Your First Online Business Model

online business model

There are so many different online business models to choose from.  You could write articles, open an online store, create the most listened to podcast about 18th century children’s fashion.  Where should you start?

A couple of weeks ago, I wrote about  different methods of generating Online Passive Income.  I’ll list them again here, but if you haven’t read that post yet, then you should really pop back and give it a read before going any further (don’t worry, I’ll be waiting right here for you when you get back).

10 Best Online Passive Income Ideas


1 – Write Articles for Revenue Sharing Sites

2 – Create a Blog or Website and Sell Advertising

3 – Record a Podcast and Sell Sponsorships

4 – Create a YouTube Video and Monetize it

5 – Sell Other People’s Products Through Your Blog or Website

6 – Sell Other People’s Products Directly via Pay Per Click Advertising

7 –  Sell your own Information Product: E-Book, Course, Video Series, Newsletter

8 – Sell your own Software, App, WordPress Plug-In, etc.

9 – Sell Physical Products that are Drop-Shipped

10 – Create a Membership Only Section of your Website

 What Model Should You Choose?

Well, if you’re super-duper clever, you will have noticed that I started with a blog.  That doesn’t mean that this is always the best choice, though.  Let’s explore our options.

I’m not a big fan of Idea 1 from the list above (revenue sharing sites).  You give up too much control over your future.  It isn’t a bad way to start, though, if you’re feeling intimidated about the mechanics of setting up your own site (don’t worry, I’ll walk you through setting up a site soon.  It wasn’t as scary as I thought it might be!).

A blog or website gives you a platform to provide information or entertainment to your audience and to sell advertising or products.  It also allows you to build your own brand and your own community, both of which will build trust, traffic, and revenue.  Items 2, 5, 7, 8, 9, and 10 from our list all require a website of some type.

Even podcasts or videos, though they can be monetized as stand-alone strategies, greatly benefit from having a website to refer to.  You can’t click or comment on a podcast!  You can’t sell products through a video or a podcast without having somewhere for people to go to complete the purchase process.  Likewise, you can do Pay per Click advertising with no website, buy you’ll get more sales if you push people to a site of your own where you can provide more information to secure a sale.

 Blog or Website?

I really think that this is dependent on you and your intended audience.  A blog is timely and engaging because it’s always fresh.  A website can be better organized and a lot less ongoing work once it’s all set up.

Sites that Work well as Blogs

  • Your personal travel story
  • A project website showing start to finish development
  • A news or gossip site
  • Anything documenting a fast changing subject

Sites that Work well as Traditional Websites

  • A small site whose prime purpose is to convert a visitor to a buyer as quickly as possible
  • An online or brick and mortar business’ site
  • An educational site that has a set curriculum

Then again, why does it have to be one or the other?  Your website can have well organized static pages that act as an “evergreen” resource for new visitors and a blog that keeps people coming back for new content.

Don’t forget that social media can act as an extension of your website as well, so twitter or facebook can offer the fresh content and encourage the engagement of your audience while the website changes more slowly.

I chose the blog format for Online Passive Income Journey because this is both a (figurative) travel story and a project.  On the other hand, as the content builds, it’s going to be more difficult for newcomers to find the instructional content.  I plan to add “Start Here” and “Resources” sections at that point so that I will end up with a hybrid site.

A Question of Scale

The next decision is how big to make the site.  The definitions below aren’t precise, but you can divide website sizes into three broad categories:

A micro niche site might be a single page with an affiliate link or a collection of a few focused articles.  It’s designed solely to target a very specific search term and convert traffic to buyers or display lots of adsense advertising.  Once it’s on the internet it will be quite static, but you’ll need many of these to generate significant income.

You will find many articles and videos online about how to make $1000 per month with 20-30 micro niche sites.  The only problem is that these schemes no longer work!  In 2011, Google updated their algorithms to punish thin content sites.  They also started to block adsense accounts.  Micro niche sites usually rely 100% on search engine traffic, so thousands of sites saw their income drop to zero overnight.

In my view, the only place for a micro niche site today is as a “landing page” for a Pay per Click advertising campaign.  In this case, you have no adsense advertising or Google search engine traffic, so you don’t need to worry about algorithm changes.

A niche site will often be 10-30 pages of content designed to demonstrate your authority on a subject and provide good quality information to people who land there.  There’s enough content that they will learn something and you can establish yourself as an authority.

An authority site can be hundreds of pages.  This is a place where you can build a trusted brand and a community that keeps coming back.  This type of site can be a powerful revenue generator (and a lot of fun), but it takes a lot more time and ongoing effort than the smaller sites.

With an authority site, you can have diverse income streams from advertising, affiliate sales, your own products, and even membership areas.  You can also have diverse traffic sources.  You develop links to other sites, facebook, twitter, and have your own email list.

Since you add so much value, Google is unlikely to suddenly cut off all of your search engine traffic, but even if they do, you’re protected because you still have your existing community and other traffic sources for new readers.  You’ve put so much effort into building your site, you don’t want Google to be able to arbitrarily wipe out your livelihood in one fell swoop!

The Winning Online Business Model

The type and scale of your site or portfolio of sites is really going to depend on your goals, preferences, and the topic you choose.  For Online Passive Income Journey, a blog is an obvious choice.  I’m so excited about this topic that I already have 65 posts planned out in OneNote, so this will eventually grow to be an authority site.

Your choice of topic will also have a significant impact on the type and size of site you build, so we’ll explore choosing a niche in another post very soon.

(PS: Thank you, Sara over at for asking good questions on the forum about whether you should start with a podcast.  Your well timed question prompted me to finish off this post and get it published!)

What’s your ideal online business model? Leave a comment below. 

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2 thoughts on “Your First Online Business Model

  1. You’re welcome! Thanks for the link. 🙂 I didn’t realize there were so many different ways to monetize a website. The internet really is an amazing place.

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