It may seem strange that although your primary reason for operating an online business is to make money, this is the last part of the equation. The simple answer to this is that the money you make from your business is simply the reward you are paid for providing value to someone. It stands to reason then that first you must create value and second you must provide that value to someone. That’s why your product and your customers must come first.
There are several different ways you might choose to monetize your business.
If you have decided to work as an affiliate and market someone else’s product rather than creating your own you will have to sign up as an affiliate with a service provider like Clickbank or Commission Junction (or one of hundreds of other services) or with the vendor themselves. The service provider or vendor will then keep track of the sales you refer and work out the commissions you are owed and usually they will pay you periodically when your sales reach a certain minimum threshold. You may be paid either via check or some kind of electronic transfer. This will all be explained in the terms and conditions you will have to agree to in order to sign on to the program.
If you are going to sell a physical or digital product on your own you will need to set up a payment processor to allow your customers to pay you via credit card or electronic transfer. Credit cards are by far the most popular way people like to pay for things they purchase on the internet, however they are also the reason people are hesitant to spend money online.
Credit card fraud is huge business.
To make sure your potential customers aren’t spooked when they get to the point of paying for your product you MUST find a reputable payment processor provider and make it clear to your customers they can trust this processor explicitly.
Many third party seller platforms like eBay or Amazon have a great measure of trust built into their payment processing systems. eBay for examples encourages the use of PayPal as a payment processor because of the inbuilt systems and protection measure PayPal uses to collect money, including via bank transfer and credit cards. PayPal is also an easy to use method to collect money from customers on sites other than eBay and they make it easy to create those ‘Buy Now’ buttons you see at the bottom of a lot of sites. Their logo and website are highly recognizable because of eBay. They also allow you to use their service to create shopping carts, collect donations and initiate recurring payments. This is a method I highly recommend you use when you are first getting started to get the hang of it before trialing other methods.
Primarily I imagine most of you are considering an online business selling digital products. You might want to write an ebook or create a video and then offer it for sale. You’ll have a sales page and at the bottom of that page there will be a ‘buy now’ button that links to your payment processor.
You must also make sure you understand how to make sure your customer receives their digital product instantly. There are a number of ways to do this and I’m not going to go into detail here, but in essence you either provide a download link on a ‘thank you’ page, send an attachment of download link in an email, or use a digital products service provider to do all of the above on your behalf.
The systems above provide a way for you to monetize your product once for each product sold. That is, your customer pays an amount and they get a product.
With this in mind to enable you to make a target amount of profit you will have to divide the amount by the price for each product to determine how many customers you need (and also factor in returns, particularly if you offer a money back guarantee).
There is another great way to monetize your online business that can boost the amount you need to earn from each customer you sell. This is by creating a subscription based business either in the form of a paid subscription to a newsletter or some kind of membership site. With this strategy you charge a fee on a monthly basis to subscribers and members. They sign up once and if you’re lucky they remain members for life, paying you each month for the privilege. This is sometimes referred to as a ‘continuity’ business model because your income from one customer continues to flow in again and again long after the sale is made.
The key to creating a successful and profitable online business in the heat of a highly competitive marketplace is to make sure your marketing efforts return the maximum dollar amount from each lead. Using continuity models is one way of increasing your return, but whether you use this method or stick with a one-off selling strategy there is one more strategy that you should implement to get maximum sales for your efforts.
Let me introduce you to the concept of the back-end sales system (or upselling as it is sometimes called). You know this system very well and have probably encountered it thousands of time in your life without even realizing it. It happens every time you go into a fast-food restaurant and order a burger and get asked whether you ‘want fries with that’ or a drink, or to upsize, or to purchase a toy for a dollar. It’s the first thing taught to 14 year old sales clerks on their first day at McDonalds and it’s drummed into them again and again and again.
If that’s not evidence enough that it works and that you should implement it into your business then I don’t know what to say.
Here’s how it works on the internet (in fact you’ve already seen it in action when you bought this product as I always have the system running on my sales).
You buy an ebook and fill out your credit card information then click the ‘ok’ button (or whatever it’s called). You are then taken to a page that is preliminary to giving your customer their download information.
This page is essentially another sales page that gives your customer an opportunity – a one-time-only opportunity – to purchase something complementary to your product, or an upsell to your product (eg premium membership when they’ve paid for basic already). This one-time-opportunity product is almost always more expensive than the product they already purchased. See you’ve already established this person is interested in your niche, interested in your product and that they trust you.
The upsell page has a link at the very bottom that allows them to skip ahead to their download (thank you) page, but to get to that link they have to scroll down through the offer and look for it and in the meantime they will often take a look at the ‘rare’ opportunity they are being presented with. They already have their credit card out. They’re already willing to invest in their education. A few more dollars to get premium, high end information is usually something they are willing to consider.
An alternative way to introduce your upsell (rather than inserting a page between the sales page and download page) is to use the download page itself as an upsell opportunity or offer a review and link to an affiliate marketing product here. I personally add a subscription page to my newsletters on this page and then market my other products and affiliate products to these ‘confirmed buyers’. That is, I want to capture the details of these buyers as I know they are ready and willing to spend money online.
The main thing is that in addition to your regular sales offers to unconverted leads you should also be marketing to existing customers.
One final monetization strategy.
You may find that the information you are producing (if it’s information you’re producing) is of great value and very popular, but not in the kind of way that people are going to buy it from you. Take bloggers for example. Millions of people look up their favorite blogs every day for opinions, news and other information, but they wouldn’t be willing to pay a monthly subscription for the privilege. These bloggers nevertheless make a good income from their sites from advertising revenue.
Selling advertising space is the way the great news and information providers of the past 100 years have made their fortunes. It is the backbone of newspapers, television, radio and magazines and it thrives equally voraciously on the internet.
Set up a blog, add a few lines of Google Adsense code and you could have an income in days! I know because I’ve done it on this blog!!
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