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    12 May 2013

    5 Solid Online Business Models You Can Embrace to Generate Income

    According to Business Matters magazine, 90% of all online businesses fail; in other words, if you’re starting an online business you’re 9 out of 10 times likely to fail.
    While the reason(s) for failure of every online business differs, there are often a lot of factors that can be pinpointed as the main reason why MOST online businesses fail.

    However, another very important reason why online businesses fail that is rarely discussed is their business model; in other words, most online businesses are started first before the owners realized that they don’t have a viable business model and they give up.

    Your business model is everything; yes, marketing is important but the right business model will ensure you’re generating enough revenue and profit to justify your other efforts in your online business. With that said, here are 5 online business models that you can embrace or get inspiration from; I’ll be sharing the business models first and then linking to reputable websites that use these business models so that you can check them out to see these business models in action.

    1. The Blog-based Affiliate Marketing Model

    The blog-based affiliate marketing model is listed first because it’s the easiest on this list and also because anybody can do it, with or without a marketing budget.
    This model is simple; you build a blog in a specific niche, you attract an audience and you make money by recommending affiliate products to your audience.

    In most cases, you’re not just recommending affiliate products to your audience just to make money; when your blog reaches a stage, you’ll start recommending premium/paid tools that can help your audience achieve certain results. You’ll then be able to make money by becoming an affiliate for the products you recommend.

    There are several ways to make money using this model; you can make money by featuring links to affiliate products in individual posts, on key pages on your blog, banner ads and through a massive resource page that features all the tools you recommend.

    A major blog that does this effectively is Pat Flynn’s Smart Passive Income blog. Using this model, Pat is able to make an average of $50,000 every month while only spending an average of $5,000 on various aspects of his business.

    Also, this approach is becoming more mainstream with some of the biggest blogs in the world embracing it and generating millions of dollars in annual revenue. In mainstream media, it’s referred to as “native advertising” but the model is the same thing; build a massive audience for your blog and make money when they buy affiliate products you recommend.

    2. The Full-Fledged Affiliate Marketing Model

    Unlike with the model above where you need to start a blog and build an audience to make money off affiliate products, this approach is actually solely based on recommending affiliate products. In other words, you don’t have to build an audience or a blog; you just recommend the best affiliate products in your field or help people find the best offers if they buy through you – that’s your business model; since your links are affiliate links, you make money each time someone buys.

    While there are countless examples of this online, a noteworthy example can be seen on Make a Website here – the site provides a detailed tutorial for those who want to start a blog or a website and then recommends products/services that you need to create your website. When you use any of the products, the site owner makes an affiliate commission.

    3. The “Email Only” Model

    If you’re active in the online marketing space, a phrase you’ll no doubt come across often is that the “money is in the list.”

    Basically, the idea behind this is that no matter your business model – ecommerce, blogging, services, products etc. – the best decision you can make is to build an email list.

    However, what if you can take this to the next level and make your email list your only source of revenue? In other words, you don’t need to have a blog or an affiliate site or any other kind of site. You just need to have an email list that you have good relationship with and that you can recommend quality products to and make money from.

    Just how powerful is this model? According to a recent NYTimes profile of Jon Rimmerman, Jon makes $30 million annually – yes, thirty million dollars – selling wine exclusively to his email list.
    This approach can be used by small businesses and big businesses alike and if you’re an individual or small business considering this as an option, you might want to familiarize yourself with Glen Allsopp’s Cloud Blueprint videos.

    4. The Paywall/Continuity Business Model

    Depending on your business type, another business model worth experimenting with is having a paywall for people who want to read your content; in other words, access to your content is restricted to those who are paying a certain fee.

    You could decide to put all your content behind a paywall or to make some available for free, but having a respected brand and effective marketing is critical for this approach to work.

    Exactly how powerful is this approach? Andrew Sullivan recently decided to experiment with this approach for his “Dish” blog and was able to raise just over $300,000 in 24 hours. Also, with the New York Times making around $90 million last year (2012) as a result of putting their content behind a paywall, I think this model is very powerful.

    However, if we’re being honest, not everybody will pay to read your content if you’re an internet nobody without Andrew Sullivan’s name or without the brand of the New York Times. A better way to approach this is by creating a membership site or by charging a subscription fee to access premium content on your site; in other words, you have the free content that everybody can read but they can take things to the next level by subscribing to access your premium content.

    5. Sell Your Own Products

    This post won’t be complete without this option listed.

    You’re probably an expert at something so why not create a product, based on your expertise, that helps people solve a major problem while you make money as a result?
    Create multiple products and sell them, experiment with different pricing models and product types until you find what works for you.


    Don’t let having a weak business model lead to the failure of your internet business. The above are some solid business models you can embrace today.

    Bamidele Onibalusi is a young entrepreneur, freelance writer and the founder of - a top blog for writers who want to be in control.

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    12 Responses to 5 Solid Online Business Models You Can Embrace to Generate Income

    1. Mike Turco May 12, 2013 at 1:54 pm #

      Those are some really good suggestions and thanks for sharing them.

      I once followed a line of though re. “the types of online business models” and came up with only three (at an abstract level). I wrote an article about it, too. And when I find that article I’ll post it.

      Broker: hooking up a buyer and seller. For example, ebay.

      Landlord: charges you “rent”. For example, godaddy.

      OEM/reseller: sell your products/services, or someone else’s, directly from your website.

      A lot of business mix these models. In fact, the original article suggested that when one was looking to expand their business, they should consider expanding “vertically” by taking on an additional model while continuing to sell the same stuff, as opposed to finding new things to sell. (Hope that makes sense.)

      Anyway, been following your blog for a little while. I enjoy reading it and appreciate your efforts.


    2. Anton Volney May 12, 2013 at 3:09 pm #

      This was a really great post. It leaves me with a lot to think about as far as my blog/business model goes. Thanks a lot.

    3. Mark May 12, 2013 at 8:14 pm #

      Solid advice overall. I tend to think that hybrid’s of the above generally work best. Placing all your eggs in one basket can sometimes be a little scary. You can have a blog based affiliate model, sell your own informational product, and have an email list you market to as well. I fully believe that you should be playing a few hands at one time, especially if you’re playing the affiliate game and Google changes their algorithm. Nice to have some income coming in from other sources if something crazy happens.

    4. izu May 12, 2013 at 10:41 pm #

      nice post,,i feel like am doing the right thing although am just starting out

    5. Ajay Prasad May 13, 2013 at 4:04 am #

      Thanks for sharing these useful advices. Online business can indeed be very helpful for generating money. It is perhaps one of the convenient methods of making fast money.

    6. Sunday May 13, 2013 at 4:47 am #

      Sure, these are fantastic business models we can to see online today. While some are fitting for people who are less known, others are fitting for well known persons.

      For newbie bloggers, I think the first business model would the ideal one to start with. The Blog-based Affiliate Marketing Model can be combined with The “Email Only” Model if the blogger is beginning to get popular. This approach is likely to help increase revenue for the blogger.

      However, to avoid failure in any of these models, there is need to research and focus on what what the customers want and creating products or services to satisfy those wants.

      Nevertheless, this is a helpful post with spot on examples!

    7. Olatunji Femi May 13, 2013 at 4:56 am #

      This are cool business model that can be considered for online business start up.

    8. witcherry May 13, 2013 at 8:22 pm #

      I’m actually trying my hand at blog-based affiliate marketing though I am just starting out.

    9. Raj May 14, 2013 at 6:09 am #

      Nice to know, very good article, surely helpful and informative…..

    10. Dan May 19, 2013 at 5:22 pm #

      Very informative and educational and awesome business model

    11. Dare June 9, 2013 at 2:27 am #

      great content… but just a first step… i think driving traffic is the big issue…

    12. Herbal Biz July 19, 2013 at 9:40 pm #

      I think email marketing is still a great way to promote any biz online. You can either build your own list or use safe swaps. Gone are the days of making a list of friends and family (thank God ;). You also need a sustainable business that is recession proof.

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