Wondering how do websites make money? You are about to find out! There are a lot, I mean a lot of ways to make money with a blog or a website. If you are wondering how you are going to monetize your site, then you’ve come to the right place.
I’ll discuss all the strategies and methods that the most successful websites use to generate income. When you are done reading this post, you will be aware of all the ways a website can make money and you will be armed with the knowledge and tools necessary to convert your site into a cash machine.
Before we start, I’d like to reiterate as I have in the past. First and foremost, provide value to your readership. Making money will be easy once you’ve created a loyal readership in the right niche. Always remember if you want to create a cash cow of a site, then you need to pick an industry that is thriving and you know a lot about this subject or at least are willing to learn. It also helps if there is less competition in terms of search engine ranking in that particular niche. You can use a tool like SEMRush to help you with that. But enough of that, let’s look at how you can make money online!
If you have created a high/medium traffic site in the right niche, you’ve hit the jackpot. But we have to dig a bit before we hit gold, using the right revenue generation model can make an enormous difference to your revenue numbers.
Generally, site owners make money by
- Selling your own stuff (services, products of their making both digital & non-digital, eBooks and other premium content)
- Advertising & Affiliate Income (selling and promoting services and products made by others)
At the end of it all, it comes down to one of the aforementioned two – You either sell your products and services or you can act as a conduit for the sale of another’s product or services.
Let’s look at how you can monetize your blog or site.
Sell Advertising Space
You can sell advertising space in the form of banner adverts to businesses and people. It isn’t quite that simple, though, you get paid differently by different advertisers.
CPM – Pay Per Impression Advertising
Your website receives revenue as and when you generate impressions for the sponsor. This rewards a website for every thousand impressions that it generates. You may get paid anywhere between $1~$7 per thousand impressions depending on your sponsor’s industry. The most well-known CPM advertising network is BuySellAds.
PPC – Pay Per Click Advertising
You make pennies every time someone clicks on a banner or link. It generally works out to a higher amount per click when compared to CPM but it might depend on your niche.
Selling advertisements via contextual ad networks is best when you have a site that covers a large spectrum of subjects. If your site targets specific niche or keywords, you’ll find that Affiliate Marketing is probably a better money-making strategy for your site.
Also known as CPA or Cost Per Action, Affiliate Marketing is an extremely profitable way to generate revenue for your website. The section of Affiliate Marketing goes into a lot of detail, rightly employed it can make your site very profitable relative to running CPM or PPC advertisements. It’s also a lot tougher to utilize, so let’s talk about affiliate marketing.
As the name might suggest your website acts as an affiliate for someone else’s product or service.
How does affiliate marketing work?
You promote a certain product on your site, your visitor identifies the product as an effective solution to his or her necessities and purchases the product. You get a predetermined percentage or fixed commission for each purchase made by visitor or reader who passes by your site to discover the product or service and then makes a purchase on the affiliate sponsor’s website. This works because the company that sponsors the affiliate program finds a new customer, your visitor found a new product and you get a commission. All three parties involved end up with something they might not have had otherwise. You works as a middleman between buyer and seller and get paid for doing so.
Affiliate marketing campaigns produce new leads for the sponsor and generate commissions for your site effectively only when the niche of the campaign is close to your site’s niche. The further the distance between your niche and the campaign’s niche, the less effective the affiliate marketing efforts.
- Tip #1: Keep the niche of any affiliate campaign as close to your site niche as possible. Ad networks ensure that the right adverts are displayed on your site with PPC & CPM, but with CPA you need to find the right affiliate to endorse.
Write honest content/reviews, never go over the top and recommend a product or service you have not used. It is okay to verify the features of a product and write a dispassionate review. To give a positive review for any product, use it first or read extensively about the product, reviews provided by domain authoritarians who have a history of being impartial and fair in their assessments (Your eventual aim should be to make your site in their image). And be informative, add value and try to help your readers find the best products. If you’ve used the product better still, be insightful.
- Tip #2: Be honest & informative. And if you have used the product be insightful. Else you stand to lose your reader’s trust and you lose revenue.
Write about alternate choices. Never recommend a single product, always offer choice to the reader. Your site’s business is to inform your readers. Aigars writes about 20~50 themes in our collection roundups, it is to help provide choice and that’s for free themes. The choices provided should cover as wide a net as possible, when you expect your reader pay for a product.
- Tip #3: Present reader with alternate choices. Doesn’t mean you can not recommend the best choices in your opinion but try to include as many alternates for your reader as possible.
This is going to be a bit strange, but bear with me! People look for your opinion, put your reputation on the line by recommending one or two products above other choices, but only if you can identify them as the very best options for your readership.
Recommend what’s best for your reader, not yourself. Different affiliate programs have different commissions, some much more profitable than others. But these more profitable programs may not necessarily have the best solutions to your reader’s necessities and problems.
- Tip #4: A small piece of a bigger pie is better than, well you know how it goes!
Disclose affiliate income, always inform your reader that you receive a commission for products that you recommend. Let your reader know that, this is how your site generates income to pay for writers, website development and hosting. I am sure they’ll understand.
- Tip #5: Disclose affiliate marketing on your site on pages where there are affiliate links.
Do not push products on your readers. Stop cramming your content with multiple links, try to keep it to a minimum. It might turn off someone, allow for the possibility that your reader is skeptical about someone who profits from their suggestions. Never allow anyone to ever feel that you are merely trying to sell them things.
Always attempt to connect with your audience by being informative, insightful and very importantly helpful. After you’ve described the problem that you’re attempting to solve which should be one that your readers can relate to, only then should you proceed to promote a product as a possible solution. I think subtlety is underrated.
Remember that affiliate marketing can help make a great deal of money for you if you target the right niche. Not only should your site be relatable to that niche but your niche should have sufficient traffic from the specific niche. Affiliate marketing tends to be very targeted, it will not work if there is no money in that market, to begin with.
Before you decide to run an affiliate marketing campaign on your site, try reading the about the affiliate programs offered by the ten biggest players in your industry. Look at their customer numbers and their commission percentages. See if the numbers make sense and whether affiliate marketing is right for your site’s niche.
MyThemeShop offers a 55% commission on any new customer you bring to them. We use their affiliate program on our website and highly recommend it.
In comparison, Elegant Themes offer a 50% commission and StudioPress offer a commission of 35%. If either of them had sales exceeding MyThemeShop by a great extent, they will make for better affiliate options but given that there isn’t too much of a difference, you will be better of using all three affiliate programs. This way you can present your readers with multiple choices.
Check out for how long the tracking is valid when you bring new traffic to these sites under affiliate programs. This also known as the tracking cookie period. Most reasonable affiliates have periods of 60 days or greater. After that any sale made as a result of traffic your site brought them, doesn’t earn you a commission.
My examples may have been specific to the WordPress niche because I am familiar with WordPress. The commissions vary from sector to sector as the size of the deals vary. Look at all affiliate programs and identify the likelihood that they will generate a steady cash flow that is sustainable and builds over time. And test a few of them out before you settle on one or two of them.
Bluehost has a great affiliate program for many reasons, rather than boring you with “Why?”. I’d like to talk about Pat Flynn who made $424,800 which accounts for about 40% of his site’s revenue in 2014 via BlueHost’s affiliate program and about $670,000 from all affiliate programs. Now remember his website has multiple sources of income and apart from his BlueHost affiliate program all his other income sources are at best $50,000 and not more. I’d recommend that you have a look at Pat’s site and his income statements, you’ll notice that despite the diversity in his income sources he makes about 65% of his income via affiliate programs. This should quite clearly illustrate the power of affiliate marketing. Keep in mind that we might receive a commission if you decided to purchase through these links.
A Few Things About Advertising – PPC, CPM and CPA
- Tip #6: Banner adverts are not really your best option, their click through rates are rather low in comparison to in-content links. But if you aren’t using all the space on your website, then perhaps you could add banner advertisements to add to your revenue.
- Tip #7: Cut out the middleman, many ad networks take out a chunk of your revenue. Remember direct deals are always better than going through an intermediary. It’s also a lot harder.
- Tip #8: Never crowd your content out with too many advertisements banners or in-text links.
- Tip #9: Use a heat map plugin and try to figure out which parts of your website attract the most attention. Place your adverts appropriately.
- Tip #10: While plain banner adverts (Not based on PPC, CPM & CPA) pay on a monthly or bi-monthly basis and offer some security of income, even if your traffic doubles or triples, you still get paid the same. PPC, CPM & CPA based advertising on the other pay based on how well your site does and how well it converts traffic into sales/impressions.
Sell Your Product/Service
Creating a website to generate revenue is primarily based on projecting yourself and the people who post content on your site as domain experts. Sometimes it is very easy to prove that you know your stuff, an example would be a WordPress theme developer and writer. Aigars writes a great deal about themes and he gets a lot of interaction because he is a pretty awesome web developer.
Projecting yourself as a domain expert is crucial as it is what your site relies on to generate revenue. It is aided by creating products in that particular niche or in the alternative offering services in the same niche or even a related niche.
Of course, this works both ways web developer turns writer and the otherway around, the same is applicable to any niche.
- Tip #11: Generating good and most importantly useful content will help project authority and domain expertise and bring more sales.
This is not limited to digital products like themes, it can be extended to almost any industry for which there is sufficient interest on the internet. Companies of any niche or sector can sell their own products via the internet.
- Tip #12: Selling stuff services/products and generating good content on the same industry/niche/sector brings in more visitors and as a result more prospective customers to your site.
You may have noticed by now selling products and generating useful content go hand in hand. One aids the other and vice versa.
Whilst selling your own products and services creating an affiliate program will help sell your product better. You will obtain a greater reach by sharing a percentage of your product’s price for a sale that may have gone unrealized otherwise.
Some people may be reluctant to share their profits, but what they fail to realize is that the profits you share would not have been realized at all had there not been an incentive for your affiliate to share and recommend your products.
Here you will find more about platforms that you can use to sell your products.
Enable Directories On Your Website
Basically the online version of paid classifieds and an easy way to make money. The best thing about directories is you have no limit to the number of companies, businesses or freelancers who can list themselves.
You can charge a flat rate or charge a commission on business your site directs towards the sponsors. And depending on your blog’s primary focus, directories are a handy tool to help your users. For a real estate blog, you could create a directory for the real estate agents.
- Tip #13: It can be a really helpful feature for your readers, especially in primary services based niche or industry.
For WordPress users, a few handy WordPress themes to help you out. Although, I wouldn’t recommend a directory theme if that isn’t the crux of your site.
You can use Business Directory Plugin to add the functionality to your site or get some custom web dev work for your site which is preferable.
To find out more about how to make a directory using WordPress please read our detailed guide.
This idea is rather similar but the polar opposite of creating a directory on your site. Job Boards can be an extremely useful source of site revenue wherein the person who posts the job pays a monthly fee for his or her job posting.
Pro Blogger is an excellent example of a site with a very profitable job board system. When I checked out their job board, they had about 30 job openings advertised on 4 different pages, which means about 120 job postings. That translates to roughly $6000 revenue per month. To start your own job board you can use any of these WordPress themes and plugins.
- Tip #14: Generating revenue with directories and job boards is a really smart idea because you have very little work and you get a lot of revenue. Both methods involve significant web development work to start off but subsequently, it requires very little effort for its upkeep.
Offer Sponsored Reviews
Websites with reasonable clout and domain authority often receive requests from small businesses to post reviews of their new products. You can offer sponsored reviews for a fee. We offer sponsored reviews on ColorLib. While it’s okay to publish content as part of a sponsored review, you should never offer your opinion for sale. Sponsored reviews really bring in a good amount of cash for relatively little work.
- Tip #15: Sponsored reviews are a great way to make money! But please add a sponsored review disclosure whenever possible, sometimes sponsors make request that you not reveal that it is a sponsored review. Personally, I feel you should provide a dispassionate review with a disclosure.
Even if you do not disclose sponsored reviews, most websites will have a sponsored review section. This will indicate to your reader that you do write sponsored reviews. If you do not disclose sponsored reviews, maybe a few of your readers may get upset. But I guess they really can not complain much about it, if you are honest in your product reviews.
On Colorlib, we offer paid reviews at $560. Not only do we get the benefit of the cash, but sometimes we get our hands on a product that hasn’t yet hit the market which is an added benefit. And review content generally tends to be in depth content about specific products which almost all readers love.
- Tip #16: Sponsored reviews help you get your hand on products that haven’t yet reached the market yet. Many gaming related YouTube channels receive access to games as beta testers and some tech websites are able to get their hands on new laptops and graphic processing units before, they hit the market. This can offer a significant edge over your competitors.
Create Premium Content
You can craft content that is very difficult to come by on the internet and package it for sale. It can be an eBook or an interactive tutorial/course. You need to provide some free content to entice the audience into buying your content. Also, it helps a lot if you’re specific about what the premium content will teach or reveal to the buyer.
- Tip #17: Premium content will not work if you offer something that is available for free on the internet.
I’m currently trying my hand at Data Science and I want to learn R. I’ve used Data Camp, they have an awesome strategy. You get access to the first part of their course for free. After that, you’ll need to pay for access to the subsequent sections.
When it comes to premium content, you can choose either one-time purchase models or recurring subscription models for continued access to content and support.
- Tip #18: With a sales models for paid content, I believe a freemium + subscription hybrid model is best for most content. They have shown tremendous success. In Asia, the freemium App Store model accounts for 90% of all revenue. Many WordPress plugins & theme houses work with freemium and subscription models, again they’ve been very successful.
Write a great book
Most successful blogs and websites are run by good writers and journalists. This can also include web developers, programmers, search engine optimization, marketing specialists who’ve become good writers. Many highly ranked websites are run by people with years of experience in their chosen field. Sometimes a single post is not big enough to convey all the information you have to offer.
However, a book is a great channel for the delivery of a wellspring of useful information to your readers. After you’ve exhibited considerable domain/niche expertise and your site receives some traffic, a book can be a great idea.
eBooks are a useful idea, even if you decide not to monetize them. But, the better thing to do would be to provide limited access and full access for a small fee.
Useful information is hard to come by and a book preferably was born out of personal experience sells well. Generally, ebooks provide some form of self – improvement information (How To Get Ask A Woman Out?, Grow Your Blog By 300% With These 3 Steps) at least many of them do.
- Tip #19: These books offer actionable insight for real people to help themselves personally or professionally.
If you feel providing limited access will perhaps create a disgruntled readership, then divide the book into multipart series and offer one of them for free. As I mentioned before the freemium model is the best way to go when it comes to paid content.
- Tip #20: Apart from all the monetization incentives, books also help develop and solidify your brand. Make sure you get just right, it can be a very powerful marketing tool and enable you to reach a greater audience.
Writing useful content for your users is great but webinars are a powerful tool. It doesn’t just rely on a sense of vision. Webinars can help set your site apart from your competitors. You shouldn’t underestimate how useful it can be for your business.
Webinars are way better than just plain text when it comes to educating and informing people. Connecting with people is difficult, reading content and watching webinars are worlds apart.
Host one or two free webinars and teach people something. You can then teach people something and you can proceed to sell them the remaining webinars in the series. You can use a service like GoToWebinar.
- Tip #21: Try making YouTube videos for practice, perfect your delivery and get it just right for your webinar series.
The same can be said for podcasting as well.
Building a strong mailing list is always a useful asset to any blog as it helps build your readership. You do not have to rely entirely on social media shares and search engine rankings. People will keep visiting your site long after their first visit if they sign up for weekly or monthly newsletters. Most sites with loyal readership have fat email lists.
You can employ email marketing to sell products as an affiliate or you can sell your own products. Either way, email marketing is a powerful tool that will build sustainable revenue and traffic for your site.
- Tip #22: An email list is probably a group of people with very similar characteristics and demographic features which is why they’ve subscribed to your site’s blog. You can certainly expect a better conversion when selling products via emails.
- Tip #23: Using pop-ups effectively will increase your subscriber count dramatically in just one or two months.
How to send professional-looking emails? You can find out here.
How Colorlib Makes Money?
We get this question a lot and there is no simple answer to this because we combine many things together and here are the main ones in no particular order:
- Selling our own themes, templates, plugin mockups and other downloadable products.
- Affiliate income from theme, plugin, hosting mockup sales.
- Selling banner places
- Paid product reviews
We try to monetize our website using various different methods but we try to keep ads and other promotional content to a minimum to keep our users happy.
I hope this answers your question about how do websites make money. I’ve described in my opinion some of the best revenue-generating solutions for websites and blogs. I can not, however, make a prediction of how well each advertising method is going to work. Only you can be the judge of that. And the only way you can do that is to try things out!
But before you start advertising, always remember to ask yourself “Am I really providing something valuable for my reader ?, Is there something new under the sun in my content ? “. People will trust you and purchase the products you throw at them if the answer to the previous two questions is a resounding “Yes!”.
When it comes to selling your own products and premium content, always remember to go above and beyond the expectations of the reader. I’d recommend the freemium model for all your premium content. In a freemium model, you offer a significant chunk of your content for free. But, you just need enough content to entice someone to purchase it. But if it is a digital product like for example a plugin or any other product that requires continued assistance, support and updates, then a subscription model is a better choice.
And as for advertising on behalf of others, via any of the multiple previously discussed methods. Always ask yourself “Would I buy this service/product that I am recommending if I have the same requirements as my readers?”. It’s far easier to convince someone else to purchase something if you are convinced about the quality of the product you are recommending.
Don’t get stuck on any one method of revenue generation. Be sure to try out each of them for a three month period or so. Nevermore than three or four at a time and make sure you give each monetization technique a fair chance, give each its own space.
If you insert all affiliate advertising in the form of in-content links, you can not possibly compare it to a banner that is always on display on every page of your site. Place all monetization techniques on the almost equal footing and give them a fair trial. It may take a while, but it’ll be well worth the effort!
No matter how many statistics you read about advertising, no one can really predict the outcome of your website. You need to try things out and perfect your ideal hybrid of revenue-generating techniques.
I hope you found the post useful 🙂 Subscribe to Colorlib for more of the same!