1. Drop Shipping
The basic idea behind a drop shipping business is that, as a small business owner, you don’t have to maintain a large inventory (or any inventory whatsoever) of products or handle any delivery to your customers. That eliminates the financial cost and risk of having a warehouse full of stuff you might not sell, and the hassle of arranging to send orders all over the country or the world. In fact, you don’t have to manufacture or store any products at all.
The only thing you have to focus on is marketing and advertising to find the customers and make the sales. Once the sale is made the rest is handled by others. Your only cost is the expense of marketing and advertising to acquire a new customer.
Once that is done, you’ll work with a company that specializes in drop shipping. Here’s how it works:
1. You list products for sale on a platform like Shopify, Amazon, eBay, or Etsy.
2. When one of your customers makes a purchase, you purchase the product from a third-party company (the drop shipper, usually a manufacturer or wholesaler) for a lower price. This process is as simple as forwarding the order from your customer, a process that can actually be completely automated. (Remember you don’t have any risk here of buying inventory because the sale has already been made).
3. Your drop shipper then sends the product to the customer.1
Easy enough, right? With drop shipping, you can offer a wide range of products, so the operating expenses for your business are super low.
As you can see there is no risk on your part because you don’t even purchase the product (at cost) until the actual sale is made!
What are the downsides to the drop shipping business model? You have to find a reputable supplier or manufacturer you can count on to deliver to your customers. If an order is late or doesn’t go out—or a product is of poor quality—you get blamed, as your company is the one representing the product and customer experience.
Also, because this market is so competitive, the margins—that is, the difference between the wholesale price and how much you can sell a product for—are lower, so this will be a high-volume type business to generate a serious income. But still, it is a worthwhile low or no-cost start-up option.
One way to stand out from the competition with a drop shipping business is to private label your products. This simply means you put your own label/brand on the products that the manufacturer is creating. That way you’re not selling the same product brand and just competing on price; rather you can use your own brand and face less competition.3 Think about when you’re looking at medicine at the pharmacy; the brand names sell for higher prices and people think they are different from the generic brands even though the ingredients are exactly the same. Consider these factors when researching a good drop shipping product.
Anyone considering a drop shipping business should seriously consider leveraging Amazon.com to grow their business and learn more about selling on Amazon also, because Amazon is an established marketplace that people already trust and has an existing customer base.
· Requires very little startup capital
· No need to maintain inventory
· You can leverage established marketplaces with existing customer bases
· You can be blamed for your drop shipper’s mistakes
· The market is very competitive
· You must sell a lot to generate a substantial income
2. Owning a Digital Marketing Agency
As a Social Media Marketing Agency owner, you will work alongside individuals, brand and companies to build and run their social media presence. The agency’s daily tasks consist of monitoring, measuring and engaging the performance of their clients’ social media accounts and making appropriate changes to improve their online presence. There are other lucrative services you can offer such as running a clients Facebook ads.
Facebook ads are a powerful way not only to reach millions of people but to target specific demographics or target audiences. If done right, Facebook ads can massively increase website traffic and result in increased sales and revenue. It’s tricky to get right, which is why many companies are happy to outsource to somebody who can maximise their Facebook advertising.
Successfully advertising on Facebook involves calculating the Lifetime Value of your customer, which comprises several calculations based on the average sale per customer and frequency of purchases. This figure allows you to set a budget-appropriate offer on Facebook to reach customers who are likely to respond to the ad. You’ll then need to create a target audience appropriate for the client and set up things like engagement campaigns, which encourage Facebook users to engage in the advertising.
Once you’ve learnt the process, it becomes easy to replicate for other clients and is a straightforward business to run from home. Set up a website to market your service and, of course, use Facebook too.
You can learn more how to set up a Facebook Ads Agency here: https://outhustleyou.teachable.com/p/social-media-marketing-agency
3. Affiliate Marketing
Affiliate marketing is somewhat similar to drop shipping but with some key differences. With this e-commerce model, you again don’t maintain an inventory of your own products, and you don’t have to worry about shipping products to customers.
Basically, you pick a profitable niche for your online business, then you find an affiliate partner who has products available in that niche. Some of the most popular affiliate sites are Clickbank.com, Amazon.com, and CJ Affiliate by Conversant (formerly Commission Junction). Between them, they offer just about any digital product (like eBooks, audio files, video files) or physical product you can think of. Many big-name companies and brands like Wal-Mart and Home Depot run their own affiliate programs.
With affiliate marketing, you offer the products for sale, for example, on your blog or e-commerce website. Each product has a unique link that tracks back to your account with your affiliate partner. A prospect who clicks on the link is taken to your partner’s shopping cart for checkout. Once they buy, that purchase is recorded and you receive a commission. Commission amounts vary depending on the affiliate partner, but is generally 5 percent to 25 percent, or 50 percent or more with digital information products. As you can see, there’s little risk on your part and virtually no investment needed either. Just like with drop shipping your only costs will be marketing and advertising to drive traffic and generate the sale.
The key difference between this and drop shipping is that the business model is even more hands off. All you have to do is provide a link for the customer to click on and the merchant handles everything; billing, order fulfillment, customer service, etc.
All you have to do is handle the marketing to get your prospects to buy (through social media, YouTube, email marketing, blogging, or whatever method you choose). But after they click the affiliate link, it’s out of your hands. You don’t have to ship products or handle any customer service questions. And you certainly don’t have to maintain an inventory.
All you have to do is focus on marketing your website.
Affiliate marketing really is one of the most “hand-off” types of online businesses you can start.
- Low risk: No initial investment required
- Hands-off business model
- You’re responsible for driving web traffic to the affiliate link (no traffic means no money)
- May need to spend money on advertising and marketing
Have you watched a YouTube video lately? Of course, you have! This is one of the world’s most popular websites, with more than 2 billion users watching hundreds of millions of hours of video each day. And it’s not all cats doing funny things, by any means.
You can create a channel in a niche and make a full time living of the YouTube Network. No, you’re not trying to create a viral video, so to speak, although if it does go worldwide and is seen by millions, that’s a good thing.
Instead, you’ll be following a proven strategy for maximizing views of multiple videos on a regular basis. You’ll be creating useful content—something engaging that people want to watch. And it works in many, many different niches. It could be a how-to video or a talking-head video on a topic of interest for people in your niche—the sky is the limit.
You make money with ad revenue. Your first step is to create a YouTube account and start uploading videos. Then you enable monetization on your YouTube settings.This gives Google the go-ahead to include short AdSense ads with your videos, which you’ve seen if you’ve watched a YouTube video. When viewers click on those ads, you get paid.
Another opportunity to make money with a YouTube channel is through paid sponsorships. Build a large enough following and companies will be more than happy to pay you to promote or mention their products and services in your videos.
Some tips to create professional-looking videos (no expensive pro equipment needed):
- You can use your smartphone or a simple video camera. But make sure the lighting is good so that everything in your video is clear and easy to see.
- Make sure the audio is clear. You don’t want an air conditioning hum, construction noise, or other distractions.
- Use simple editing softwarelike iMovie to put titles at the beginning of the video and to edit out any flubs.
Above all, remember that your videos can be simple and don’t have to be slick. Just provide useful content and be engaging and interesting. Funny helps, too.
And to extend the reach of your videos, be sure to post on your Facebook page, Twitter, your blog, and other channels. Let people know you’re in the video business now.
In addition to ad revenue from YouTube videos, you can also use your YouTube channel to drive traffic back to your website, where visitors can read your product reviews, click on the ads on your website, or even get on your email list—where you can make multiple sales with your email list.
- You can use your existing smartphone or computer
- It works across several different niches
- Creating and posting videos can be time-consuming
- It may take a while to begin making revenue
5. Information Products
If you’re a specialist in a particular area, you can produce an online course to take participants through training or education on a topic. Alongside expert knowledge on your subject matter, you’ll need to be adept at producing media that can deliver the training, in the form of videos, podcasts, websites or apps.
There’s no shortage of ways to create information products, but the most popular formats include:
- Audio: a recorded teleconference, interview, course, or some other spoken-word product
- Video: a recorded webinar, a how-to, an interview
- Text: an ebook, an instruction booklet of some sort, a travel guide
In each of these categories, you can really get creative and make any type and format of content, as long as it’s engaging and useful.
No matter which way you do it, it’s passive income—money you earn while you sleep because you put these products up for sale on your website and a customer can buy and download them any time of day or night, automatically. All you have to do is check the sales periodically to see what topics or types of products are selling best so you can make more of those.