Blogs are no longer new, bloggers no more a rarity. Many of us have travelled the path of blogging, and some like Michael Arrington and Arianna Huffington have made serious money leveraging their blogs as significant media platforms. In this post, I want to give you some thoughts on making money blogging, an endeavor that has left most journalists and writers decidedly frustrated.
First, you should not expect to directly monetize your blog with CPM advertising unless there is serious traffic flowing to your site. And ‘serious’ means millions of unique visitors a month which few blogs ever get to.
Second, there are indirect monetization models that work well, and if you take my example, for many years, I used my blog to generate consulting business, successfully. The blog serves as a living, breathing résumé through which prospective clients get to know you, and it works very well to establish good, solid, sustainable connections.
Third, and this is where I will be spending the bulk of our discussion today, is that you should look at affiliate programs as possible ways to make money by blogging.
Let’s look at an example.
Say, you are an experienced and really good journalist who has focused your entire career on business journalism, especially technology and entrepreneurship. Given the rate at which media companies are imploding – Business Week was purchased by Bloomberg for less than $5 million, putting many stellar writers out of work – it may, actually, make sense for you to do your own blog, and explore affiliate programs that could be of interest to your readership.
How do affiliate programs work? You promote the product (s) on your site – through ads or editorial content – and as you send traffic over to the product site, and the sale happens, you get a commission for it.
Now, it is important that you focus on programs that offer enough incentive to market their products. In other words, you cannot make a living by selling $5 products. You need to sell higher ticket items.
Let’s do the math: Say, you sell a $1000 product, and get 10% commission on it. You need to sell 100 units to make $10,000 a month, which is a reasonable income level. And it is conceivably viable even if your traffic level is modest, say, 30,000 unique visitors a month. Even at 10,000 uniques a month, you could make some decent money, definitely more than what you would make through the Ad Networks like IDG selling CPM ads. Those really suck from a ‘how to make money with blogging’ point of view.
The numbers, however, will not compute if you try to sell lower priced products, because then you need much larger volumes, and hence, much higher traffic to make the target compensation.
As you can imagine, as a business blogger myself, I have given an inordinate amount of thought to this issue, and it has, in fact, led me to create the 1M/1M affiliate program. The terms are exactly as I described above: 10% commission for a $1000 product, and using this model, I believe, business, entrepreneurship, technology, and related bloggers CAN support themselves.
We are definitely looking at a time when journalism is going through an immense existential crisis. I hope that the model I have defined will salvage at least a portion of the journalism universe, and give people ammunition for survival.
Will this help all bloggers? Not necessarily, certainly not the 1M/1M program alone. But, if you apply the model and try to find products to sell that fit the kinds of characteristics I have described, you would be able to find or create affiliate programs that actually help sustain journalism in different sectors.
For my part, one of my aspirations is to also create some media entrepreneurs within 1M/1M who can build million dollar ventures using the model presented above. Here, if you do the math, to generate $1 million a year in revenue, you would need to sell 10,000 units of whatever product you are selling @ $100 per unit commission. That means, you will need to build traffic up to a much higher level, and for that, you would need a team of writers, not just a solo blogger. But at least in the domain of entrepreneurship, business and technology, I feel that this is quite viable. Over the course of the 1M/1M journey, we will look for entrepreneurs who have the ambition and the resilience to make this happen.
I am especially interested in working with media entrepreneurs whose primary passion is advocating entrepreneurship and innovation. I know so many of you, personally, and you are unable to monetize your talents at the right level. I hope, by joining hands, 1M/1M will be able to create a framework for you to do the work you do best: unearth great stories, cover news, trends, heroes, impact policy, and do what media, at its best, is meant to do.
In addition, I’d like to also see entrepreneurs who are interested in creating affiliate networks and programs for other sectors to support journalism and media activities facing similar existential crisis.