Here are 5 proven ways people make a lot of money online. All are hard, some have produced fewer millionaires than others. As for me, I like the final entry. Read it. Its why you won’t hear me speaking at any more conferences (in the near future) or writing any books.

1. Monetizing “free” traffic. Simple, build a website, get it indexed in the search engines, monetize it with advertising (PPC, affiliate, display/banner), pocket the profit. This is why search engine optimization is such a big deal.

2. Buying traffic and selling it for more. Harder than #1 because you can lose money. You buy visitors from any source (PPC, display/banner) and send them to a website that will earn more money per unique visitor than you paid per unique visitor.

3. Sell information to other people about how to make money online. Its garbage but this garbage has made a handful of people rich. Most of the money comes from e-mail lists and other affiliates. This is the land of long sales letters, H1 headlines, and clickbank screenshots (showing you that they know what they are doing because they just sold this garbage e-book to 1,000 othe people like you.)

4. Build a money-losing business and flip it to Google, Yahoo, or another big media technology company. This is a step up from 1, 2, and 3. Why? Because it results in very large paydays. With the expection of a select group of domain name owners, its unlikely anyone from 1, 2, or 3 will ever have over $100 million in their bank account.

5. Build a money making business. Pocket the profits and/or sell it. This typically includes selling subscription services, retail, or digital goods. This may well be one of the hardest of all. Because of all of the money flooding the internet there are price discrepencies that make it virtually impossible for a business to turn a profit.

How so? One example is Google giving away services for free. Google Analytics was once a service that cost hundreds of dollars a month. Now its free. Suddenly anyone trying to sell an advanced web site analytics service for thousands of dollars a year is in trouble. The same applies to high volume retail with razor thin margins. In both cases you simply can’t compete on price.

Making money on the internet can be very hard. When you do “crack the code” there is no guarantee that what works today will work tommorow. Markets change. Algorithms change. Buyers dissappear. If you want to become an internet millionaire don’t prepare for a vacation — prepare for survival.

4 thoughts on “5 ways people become internet millionaires

  1. In no. 1, People are millionaires by monetizing free traffic? I thought it takes more effort than that, like building communities around your content.
    And why do you like number 5 exactly? Why will this stop you from giving speeches? :? :)
    thanks

  2. Well, building communities around content is a way to get free traffic. Traffic from Google, word of mouth, that all qualifies as “free” traffic, although of course you have to do things that result in the Google rankings and people telling their friends.

    #5, these things are distractions. I’ve considered ending my blog but its become kind of compulsive.

  3. Many years ago (25?) before there was an internet I read a book called “The Corporate Steeplechase” where the author said loneliness was an occupational hazard of solo business owners. Because they were lonesome they would get tempted to spend time with callers on subjects which were outside their core competencies and otherwise unconsciously do things that used their time and/or got them involved in projects they should have avoided.

    The fact is, making money on the internet is such a hidden and unknown world the chances of having a local confidant or mentor is small. A blog has more reach :)

  4. I am so sick of those get rich quick e-books but really it is no different than those quit your job seminars in the real world. Unfortunately, people are looking for that magic pill that will transform their lives. They don’t realize that the “gold at the end of the rainbow” is most often attained by hard work. And making money online is a lifestyle, not a destination.

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