The Costs of Website Ownership

A model worth investigating is charging people to put content on your website, or earning money from other people’s content. To do this you need to convince interested parties that your site is the best option for them, that they will get the best exposure from your site. Not surprisingly, you need a site that has a high flow of traffic.

Online malls are a good example of this model. Here, businesses which wouldn’t necessarily survive on their own pay a company that in turn provides the web space and necessary tools for them to get together on one site and create a community where customers can browse featured products from the various merchants and shops. Customers are drawn by the variety of products available, and the merchants benefit from much higher exposure than they would typically get from banner ad campaigns.

The strength of this model lies in the exposure smaller companies get from their association with your site. There are thousands of companies that simply can’t afford to maintain a website by themselves and don’t have the means to drive traffic to their site unassisted.

Another variation – one that has proven successful with smaller websites – entails joining an affiliate program. At little or no cost to you, you market content for other businesses on your website, and in return receive a percentage of the sales generated by people who buy items on your site.

If you have a website that has a reasonable amount of traffic, you can make money from banner affiliate programs where you earn a few cents for every banner click through that your site generates. Affiliate programs are very popular, and it’s easy to see why. They present a good way of making money without incurring huge costs, but sensible business practices still apply. You still need to attract customers to your site and you still need to convince them to buy and keep buying your products.

Third Party Revenue

A similar model to the previous one involves generating money from third parties. If your site has high traffic, and is well marketed, other companies may be willing to pay to advertise on your site. This includes all forms of online advertising such as banner ads and sponsorships of pages or sections on a site.

Sponsorship is the best way of generating money from advertising. This is because a company can target a specific area on your site that it knows will draw customers that are interested in its products or services. So, you can charge a higher rate than you would for a normal advertiser for a higher profile on your page, letting your sponsor brand the page with its logos, or adapting your site’s design and colors. Bear in mind, you will always be in competition with other sites that are after the same sponsors as you.

E-Commerce

Probably the best known model is e-commerce. It is one of the most complex models. Furthermore, there are various models within e-commerce itself, of which not all suit all businesses. Actually, e-commerce often is more about saving your company money than making money. By conducting all, or most, of your business transactions online your business can save money by cutting out the middle layer that typically drives up costs.