discovered that the information was just a small offshoot of a microbusiness website.

Lionsgrip actually has nothing to do with chickens --- they're a small company that produces mats you slip under your tires when your car gets stuck in the mud.  But the owners decided not to stop building their site after they added all of the obvious information about their product.  They went on to build six separate "guest websites", each chock full of useful information (and with two ads on every page sending you back to their traction pads.)

Lionsgrip's website is a great example of the SEO truism --- if you create good content, people will come.  Granted, Lionsgrip probably would have gotten more specific traffic if the content they built was more closely related to their product, but any useful content will attract potential customers to their site.

For other tips on free or cheap advertising, check out our microbusiness ebook.

By E. Sizemore

There are entire sections in most book stores these days dedicated to the “How to make money online” genre. I plan on writing a book about this topic myself within the next couple of years. Needless to say, we’re not going to cover the topic in any great detail from a single blog entry or article. But for those of you who just want an overview, what we are going for here is an introduction to the different ways you can make a living online.

Some people focus completely on one “way”. For instance, some people open up an eCommerce store and sell products. They don’t sell ads or do anything else. Some people have content websites that sell banner ads. They don’t join affiliate programs or sell their own products. Others, such as myself, mix and match the different monetization models depending on what is most appropriate for a particular website or topic. I will provide a link to one of my websites for each type of monetization model as an example.


#1 – eCommerce Store ( http://www.gaiam.com Where I work)

The first and most well-known online business is the “store”. eCommerce as a monetization model is one I’m sure everyone has heard of. But what a lot of people don’t realize is that the profit margin on most eCommerce products, once things like warehouse space, customer service, shipping… have been taken into account is often not much greater than the cut an affiliate marketer gets for doing a fraction of the work. We’ll get more into that later.

There are three ways to do eCommerce, generally speaking. First is to keep product in stock; second is to make the product on demand; and third is to have the manufacturer or distributor drop ship. They all have their pros and cons. The obvious downside of keeping products in stock is that you’re stuck with the bill if they don’t sell and it requires an upfront investment. If you run a microbusiness where you’ve created your own invention, like a chicken waterer, option two could be the way to go. The third option, drop shipping, is when you don’t keep the product in stock yourself. When an order comes in from your website you send the manufacturer or distributor the order and they ship it straight to your customer. Sometimes you can even get them to use your own shipping labels and packing slips with your logo. This is a good way to get started selling other people’s goods with minimal investment, but beware of the MANY drop shipping scams out there. We won’t get into that here, but let’s just say the best way to find drop shippers isn’t to Google “drop shippers” but rather to find a product you want to sell and call up the manufacturer or distributer on the phone and ask if they drop ship.

Any way you go about it, operating an eCommerce store is going to take a lot of time. You’ll be dealing with customers and vendors constantly. Imagine how many items get lost in the mail or arrive broken and need to be returned. Expect to spend a LOT of time on the phone talking to other people if you run an eCommerce business.


#2 – Affiliate Marketing (http://www.comparethebrands.com My affiliate site)

What if you could make money selling products online without having to deal with people? Personally, I don’t want to worry about customer service issues. I don’t want to deal with warehousing space, inventory management or logistics either. Let ALL of those eCommerce headaches be someone else’s problem and let me focus on what I do best, which is – sell stuff online. If this kind of situation sounds appealing to you then affiliate marketing might be the way to go. In this monetization model you get usually between 5% and 10% of the price for anything you sell by sending someone from your website to a merchant’s eCommerce website. Again, there are many great books about affiliate marketing and I’m not going to be able to teach you how to do this for a living in one post. But I can tell you where to start, which is A: signing up as an Associate on Amazon.com, and checking out major affiliate networks like Commission Junction, Share-a-Sale, Linkshare and Google’s affiliate network. Also, read as many affiliate marketing blogs as you can. Just don’t pay for any eBooks or programs. All of the information you’ll need is free if you know how to use Google. Here are a few posts I did on one of my websites (which is an affiliate and PPC website) a few years back:
http://www.firstpagefitness.com/make-money-with-these-fitness-affiliate-programs/
http://www.firstpagefitness.com/top-health-and-fitness-affiliate-marketing-programs/
http://www.firstpagefitness.com/water-for-life-affiliate-program-gets-even-better/


#3 – Lead Generation (http://www.usrecallnews.com My lead gen site for personal injury attorneys)

This is a more advanced form of affiliate marketing. Both traditional affiliate marketing and lead generation (lead gen) are what’s known as “pay-per-acquisition” or “performance based” marketing in which the business doesn’t have to pay you unless someone buys something, or signs up for something. In this case they are paying whenever someone signs up to be contacted, such as signing up for a newsletter or opening an account. Most lead gen. programs tend to be affiliated with topics like phone ringtones, real estate, online gambling, mortgages, pay-day loans and online education. In other words, competition is fierce. This is why I say it is a more advanced form of affiliate marketing. But the pay-outs are also higher and sometimes you can find a good niche for yourself.


#4 – Banner Advertising (http://www.livingoffgrid.org My content website with banner ads)

Unlike performance based marketing, publishers get paid for their banner ads even when they don’t make money for the advertiser. Whether or not someone clicks on the banner; whether or not someone buys something after clicking on the banner… it doesn’t matter. They are usually sold on a CPM (cost per thousand impressions) basis, which means you have to have a LOT of traffic to make money with most banner advertising networks. However, you can privately approach merchants in your industry and offer banner ads for a monthly or annual cost regardless of impression count. They’ll usually want to see how much traffic your website gets.


#5 – Pay Per Click (ALL OF THE ABOVE websites also incorporate Google Adsense PPC ads)

There are two sides to the pay-per-click (PPC) coin. The first is that of the advertiser, in which they bid through programs like Google’s AdWords on keywords that trigger their ad to show up. They don’t pay unless someone clicks on the ad so they can get all of the “impressions” they want without the risks involved in banner advertising. At the same time, since they pay for the click and not the “conversion” or purchase, there is more of a risk here for merchants than with performance based affiliate advertising. Publishers (that’s you) use programs like Google’s AdSense to offer up advertising space on their websites. They only get paid when someone clicks on one of the ads, which could be in the form of links, banners and even video. One of the best things about this system is also one of the worst things: You don’t control which ads show up. This is good in a way because you don’t have to worry about finding advertisers. The system does it all for you based on the content (keywords) they find on your page. The downside is that sometimes ads will show up on your site that you don’t like. You can always log in to Google’s system and choose to block a certain advertiser, but sometimes it takes months before you notice. Generally speaking, however, I don’t find this to be a problem.


Search Engine Optimization (SEO) – What ALL Of These Methods Reqire

SEO is the process of working on code, content, links and other factors in order to achieve a better placement on search engines like Google, Bing and yahoo!. You can buy your way into the sponsored ads on search engines (usually the ones that show up on the side) but the main results are referred to as “organic” and you have to work to get shown there. I am an SEO Consultant. It is what I do for a living so I have a big advantage in this regard. But anyone can learn the basics of SEO. It isn’t rocket science. It all boils down to basic elements like:

• Make sure your website is crawlable (eg no flash navigation or flash content, text should be text, not text embedded inside images, no fancy javascript navigations…)
• Make sure your content matches what you want to be found for (eg don’t write about blue widgets if you’re hoping for people to find you on Google for green thingamobobs)
• Make sure your meta title and meta description match what you want to be found for, which also matches the content on the page.
• Make sure good, quality websites link into your website. When possible, the link should be on a topically-related website and the hyperlink text should match what your title, meta description and page content says your website should be ranked for.
• Make sure you have unique, quality content that was written for your website and not shared with a bunch of other websites.

In other words: ALL YOUR DUCKS SHOULD BE IN A ROW. If your website is about green thingamabobs and that’s what you hope people will find you for on Google, you should have “Green Thingamabobs” in your Meta Title, in your meta description, in your page content, and in links that come into your website from other websites about “thingamabobs”. Again, entire books have been written about SEO. Entire books have been written about specific pieces of the SEO process, such as search-friendly copywriting. There are week-long conferences in cities across the nation dedicated to this topic. I have devoted the last five years of my life to perfecting the art and science of ranking highly on search engines like Google. You will not learn it overnight, nor can I tell you all about it in an article. But now you know enough to get started on your own research. Here are few resources to take you a step further:

• Find out what people are searching for: https://adwords.google.com/select/KeywordToolExternal
• Learn more about SEO: http://www.seomoz.org/blog
• Join an SEO forum: http://www.seobook.com/ (just sit back and read for awhile before joining discussions or asking question. You’ll find most of your questions have already been asked and answered by previous visitors.)
• Read lots of SEO blogs: http://www.toprankblog.com/search-marketing-blogs/

Everett Sizemore has been involved in SEO as an e-commerce business owner, marketing agency employee, independent SEO consultant and as an in-house SEO manager. Of these situations, Everett finds his in-house position as the SEO manager for an e-commerce brand to be the most challenging and rewarding. Everett works for Gaiam, Inc. and blogs about e-commerce SEO on his website http://www.esizemore.com. He speaks about in-house SEO at direct marketing conferences and has guest lectured at the University of Denver on Internet marketing topics, including SEO.

We make our "egg money" from our homesteading blog --- we pour out our souls and sometimes readers click on our ads and put a few cents in our pockets.  Lately, I've been starting to think about the distinction between non-clickers like me who tune out all ads immediately, and clickers who are sucked in by the advertising.  Is there any way to tell whether visitors will be clickers?

Google Analytics collects exhaustive amounts of information on each of our visitors and I've noticed the following trends:

• People who operate under Windows are much more likely to click on ads than those who use any other operating system.  I figure that Windows users are probably much less tech savvy and don't really know much about ads --- many of them probably click by accident (which is fine by me since I get paid per click regardless of what happens next.)
• The combination of Windows and Internet Explorer is click-city.  These visitors click on ads nearly twice as often as you would expect!

I enjoy collecting data like this, but don't really plan to do anything with it.  Sure, I could probably double my ad income by working on attracting Windows/IE users, but it seems like more trouble than it's worth...

If you'd like to learn how to set up Google Analytics and other tracking software on your website, check out our ebook.

Lots of people try to trick the system using search engine optimization, but it's nearly as easy to get to the top of the search engines organically.  My advice is to find out which part of the internet you love and make a presence for yourself.  If you're like us and love to blog, then make sure you post a blog entry every day.  Or maybe you'd rather hang out on Facebook, tweet your way to significance, or shoot the bull on forums.  As long as your online presence is visibly linked to your business website, every time you make a post or a tweet, you're making your business site more important and netting more customers.

We attribute quite a bit of our microbusiness success to our incessant blogging.  Our homestead blog gave our business a jumpstart --- rather than starting as an insignificant website tucked away in a dark corner of the internet, our business was attached to a well-read and loquacious blog.  Although only a limited number of people read the blog itself, by adding a little note at the end of each of our personal blog entries with a link to our business website, we quickly pushed our business website to the top of the search engine rankings.  The same effect is easy to achieve by, for example, putting a link to your website in your forum signature and posting up a storm on a well-read forum.

So find a part of the internet you enjoy and get out there!  Think of search engine optimization as running for political office.  No one's going to vote for you if you don't put in your time kissing babies.