How I Make Money Blogging

I have shared a lot of my financial details on this site including my investment strategies, my growing net worth and even a secret business I want to open up, but I have never discussed how this blog operates as a business.  Until today.  I have no real interest in running the type of blog that really “teaches” how to blog I wouldn’t find it interesting enough to keep it up; The Financial Blogger does a 1000x better job than I ever could (he also makes a lot more than I do and clears a good amount more).

First and foremost, I tell 3 things to every new blogger who emails me:

  • YOU HAVE TO BE PASSIONATE ABOUT WHAT YOU ARE WRITING ABOUT
  • YOU ARE LIKELY NOT TO MAKE ANY MONEY FOR A VERY LONG TIME SO SEE RULE #1
  • AT FIRST YOU WILL HAVE TO CONNECT WITH OTHER BLOGGERS TO GET ANY TYPE OF TRACTION

I had to learn those rules the very hard way 4 years ago but it has been AWESOME and something I don’t see myself giving up for a long time!

The Ways to Make Money Using Your Blog

This is just going to be an introductory post but will be happy to answer specific questions in the comment sections.  Some definitions/Acronyms first:

  • CPC – Cost per click.  Means every time a reader clicks an ad the blogger gets paid
  • CPA – Cost per action.  Means every time a reader clicks an ad and then acts on the new page opened up the blogger gets paid
  • CPM – Cost per Thousand Views. Means every time the page is loaded the blogger gets paid.

Contextual Advertising

Contextual ads try to figure out what’s on your page and then put up a relevant advert.  Google Adsense is a fantastic example.  Bloggers simply have to drop the code on their site and boom google does the magic.  It pays out either in CPC or rarely in a CPM format.  I haven’t encountered an CPA type contextual ad but if anyone knows of one I’d love to know about it.

Affiliate Advertising

Affiliate advertising is when a blogger links to a particular service or product.  For example if you hover over this affiliate link for FOREX Trading you’ll notice that my website is in the code that lets the offering company keep track of who sent that particular reader/customer so the blogger’s account can be credited. Generally, these are CPAs but I have started to encounter more and more CPC affiliate relationships.  Most CPMs would probably fit here too since you are being paid to place a very specific service or product on a particular page or post.

In addition to working with specific companies one can work with an affiliate manager. I use a couple but these companies usually have a relationship with hundreds if not thousands of advertisers.  So instead of having to deal with hundreds of 1099s you can deal with just one from a company that has already negotiated the deal with the company you’d like to link to.

I am very hesitant to enter into single company affiliate CPA relationships for two reasons. I don’t want tons of 1099s and I think the temptation for the company to erase my sales are just too great.

I AM TERRIBLE AT MONETIZING WITH AFFILIATE ADVERTISING.  I have tried to hire people in the past to help me, but it has never worked out.

Private Advertising

Generally this is a flat fee for a spot on the home page or a link in a post.  The link could be text in nature or it could be a banner ad.  Text links are a no-no for Google, but google is not the government so it is not illegal but you are playing with fire.  Google is very good at what it does and if you take that low hanging fruit it is very likely that you’ll be caught and then you’ll lose your search engine traffic and ranking leading to you basically starting over in terms of monetization.

Selling Your Own Wares

Most people think that if they put an ebook on their site they’ll make a passive income and be able to retire. Hell, most people think if they put their words on the internets they’ll be able to retire in Hawaii.  Neither is true.

That being said, many bloggers (not me) have created their own content in one of two ways.  The first is a premium relationship package (I Will Teach You to Be Rich is KING of this) and the other is in the form of an e-book.  Personally, I think most ebooks are terrible but there a few gems out there (I will be reviewing one next week for my buddy Matt at Dividend Monk which is fantastic and long).

 

If You are a blogger which monetization methods am I missing? If you are a reader did you learn anything about how a blog works?

28 Responses to How I Make Money Blogging

  1. I learned a ton from this post. I’ve not been diligent about monetizing my blog. I’m interested in growing my readership now and have decided to focus on this later. However, we do have ads, and I’m always a little hazy about how different types work. Thanks!

  2. I see in google adsense how money is made and I agree that page views bring in REALLY low amounts of money. It’s the clicks that are important, which is why you need search engine traffic! Fellow bloggers are unlikely to click on your ads!

    • “which is why you need search engine traffic! Fellow bloggers are unlikely to click on your ads!”

      One of the hardest things to explain to new PF bloggers

  3. Totally agree, the first few years of blogging I really didn’t make any money either. My earnings tooks off quickly once I tweaked my adsense ads (displaying them a little bit differently). Unfortunately, my earnings have come down off the peak and now I am in the process of building back my readership and hopefully the revenue will come up again too! Nothing beats getting a thank you email from a reader telling me that something they read on my site has helped them out!

  4. Thanks for sharing. I always appreciate people discussing this topic, since it is one that I am very interested in. At this point in time I am just trying to build up my traffic before worrying about monetization. I do have Google AdSense ads on my site but I don’t expect too much from them. Hoping to partner with some companies in the future. I think the real money is in private ad deals…but I have no way of proving this :P

    • “At this point in time I am just trying to build up my traffic before worrying about monetization.”

      A FANTASTIC strategy that will pay off in dividends later on

    • Interesting theory that may be pretty close to the answer. Most e-books don’t answer anything that isn’t found on the blog already! There are exceptions obviously but for the most part they are so regurgitated it is annoying

  5. I’m starting to make a little money with affiliate marketing. Unfortunately, you have to push a product once in a while. Write a relevant post and endorse the product that you like. I found that randomly placing links doesn’t really work.
    Do you have any luck with CPM? I haven’t tried this yet.

    • I have not really tried any CPM products mainly because I don’t have anywhere enough pageviews to make it worth it. Seems like that is a 50K+/month avenue

    • You know what, I don’t think it is all that lucrative in the PF world. Ask a few bloggers who have tried recently! Eventually it will become more popular again but right now one could buy a great PF blog for dirt cheap

  6. Nice breakdown! I dabble a little with advertising, but nothing to write home about. Your warning about not making money for a long time and being passionate is gold. Reader beware!

  7. I’m glad to read your thoughts on ebooks. Most people rush to get it “published” and it adds no value. Building up my # of subscribers is paramount for me.

  8. I’ve found all these strategies to be exceptionally unrewarding. FaM remains monetized only because it generates a small but steady income — I figure a few hundred bucks is better than nothing.

    Every now and again, though, I consider removing AdSense and demonetizing the site altogether. It seems kind pointless. I don’t write to get rich. I don’t write to be popular. I write to write.

    Where Google is concerned, the monolithic arrogance is disturbing; who is Google to tell me that I have to spend unimaginable numbers of hours climbing around in my site’s code to enter no-follow tags in any link to any site that might remotely be considered “commercial”? This outfit does not own the Internet, and it should be legally enjoined from trashing individual sites that commit no crime and offend no one. Google hasn’t swatted me yet, but I’m sure it will eventually, because the nature of my content is such that it does contain a lot of links to businesses. That’s what PF content does.

    I am interested in doing ebooks, though. Just haven’t been able to find the time to compile the things!

    • I bet your ebook would be the exception! A book explaining the finer points of self editing is one I desperately need.

      I know you don’t write to get rich but the income can be such that it is seductive and hard to stop lol

  9. Before my break from blogging and with the help from Crystal at Budgeting in the Fun Stuff, my blog was earning a few dollars here and there. Now I am blogging about what is important to me (staying on track financially) and other things that pop up.

  10. A good overview here! I’ve only used text links in posts to date. This is where a niche really helps, I think. However, I really hate terribly written sponsored posts that I see on other blogs. I think it’s a bad look, running crappy content – it cheapes and reflects poorly on the blogger, and it looks like they only care about making a buck.

  11. You are so generous to share your secrets. Thank you for putting light on some of my questions. Hopefully this makes a powerful instrument for my pursued career online. Thank you so much and more power to your career and your followers.

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