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At one time or another, we have all presented a gift to a friend or a loved one on a special occasion. Thinking back, you will likely remember that making such selections is not always easy. We usually think long and hard about the recipient before we choose the gift.

If so much time and energy is spent choosing a gift for a loved one, imagine the importance and toil involved in the process of choosing the right niche for your online business or blog! After all, the products and services that your business creates are not about you. The bottom line is to deliver value to the customer.

Choosing the right niche is the most important and perhaps the most difficult step in building your online business. You must consider numerous factors, such as the market demand, your passions and strengths, and, most importantly, the competition.

Thousands of new blogs are created every hour, yet most bloggers miss out on success because they neglect the importance of the niche selection process. If a blogger is sure to get this part of the process right, he or she will be ahead of the game and all the other factors will fall into place.

Discover Your Passions

I am sure you have heard a million times that if you do not have passion for what you do, money and joy will escape you. Many bloggers wrongly assume that they have a passion for a particular topic, so they start blogging on that topic. Then, after several months, they end up realizing that their real passion is for something else.

I made this very mistake a year ago. I was interested in riding motorcycles with friends, and I assumed that since I liked to ride motorcycles, I could start a successful blog about motorcycles. After a few months of blogging, I realized that even though I did like to ride them, staying up to date on motorcycle news and sharing that information with readers was not something that I loved to do. Anyway, I did not let the blog die. I was fortunate to find someone who had a passion for motorcycles and also loved writing about it.

Being passionate about a particular topic does not guarantee that your blog on that topic will be a success. You need to find a topic about which you love to teach and share information with others. Think about situations in which you have found yourself talking endlessly about a particular topic with friends or colleagues without expecting anything in return. Also, make a list of the books and magazines that you read often. Blogging is just one form of communication, and it is not much different than talking to people. If you love to talk about a topic, chances are that you will also love blogging about it.

In addition to the joy you will get from sharing your knowledge with others, money is the extrinsic reward you will receive for your blogging efforts. Once you start writing in your blog, you will still need to wait several months, or perhaps even years in some cases, to realize the handsome profits blogging can bring. If earning money is your primary motivation for blogging, you may quickly get disappointed and abandon your blog. The driving force keeping you on track should be the pleasure you gain through sharing information with like-minded people.

After I discovered that writing about motorcycles wasn’t as enjoyable as I thought it would be, I did some serious thinking and realized that I frequently talk to my friends about business, blogging, and marketing. I have given guest lectures at many universities about blogging and Internet marketing without expecting any monetary benefits. Since I love to talk about these subjects, I knew blogging about them would be no different. That day I decided to start my blog at BusinessAttitude.com. I found my blogging passion.

Analyze the Market Demand and Competition

Once you have discovered your potential blog topics, the next obvious step is to measure the market demand within those niches. Remember that you need to first and foremost give people what they want, not simply what you like. Some of your topics may be well received in the market, and some of them may fail. You need to be sure to select the topic from your list which will garner the maximum results in terms of readership and profit.

There are certain websites from which you can gather valuable information about the market. Here, I have explained the websites and tools which I use on a regular basis:

Yahoo Answers: Yahoo Answers is a community where questions and answers are exchanged constantly. If you are a long-time Internet user, you may have used it before, or at least heard of it. Questions are posted in a wide range of categories. Find the category which is closest to your topic and look at the posted questions. These questions provide valuable insight into what people really want and need in your niche.

For example, prior to starting my motorcycle blog, I browsed through Yahoo Answers. I noticed that many people asked questions regarding where they could find good pictures of their favorite motorcycles. I came to the conclusion that even though there are a lot of websites publishing information about bikes, there are very few places where one can find high quality photos.

I thus invested a great deal of energy into producing quality photos of the motorcycles in addition to publishing great content. My investigation of Yahoo Answers ultimately led my blog to grow faster than other similar blogs.

As you browse through various questions, you should look at the resolved questions in addition to the open questions. The answers to resolved questions can provide details regarding the competition in your niche. You can “spy” on your competition and analyze any possible deficiencies they have. Try to overcome these shortcomings in your own product.

Google Keyword Tool: Google owns the lion’s share of the search engine market. Almost everyone uses Google to find information on the Web. The Google AdWords Keyword Tool is a free feature which gives you insights into the keywords people type in the Google search engine. It also provides the monthly search volume of those keywords.

For example, when you type in the keyword “motorcycles,” then click “Get Keyword Ideas,” the tool will generate a list of keywords related to motorcycles. The list might include words such as Harley Davidson, Yamaha, Honda, and so on. Try this tool with different keywords to become familiar with how it works.

You can also enter a website’s URL into this tool to obtain a large list of keywords related to that website, along with their monthly search volume. The higher the search volume, the higher the demand for information. You can use this tool not only to select the topic for your blog, but also to brainstorm ideas for possible articles you will consider publishing in your blog.

To analyze the magnitude of the competition in your niche, take the keywords from this tool and search for them in Google within quotes. For example, if you want a rough estimate of the competition in the “weight loss” niche, search Google for the keywords “weight loss.” This particular search will produce 90.1 million results, which means this exact phrase is repeated in 90.1 million pages across the Web.

So, as you might have guessed, the weight loss niche has incredibly high competition. If the same is true for your topic, try to sub-divide your niche. For example, you might search for “weight loss for teenagers.” This phrase brings up only 20 thousand search results, meaning there is relatively low competition in this niche. It will be much easier to attract prospective readers and buyers if you create a blog or an information product in a smaller niche (a sub-division of a larger niche).

The sponsored links which appear on the right-hand side of the search results also provide valuable data about the competition in your niche. The higher the number of sponsored links, the greater the competition.

ClickBank Marketplace: Clickbank.com is an online payment gateway which enables people to sell digital products online without any hassle. Authors who write small books which cannot be published traditionally rely on ClickBank to sell their books in the form of e-books.

The ClickBank marketplace lists their digital products according to categories. Across each listing of a digital product, they also publish a variable called “gravity.” The higher the gravity, the higher the damand and sales for that product. You can compare various products within your niche, and thus gain valuable insight into the types of products that sell well.

Avoid a Head-on Collision with Your Competition

Many people believe that one can be successful in business only if they can discover a niche where there is no competition. Contrary to popular belief, competition is actually a good thing. If you find a niche where there is no competition, chances are that people are not willing to spend money within that niche. Competition proves that there are profits to be made. Selecting a niche and beating your competition is much better than trying to discover a niche where there is no competition at all.

Another mistake people make when trying to beat the competition is that they try to market a higher quality product for a cheaper price with lower profit margins. Selling cheap is not good marketing. Lowering the price of your product and providing higher quality does not prompt consumers to ditch the competitor’s product and buy yours. You may wonder why this is so. The answer to this question lies in consumer psychology.

When an average consumer buys a product for a particular price, and is then offered a better quality product for a cheaper price, the consumer is not convinced to instantly switch products. By choosing the latter product, the consumer admits that the original decision to buy the former product was a mistake. Consumers hate to admit that they were wrong. You need to give consumers a better reason to buy your product besides just a cheap price.

For example, before I started my motorcycle blog, I observed that automotive blogs received heavy traffic. There were more than five blogs competing with each other. If I too entered that niche and started a general automotive blog – writing about both cars and bikes – readers would have to choose between me and the competitors because they cannot read more than five blogs at a time. Even if I published content of much higher quality, it wouldn’t suffice.

I knew I needed to provide a reason for people to come to my blog. If my blog was just about motorcycles, people interested in automobiles would read the general blogs and those with a special interest in motorcycles would read my blog. In this case I sub-divided the niche and provided a unique reason for readers to visit my blog.

By sub-dividing the niche, you are creating your own category. Edwards Deming, the famous philosopher, said: “It is better to be first, than it is to be better.” It is good to compete as long as you do not end up doing exactly the same thing as your competitors.

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Once you have chosen and purchased a domain name, the next step is to host your website. Hosting a website online can be compared to inaugurating a brick and mortar shop and putting up the “We Are Open!” sign. Web hosting involves uploading the website’s files to a web server and configuring the site so that it is accessible to Internet users worldwide. A web server is an ultra-fast computer with a high speed Internet connection that is always on.

Even if you have not designed your website and the files are not ready, it is a good idea to buy the hosting first and then tweak your website’s files as you move forward. This will allow you to see how the website will look for the end user as you complete each stage of development.

Types of Web Hosting

Theoretically, you can host your website from your own computer. Once you install and configure the necessary software, it can be accessed by anyone. The drawback of self-hosting is that you always need to keep your computer on, and your computer may not be able to handle the load if there is a sudden increase in the traffic to your website. Hence, it is always recommended that you host your website at one of the professional web hosting companies which rent their servers at a very nominal price. There are several types of web hosting, but the two major types are “shared hosting” and “dedicated hosting”.

Shared Hosting: If you are hosting a personal blog or a small business website, you may not get much traffic in the early stages of your website’s life span. In such a situation, you can buy a shared hosting plan from a web hosting company. When you do this, you will share the resources of the server with other website owners. Shared hosting plans only cost around $5 to $10 per month and are usually reliable enough for a small website. If you pay upfront for a long period (two to three years, for instance) you will get a good discount, but this is not usually recommended. One web hosting company which provides excellent service is HostGator. They have been in the hosting business for a long period of time and have excellent customer support.

If your website traffic grows to more than 5,000 unique visitors per day, you should switch to a dedicated hosting plan. Usually you need not worry about when you need to switch to dedicated hosting. If your website in the shared hosting server receives significant traffic and consumes enough server resources, the hosting company will inform you when the time is right to upgrade from the shared hosting plan.

Dedicated Hosting: As the name suggests, your website will be hosted in a server which is dedicated only to you. There will be no other websites hosted in the server. This is a safe option because other sites will not share the resources of the server and your website will deliver your visitors maximum performance and a smooth browsing experience. You can host more than one website of your own on a dedicated server. They are more secure and the possibility of your website crashing is very limited.

HostGator offers reliable dedicated hosting plans as well, which start at $174 per month. This may seem costly, but it is worth the price for the security and peace of mind it delivers. Dedicated hosting also comes with a dedicated IP address, which we will discuss in the later part of this article.

Factors to Consider While Choosing a Web Hosting Company

During the process of learning the specifications of web hosting and choosing a web hosting company, you will come across a lot of technical jargon. Unless you are a programmer or part of the technical field, you need not learn most of the complex words. However, learning some of the jargon may help you choose the right hosting plan.

Disk Space: Disk space is the amount of storage that the company will offer you for storing your website’s files on their web server. For static corporate websites and personal blogs, 100 MB of storage will be more than enough. Unless you are hosting a lot of media, like stream video and audio, you need not worry too much about disk space.

At one time, companies offered only a few hundred MBs of storage space. As competing companies fought with each other by delivering more space, it has come to a point where many of the professional web hosting companies now offer unlimited storage and bandwidth. This is theoretically impossible, but it is meant to attract and impress customers. Just like an average Gmail user is not going to use the 7 GB+ storage that Google offers, website owners will not use an exorbitant amount of server space. Hosting companies have come to the conclusion that the average storage consumed per user will be quite low, so they offer “unlimited” storage.

Bandwidth: Whenever an Internet user accesses your website, the files are downloaded from the server to the user’s computer. Each time this happens, bandwidth is consumed. When traffic to the site is high at a particular time, the bandwidth required to serve all the users increases. The shared hosting plan at HostGator offers unlimited bandwidth, but they will ask you to upgrade to a dedicated server if your website is consuming too much of the server’s resources.

Linux & Windows Web Hosting: There are two classes of software which power a web server. One is based on Linux and the other is based on Windows. Linux is the preferred option for most webmasters because it is open source and is more flexible than Windows-based hosting. However, this difference is independent of the operating system that Internet users have on their computer. The famous open source blogging software (Wordpress) is also based on Linux.

Add-on Domains: If your web hosting plan offers add-on domains, you can add several websites to the same hosting account. If you plan to host more than one website, it is recommended that you choose a hosting plan which allows add-on domains. This will allow easy management of your websites in a single account. Not all web hosting companies offer this option, and if offered, the number of add-on domains allowed per account will differ. Right now, the “Baby” hosting plan at HostGator offers unlimited add-on domains.

Dedicated IP: When you purchase a shared web hosting package, your website will be assigned an IP address. This IP address will be the same for all the websites hosted in that web server. When you share the IP address of your website with other websites, there are a few drawbacks. If one of the websites which shares the same server as your website publishes illegal content, or for some reason their website is blacklisted, ISPs and search engines may ban that IP. If your website shares the same IP, you will be affected too. To avoid this, it is a good option to get a dedicated IP address which assures that your website will be the only one on the Internet which has that IP. If you have a shared hosting account in HostGator, you can get a dedicated IP by paying an extra $2 per month.

cPanel: After you purchase your web hosting package, you will be given a login to a control panel where you can manage your account. The account includes databases, emails, traffic statistics, add-on domains, and so on. There are many types of control panel utility software on the market, so the software used by each hosting company may differ. Most of the leading web hosting solutions use software called cPanel, which is one of the best website management software options. It has a lot of features and is very user friendly. When you purchase web hosting, make sure the company uses cPanel for their website management (HostGator uses cPanel).

Fantastico: Fantastico is a script library that automates the installation of web applications to a website. Fantastico scripts are executed from the administration area of a website control panel such as cPanel. Fantastico saves a lot of time when you install blogging applications like Wordpress, forums such as SMF (Simple Machines Forum), and other opensource applications. When you buy your hosting package, make sure that it comes with Fantastico.

Additional Factors to Consider While Purchasing a Web Hosting Package

Domain Registration: Many web hosting providers try to convince you to register the domain with them. Some hosting companies even offer a free domain name when you buy a hosting pack for one year or longer with that provider. I do not recommend registering a domain name with the hosting company for the following reasons:

• The annual renewal cost of the domains will be higher than individual domain registrars.
• When you want to move your website to another web hosting provider, transferring the domain name is a cumbersome process.
• If you sell your website to someone else, the buyer would prefer the domain to be registered through a well-known registrar like Name.com or GoDaddy.com because of reliability and ease of transfer.
• Most hosting companies are not licensed domain name registrars; instead, they have a partnership with other registrars. When a hosting company goes out of business, it may be very hard to get back your domain name.

Location of Datacenter: It is a good idea to host your website with a company whose web server is in the country of your target audience. The closer the web server is to the Internet user, the faster the page will load. For example, if your website’s target audience is in India, it is recommended that you host your website with a provider whose web server is situated in India. You need to clarify this with the hosting company because many companies in different countries have their servers located in the USA or UK.

Purchasing for Long Periods: I do not recommend signing up for more than one year at a time with your hosting provider. While it is uncommon to move domain names from one company to another, there are reasons that you may want to move your website to another web hosting provider. Reasons may include lack of customer support, inability of the web server to run certain scripts needed for your website, frequent server down times, and so on. Web hosting companies often try to sell two to three year hosting packages with large discounts, but do not be lured in by these deals.

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Almost everyone hears a voice deep inside which says, “Yes! I want to be rich.” And we know that even the people who say, “Money does not buy happiness; Money is not everything in life” want to be rich. Why? Because money can buy big houses, beautiful cars, and dinner with our loved ones in a five star hotel. Of course, there are some things in life which money can’t buy, but money will solve every problem that not having money creates.

The inconvenient truth is that most of the people who want to get rich will never get there. People who do become rich have one characteristic in common which differentiates them from others – they take action! This may sound too simple, but it is this piece of the puzzle which prevents most people from attaining their desired financial independence. To better explain this concept, let me give you an example.

A few years back I was watching a TV show hosted by a famous motivational speaker, Jack Canfield. He took a $50 bill from his pocket, raised it in the air, and asked the audience, “Who wants $50?” More than a dozen hands shot up. And after a few seconds, a lady walked up to him and said, “Yes, I want $50. Give it to me.” And she took the $50 from his hands! She took action, and that is what made her different from the rest of the audience.

The people who raised their hands had the intention of receiving the $50, but they did not take the necessary action. Perhaps they expected the speaker to come hand over the bill to them. This is the mistake that most people make in life; instead of being proactive and seeking opportunities, they wait for opportunities to knock on their door. Opportunity rarely knocks on doors, and when it does, most people miss it. Successful people are those who go out and grab opportunities before others do.

You have a desire to make money, and the fact that you are reading this article means that you belong to the 1% of people who take action. I congratulate you for that. You are already ahead of the people who do nothing more than want to get rich.

Build a Business which Can Run Without You

When we look at history, it is easy to see that the people who made fortunes did it by creating a business and not performing a job. Let me describe the difference between the two with a simple example I adopted from the book Good to Great.

In earlier days of human evolution, there were many experts who could see the position of the sun, moon, and stars and tell the time within a few minutes. Whenever people wanted to know the time, they would contact these experts. Then after some years a scientist invented a clock. This clock could tell the exact time whenever and wherever people needed it, and similar clocks could be manufactured multiple times. Now, who is the genius? The expert who could tell time by the stars or the man who built the clock? Business is similar to building a clock, whereas being employed to someone else is like being a time telling expert. Whatever you do, keep asking yourself whether you are building a clock or simply telling time.

Opportunities to Make Money Online

The Internet has opened up a wide range of financial opportunities. Just like in the real world, these opportunities can be classified into jobs, self-employment, or businesses. In my future articles, you will learn about opportunities from all three categories. If you are an Internet beginner, you can start making money through the various methods and techniques that fall under the category of jobs. As you move forward, make sure you do not stick to the same methods for too long. You should start investing your earnings in building a business so that you can secure a passive income and create a cash flow for fueling your business and personal needs.

Who Can Make Money Online?

Anyone can make money online. The Internet does not care which country you are from or what beliefs you have. As long as you can provide value to the Internet economy, you can make money. If you are a web designer, your clients should benefit from the designs you create for them; if you are a blogger, your readers should get value from your articles; and if you promote a company’s products for commission, they should get valuable customers in return for their investment. Whatever you do, make sure that it creates value.

One of the biggest advantages to online financial opportunities is that you can create your own schedule. If you are engaged in a daytime job or a business, you can start by investing one hour per day online then slowly work your way up. Within a few years, you will learn the ins and outs of Internet business and eventually rely on the Internet for a full-time income.

There are certain methods, called “black-hat” methods, by which you can trick people or systems and make money online. Many people use such methods to make short-term money. But keep in mind that such methods neither improve your skills nor help to build a business system. Any technique or method used to make money online which does not create mutual benefit for all parties involved is eventually going to collapse.

Where Does the Money Come From?

I can understand that even after several years of using the Internet and hearing stories of online fortunes, some people are still not able to absorb the fact that the Internet can be a dependable source of full-time income. This is because little information is communicated about how the Internet economy works. I am confident that within five minutes, you will clearly understand the power of the Internet and will change your outlook.

In every economy, money is born where value is created. When value exchanges hands, money flows in the opposite direction. So if money is being poured into the Internet economy from a few sources, it means that the Internet delivers value in return. Let us look at the two major sources of online money flow:

1) Advertisers: Any product or service requires advertising to a targeted audience. Television, radio, newspapers, and magazines are just channels of communication which have traditionally been used because there was no other way for advertisers to reach their target audience. Today, however, advertising dollars are being poured into the Internet because it provides a cheaper, easier option. Newspapers and radios might soon be objects of the past.

2) Online Buyers: Money is also being pumped into the Internet by people who click “check out” and sit back and relax while products are delivered to them. Ranging from small priced information products all the way up to tangible products like computers and hardware, many people make purchases online. These numbers are only going to increase. Why? Online ordering saves a lot of time and money, and that is of great value to people!

As far as I know, advertisers and online buyers are the ones who set the wheel in motion. All the other websites, networks, services, and online businesses were built around these two pillars of the Internet economy – and these pillars are growing stronger than ever.

It does not matter whether you have a blog, a service-based business, or a profitable offline business; whatever you do, make sure that you do not look back and regret skipping out on the Internet. Bill Gates wrote in his book Business @ the Speed of Thought that business will change more in the next 10 years than it did in the past 50. That is the power of Internet.

Online Business Models

There are various types of online businesses, some of which are out of reach for an individual just starting to make money online. For example, online payment systems like PayPal or auction websites like eBay have difficult entry barriers. They require several legal formalities and a financial investment ranging in the millions. However, here are some business models which anyone can adopt and grow easily.

Blogging: Blogging is the most common form of online publishing. Anyone with basic computer knowledge can start a blog of their own and share their ideas. If the content is strong and gains publicity, the blogger can earn money from advertising. Not every blog establishes a strong base of readers; there are certain key factors which determine the success of a blog. Some blogs have become so popular that they command attention comparable to traditional media.

Affiliate Marketing: Affiliate marketing is the process of promoting a company’s products for commission. This is the simplest and easiest way to begin making money online, and it is accessible to anyone. The company which created the product will take care of delivery, shipment, and guarantees, while the affiliate simply earns money through advertising. Affiliate marketing can be done through various methods, one of which is blogging.

Author an e-Book: If you have expertise in a particular topic and if you can fulfill a common need, you can write and sell an e-book. The e-book creation process involves writing the content on a word processor and saving it in PDF format. Once done, it can be sold to anyone who needs your information. You can either set up your own payment system, or list the product at the ClickBank.com payment gateway. ClickBank has a substantial affiliate network and the affiliates will be ready to promote your e-book for a commission. Affiliate commissions for e-books usually range from 25 to 75 percent since there are no production and overhead costs.

Online Forums: Online forums are websites that enable Internet users to discuss and exchange ideas and thoughts. You can start a forum on a topic of interest and gain members. As it grows in content and popularity, you can monetize the traffic with advertisements. Popular online forums can reach hundreds of thousands of registered members, and have the potential to earn a large monthly income. The most commonly used software for online forums is vBulletin.

Online Directories: In the past, people used the yellow pages to find local business information. With the growing popularity of the Internet and its ease of use, people now rely on it to find information. This provides the opportunity to create an online directory in your home town or area. You can encourage people to post their classifieds in your website and charge for advertisements. This model is rich in financial opportunity as more people start to use the Internet on a daily basis.

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There are seemingly infinite opportunities for making money online. But in my opinion, the easiest and most straightforward opportunity is affiliate marketing. Tens of thousands of people are involved in affiliate marketing. They work from the comfort of their homes and make a full-time living through the Internet. I have personally known people who make more than $50,000 per month via affiliate marketing. That is not to say all involved with affiliate marketing will earn this income, but it does illustrate the scope of income possibilities. It takes several years of experience to reach this high income level, but even if you have just 1% of the success that the top affiliate marketers have, I am confident you will be glad you tried it. I am personally involved with affiliate marketing and it provides comfortable supplementary income.

Before you get into the process of earning money through affiliate marketing, you should first learn a bit about traditional marketing. Before the Internet became widespread, companies had internal marketing departments. They advertised their products through traditional media outlets like television, newspapers, radio, and print magazines. These were the only methods of marketing for several decades before the Internet was born. Traditional methods allowed little to no opportunity for outsourcing the marketing process. The advent of the Internet, however, enabled advertisers to outsource their marketing process to individuals like you and me.

Today the Internet is widely used by millions of people all over the world, allowing them to purchase products and services from various companies with a click of a button. When transactions are made online, it is possible to track each user’s behavior. This tracking process prompted the birth of affiliate marketing.

What is Affiliate Marketing

Affiliate marketing involves two parties: the advertiser, also called the merchant or retailer, and the publisher, also called the affiliate. In this case, since we do not have our own product or service, we are the affiliates. Affiliate marketing is also defined as performance-based marketing. In other words, the advertiser will compensate the publisher depending upon the performance of the publisher. Usually the publisher or the affiliate is paid for every sale that is generated via the publisher’s affiliate link.

For example, imagine that an advertiser is selling t-shirts online at T-Shirts.com and each shirt costs $10. The advertiser can choose to give away 20% of the sale price to the affiliate who referred that sale. If you as a publisher refer a customer to buy a t-shirt from the advertiser, you will get $2 for each sale. If you refer 10 customers to them, you will earn $20.

If you want to become an affiliate of a particular advertiser, you have to sign up for an affiliate account. After your account is approved, you will be provided with your own unique affiliate link. For example, if you are an affiliate of T-Shirts.com, you will be given an affiliate link that looks something like <www.T-Shirts.com/?=YourAffiliateID>. Your affiliate ID can be a username, a random number, or any other form of unique identification.

When an Internet user clicks your affiliate link, he or she will visit T-Shirts.com and the affiliate tracking system will record that you referred the visitor to their website. When the visitor purchases a t-shirt, you will be credited with $2 commission in your affiliate account. Note that you will not make money when the customer clicks the affiliate link. You will earn affiliate commissions only when the customer completes the purchase on the merchant’s website. The advertiser is paying you for the performance and not just the volume of visitors (hence the alternate name of performance-based marketing).

Affiliate Networks

As you can see in the above example, the t-shirt merchant does not need to worry about marketing at all. All they did was simply set up the affiliate system and pay the affiliates who referred sales to the merchant. The ease of this system made affiliate marketing very popular. Almost every merchant selling products or services online started their own affiliate system. But this phenomenon gave rise to a new problem. Affiliates who were promoting many different products found it very difficult to track all of their earnings in different affiliate accounts held with each merchant. This led to the creation of affiliate networks.

An affiliate network acts as a meeting place between publishers and advertisers. Advertisers no longer need to install their own affiliate system. Instead, they can approach the affiliate network and set up their program. Affiliates can sign up with the network and promote any product that they find in the affiliate network.

The affiliate network collects the payments from the advertisers and distributes to all the publishers on a monthly basis. They also provide the technology infrastructure and support for the affiliates. Most of the affiliate networks have a revenue share of 20-40% with the advertisers in return for providing these services.

One of the biggest affiliate networks on the Internet is Commission Junction (CJ.com). They have been around for more than 10 years and are one of the most trusted networks on the web. Another prominent network is ClickBank.com. ClickBank is similar to Commission Junction, but ClickBank specializes in digital products.

Types of Affiliate Programs

There are basically two types of affiliate programs. The first is Pay Per Sale, meaning the affiliate earns a percentage of the sale or a fixed amount for every sale whenever a visitor clicks the affiliate’s link and purchases the product or service on the advertiser’s website. The second is Pay Per Lead, meaning the visitor need not purchase any product, but instead fills out a form or signs up for a free account on the merchant’s website. For example, many free dating websites will prompt visitors to sign up for a free account through your affiliate link. When they do, you will earn $1-5 for every lead depending on the advertiser.

Promoting Your Affiliate Link

Now that you know what an affiliate program is and how affiliate marketing works, let’s look at the different methods by which you can promote your affiliate link.

Websites: If you have a blog or a website about a certain topic, you can find affiliate programs related to your topic by searching Google. For example, if your blog is about skin care, search Google for “skin care affiliate programs” and sign up. You may also find skin care related affiliate programs inside affiliate networks. Once you have acquired your affiliate link, the next goal is to drive clicks to that link. You can place banners or text links on your website and wait for people to follow the link and make a purchase. An effective way to promote a product is to buy the product yourself and write a review of it in your website or blog. At the end of the review, you can instruct your readers to click the link and buy the product at the merchant’s website.

Article Marketing: If you have strong writing skills, you can write articles of 300 to 500 words about certain topics and submit them to article directories such as ArticlesBase.com. These article directories have vast databases of articles on nearly every imaginable topic. When you submit an article, they allow you to include a custom signature, which can also include your affiliate link. Once your article is accepted and published at an article directory, anyone has the permission to copy that article and post it in their own website or blog as long as they keep the signature box intact. If your article is strong, many people will post it on their website, which will lead more people to your affiliate link.

Another popular article directory is EzineArticles.com, but they have stricter guidelines which do not allow affiliate links in your signature. To promote affiliate products through EzineArticles, you should first build a one page website where you can market your merchant’s product with your affiliate link. Then you can link to your website from the article’s signature. If your marketing message (also called a sales copy) is very influential in convincing the prospect to buy the merchant’s product, it can be more effective than redirecting the visitor straight to the merchant’s website via your affiliate link.

Forum Marketing: A forum is a place where people discuss a particular topic with other like-minded people. There are forums on a vast range of markets. To find forums on a particular topic, search Google for a keyword from the topic followed by the word forum. For example, if you want to find forums about Weight Loss, search for “Weight Loss forum.” Forums allow you to sign up for a free account and participate in the conversations. Most forums have a signature box where you can insert promotional links. When you participate in the forum by posting useful information, your signature will be displayed along with each post. The more you post, the more your affiliate link gets clicked.

Search Engine Marketing: Search Engine Marketing (SEM) is the art of promoting your affiliate links via paid search results. When you search for a particular keyword in a search engine like Google, the results that you see on the left side are the natural, or organic, search results. The links that you see on the right side of the screen are sponsored links or paid search results. Companies or organizations pay Google to include their link in the search results when a particular keyword is searched. For example, if you want to promote a facial skin cream via SEM, you should first sign up for an account at Google AdWords (adwords.google.com). Then you should instruct Google to display your affiliate link whenever people search for the term “skin cream” or “buy skin cream.” You then have to pay Google for every click that you get. For example, if a product costs $50 and the merchant is giving away 20% affiliate commission, then you will receive $10 for each sale as affiliate commission. When you drive 100 visitors to your merchant’s website through your affiliate link by paying Google $0.10 for every click, you total investment would be $10. In this case you need to make at least one sale to break even. With two sales, you would earn a profit of $10, and so on.

Search engine marketing requires a lot of experience and expertise. This method is not recommended for beginners, because if they are not careful and strategic, they may end up throwing away money in marketing and get no sales or profit in return.

Buying Traffic: Another good way to promote affiliate links is to buy traffic from other websites. This is similar to SEM, but instead of paying the search engine for getting clicks, you pay other webmasters to display your banner or text advertisement on their websites. Before you commit to a big advertising package, you should first test the quality of their traffic and analyze whether the traffic coming from their websites will convert into enough sales to give you a good return on investment.

Email Marketing: The process of promoting a product or service by sending direct emails to the target audience is called email marketing. The first step in email marketing is getting an email list of potential customers. You can build your own email list by asking people to opt-in on your website, or you can purchase one. One of the most popular email marketing services on the web is Aweber.com. They provide features such as tracking clicks in the email and sending automatic follow-up messages. These services cost only $19.95 per month. In email marketing, you should send emails only to those who have opted to receive your email. Otherwise, it will be considered spam and you will lose your brand image.

If you are a beginner in the Internet marketing industry, you should try article marketing and forum marketing first. Once you have gained experience, you can invest your earnings in creating a website or trying Search Engine Marketing. If you are interested in becoming an expert in this field, there are several online coaching programs with step-by-step guidelines for how to participate in affiliate marketing most effectively.

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There are many services online which allow you to create web pages and blogs at no cost. You can use these services to establish an online presence, as well as to create a money-making venture. However, you cannot own your website, which results in your having very limited control. In addition, you cannot sell your website; and you will lose your sweat equity investment of time and money if your website is shut down for some inexplicable reason. If you are serious about establishing a profitable online business, you should consider creating your own website. The first step in this process is to register a domain name for your site. In this article I will explain all that you need to know about domain names.

What is a Domain Name?

A domain name is a unique identifier for a website which is used by Internet browsers to access a specific site on the web. A domain name consists of words and numbers, or a combination of both, with an extension. A domain name can have up to 63 characters, however no special characters are allowed, except for a hyphen (-). There are several different extensions for a domain name, but the most commonly used ones are ‘.com,’ ‘.net’ and ‘.org.’

Each website on the Internet is stored in a specific web server. A web server is simply an ultra fast computer with a high speed Internet connection that is always on. Every web server has an IP address, which is a dedicated set of numbers peculiar to that server alone, and will look something like 70.230.90.23. When an Internet user enters a domain name in a web browser, it will send a request to the domain name system to determine the IP address of the web server in which the website is hosted. Once the browser knows the IP address, it will send a request to that web server to download the specific page the user wishes to access. Typing in the IP address each time we want to access a website would be rather complicated; therefore, the purpose of domain names is to help us access websites much more easily by typing in words and phrases that are easy to remember.

Choosing the Right Domain Name for Your Project

The domain name is the only part of your website that cannot be changed in the future. You can change your web design, your business model and your content, etc., but you cannot change your domain name. You should make certain that you choose the best possible domain name for your project before investing any time and money on that domain.

The best way to come up with a list of potential domain names for your project is to brainstorm various combinations of words related to your market. You may want to write them down on paper so that you can refer to this list as you check upon the availability of these domain names. A domain name which looks good for you, however, may not have the same impact on others. Therefore, it is a good idea to ask your friends to help you choose the best domain name from a list of potential names, or even ask them to suggest some creative names for your domain to give you even more ideas.

There are many free domain name suggestion tools on the Internet which generate a list of available domain names based upon your selection of categories and keywords. These are simply computer programs, and the names they come up with are not meaningful — and are, therefore, unworthy of use. The best tool I have come across so far for determining an appropriate domain name is that which sits between our ears. Use this tool, along with the following guidelines, and I am sure you would find a good domain name for your project.

1. Descriptive: Your domain name should describe clearly the type of website you are running. For example, if your website is about pets, your domain name should be something along the line of pets.com, onlinepets.com or petsinfo.com. When people see the domain name of your website, they will immediately understand what the website is all about. Even though many of the obvious domain names have been already registered, you should try your best to get a descriptive domain name — instead of naming the website with your name or some word which has no immediately apparent link to the purpose of the website.

2. Keyword Rich: If you are expecting to get traffic from search engines, it is recommended that you include keywords in your domain which are most frequently and regularly searched for on the Internet. For example, if your website is about digital camera reviews, it is a good idea to include the keyword ‘review’ in your domain name. Your website will have more weight in the eyes of search engines if you use these types of keywords in your domain name, as compared to one which does not.

3. Get a ‘.com’: The top three domain name extensions are ‘.com,’ ‘.net’ and ‘.org.’ Out of the three, ‘.com’ is the most used and preferred option. A longer domain name with a ‘.com’ extension is more preferable than a shorter name with some other extension. This is true because when people come to know about your website through different channels, most of them will type the name of your website followed by ‘.com.’ If your domain name is on some other extension, you could end up losing a percentage of visitors to the ‘.com’ version. If your website targets the audience of a particular country, it is recommended that you register your domain name with an extension specific to that country. For example, websites targeting audiences from the U.K. have domain names such as website.co.uk. If the ‘.com’ version of the same domain is available, it would be an excellent option to register it as well and then redirect the visitors to your country-specific domain.

4. Avoid Hyphens and Numbers: When deciding upon the various possibilities for your domain name, it is important that you avoid hyphens and numbers. For example, if you are trying to register a domain name like GardeningTips.com, and that domain name is already taken, you should not be tempted to register Gardening-Tips.com, if it is available. The chief reason for this is that many people will forget the hyphen while typing in the domain name and you will lose your visitors to someone else’s website. Also, you should avoid choosing domain names with numbers, such as GardeningTips4u.com. Most people will simply get confused when trying to access sites with names such as these and will end up typing in things incorrectly.

5. Brandable Domains: Many of the obvious ‘.com’ domain names, with words from the dictionary and simple descriptions, have been registered already because the Internet has been around for quite some time. If you have tried your best to come up with all the possible domain names for your business and found that all of them have been taken already, it can be quite frustrating. I have been in that situation many times. The next best alternative then, is to register a brandable domain name. A brandable domain name may not mean anything specifically, but will be one that is easy to remember and to pronounce. For example, consider the two biggest and most influential websites on the Internet – Google.com and Yahoo.com. Neither of these domain names describes the purpose of these websites. Neither company named these sites for what they actually are, such as SearchEngine.com; yet each of these sites is highly successful. When you come up with ideas for a brandable domain name, make certain it is easy to pronounce and spell to reduce the chance of people misspelling the domain name while trying to visit your website.

6. Future Scope: When you register your domain name, visualize how your website is going to be 10 years from now, or even longer, and make sure your domain name gives you permission to expand your project to wider markets and audiences. For example, if you plan to start a website about small cars, you may register a domain such as SmallCarReviews.com; but after a few years, you may want to expand your website to include reviews of sport sedans of SUVs and your domain name will not allow you to do so. In this case, you should have registered something similar to MyCarReviews.com or OnlineCarReviews.com.

Checking on Availability and Registering Your Domain Name

Most of the domain registrars have a built-in tool which automatically checks to see whether a domain name is available for registration or not. You can also use the following tools to check the availability of domains:

• Instant Domain Search – Checks the availability of .com, .net and .org domains in real time.
• Who.is – Shows you the availability of any domain name. If the domain name is already registered, it would show you details such as creation date, name servers and contact details of the owner if available.
• Ajax Whois – Real time domain search tool which behaves similarly to Instant Domain Search but has more extensions such as .us, .biz, .info, and .ca

Once you have decided on your domain name, you can register it at anyone of the following registrars which I recommend:

• 1&1 Domains – With over 7 million customer contracts worldwide, 1&1 Internet is the largest web hosting company in the world
• GoDaddy.com – The world’s largest domain name registrar. They have offers on a regular basis and you can register your domain name for the lowest possible price.
• Name.com – A domain name registrar with simple and clean interface with excellent customer support

Register For Long Periods: The default and minimum registration period for a domain is one year. After that period, you should renew your domain name, or else it will no longer be yours. To reduce the risk of losing it to someone else, it is a good idea to register it for a long period, usually 5 years; especially if you have big plans for your project. You will also enjoy good search engine rankings, especially from Google, because the credibility of your website goes up compared to those spam websites, which usually have their domains registered for no more than a year or two.

Register Other Extensions of Same Domain Name: As your website becomes popular over time, other people may try to use your brand name and reputation to their advantage by registering domain names which look very similar to yours. In this case, you might wish to register possible misspellings and other top level extensions as well. For example, when you type in Gooogle.com, Google.net, Google.biz or Google.info, all of them redirect you to the main Google home page.

If you find that most of the domain names that you have short-listed have been already taken, you should repeat the process of coming up with creative names for your domain. Remember that most high quality domain names will not be available for registration. Many of the best names are already taken, and are only for sale in the domain aftermarket. If you are truly serious about your business, you should consider investing in a high quality domain name.

Domain Name Aftermarket

A domain name aftermarket is a place where you can buy and sell domain names. You can use this forum to buy a good domain name for your website or sell your old, unused domain names. You can also invest in a good domain name and sell it for a profit at a later time. Many people are involved in the business of buying and selling domain names; in fact, it is often considered the online version of real estate.

The largest domain name aftermarket is Sedo.com. They have a large number of buyers and sellers. Domain name transactions worth hundreds of thousands of dollars are very common. If you have a domain name which you are willing to sell, you can list it at Sedo.com. There is no fee for listing your domain name; however, if someone decides to buy your domain name, Sedo will charge a 10% commission on the sale price. Sedo provides a reliable escrow service. They collect the payment from the buyer first, and once the buyer has confirmed that they have received the domain, Sedo will release the payment to the seller and hold back their commission.

Domain Parking

If you have a domain name which gets some traffic, but is no longer a part of your project, you can park the domain name to earn some money. Sedo.com and Google AdSense provide the best domain parking services.

When you park your domain name, advertisements relevant to the market of your domain name will appear all over the page. For example, a domain name such as FatLossPoint.com will display ads related to the weight loss industry. You will earn money whenever people click on the ads.  If your domain is newly registered, it will likely not produce significant earnings due to low traffic (though it would probably produce enough to cover at least the yearly registration charges of the domain name).