I think “passive income” and “autopilot internet business” are 2 of the most frequently abused terms in the brick-and-mortar as well as the online business world.
If you’re thinking that you can set up a business and have it running completely by itself, which continues to generate consistent and regular income month-on-month and continues to do that without you having anything to do with it, I would be pretty keen to take a look.
It IS possible to do it once you have systems in place, but given the highly competitive nature of niches in the online marketing world, you will need to put in some effort to maintain your business performance.
If you are interested in building a long-term, sustainable business continue reading on.
So you hear about some Internet guru telling you that if you create 1,000 websites and they make $1 a day, and if you make $1,000 a day, that’s $30,000 a month, right?
While you can theoretically do that with made-for-adsense sites, or automated scraper sites, or even 20,000 page content sites, relying on random search engine traffic, I’m not sure it always works well in practise.
I do know a couple of guys who’re doing this, and they’re pretty skilled (having racked up more than 10 years of experience in doing this).
But then it can be a struggle sometimes, because even if you are indexed, sites might be manually reviewed by staff at Google or Yahoo! or MSN, and de-indexed, or relegated to search engine result page oblivion (maybe page 50 or so…).
Here is what I do to build my online income.
- Due diligence: Evaluate an offer. Find out what top earners in that niche are doing. Determine if it will work long term (I prefer year-round niches, rather than seasonal ones which might be based on the summer, or the current season of American Idol). See if it’s something that make sense.
- Focus: I’ll focus and test that one offer – whether it’s through natural search traffic or paid traffic. I’ll promote only that offer and see if it generates results for me. (no offer will perform exactly the same way for 2 affiliates).
- Scale: If the offer looks like a viable one, I’ll set a profit target (profit = revenue – expenses. You need to budget in your expenses, not your gross commission to have an accurate picture of your business). From there, I’ll scale it to either $5,000 a month, $10,000, $20,000 or some other number. The projection depends on the specific niche and how viable I believe I can grow it to.
- Automate/Outsource: This is the major step that many marketers do not focus enough on. Here’s where your ability to scale your business comes in. Assuming you are bringing in about $5,000 in net profits from one niche – I will look at outsourcing the continued operation of this niche site, as well as the marketing efforts – whether it’s paid traffic, link building efforts, social marketing, etc. This might cost anywhere from $1,000 a month to $2,500 a month. (again, depending on the niche). So once the website has been outsourced, my net profit drops to $2,500 to $4,000 (assuming it’s a $5,000 a month site).
Am I giving up too much of my profits by outsourcing or automating my business?
Not really, because although I am giving up a portion of my profits, I am “buying” time. The moment I train and hand over the operations to a team, I am free to work on another project and build that up, scale it, and pass it on.
If you haven’t got it yet, the business is “automatic” because it runs without you. This is very different from the misinformation that some create that a website can sit there on the internet, without anyone maintaining or operating it, and it mysteriously churns out huge stacks of cash.
Networking is one of the most vital assets, probably more so than technical knowledge if you’re to succeed in this field.
If you are able to find good partners who can manage your businesses for a portion of the revenue or profit (if they’ve special skills) or if you can pay them a flat fee. (if it’s a lower value task), you can continue to scale your business and as they say, build “multiple streams of income”.