Have you ever thought about building a business online, but you did not know what product or service you wanted to sell. Well, one option that is open to you is to promote products for someone else. In this type of online enterprise the object is to drive traffic to somewhere else or attract traffic to your web site that will in turn sell products that exist elsewhere.
In order to understand this a little more clearly, let’s look at the different types of online revenue generation that exist.
Online Advertising
In the simplest type of model, you can generate online revenue by displaying advertisements from other companies. The original model for businesses advertising online was to display banner ads. Banner ads were purchased in units of 1,000 page views known as CPMs (cents per thousand). This was fine in the early days of the Internet, but over time many online viewers have come to ignore those winking and blinking banners. Banners in many respects have become just an online nuisance.
As a counter to the lack of conversions from banner advertising, a small company called Looksmart institued a pay-per-click (PPC) model where sellers bid for search engine placement based on the amount that they would pay "per click". It was a known fact that the higher a link existed in the link, the more likely a visitor would be to "click" on the link. Therefore, to get a more favorable (i.e. higher) listing, the more the advertizer would pay for the placement.
It was around this time when a new type of search engine appeared on the Internet. Their model was built for speed and was set up to counter the disrespect of the online banner advertisement, and Google developed the innocuous text links that are ever prevalent on their search engine. They brought pay per click advertising to a new level and brought about the whole concept of niche marketing and advertising. When a search engine gives the person searching what they are looking for, the advertiser can optimize his conversions by buying traffic where his prospective customers are looking. It’s a win-win for everyone involved as products, services, and customers are gathering in the same place.
Affiliate Marketing
Another way to generate revenue from an online business is through affiliate marketing. In this type of business, the object is to drive traffic to another site which is selling a product or service. The affiliate marketer is paid when a sale is made. This is known as payment on a cost per acquisition (CPA) basis. This is the most prevalent model operating on the Internet today. This is good for both the affiliate and the ultimate seller as the seller only pays the affiliate on the products which are sold which eliminates a sales force and basically pays for sales on a commission basis. The affiliate, on the other hand, can generate revenue from numerous places with ever having to worry about buying products, product inventory, or fulfillment.
What Others Are Saying
More than Google’s results, Yahoo’s may be indicative of the broader trend in fef online advertising, since Yahoo is a leader in the display ads that most Web sites depend on for revenue. Overall online ad revenue is expected to fall 2.9% […].
For a publisher, Bizo creates new revenue opportunities and more efficient monetization of online audiences. — For business audiences, Bizo decreases the volume of irrelevant advertising across the web. […]
Online advertising revenue in the United States dropped 5.3 percent to $10.9 billion in the first half of this year, according to the Interactive Advertising Bureau. Display advertising declined 1.1 percent. […]