Website Investing for Beginners

Investing in websites can be a fantastic opportunity to make some (relatively) passive income online.

And you don’t need to be an expert or have any deep knowledge to start investing in websites. Yes, there are some basic skills required, but the learning curve is fairly short for anyone with just a bit of 21st century tech savvy. 

Many people compare this income model to real estate investing, and even refer to websites as “digital real estate.”

Certainly there are some tempting similarities. For one thing, we can talk about two general ways of making money from websites. Like real estate, you can either hold the property and collect monthly income, or buy a property at a low price and sell it for a higher price, also known as “flipping.”

How Do Websites Make Money?

First, let’s distinguish a website that is tied to a money-making business from a website where the site itself generates the income. 

In the first case, maybe you have a brick-and-mortar business that sells a product, like clothing, and you use your website to attract customers. And this obviously works for ecommerce, too, where the brick-and-mortar is replaced by online shopping, like Amazon. Or maybe you have a service-based business like a plumber or a landscaper. 

But if we’re talking about the website itself being the “business,” then we can look at other models for generating income. Here are the most common ones. 

Making Money With A Content Site

Content marketing involves creating high-quality content that attracts visitors to your website and generates revenue mostly through advertising networks such as Google AdSense or Ezoic or similar. This strategy requires some time and effort to create content that is valuable and relevant to your audience, but it can be a highly effective way to generate passive revenue once the site is up and running.

The penultimate goal here is to get your content to rank high in Google searches. High ranking pages get more traffic, and hence make more money by displaying more ads to more people.

Ads are generally paid by “views,” and the ePMV is the earnings (dollars) per 1,000 views. The ePMV will vary by industry, and it can also be seasonal, as well as affected by the general economy. When the economy is good, advertisers have more money to spend. 

A typical ePMV might be $10.00. That means for every 1,000 visitors to your website, you are paid $10.00. So if you get 2,000 visitors a day on average, that would net you $600 a month. 

Making Money With An Affiliate Site

Affiliate marketing involves promoting other people’s products or services on your website and earning a commission for each sale made through your referral link. This strategy can be lucrative if you have a large audience and are promoting products that are relevant to their interests. 

The two factors are, obviously, the cost of the product or service, and the commission percentage. 

Amazon Associates is a popular affiliate program. It’s popular because it’s easy to get started, but just note that other affiliate programs pay a much higher percentage. 

And like a content site, affiliate sites rely heavily on search engine traffic. However, with affiliate sites, the rule of thumb is quality over quantity with regards to traffic. You need the people who are visiting your site to be very interested in the products that you’re promoting, not just casual website surfers. You want them to already be in “buy” mode, so your content should reflect that, and keyword selection is important. 

For example, a content site might write an article entitled “What are WiFi routers?” This article is purely informational, and would be aimed at a person just looking to understand this topic. And this would have wide appeal and probably generate a fair amount of traffic once it reached Page 1 in the Google search results. 

On the other hand, an affiliate site might take a different approach to the same topic and write an article entitled, “Best WiFi Router Under $100.” This is aimed at people ready to buy. The traffic to this article would likely be less than the previously mentioned one, but it would pay out a great percentage. 

Making Money By Selling Digital Products

Digital products are popular among internet entrepreneurs because they are cheap to reproduce and sell at scale. In other words, while it takes a lot of effort to write an ebook, the cost of producing a million ebooks is the same as the cost of producing just one. 

Besides ebooks, other popular digital products are e-courses, SaaS (software as a service), subscriptions, and memberships. 

In some niches, this can be the most profitable model of all. Tech niches are particularly ripe for this. For example, an e-course on how to use a particular type of software tool (ex. Photoshop) could be potentially very profitable. 

How Do You Create Money-Making Website?

So how do you “get” one of these sites? We can further break this down into three ways to get started. 

Buying an Existing Site

This strategy involves purchasing a website that generates revenue and holding it for a period of time to increase its value. The website can be monetized through any of the methods mentioned above such as advertising, affiliate marketing, e-commerce, or other means.

Furthermore, this strategy often involves buying a website that has potential but is not being fully utilized, improving its content, design, and SEO, and then eventually selling it for a higher price.

There are several marketplaces out there where you can search for sites in your price range, then perform the due-diligence to vet your options for the best value. 

Building From Scratch

Building a website from scratch involves creating a new website that generates revenue and building it up to become profitable. This strategy requires more time and effort than buying an existing website, but it allows the investor to create a website that is tailored to their exact interests and expertise.

Needless to say, this method also requires more know-how, and you have to be very patient before you’ll see any profit. In the long-run, this might be the most profitable way to go. But it also requires the most effort. 

Building on an Aged Domain

A good compromise might be building a site on an aged domain. This means acquiring a domain from an auction, such as GoDaddy, that already has some “credibility” on the internet, which means that it will get noticed by the search engines much quicker than a site built from scratch on a new domain. 

A couple of downsides here. You can’t always find the “perfect” domain name that matches the brand that you have in mind. Also, there is still work to be done since the site itself has to be built, even though the domain carries its residual authority. 

Website Investing Summary

Website investing refers to the act of buying, managing, and selling websites for profit. There are various ways to make money by investing in web properties that we will discuss in this post.

Overall, website investing can be a lucrative way to generate passive income, but it requires a some amount of time and effort to be successful. It is important to do your due diligence before investing in a website and to have a clear strategy in place for how you plan to generate revenue from the site.