How to Make Money on the Internet: 5 Different Methods

thanks to hover for sponsoring this video and supporting my channel hey there my name is thomas frank and for the past about eight years i have made my full-time living on the internet that's been done primarily through my blog college info geek a podcast that i run and this youtube channel with income sources ranging from speaking engagements to youtube ads to sponsorships affiliate marketing sales of my own book and a secret only fans account one of those is a lie can we leave that in the video so as somebody who makes their living primarily from creating things for the internet i naturally get a lot of questions from people who want to do the exact same thing and i remember being one of the people asking those questions back when i started my blog about 10 years ago i was primarily doing it just to boost my resume and to have fun but i quickly started reading blogs written by people who were making their full-time incomes sometimes over six figures just running their blogs at first i thought this lifestyle would be impossible for me to achieve the freedom seemed alluring but i felt that that was for other people who got lucky and i would just have to work a job and just blog on the side but i was curious so i started learning and started devouring as much as i could possibly get my hands on from the tiniest details on website speed to the marketing psychology behind the colors of buttons on landing pages and about two and a half years after i first started my blog i hit full time income for the first time about three years ago i hit six figures in income for the first time and last year we did over half a million dollars in gross revenue i'm throwing these numbers out here not to brag but to provide a little bit of context on a what's possible be what's happened in my experience and to hopefully give myself a little bit of credibility for making a video like this so today what i want to do is kind of explain some of the ways that you can use to make money on the internet if that's something that you want to do so first we're going to cover some pretty important groundwork here and then i'm going to be covering five different ways that you can use to make money on the internet and for each of these methods i'm going to give you some tips for both getting started in it and being more successful with it to lay down that groundwork i talked about the main idea i want to communicate here is this making money on the internet is just like making money out in the physical world in at least one key dimension which is that you have to have some way of providing scarce value so what do i mean by that well value is obvious if you remember your economics class you probably remember that money is number one a store of value number two a medium of exchange and number three a unit of account so essentially money is a way of giving a numeric value to well value i value not mowing my lawn so i pay a lawn mowing company to do it instead of course there are different levels of value as well something that i value more than that is having a person to edit my videos which is also something that takes more skill so as a result i pay my editor tony quite a bit more than i pay lawn mowing company by scarce i mean not abundant the more choice that a customer has when it comes to a given service the more you as the service provider are going to have to start competing on price and the more you have to compete on price the more you have to start eating into your margins which is the difference between your income and what you had to spend to make that income on things like buying inventory running ads paying for web hosting whatever it might be a great example here is drop shipping and i will not be surprised if you get an ad for a drop shipping course on this video if you're watching it on youtube essentially drop shipping is a business model where you identify a product set up an online store for it and then when a customer orders that product you actually send that order to a supplier who sends it to the customer you don't keep anything on hand this is a very attractive business model because number one you don't have to spend any money upfront on inventory which is usually risky and requires warehouse space and number two you don't even have to deal with the hassle of shipping orders to customers instead as the ads for so many drop shipping courses will tell you all you got to do is find a cool product build an online site where people can order that product and then just drive traffic to the website using slick instagram ads or search engine optimization or whatever and you can do all of that while sipping a margarita from a beach in bali as long as it has wi-fi but you're going to be doing it alongside about a billion other dude bros trying to do the exact same thing so remember this easy low cost of entry equals huge competition equals razor thin or sometimes non-existent margins which can put you in the hole a better option is finding a way to increase the value of what you're offering or make it more unique somehow for example while most editors can provide basic cuts tony can do color grading he can do intricate sound design and he knows how to use b-roll to make the video that you're watching a little bit more pleasing to the eye but of course those skills take time and practice to develop and in some cases there may even be some form of monetary investment like i don't know buying a two 000 sound effects library so keep this in mind before you can make significant money on the internet you have to find a way of providing scarce value anybody who is telling you anything different is almost certainly trying to sell you something and it's probably a course that helps them make money not doing the thing that they're teaching you how to do you have to provide value luckily there is more than one way to do that so freelancing is probably the best place to start here because it is in my opinion one of the easiest ways to start making a decent amount of money on the internet fairly quickly especially if you have a skill to start with it's also the place where i started back in high school i started a freelance web design business and i put up a website trying to get clients and i actually landed a few that helped pay my bills throughout college now i will admit that a lot of the clients i got didn't actually come from the internet some of them came from word of mouth referrals in my local area and for other ones i was actually making cold sales calls trying to get clients but eventually i did get two clients who found me through google searches and they hired me for ongoing web work that actually again paid some of the bills that i had during college and provided some decent money if you want to talk about numbers i think the first website i ever built i charged about 350 bucks for and the last one i built before i moved into blogging i charged around 2 000 so you can make some pretty good money doing web development whatever you want to do if you want to get into freelancing you first have to learn a skill that is in demand and that ideally you can do over the internet so i'm talking about things like web development video editing podcast editing is a big one professional writing and sometimes even bookkeeping another option is actually doing in-person services but marketing them over the internet using geo-targeted ads or by just targeting people in your area in other ways so this could be things like photography and videography maybe being a wedding photographer doing interior decorating or and i'm surprised this is a thing but i researched it and it is you could become a decluttering and minimalism consultant did you say minimalism in fact you can even go get your konmari certification to help people channel their inner marie condo and declutter their lives we live in a weird world but hey that's the thing you can do anyway with freelancing the great thing about it is that the investment you have to make up front to provide that value usually is gonna come in the form of time and sweat you're often not gonna have to spend a whole lot of money for instance as a web developer i learned pretty much everything i know for free just looking at blogs online resources and that was over 10 years ago today the resources for web development education that are free are vastly better than they were when i was learning codecademy is a great example okay three tips for getting started as a freelancer number one and this is super important you have to build an online portfolio have a place where people can look at the work you've done for clients in the past and judge whether or not your services are going to be right for them if you don't have any clients right now do some work on your own or possibly do some spec work for a non-profit or something just to get some experience under your belt and a project that you can show off number two put what you do and where you are in your social media bios i'm talking twitter i'm talking instagram i'm talking linkedin people like me often go to twitter and type in things like freelance graphic designer freelance motion graphics artist and then i will just start clicking on profiles looking at the pin tweets looking at the url in the profile hopefully it's a portfolio and i've made hiring decisions based on that kind of a search process so do it and finally number three build relationships with other freelancers who offer complementary services so if you're a freelance video editor like tony you might want to build some relationships with freelance motion graphics artists that way if a client comes along who needs both services if they find the other person they might be able to refer you and vice versa our second method for making money on the internet is affiliate marketing so getting into affiliate marketing means essentially becoming an unofficial salesperson for another company you sign up for their affiliate program you put links to their products on your website or in your youtube video descriptions and then when people click those links or use your discount code and buy that product you get a commission of that sale affiliate marketing actually drives a significant portion of the revenue that comes into my business particularly over on my website college info geek for example skillshare's affiliate program pays ten dollars whenever anybody signs up through my link so on my website i have all these little ads up for my own courses over on skillshare whenever anybody clicks those and signs up i get ten dollars the internet's biggest affiliate program is amazon's now the commission they pay on most product sales is pretty small but the upside of participating in that program is that well you can link to pretty much any product on amazon and there's millions of products so sites like the wirecutter make pretty much all of their income by creating buyer's guides guides on the best headphones or the best bluetooth speaker when somebody comes in and clicks the buy button on their recommendation they get a cut of that sale so how much money can you make with affiliate marketing well it varies really really wildly for one example convertkit which is an email marketing service pays their affiliates a recurring 30 commission on any sale they bring in recurring so as somebody who uses convertkit i have about a hundred thousand people on my email list which means i have to reluctantly fork over about 700 a month to convertkit and that means that the person who referred me because there was somebody who referred me is making a nice 210 dollars a month just off of me recurring on the other end of the spectrum we have programs like amazon's which again don't pay a whole lot per sale at present moment for example they are currently paying three percent for headphone sales so if you want to go back to our wire cutter example if wirecutter is recommending a 200 pair of headphones that means that if somebody clicks their link they're making six dollars on that sale and that means that wirecutter has to bring a crap ton of traffic into their headphone buying guide let's be super generous and say that one percent of the people who read that guide actually go on to buy those headphones through their link that means they're essentially making six cents per page view so to make that same 210 dollars that the convertkit affiliate made just off of me they need to bring in 3 500 page views so to be successful as an affiliate marketer you have to do three things first you have to find programs that pay a good amount per sale second you need to figure out how to drive more traffic to the web pages that contain your links or the youtube videos that contain them and finally you want to find a way to increase your conversion percentage which is the portion of people who actually click your links and then the portion of those people who actually go on to buy how do you do those things well for the first problem you just need to do your research and platforms like impact actually contain a marketplace where companies can post their affiliate programs and their conversion percentages and then you can apply to join those programs if you like for traffic you want to build an audience there's a couple of different strategies for doing this personally i built a blog and then a podcast and then a youtube channel around a general topic that i was interested in and then over time as affiliate opportunities arose for that topic i added them in organically but some people take the opposite strategy some people will first find a product they want to promote and then they will use keyword research to try to match that to a problem or an interest that people have if you want to go this route you can use tools like ahrefs.com to do keyword research you're looking for keywords that have a decent amount of search interest but not a lot of competition and if you find one you can start writing articles on it or making youtube videos on it in the hopes you're going to rank well in either google searches or in youtube search if you bring in traffic you're hopefully going to bring in affiliate commissions finally you want to find a way to increase those conversion percentages and this could be an entire video all on its own i don't know if it would fit on this general channel but essentially you want to start learning marketing strategies and get data driven so track how much traffic you get and how many clicks you get then make a change and then track the data again and compare and see what you can do income source number three european three is the programmatic ad so programmatic ads are ads that run alongside content that you create these are different from brand deals which we're going to talk about next because programmatic ads are not sold by you and you don't deliver the talking points yourself either so the example that you're probably most familiar with is youtube adsense which runs the ads that you see and let's be honest probably try to skip every single time before you watch a video unless you're watching this on nebula which has no ads anyway when it comes to programmatic ads the acronym actually no it's not an acronym it's an initialism and the initialism that you want to keep in mind is cpm which stands for cost per meal and meal is just the latin french and italian word for a thousand so we're talking about cost per thousand views here this is how these ads are often priced so if the cpm is on average two dollars which it could be here on youtube quite often then that means if you want to make the same 210 dollars that we had back in our affiliate marketing example you got to bring in 105 000 views so as you can see if you want to make money on programmatic ads you got to have a huge audience which is why you probably see most of your favorite youtubers diversifying their income streams doing brand deals doing merch adsense can be a decent revenue stream i make about seven or eight thousand dollars a month on it but it is one of my smaller income streams and i don't rely on it again because the cpms are so small you have to have a huge audience to rely on it that being said if you are hell bent on being the next jacksepticeye or mr beast and you know you're going to be bringing in millions of views there is something really important i need to talk to you about when it comes to programmatic advertising and that is the relationship between views and income a lot of people think this relationship is very strong and they'll often ask me questions like hey dude how much money could i make off of a million views to which i always have to answer it really really depends views and income are not strongly correlated these are only one variable in a very complex equation and this is going to be obvious to you if you think about it for more than a few seconds so let's do an example here let's say that i run a company that sells expensive pool cleaning robots if i'm considering running ads on my friend matt's channel that's all about pool maintenance i can be reasonably sure about a couple of different things number one the people watching matt's videos probably own pools otherwise why would they be watching videos about how to clean a pool and number two because those people most likely own pools i can also be reasonably sure that those people probably make a decent amount of money as well because they own pools so that means i have a relatively affluent potential customer base and because of that i might be willing to pay a 10 cpm to advertise on one of matt's videos which means that even if he's only bringing in 10 000 views on a video those views are gonna be worth a lot and to give you a counter example let's talk about philip defranco i love philip defranco's channel but let's be honest a lot of what phillyd talks about is essentially celebrity gossip and controversy and something that we know about celebrity gossip and controversy as humans who love us a little bit of shot and fraud in the morning is that all kinds of people are gonna click on that which means that if i'm running that pool robot company i can't really be reasonably sure about who is in philly d's audience it could be a pool owner it could be somebody living in an apartment who has no interest in owning a pool whatsoever and because of that i can't afford to spend as much per view on phillips channel maybe i'm going to pay a 50 cent cpm so to make the same amount of money that map makes on 10 000 views d is going to have to bring in well what's 20 times 10 000.

It's gonna be 200 000 views so again the correlation between views and income is extremely weak and if you want to be successful with programmatic advertising you either need to bring in millions and millions of views on you know video games or celebrity gossip or whatever you want or maybe a little more strategic here you pick a topic that's a little more niched down and that has a viewer base who might be a little more primed to buy slightly more expensive products now i was picking on billy dee a little bit earlier but he has something that is actually a huge feather in his cap which is a loyal audience and that makes his channel a great fit for way far at brand deals so brand deals these are the sponsored segments that you're going to see on most high view youtube videos these days these are the sponsor segments that are read by the creators themselves and if you're watching this video on youtube you're going to see one at the end of this video and if you're somebody who usually skips those ads i would say maybe stick around and watch this one just to see how i structure it because with brand deals and sponsor segments there is a huge amount of price variability and that is because there are a ton of different factors that go in to the quality and the effectiveness of an ad with a programmatic ad you don't have a whole lot you can control you can control the topic of your video which may control the segment of people who watch it and influence your cpm somewhat you can control the quality of the video to try to bring in more views but that's about it i guess you can also control ad placement so pre-roll post roll but with a sponsored segment you have so much more control because you as the creator are doing the read yourself the good news is that sponsored segments and brand deals typically pay a lot more than programmatic ads sometimes 10 times more sometimes even 20 times more and that's because ads that are voiced by the creator by the person that the viewer came to watch are simply a lot more effective the main downside is that brand deals are typically a little bit less accessible when you're getting started and that's because you're gonna need to build up a sizeable audience on your platform of choice first once you bring in a significant amount of views on youtube or on instagram or wherever it is that's when you're going to start seeing raid shadow legends and various pubic hair removal products sliding into your dms now there are a lot of factors that are going to go into the effectiveness of your spots but the most important one especially for your long-term success is trust you have to put your audience first which means only promoting products that you know are going to be valuable and helpful for the people who watch and trust you another important concept that can increase the effectiveness of your sponsor reads is the ada framework which stands for attention interest desire and action i think i first learned about this concept in the movie glenn gary glenn ross where alec baldwin explains it with a lot more swear words than you're gonna hear in this video but essentially a good ad follows these steps in this order first working to get the viewers attention then getting them interested by talking about something that the viewer hopefully cares about only at that point is it useful to start introducing the products talking points and tying them to that interest i see a lot of ads here on youtube that do that whole smooth segway thing but then immediately launch into the talking points for the product which makes the ads less effective than they could be lastly i have to say this if you're a creator who gets approached about brand deals remember what i talked about earlier with regards to views and pricing they are not strongly linked so it may be worth pricing your first couple of deals with a brand or an agency based on price since you really don't have a whole lot of extra data to give them at that point but after that you shouldn't be pricing solely based on views and never let an agency talk you into a view guarantee because you know the views are not strongly linked to pricing so if they are trying to make you believe that they are they're probably not treating you fairly finally we have method number five which is selling your own products like this cool pixel llama sticker that i have on this mug which is not mine but the sticker is so if you want to sell your own products i don't blame you because whether we're talking about sponsor segments or cpa ads or affiliate commissions in any case you're advertising somebody else's product which means that you don't get the entirety of that sale you just get a small slice of the pie and what if you want the entire pie for yourself well selling your own products can get you that minus your expenses of course so the main thing i want to talk about when it comes to sales of your own products is that doing this almost always involves some kind of upfront investment that could be monetary investment in the case you have to buy inventory though there are ways to mitigate that using crowdfunding sites like kickstarter is one of them but there is almost always going to be a huge upfront investment of your effort and time and since this is your own product you haven't sold before there is a big risk factor because you don't know how well it's going to sell so my main tip here is to do some market research and the one example that always comes to mind when i think about this is involving my friend grant baldwin who was a professional speaker who spoke at colleges and schools for most of his career and at some point he wanted to create a course for people like yours truly who wanted to do the same thing so instead of investing a ton of effort up front and creating this big long course and then trying to sell it he first pre-sold access to a rough outline of the course to a small portion of his email list of which i was one of those people and i bought access to that pre-sale which was about half of the price of the regular course and what i got at first was literally just an evernote outline with a bunch of bullet points of the things he thought needed to be in the course and personally i found this really really helpful because i'm a quick learner and i really liked just being able to go down this bullet list and get a lot of my initial questions answered so this was in my opinion a really great way to do some market research gauge that interest and kind of mitigate the risk involved in selling your own products now personally i use all five of these methods to create multiple sources of income for my business and if you're just starting out that should be your eventual goal but at the beginning it'd be a good idea to just pick one of these and make that your focus at first but no matter which one you choose there is one common factor which is that you need to create an online presence for yourself if you're a freelancer that's going to include your portfolio where you can show potential clients your work and if you're selling your own products you need a place where people can go to buy them but even if you just want to make money on youtube it's still a smart idea to create your own online space you don't want your entire business to be at the mercy of a platform that you don't control for me that space is my personal website thomasjfrank.com where i have links to my book to my courses that people can buy and to other work that i've done and if you want to create a space that's like mine then the first thing you're gonna need is a domain name which you should get over at hover hover is the best place on the internet to get your hands on domain names not least of which because they have a pain-free quick checkout process without any annoying pop-ups or friction they also have hundreds of domain extensions you can choose from so you can get your classic.com or dot me or you can get something kind of funky and interesting like i've gotten with thomas.lol and one thing that i'm going to note here is that even if you're not ready to start your business if you do have a name in mind it's a very smart idea to secure the domain name now so nobody else can take it from you once you are ready to get started once you do have your domain name you can also create a professional looking email address for it like thomas collegeinfogeek.com or thomas thomasjfrank.com plus there's a feature called connect where you can easily connect your domain up to online website builders and even online store builders so if you are ready to get your domain name head over to hover.com thomasfrank where you can get 10 off your first order and support this channel thanks so much for watching if you enjoyed this video hitting that like button gently with your middle knuckle is definitely helpful that helps the youtube algorithm know that people like these videos and maybe it'll send it out to more people so definitely helpful for me and i just checked my stats the other day and realized that only 40 of the people who watch my videos are actually subscribed so if you aren't subscribed yet and you enjoyed this video definitely hit that subscribe button so you don't miss out on future videos beyond that i'll have a couple other videos on the screen here you can click on or you can follow me over on instagram where i'm doing q a videos every single week if you've got questions send them over and that's it so thanks for watching and uh if you don't want to do anything i just said well don't because i'm not your dad

You May Also Like