Why You’re Not Making Money Online

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Too many people think that they can just start a blog, put some AdSense on the sides, throw some links on there and start making money within the month. Of course that’s just wishful thinking; here’s a look at reality.
According to a study done by the University of Texas along with Chikita, the top 50 thousand blogs (as ranked by Technorati) cumulatively generate $500 million in revenue, after which the revenue starts to plummet. Here’s a look at the revenue distribution:
msaleem_chikitastudy.jpg
However, these figures aren’t necessarily discouraging. If you read the Pronet Advertising’s 4 Steps to Success you’ll note how closely most of the top blogs follow the formula (which is quite obviously not rocket science). What most people tend to overlook is that while blogging can be a profitable business, it takes time for any blog to mature, get recognition, and start generating the traffic required to generate money.
With that in mind, here are some other things we should acknowledge:
1. The top 50,000 blogs making $500 million per year means that the average blog made $10,000. While in most cases you can’t sustain yourself solely based on your blogging income, this is still a good amount of money to supplement other income sources.
2. While top-ranked blogs like TechCrunch and Mashable are raking in hundreds of thousands of dollars, reaching that status is incredibly difficult and an irrational expectation for a new blog.
3. The blogging space is growing, the long-tail is become longer and as blogging becomes more and more mainstream the amount of money flowing in and the size of the pie are only growing larger. This means that while you should have rational expectations, you shouldn’t give up hope on blogging as a viable source of income.
4. Not all monetization schemes are made equal. To decide how you can make the most from your blog, it is best to try out several different methods over time and see which suits your blog and your audience the best and then stick to it.
Note: Though the results of the study may not be entirely accurate they do present us with a good starting point for the discussion.

Cameron Olthuis

Cameron Olthuis

Cameron Olthuis

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