I would venture to say that one of the leading reasons people start blogging, is the perceived potential to make money. In my first year of blogging, I have learned more about monetizing a Web site than I can possibly fit into a single post, so I will just hit the highlights for you!

Before I entered the world of blogging, none of the websites I designed for clients or myself had been monetized in any way (and none of them were blogs). I was aware of direct advertising as a means of getting a return on your investment, but I really hadn’t clued in to much else. One of my clients had started including affiliate links in her web updates and then she wanted some Adsense blocks added. I had never done any of this before so I had her tell me what she knew and I set about doing my own research to get more information.

The big names in the internet marketing world lead you to believe that all you have to do to start making money from your web site is to slap a few Adsense ads up there, buy their book or e-book, sign up for their affiliate program and “poof” - you will be an Internet Marketing Millionaire overnight. Guess what? That’s not quite how it works.

In my experience, monetizing your web site takes:

• Research
• Trial and error
• Traffic
• and Patience

Every web site is different and there are many different ways you can monetize a site. Certain methods work better than others based on your content, your audience, your traffic level, and your end goals.

Adsense and other contextual ad programs

Where it works: Niche sites tailored to a specific audience. Health, celebrity, consumer product, and extremely specialized niches work best. The less “tech-savvy” the audience, the better the click through rate is going to be (in my experience). Also, the higher your traffic rate, obviously the better you are going to do.

How to maximize your earnings: Use a mix of link ad and ad blocks and blend them into your design as much as possible. Try out a variety of placements using channels. If using on a general topic blog, place on single pages only for more relevant ads.

Affiliate Programs

Where it works: There are affiliate programs for just about everything from specific products to e-courses and absolutely everything in between. Affiliate links work best when presented as recommendations or reviews. Landing pages or pre-sale techniques really help. Affiliate links, if done right, work well even with a the traditional non-clicking audience.

How to maximize your earnings: Do your research. Find affiliate programs for products your audience already uses or would use - especially with a good recommendation from you. Use a pre-sale technique such as a well written landing page for better conversion rates.

Direct Ad Sales

Where it works: Selling text link ads or banner ads have the highest pay potential once your site gets fairly mature and starts getting consistent traffic flows. Having a defined niche/audience helps dramatically. Also, strong content and good SEO techniques make your site more attractive to potential advertisers.

How to maximize your earnings: Have a page about advertising on your site, or at a minimum, have solid statistics on your traffic, click through rates, and your demographics on hand. Be willing to share this information with potential advertisers. You can use brokerage services as well, but keep in mind that they will take a cut of your earnings. However, this may be the easiest way to break into the direct ad arena.

Paid Blogging

Where it works: You can do paid posting through a brokerage service or you can get paid to write regularly for a network. Most of the time the brokerages that offer pay per post (or review) opportunities require your site meet some basic requirements, but beyond that, you can choose which paid opportunities you wish to write on. Writing for a network requires application for the position, but can be a great way to earn money from blogging - especially when you consider what your current blog makes.

How to maximize your earnings: Look for pay per post opportunities that you enjoy, offer some value to your readers, and ones that pay fairly well. When getting paid to blog for a network (or similar), look for a network with a solid reputation, fair pay and bonus opportunities for increasing site traffic.

The Final Word

There are plenty of people making a really good living using a combination of web monetization methods, however I doubt any of them got there overnight and without making plenty of mistakes along the way. And for the record, I didn’t make very much money my first month of monetizing my sites - or my second - or my third. Around the 4th month, things started picking up. After a year of monetizing my sites, I have gotten to the point where I can consider MYSELF as a client - allowing me to stop doing some of the client work I no longer enjoy. I know there is still ALOT more I have to learn about making money on the Internet, but we’ll revisit my progress in another 6 months.

I would LOVE to get your insights on web site monetization. What has worked for you? Am I painting a realistic or accurate picture or have I had a totally different experience than yours?

I had an opportunity to attend a webinar yesterday with some of the PR group I do a lot of work with. The webinar was hosted by PRNews and titled Building Community & Reputation Online With Social Media Tools.

Sam Decker of Bazaarvoice was one of the presenters and he talked about using User Generated Content, such as user reviews to generate more sales at your site. As a matter of fact, a recent Sherpa study found that 58% of online shoppers prefer sites with reviews.

Who do you trust more when getting information on a potential purchase - a sales rep or marketer? Or do you trust someone else like you, who has already purchased the product you are looking at?

I think that there are two main reasons why word of mouth or user reviews are so powerful.

It’s all about the money

For one, we perceive that it is less likely that the reviewer has a monetary stake in the sale of the product, therefore they are really telling the truth as to how good the product is or is not. The sales rep or marketer will most definitely receive some form of monetary gain from the sale of the product.

It’s all about the experience

Secondly, who is going to be able to better tell us the benefits of a product, how it is used, what works great, and what the product’s downfalls are? The user who purchased, used and reviewed the product. After all, word of mouth advertising has been around for a long time has always been perceived as more “authentic”.

The sales pitch could tell us the product benefits, but we are naturally going to be more drawn to the product if other users can sing its praises or warn us of a sub-standard product.

What about paid reviews?

Does the fact that a reviewer was compensated in some way diminish the value of the review? I think it all depends on the source. If the reviewer does a nice job of giving us the products pros and cons and let’s the reader know that it is a paid review, then no, it doesn’t diminish the value of the review (in my opinion).

What does this mean for your business?

Let your customers do some of your sales work for you! Give them a platform to speak their minds whether through user reviews or comments. Then take that information and implement it in a meaningful way at your site by featuring top rated products or in the case of a blog, use the popularity plug in to help you feature your most popular posts.

The webinar was very interesting and over the next few days I will share more of the insights and statistics I found helpful.

Join the conversation! What do you think of user generated content for generating sales? What are some examples of sites that really implement this strategy well?

The Amazon affiliate program continues to grow. The latest is the beta release of their Context Ads program. The context links ads are automatically served based on your site’s content. The links show up within your content and then you can customize what the window looks like when someone mouses over your link.

It looks something like this when you mouse over a link:

If you have a site that is consumer oriented, especially one with product reviews, this may be worth giving a try.

The program is very easy to set up - you just paste a small script within your site’s code, and you only have to do it once. Amazon serves the links automatically based on the phrases and key words in your content. You can also choose the categories from which the products are served.

I think I may try it on one of my sites that gets decent traffic but not a lot of Adsense clicks and see how the two programs compare.

Has anyone else tried this out yet? What do you think of Amazon’s latest tool for monetizing your site? Is it a threat to Google Adsense or will it just make the market more competitive?

UPDATE - I had originally posted that you can’t run these two programs together, however, according to Jensense and ProBlogger.net, Adsense has changed the rules on this. Since they are displayed differently, they are okay.