There are thousands of ways to make money online. But there is no magic bullet or secret formula. No matter what they big flashing sales pages tell you, you’re not going to become a millionaire overnight. Not even if you subscribe to that ‘100% guaranteed proven money making formula’.
The only real way to make money online is by selling a reliable product or service. You can do this by building your own product or service, or you can do it by becoming an affiliate of an existing product or service. But whichever way you choose, there are a few things to consider if you want to turn a real profit.
1. Your product or service should attract a significant customer base
Unless you want to spend a lot of time developing a niche product that fills a gap in the market, then you should be thinking about goods and/or services for which there is a significant, consistent need.
HR software – which helps you track employee records and attendance – is an excellent example of this. Almost every company in the world employs people. Therefore, your potential market size is limited only to the number of businesses in the world!
Of course, beyond the B2B market, you might prefer something that appeals to even more individuals. Anti-virus software is an excellent, relevant example of a product or service with a massive customer base – because almost everybody owns a computer, and the threat of online viruses is growing daily.
2. Use a subscription-driven model to generate recurring income
If you are selling a product or service on a one-time basis, then you’re going to have to continue selling it, to make regular profits. While you should never halt your marketing activities, a subscription-driven model ensures the maximum LTV (Lifetime Value) of each customer you manage to win.
Digital products like those mentioned above, command a consistent, recurring payment from your client. Whether this is monthly or annually, as long as you ensure good service delivery, your customers will keep on lining your pockets.
3. Make sure your product or service is not part of a dying trend
Make sure you don’t end up beating a dead horse – technology keeps evolving, and priorities are changing. You don’t necessarily need to sell a brand new, never-before-seen product. But imagine building an online business selling cassette tapes, right now in the year 2017? They still exist. But you wouldn’t get very far.
Stay ahead of the trends. Look for innovative products that are just starting to shine. But most of all, avoid trends that have run their course and are heading for the dustbin.
4. Do your profit margin research
Branded products or services often get sold with fixed margins. For example, all distributors of the Samsung Mobile Phone company all earn profits from a fixed margin, with no bias – this is because they buy them at a set price, and must sell them at the recommended price. The retail price is already fixed and promoted via Samsung’s advertising.
So instead of selling a product or service where the profit margin is already fixed, why not find something where you can set your own margins? For example, you can import a lot of gift items, at a little cost, from factories in China. These can be sold closer to the recommended retail price for similar items from your own country. There’s a full description of this procedure here.
If you don’t consider these four points, you’ll harm your chances.
Look, it’s up to you how you want to make money online. But if you ignore this advice, then you’re shooting yourself in the foot. All you have to remember is this:
- Pick a product or service with a big market.
- Utilise monthly subscriptions to generate residual income.
- Make sure you don’t hit a dying trend.
- Take care to avoid fixed profit margins.
Now, what are you waiting for? Get out there and make some money!