Passive-Income WebSites: Real or Fake?

Searching for Secrets

Passive-Income WebSites: Real or Fake?

This article is the first in this Series. Links to all published articles in this Series will be posted here and at the end of each article. This article is designed for Beginners.

It’s the same old pipe-dream…

revisited and tweaked for 21st-century readers:

Make money while you sleep!
How to Get Rich on the Internet!
Work From Home…Quit Your Day Job!

Consider this:

  • If you Google “money making web sites” you’ll see no less than 723 million results!
  • A search for “passive-income web sites” turns up another 4.2 million results!

Just the Facts…”

This article isn’t about the hype and hard-sell, get-rich-quick schemes (where no one but the seller of the “program” gets rich). This article describes a legitimate website model — what I’ll refer to as the Passive-Income (or P-I) model. We’ll begin with the basics:

  • What it is
  • How it works
  • Why it works

I’ll also discuss what’s even more important:

What (& how much) it takes to make it work:

  • time
  • technical skills
  • knowledge
  • research
  • other skills
  • costs

 The Passive-Income Model (aka “money-making web site“)

Background

Let’s be clear: this model is NOT my invention! I have no claims on its framework or structure or what makes it work. Many other internet- and marketing-savvy folks came up with their own versions of this “model” before it was a model. I suspect it evolved from “trial-and-error” in the early days of the World Wide Web. I specifically remember a couple of true techies who created free “blogs” — way back in the early days of the World Wide Web, around the late ’90s —  writing articles & tutorials, and posting answers to technical questions — about the internet, but also about computers in general. You know, the kind of everyday questions that come up over and over…

  • How do I do this in Word?
  • Why does Windows do that?
  • How do I set up my email in Outlook?
  • Can I get my PC and my partner’s MAC to talk to each other?
  • How do I upgrade my hard drive?
  • How do I add more memory to my computer?

These guys (yes…they were both men) had some incredible foresight to realize the potential of the internet to get their information out to a huge audience…but I doubt they had any commercial interests in mind…

Thing is, these early “tech blogs” became so heavily trafficked that soon the techie owners were being interviewed on radio and TV, and were the subjects of wide-spread press coverage in newspapers and magazines. More importantly, they were being contacted by companies who wanted to advertise on their sites, wanting to know “How much would you charge for an ad?” Nice “problem” to have, huh? 😉

Word spread from all the media coverage of these early “pioneers” and soon others were copying (or attempting to copy) this so-called new “model” of business. Advertising mentality changed and companies began offering “affiliate” programs, where the web site owner earned a small fee if a web visitor clicked on an affiliate ad on a page of the blog. Not to bog you down with history, but it is important to understand how the P-I model emerged, which also explains WHY it works.

Fast forward to the present

This model goes by different names, the two I mentioned above and a few other variations. You can search for others for yourself.

The P-I Basics

Specialized (focused) information is at the heart of this model. The range of this information is almost infinite! It could cover careers, education, personal development, hobbies, lifestyle, travel, personal finance, investing, alternative health, etc.

HOW it Works!

As I mentioned above, advertising is an integral part of this model, but in a way that might be new to you. The general idea — culled from those early high-traffic tech blogs — is this:

  • You have a web site dedicated to a very specialized topic
  • You populate that site with high-quality content that “fans” of this topic need and want to know
  • You generate traffic to your site through “search,” with your FREE content
  • You include advertising (of many sorts) strategically-placed throughout your site
  • When site visitors see an ad that interests them, they click on it. If they end up buying, you are paid money by the advertiser
WHY it Works!

The reason this model works hinges on your targeted topic attracting site visitors who are interested in that specific topic. Consider the following scenario:

Let’s say you are considering buying a tablet computer. There are many on the market, and you know that each brand is going to tout all the features of their model, and you won’t get an unbiased comparison. So, you might search for a number of web sites that offer tech reporters’ reviews. You hope these reviews will all be unbiased, but you know that if you go to several websites for those opinions, you’ll have a better idea of the consensus of opinion. And…you’ll be better equipped to draw your own conclusions.

To take this scenario further, suppose you are not really sure about buying a tablet. Maybe it’s for your kid or spouse, and you want to know if it’s a frivolous or practical purchase. If you find articles (in your search for reviews) that address your “pre-purchase questions” you’re more likely to check out that information as well.  In fact, if you are in the pre-purchase phase, you are probably more inclined to favor those informational articles than professional reviews at this point. Later, if you decide to purchase, then the reviews become more important.

I’m sure you can see where this is going… The informational articles I mentioned above become the heart of any successful P-I model web site. Reviews may also play a part of course. The whole point is to address the concerns of visitors interested in your topic, whatever it is.

If you have solid, useful information to attract and hold readers on your web site, and you include ads that are precisely targeted to their specific interest, they will be more likely to “click” on the ads… It’s really a “win-win-win” for all involved: your site visitor, your advertisers, and you!

First, why the “Specialized” part is so important.

What this really means is “finely focused.” Think of this as the complete opposite of a generalist approach…For example, there are tons of broad-in-scope web sites out there…

Say your interest is in gardening. The “big box” stores (Home Depot, Lowe’s, Wal-Mart) all have “departments” and one of these is “gardening.” No single individual (or even small business) can compete — on any scale or in any way — with these huge corporations. They have huge budgets and huge staffs. The only way you can compete is to research gardening and find an under-served or unserved niche area…say “gardening in the Desert Southwest.” You could talk about drought-tolerant species, water conservation techniques, etc. This is a specialist or highly focused approach.

Next, it’s important to really understand the “passive” part of the “Passive-Income Model“…

I have seen marketing hype that “sells” this model based on the “passive” part, intimating that it’s NO WORK.

This is completely false!

The “passive” part has to do with this type of web site “working” for you — once you get it built, and all the work that entails behind you — without active intervention on your part, such as filling orders or shipping products.

These are the facts:

Establishing this model is anything but passive

  • It requires many hours of preliminary research
  • It requires many hours of planning
  • It requires many hours of building

Let’s take a closer look at these three phases.

Phase 1 — Preliminary Research: The “Golden Ratio”

I indicated above that you need to have an area of specialty. However, that alone will not assure your success. What you need is the proper combination of popular interest (“demand”) and an “available” subject area.

By available, I am referring to what I briefly mentioned above: an unserved or under-served small, very specialized sub-topic. This is because you don’t want to have to compete with those corporate giants! You’re looking for low competition.

As a counterpoint to this, to create that “proper combination”  or “golden ratio” I mentioned above, you want to have relatively high demand in your topic.

You can see that the very first step is to do your research to determine which topics fall into this metric (high demand & low competition).

If you are successful in this initial step, you can move on to Step 2 of preliminary research. That has to do with “monetization.” This is simply whether your narrow topic area lends itself easily to ways of making money.

For example, are there lots of ways to monetize…or relatively few? Obviously, the more ways the better. A few examples here will help to make this clearer.

Examples of monetizing:

  • Are there lots of books and / or magazines on the topic?
  • Are there lots of products related to the topic?
  • Are “fans” of the topic eager to spend money to get the latest innovation or improvement? For example, “techies” wanting the latest cutting-edge technology; photographers wanting the latest in camera equipment; weekend athletes wanting the latest innovation to help them improve their game…

You can see the need for substantial (time-consuming, but simple) research into ways of “cashing in” on your topic area. If your specialty topic “passes” these preliminary research questions, you can move on to Phase 2: Planning.

Phase 2: Planning

This phase includes some high-level aspects (getting a grasp of the big picture) as well as considering some finer details. As you will soon see, this phase is all about Planning! For example, in this phase you need to consider:

Other considerations:

  • Does your topic inspire you? It better, because you will be writing about it for as long as your site exists!
  • It does require some degree of technical affinity — no coding or programming, but most people who “get stuck” are not “computer-fluent” or they are unwilling to put in the (relatively short) learning time to become fluent. Now, this aspect alone shouldn’t hold you back if you have a great idea. You can always outsource the technical aspects of the site, while you are getting “up-to-speed” on the technical knowledge necessary to DIY it yourself.
  • The model relies on building a “fan-base” of loyal visitors who trust you

Some Final Thoughts

This model is anything but “quick money” (I can’t stress this strongly enough!)

  • This model relies on building a reputation and building traffic — both time-consuming activities. You have very little control over getting your site “indexed” by the search engines (regardless of what SEO companies will tell you)
  • Affilate & ad programs pay very little, per click , so you need to have substantial web site traffic to realize substantial income
  • Social Media can & should be used to aid in dialog with your loyal fans, and to create a viral environment where they promote you to their networks
  • The basis of this model is writing high-quality original content: it is writing-intensive, even if you are including videos (someone has to write the video script)
  • Quality content of any kind takes time to develop

Now…Some Caveats!

Remember those gazillion search results I mentioned at the very beginning of this article???

Be forewarned! Nearly ALL of these search results are NOT about the legitimate model described here. Most are for “get-rich-quick” schemes, “work-at-home” programs, or courses and books selling you information on how to “make money with your computer” or something similar. The only people making money on the majority of these products/services are the program’s author or reseller!

To illustrate just how absurd and inane some of these “get-rich-quick” schemes are, consider this: One of the search results for my first search query above (money making web sites) is a listing on eBay offering…

Money Making Web sites for sale for $29.95!" – e-Bay

C’mon! I mean…Really??? Who would sell a web site that was bringing in any kind of revenue for $30? The sad thing is, I’ll bet they’ve actually had some takers! <rolling my eyes & shaking my head in disdain>

So…Is it Really Worth the Work?

  • If you construct it properly, this site model will reward you with a steady, hopefully-increasing income stream, while you vacation, sleep, travel, care for elderly family members, etc.
  • Why I favor this model:
    • you don’t have to sell anything to bring in revenue (great for people who are not “sales-oriented” by nature)
    • it does work, if you put in the requisite planning, research and foundation work as described above
    • it’s great for people with hobbies / small niches traditionally under-served by “mainstream” marketing
    • the model permits you to turn a (properly-selected) passion / hobby into a revenue-producing business (if it’s your passion, it’s less likely to feel like work!)
  • Is this model right for you?
    • It depends
      • On your goals
      • On your interests
      • On your time commitments
      • On your dedication
    • Only YOU can answer that question!

Questions? What additional questions do you have on this model? Do you have any experience with this type of web site? If so, what are your biggest challenges? Share them in Feedback below!

Remember: This article is #1 in a Series of articles on the “Passive-Income” model! In future installments in this Series, I will explain in more detail “best practices” for how to create your own “Passive-Income” web site. Links to new articles in this Series will be posted here!

About the Author

Karen McCamyKaren is a WordPress Trainer & Coach. She currently teaches WP101 in Los Angeles, and a Girl-Develop-It class where you build your own website from the ground up!View all posts by Karen McCamy →

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