Very simply, I don’t make my money online through this blog. It currently represents only about 1-2% of my total online income. I assume that this proportion will rise somewhat as it becomes more popular, but I never expect it to be more than about 10% of my total online earnings.

I enjoy writing this blog because it helps me to think through my own ideas about Internet business and because I want to help people improve their lives by starting their own Internet business. Obviously, if I can make money from this blog so much the better, but the earnings from it could disappear tomorrow and I would hardly notice.

OK, enough about me for one post, what does this have to do with you? In fact, I think this point is extremely important, because it is the biggest single mistake I see people online making online.

Why Do People Think Writing or Even Creating Products About Making Money Online Will Make Them Money?

I think the simple answer is that they see other people doing it and decide to copy them and do it themselves. For example, they see supper bloggers like John Chow who report incomes as high as $30,000 a month, writing about making money online and think well that looks like a good idea, so they copy it.

If that sounds like you, you need to read what I am about to write next. John Chow and other Internet marketers and bloggers like him are the exception not the rule. Most people who blog about or even create products about making money online are not nearly as successful as the top people in the field.

The Internet marketing and make money online fields are very good examples of a winner take all market. A few people at the top do really, really well but most people don’t. To illustrate this point  think of popular music. Bands and artists like U2, the Rolling Stones, Celine Dion, Jay Z etc. do very well for themselves. However, the vast majority of musicians do not make millions of dollars and most end up struggling for their very livelihood.

The few people at the top make most of the money and everyone below struggles to earn enough just to scrape by on. Contrast this with other fields where there is far less disparity. The best neurosurgeon in the United States, probably earns more than the 500th best one, but the 500th best one still earns a very good living.

You can try if you like to make money in the Internet marketing/make money online field but there is another important reason why I don’t think it is a good idea.

You Need A Huge Volume Of Traffic to Be Successful

The fact is visitors to make money online or Internet marketing sites are actually not that valuable. Again using John Chow as an example in February he earned $29,643.01 from 134,931 visitors, which means his average visitor was worth about 22 cents.

Now, nearly $30,000 in a month (over $1,000 a day) certainly sounds impressive (certainly far better than I am doing) but it was only archived by having an even larger number of visitors. I am not trying to belittle John Chow’s achievements, in fact I suspect the amount he earns per visitor is much higher than the average in this field.

Nevertheless, 22 cents per visitor is still not that much. I have some websites (admittedly with far less traffic) where each visitor earns me roughly $1.50. Moreover, I run some Pay per click campaigns where each visitor is worth $5. Note, none of these campaigns or sites has anything to do with making money online or Internet marketing.

In my experience, Internet marketing and make money online affiliate programs are among the worst performing. This is also, why Internet markets have to create such huge e-mail lists. Selling 600 ebooks at $47 is not that difficult if you have an e-mail list of 60,000 people. It’s creating an e-mail list of 60,000 people that is the difficult part.

It is very hard to generate lots of traffic because of competition. Sure there is a demand for these types of products but there is even more competition. I also think this is why visitor values tend to be so low for make money websites and blogs. Visitors get confused and often give up because everyone just wants to make a quick buck off them.

When you have 10,000 websites all trying to do this people naturally get suspicious and are reluctant to buy. Finally, many people who search for make money online are both cheap and lazy. They want to make money with no effort and no cost. Well I have news for people like that, that is not the way business works.

If you are just starting out why would you want to get into market like that?

Starting An Internet Business Versus Making Money Online

For these reasons I urge you to start and Internet business and not focus so much on just making money online. The two may sounds similar but the mindsets are totally different. If you are looking just to make money online you will always be looking for the next hot trend, product, ebook, etc. On the other hand, if you start an Internet business you want to create real long term value (or you should if you want to be successful).

However, I am sure that there a few cynical people out there who think that I am only saying all this to avoid more competition. Let me assure you that there is more than enough competition out there and you deciding to enter the market will have pretty much zero impact on me.

Save yourself the hassle and create an Internet business in an area other than Internet marketing and/or making money online. You will be able to make more with less competition and less hassle. At least this has been my experience maybe I am just a really bad Internet marketer.

Have your own story to tell about making money online or starting an Internet business? Tell us below in the comments section. (Comments have to be manually approved because I get too much spam)

6. Why am I keeping my new project a secret?

I think I have already addressed this in my previous two posts. I don’t want any competition and I don’t want to influence the result. Beyond this, I want to prove to myself that I can actually build a successful Internet business from scratch not based on PPC.

However, just because I am keeping the overall project a secret does not mean that I won’t post updates on how its doing. Moreover, I plan to tell you about which tools I am using and how well they are working for me.

Nonetheless, for the time being I do not plan to reveal any specifics about my project any time in the future.

7. What things stand in my way?

My main obstacle in this new project, as with all my projects in the past, will be me. I am going to have to overcome some of my laziness and my tendency to procrastinate. To help me I have outsourced some of the work (I will explain more in a future post).

At the end of the day though, I will still have to put in a fairly substantial amount of work to get the kind of results I want. It is going to be a long term project, so it is going to require a sustained effort, something I am terrible at.

I will post updates on my progress here as well as my setbacks in terms of both laziness and procrastination.

8. What are my goals?

Obviously, I want my new project to be a success. For me that means that I would like to have net earnings of $10,000 US a month or more. If you read yesterdays post you will see that this is substantially higher than my current income.

I plan on saving the vast majority of this extra income and investing it. Ultimately, I hope this will give me total financial freedom. This will only be achieved, if I continue to live somewhat frugally. What really matters in terms of long term financial success is not how much you earn but how much you keep (both savings and investments).

My aim is to get to hit $10,000 US a month by July 2009. This is long enough a way to be feasible, but soon enough to (hopefully) keep me motivated and focused. My other goals in terms of making money and employment have already been met.

The most important thing for me has always been independence. Not only do I not want to work for someone else to make them rich, but I don’t want to have to work when someone else tells me to. My time is my time and being able to choose how, when and where I spend it is very important to me.

Fortunately, I already have the independence I want. The only thing missing is earning enough money to build a substantial nest egg, buy a place with my girlfriend and ultimately have enough money not to have to worry about it. I guess we will see how it goes.

9. What is going to happen to this blog?

Well as you have probably already guessed this blog is going to become more of an update about how my main project is going. I hope that it will serve as an inspiration for what can happen if you stick with something. This assumes of course that I a manage to stick with it and that it turns out to be a success. There are no guarantees about either, but I hope that by posting updates to this blog it will encourage me to keep at it.

Besides the project itself I do plan to provide the occasional article about how to start your own Internet business. Moreover, I plan to comment on new Internet marketing products that get released on the market. I can tell you now, most will not be worth it, but hopefully I can tell you about the few that actually are.

I do not have high hopes that this blog will make any substantial amount of money. How to make money blogs are a dime a dozen these days. I don’t want this to be another one, instead I hope you can gain some useful tips and advice from my experiences in starting my own new Internet business.

10. Do I have any advice for people who want to start their own Internet businesses?

My main piece of advice if you want to get started online is not to fall for get rich quick schemes. I have tried my hand at a fair number, and have never made much money. They are often very appealing, especially to someone like me who is lazy and procrastinates a lot, because they promise almost effortless riches.

But as I have found out you can’t get something for nothing. If you really want to succeed online you need to take a long term approach. Get rich quick tactics are definitely not long term solutions, if they even work at all. Patience is extremely important in starting any business, online or off.

The one program I would recommend if you really don’t know where to start is Site Build It (SBI). Ken Evoy explains everything you need to do in an extremely easy and straightforward manner. I have built two SBI sites in the past and they continue to generate $50-100 US a month each, without any additional work on my part. To see why lots of people love SBI click here.

Finally, don’t put things off until tomorrow which could be done today. Your Internet business is not going to build itself and its success and failure will really depend on you. So give it your best shot. Don’t be lazy and don’t procrastinate.

Now lets just hope I can stick to my own advice. I am very excited about my new project and the future in general. However, my past experience has shown me that I should not get my hopes too high. Let’s hope this blog helps give both of us the discipline we need to achieve our goals.

Thanks for reading.

So, today and tomorrow I am asking and answering a total of 10 questions to myself. Hopefully you will find them interesting but if not, they should at least serve as an outline to where I am coming from and where I hope to go in the future in terms of my own Internet business.

1. Do I make enough money online, to live on?

The short answer is yes I do. However, as you will see below, many people will probably think that I what I earn would be enough for them.

2. So how much money do I make?

This varies a fair bit from month to month but recently my net monthly online income has been between $1,600 US and $3,200 US. Both my revenue and expenses can change dramatically from month to month so there is not as much stability as I would like.

However, that being said, my non-Internet related expenses are usually less than $1,000 a month (including rent, food, booze etc.). So even in bad months I am able to save some money. I live very frugally, but that is not to say I would not be happy earning more money. I will elaborate more on this point tomorrow.

I am sure many people reading this, think $1,600 US a month is too little to live on; but the fact is that I can work (almost) whenever and wherever I want. This independence for me is the most important thing for me at this stage of my life. If I had a family this arrangement would probably have to change, or I would have to start earning more.

3. How many hours a week do I work?

Again this varies widely from week to week depending on what I want to get done and what needs to get done. For example, last week I took a short trip and I think I probably only worked about 5 hours. And to be honest I never work more than about 30 hours a week due to my laziness.

I can work so few hours because, as you will see in the answer to next question, I earn passive or relatively passive income. This means that I do the work once and get paid for it over and over again. This is the great thing about the Internet. Moreover, this is the kind of income all entrepreneurs should strive for. It is the only way to achieve freedom both in a financial and personal sense.

I often wish I could focus and work harder when I had the time to devote to it, but I guess I am not doing too badly. I will say that it is not easy being self-employed and a procrastinator. If you are a procrastinator like me, I honestly don’t recommend an entrepreneurial career. I love the freedom I have right now, but unless I change my working habits, I think it is unlikely I will be able to continue doing what I do now, in the long term.

4. How do I make my money?

Currently the vast majority (around 90%) of my online income comes through Pay Per Click (PPC) Search Engine Marketing. However, I don’t spend any money through Google Adwords, although I think it is a great program. The reason is that I have been banned from Adwords (fortunately not AdSense).

I got banned as a result of not following their terms of service. If you want to keep advertising with them, I strongly recommend you follow their rules. As a result, I currently use both Yahoo and Microsoft as my pay per click providers. They are good because the overall cost is lower, but unfortunately they aren’t able to deliver as much traffic as Google was.

To actually make money I generally just find affiliate products with high payouts, either pay per sale or pay per lead (I prefer pay per lead programs). I then bid on related terms in the PPC search engines and direct people to a landing page. In the past I direct linked to merchants but this is what got me trouble with Google so I have stopped.

As I stated above, this means that I earn passive income, because I only have to create ads and landing pages once and I keep earning as long as a given affiliate promotion goes on. I have tried to diversify into affiliate programs which should stand the test of time but unfortunately these tend to be highly competitive, so I need to supplement my income with special limited time offers.

Even though using PPC is still quite profitable for me, it will most likely not remain so in the future without Google. It is very difficult to make a living online when you can’t market to 75%+ of Internet users. Moreover, as Google gains market share it will become increasingly difficult. Thus, I have been forced to reexamine my situation, which ultimately I think is for the best.

Finally, I should just mention that I have tried other Pay Per Click search engines but I don’t recommend any of them. Either they don’t deliver enough traffic to make it worthwhile, or they deliver lots of traffic of little or no value. I know some people will disagree with me but this has been my experience.

5. Why am I starting a new project?

Well if you read my answer to the previous question it should be pretty obvious. I want to keep earning a full time income online, but I don’t think that it will possible to do so, using my current methods. I plan on posting more about how my new project is coming along as it develops.

However, I remain by the statement I made yesterday. I am not going to reveal what the new project is about because I don’t want to influence the results, and quite frankly I can do without any added competition.

Tomorrow I will post answers to questions 6-10. Hope to see you then.

One of my goals for 2008 is to try and be better about all this but as you can see it is not off to a great start. Moreover, right now this blog is not a huge priority for me because I am working on a much bigger project.

Unfortunately, I don’t want to reveal what it is now or in the future. The reason being that I don’t need any competition in the niche I am targeting.

In fact, my main reason for restarting this blog is to try and keep myself motivated and focused on my big project. I figure that if I get into the habit of posting about how it is coming along, that this will in turn encourage me to keep at it (see laziness above).

This also means that the new version of the blog will be more focused on me personally and on how my project is going and less to do with the how to start your own business online. If you are still interested in that please read my previous posts since the information there is still good and relevant.

I intend to post the occasional review about upcoming Internet marketing products, but quite frankly I can tell you now that 99% of them are a waste of money. In a future post I will explain exactly what tools I am using to achieve my results and you can take it or leave it.

I hope you enjoy the new direction this blog takes but to be honest I am not too bothered if you aren’t. I hope it will prove to be an inspiration but I am unsure if my new project will be a success or failure, only time will tell.

My one piece of advice from all this is not to follow my example. Don’t procrastinate, don’t put things off until tomorrow that you could do today. If my new project succeeds it will be in spite of my huge ability to procrastinate not because of it.

Thanks for reading

Ian

Still, I think it is a good reminder of what is possible if you stick to your internet business dreams.