Close
Close

10 Innovative Blog Business Models

Keeping You Posted by Skellie.Skellie wrote this post. For more advanced blogging tips and strategies, visit her blog, Skelliewag.

When people think about making money with a blog, they tend to think about things like AdSense and affiliate links. You write good content, people come to your blog, people click on links, and you make a bit of money. How much money you make depends on how successfully you can multiply this process.

However, for some entrepreneurs this method of monetizing a blog is just one part of a larger business model that is much more lucrative than advertising on its own.

In this post I want to highlight 10 innovative and successful blog business models that do more than sell ad space or clicks. Is there room for one of these business models on your own blog?

(Please note that this particular post does not contain affiliate links.)

1. Teaching Sells / Blog Mastermind (Educational course)

Copyblogger sells TeachingSells.com

EntrepreneursJourney.com sells BlogMastermind.com

This business model involves selling an expert course on the back of a blog. Each blogger is regarded as an expert in their field and their free content demonstrates that they have plenty of useful advice to give.

These courses may only appeal to a small percentage of the host blog’s readership, so they are usually priced at the high-end to compensate. For this reason, courses must focus on sharing skills and methods that the reader values very highly.

Most commonly these are skills and methods that will–hopefully–yield more money for the reader than they spend on the course itself. If the course doesn’t have the potential to earn the reader money then it must impart a skill that has a very high non-monetary value. A Chess course might be worth $99 a month to someone who is passionate about Chess. A course in Mandarin might be worth $150 a month to someone who is relocating to China in three months and is determined to be able to hold conversations with locals as soon as they arrive.

The determining factor in success with this model is an understanding of what your readers value deeply, and providing them with that, either by providing them with great value or the means to achieve it for themselves.

2. IttyBiz (eBook)

IttyBiz sells Ninja SEO School

Naomi Dunford writes IttyBiz for online marketers and entrepreneurs who are ordinary people with a tight budget. She says her consulting clients were always curious about SEO and how to start using it for their benefit. In response to the demand she wrote the ‘Ninja SEO School‘ eBook. If you click the link you’ll notice that it’s no longer for sale, and I hope the ProBlogger mention hasn’t made Naomi regret the decision ;).

By making the choice to say the eBook would only be available for a limited time, readers who would have post-poned the decision of whether to buy the product until later (and then probably forgot about it) were forced to act quickly.

This is a very clever method to overcome one of the eBook’s weaknesses as a medium: its format makes it seem like the product will always be in unlimited supply, which can often provoke lethargy in potential buyers. Books in bookstores go out of stock, but eBooks technically never do.

If your eBook is expensive then it’s highly likely a potential buyer will think about the purchase for several days and talk themselves out of it. By creating scarcity you can motivate potential buyers to action.

Though there are many blogs funneling into an eBook, I chose IttyBiz as an example because of the clever use of artificial scarcity as a marketing tool. (Though if you emailed Naomi, I bet she’d still sell you a copy!)

3. ProBlogger / FSw / Smashing Magazine (Job board)

ProBlogger.net sells Jobs.ProBlogger.net

Freelance Switch sells Jobs.FreelanceSwitch.com

Smashing Magazine sells Jobs.SmashingMagazine.com

Vocation-based blogs like ProBlogger (bloogging), Freelance Switch (freelancing) and Smashing Magazine (design) are a perfect fit with the job board business model. These job boards that stem from blogs are usually monetized in one of two ways: advertiser pays a flat fee to post their job ad, which is the most common method and used at ProBlogger and Smashing Magazine, or job hunters pay a small subscription fee to have access to jobs, which is the least common model and is used at Freelance Switch.

Building a job board is likely to require development costs of at least several hundred dollars and possibly over a thousand, so it may be best to wait until your traffic levels are healthy before adding something like this to your blog.

4. PSDTUTS / SEOmoz (Premium content)

PSDTUTS.com sells PSDTUTS PLUS

SEOmoz sells SEOmoz PRO

These two blogs both offer members-only content for paid subscribers. At PSDTUTS $9 a month gives the user access to a large library of .PSD artworks and tutorials from well-known Photoshop artists. SEOmoz offers its ‘Pro’ membership at $49 a month, for which you receive SEO tools, guides and extra blog content. Both membership models are supplemented by a larger proportion of free content that serves to bring potential members into the blog and also as an advertisement for the content offered in the membership program.

While members-only blog content can be a lucrative business model you should expect to meet with criticism from readers who are struck by the double-wants of experiencing all your content while also not wanting to pay for it. The internet provides such an abundance of value for free that some people perhaps stop thinking about the creator’s need to be rewarded for their hard work. You should remind them of this and then focus on those customers who see ‘free’ as a privilege, not a right.

5. SpoonGraphics (Freelance services)

Blog.Spoongraphics.co.uk sells Spoongraphics.co.uk

Chris Spooner’s blog is a good example of a supported freelance business model. Freelance services are offered on a portfolio which is attached to his blog. The blog content deals with design and presents daily opportunities for Chris to demonstrate his own expertise as a designer to potential clients who might be reading his blog.

While it might seem counter-intuitive to write for other people in the same field instead of ordinary people who might be looking for a designer, many freelancers find good work covering gaps for other freelancers. For example, a freelancer who only knows how to code might hire another freelancer to create designs for him or her. As the web makes it easier to connect with freelancers across the globe this kind of collaboration is becoming increasingly common.

6. Remarkablogger / Muhammad Saleem (Consulting)

Remarkablogger.com sells Michael Martine

MuhammadSaleem.com sells Muhammad Saleem

Michael Martine writes a blog about blogging and offers consulting services as an off-shoot to the blog, targeted towards businesses who want a strong blogging presence. Muhammad Saleem is a social media power-user who also advertises social media consulting services from his blog. The premise of this business model is to build a profile as an expert in a specific area, give readers a taste of the kind of insights you can provide and then offer consultations to those who want to benefit from your knowledge on a deeper level.

The rates you can charge and the amount of uptake you get will depend on your topic as much as it does on your personal brand. People with entrepreneurial aspirations are more likely to need and be willing to invest in a consultant because they fundamentally expect to earn back more than they spend as a result of the knowledge they’ve gained. A life consultant or sports consultant or any other kind of consultant who might not be focused on helping the client earn money needs to provide immense non-monetary value instead.

7. Pearsonified / GoMedia (Digital products)

Pearsonified sells Thesis

GoMedia sells vector graphics and Photoshop brushes

The ‘Thesis’ theme has been everywhere of late. Probably because its creator’s blog has over 5,000 subscribers and he also seems to have made the right kind of friends. If you’re going to sell a product you’ve built then nothing will help your cause more than having a popular blog to back you up.

The GoMedia design firm does more. It uses a popular design blog (almost 10,000 subscribers) to sell both design services and products: the GoMedia Arsenal vector and Photoshop brush packs. Visitors are drawn into the site via the blog content and can then be funneled into either the branded services or products on offer.

8. LifeDev, Zen Habits and Web Warrior Tools

LifeDev and Zen Habits sell Web Warrior Tools

A blog can also be an excellent way to support your entrepreneurial projects and give them a kick-start. Leo Babauta (Zen Habits) and Glen Stansberry (LifeDev) partnered to create Web Warrior Tools to provide a platform for writers to sell their eBooks and have someone else market them. Both blogs link back to Web Warrior Tools and were able to promote it at launch. Instead of having to claw out an audience from nothing, the Web Warrior Tools website was able to launch with pre-existing hype and an immediate user-base.

9. NETTUTS (Magazine model)

NETTUTS.com

Based on the success of the Gawker Media network of blogs it’s becoming increasingly common to see blogs run like print magazines, with a team of paid writers and an editor, and with an entrepreneur or company behind them, using advertising and other methods to break even and, hopefully, making a profit once staff and running costs are subtracted.

This business model can be one of the most ‘hands-off’ as you don’t need to be involved directly in the running of the blog. That being said, paying writers and an editor can be costly, so most successful magazine-style blogs are quite highly-trafficked in addition to having the starting capital to run at a loss for some time, at least initially. NETTUTS is a web development tutorials site that runs under a magazine model, paying tutorial writers and an editor out of advertising proceeds.

10. Sitepoint (Branded products)

Sitepoint sells books and educational kits

Sitepoint is an exceptionally popular website for web developers and designers. Part of that website is a network of blogs featuring web development news, tips and theory. Former and current Sitepoint bloggers have gone on to publish books under the Sitepoint brand, which are then sold from the Sitepoint website or through other channels (such as Amazon). The books are prominently branded with the website and blog logo.

Your branded products don’t have to be books. Some blogs sell merchandiseprint magazines, audio books and courses, and other products.

***

I hope this post will show you some of the creative ways people are making money through their blogs. It can be easy to approach the challenge of making money online from a very narrow angle and blinker yourself to rarer possibilities that may be a better fit with your blog.

Most importantly, don’t be afraid to trail-blaze and invent a business model that is perfect for your blog, even if it doesn’t exist yet!

6 Types of Business Entities to Consider for Your Blogging Business

This guest post is part of a two part series (see part 1 here) written by Kelly Phillips Erb, a tax attorney who blogs for b5media at taxgirl.com. You can find out more about Kelly here. For more information about tax and blogging, check out her handy list of prior articles on the subject including Problogger articles!

Once you’ve made the decision to treat your business as a business, you’ll need to choose an entity. Follows is a brief rundown of the most popular forms of business entities for freelancers and bloggers:

1. Sole Proprietorship

The sole proprietorship is the most simple form of business entity. There is no formal procedure to form a sole proprietorship and there are few formal accounting requirements. There are no separate tax forms; you file taxes on your own personal income tax return. You can easily exchange personal and business assets. This is how most bloggers and freelancers operate.

The downside of these “loose” requirements is that sole proprietors are personally liable for debts, obligations and the like of the business, including lawsuits. Personal assets are essentially treated, for liability purposes, as assets of the business.

Additionally, since your business income is reported on your personal return, deductions expenses like medical insurance are limited to the caps and restrictions for individuals. In most cases, these deductions are less favorable to take as personal expenses than as business expenses.

2. Partnership

A partnership (sometimes called a “general partnership”) is also a simple form of business entity.

A partnership operates from a tax perspective as a “pass through” entity which means that all items of income and deductions pass through the partnership to the partners according to percentage of ownership or partnership agreement. Those items are then reported on each partner’s respective personal tax return. No income tax is paid at the partnership level (though a partnership may be subject to other state and local taxes).

As a result, personal and business assets are not separate and personal assets can be subject to the liabilities and obligations of the partnership. Additionally, just like with a sole proprietorship, the availability of certain types of deductions are limited to the tax floors and ceilings on your personal income tax return.

3. Limited Liability Partnership

A Limited Liability Partnership (“LLP”) is similar to a general partnership. There is one significant difference: in most states, an LLP may register with the Department of State. The benefit of registration is that each partner is not liable for obligations and liabilities arising from the “negligence, omissions, malpractice, wrongful acts or misconduct” of the other partners. In other words, so long as you observe the proper rules, liability is largely limited to your own actions.

The LLP, like a regular partnership, is treated as pass through entity for federal and state tax purposes. Again, income and losses pass through to the partners either in proportion to ownership or according to your partnership agreement.

An LLP does not offer complete liability protection. Although an LLP has limited liability for “negligence, malpractice, omissions, etc.” there is unlimited personal liability for contractual obligations of the partnership such as, for example, promissory notes.

4. Limited Liability Company

The Limited Liability Company (“LLC”) is probably the best known corporate entity other than a regular corporation. It’s a hybrid entity that offers the liability protection of a C corporation with the tax option to be treated as a partnership or a corporation.

An LLC can be structured to provide for added flexibility, including unlimited members. An LLC also provides ease of operation and possibilities for expansion which makes it attractive for a number of freelancers.

An LLC is govened by an Operating Agreement, which outlines plans for business management. Banks, mortgage companies and other institutions will want to see your agreement when making loans or setting up accounts. The Operating Agreement also allows you to set up the “control” of the corporation and limit the transfer of interests.

Even though the LLC offers pass through tax treatment, liability is limited in much the same way as with a C corporation. This means that so long as you follow the corporate formalities, as well as keep your personal assets separate from your business assets, your liability will largely be limited to your business assets.

5. S corporation

The S corporation is another special form of corporation that operates like a C corporation but is taxed like a partnership. There are strict limitations on the structure of an S corporation including the number and types of shareholders.

The S corporation is considered a good vehicle for small, closely-held corporations. One of the most attractive features of the S corporation is the ability to “slice up” distributions to shareholders and reclassify those distributions. Traditionally, compensation to shareholders who also served as owners was taxable as ordinary income. As compensation for services, it was also subject to self-employment tax, which is the self-employed person’s version of FICA (Social Security and Medicare contributions). The rate for self-employment tax is 15.3% of wages (the equivalent of the employer and employee portion of FICA). This tax is on top of the actual income tax on those wages. The result is a painful hit – the same as operating as a sole proprietor.

Since 1984, there have been a number of tax packages passed that have made the notion of dividends more appealing, especially the legislation passed under President Bush’s first term, which lowered those rates. So practitioners started thinking: what if you paid yourself a dividend instead of a salary? Under the old tax laws, that wouldn’t be a good thing. But under the new tax laws, it may result in tax savings. This is the feature that is most attractive to freelancers; however, you will want to make sure that this is set up properly so that you don’t create a tax, legal or Social Security problem. And oh yeah, it’s definitely worth mentioning that the IRS doesn’t like it…

The S corporation also has a number of restrictions relating to ownership – be sure and check out these ahead of time. If you lose S status due to a reporting or management violation, the time period is generally ten years before you can regain your status. The default is that you would be treated as a C corporation, which likely not a good thing from a tax perspective.

6. C corporation

A C corporation is what most people generally think of when they think of corporations – C corporations are the companies usually followed by “Inc” in their names, as in Coca Cola, Inc.

The advantages of a C corporation are continuous life, clear divisibility of assets between personal and corporate, limited liability among shareholders, freely transferable shares of stock, virtually unlimited options on structuring stock ownership, and favorable tax treatment for certain expenses. All good, right?

The disadvantages of a corporation are increased administrative expenses, compliance formalities and the potential for “double taxation.” Increased administrative expenses are due to more complicated accounting and tax compliance (i.e. filing corporate returns). “Double taxation” is the result of a C corporation being a separate taxable entity and not a pass through. This means that the C corporation pays a tax on its income for the corporate year and the shareholders pay tax on dividends received from the corporation. Additionally, money that is paid out as salary is reported as ordinary income and is subject to FICA (Social Security and Medicare taxes) on the employer and employee sides; in a one person corporation, this is largely the same result as paying self-employment taxes since it’s the same pot of money.

In most cases, a C corporation is “overkill” for a freelancer with no immediate plans for expansion, hiring of employees, etc.

The Bottom Line

Be informed. Research. Know enough to know the direction that you generally want to go. But don’t assume that information that you glean from friends or the internet (even if it comes from a reliable source) is sufficient to make a business decision.

Laws vary from state to state as to how various entities are structured, so check with your tax or legal professional for specifics: I can’t stress this enough. While it feels cheap and easy to simply incorporate online, you may be creating a bigger monster – some states charge annual fees for incorporated entities which can add significantly to your tax bill. Additionally, creating an incorporated entity may subject you to local taxes that you would not have been required to pay if you remained unincorporated.

If you don’t get proper advice, you can also make elections or fail to make elections that can result in serious tax consequences. We often joke that our office is like that Midas commercial: you can pay us now or you can pay us later. Don’t forego important advice to save a few dollars in advance: you may find that you’re really paying for it later.

For more information about tax and blogging, check out my handy list of prior articles on the subject including Problogger articles!

Like any good lawyer, I need to add a disclaimer: Unfortunately, it is impossible to give comprehensive tax advice over the internet, no matter how well researched or written. Before relying on any information given on this site, contact a tax professional to discuss your particular situation. If you have a question, ask the taxgirl.

Web Warrior Tools Launches

Web-Warrior-ToolsToday I was chatting to Leo from Zen Habits who told me that he’s just launched a new site.

When Leo tells me he’s starting something new I always take notice – he’s got a habit of making things work and has built his blog from 0 to over 50,000 subscribers in under a year, has written an excellent ebook – Zen to Done (the ultimate simple productivity system) and has been a prolific guest blogger.

Leo’s new project called Web Warrior Tools and is a partnership with fellow blogger Glen Stansberry from LifeDev.

They’re promoting it as ‘ridiculously useful ebook guides to everything’ and are launching with 4 ebooks:

1. Beginners Guide to Podcasting – an introduction to expanding into the medium of podcasting.

2. Email Zen - efficient email management

3. The Get Rich Slowly Guide to Roth IRAs – retirement planning resource

4. Healthy Life Secrets – a guide for those who want to break out of an unhealthy lifestyle

These four are just the beginning of what looks like being a fairly extensive library of ebooks. What I like about it is that the ebooks are cheap ($6-$9), they’re beautifully designed (as is everything Leo does) and well written. You can preview them on the site to get a taste before buying.

Leo and Glen have shown another way that bloggers can make money with Web Warrior Tools. They’ve both built a large following of readers on their blogs and now are joining together to leverage that profile to release products that relate to the blogs that they’ve built.

Monetize Your Blog through Text Messages – TextMarks

TextmarksAn interesting new monetization strategy for bloggers is emerging today – letting readers subscribe to your blog via Text Messages.

TextMarks has launched this new service which allows bloggers to either charge $4.99 or $9.99 per month to their readers to get these instantaneous alerts.

It’s currently only available to US cell phone users on Cingular, Verizon, Sprint or Alltel.

I’m not sure it’d work for the majority of blogs as an income stream – but for those who break news that people must know – then it could be a worthwhile monetization stream to look into.

How much do bloggers make from TextMarks subscriptions? From reading the Terms of Use it seems that publishers only make 30% of the subscription (while I know they’d have costs and the carriers take their cut it seems a little low for my liking – as a content provider I’d be hoping to make as much out of it as the carriers themselves (who can make as much as 50% by the looks of things).

Some questions for readers:

  • Would you pay for this type of service?
  • What type of blogs/sites would you pay for this type of service on?
  • Do you think your readers would pay for it?

Via TechCrunch

How to Sell Information Products

Wouldn’t you love to have your very own product to sell?

More and more bloggers are looking to diversify their income streams, rather than having all their eggs in the AdSense basket. Others are just now discovering blogging, and they recognize right away that it is an ideal platform for information sales business models.

For my very first guest article here at Problogger, I’d like to share a few tips about utilizing a blog to both create and sell information products. While it’s possible to sell information products created by others through affiliate programs, I’d like to encourage you to consider creating something yourself, as it puts you in the absolute best position in the online sales world.

The good news is, if you already have a blog, but no product, you’re on the right track. And if you have neither a blog nor an information product in development yet, you will definitely want to consider starting to blog first. I’ll explain why below.

So, without further ado, here are 7 tips for creating and selling information products with blogs:
[Read more...]

Developing e-Products

Chris has posted a couple of good posts on related topics over the weekend. Both focus upon bloggers adding income streams to their business through selling products and not just relying upon advertising or affiliate programs.

  • Monetizing Through Packaged Content - looks at the topic of repackaging your blog’s content up into an e-boook.
  • BlogCommerce – talks about selling products from your blog. It gives some of the advantages of selling electronic, subsriptions and physical products.

Both posts are worthwhile reads. As someone who has experimented with this a little in a similar way to what is described with the six figure blogging course (which has had some good sales since launching the home study version) I’d add that thinking of ways of repackaging content and adding products to your blog can be well worthwhile in terms of potential income.

However there are a number of questions I’d ask before rushing out and writing an e-book including:

[Read more...]

American Express Hires Bloggers to Blog about Richard Branson Speech

Dane from Business Opportunities Weblog has been presented with an interesting opportunity to make a few dollars from his blog by being paid by American Express to blog about a speech to be given by Richard Branson and to host a discussion afterward. Dane writes:

‘I’ve been hired, with two other veteran business bloggers (Anita Cambell of Small Business Trends, and Rob May of BusinessPundit) to be a part of the online blogging event….

Following the live event, the three of us will spend the rest of the week responding to Branson’s talk and writing about a variety of entrepreneurship topics relevant to the theme of the event. Clay Shirky, a professor and blogging pioneer, will be serving as our moderator for the online discussion.’

It’s an interesting experiment by American Express. Dane gets to post a disclaimer and gets to express his own opinions through the process. I wonder if we’ll see more of this in future?

T-Shirt Competition Debrief – Was it Successful?

Quite a few readers have asked how successful the T-Shirt competition has been. How many shirts have we sold? Is it worth it?

I’m not going to go into specifics about which shirt sold how many or even what the total sales have been in the ProBlogger shop – but I will say that overall this venture has not been my most profitable one and I don’t think I’ll be retiring any time soon on my earnings from ProBlogger’s T-Shirt range.

After CafePress takes their cut each item brings in only a few dollars and while there was quite a lot of interest in the competition and quite a few have gone to the shop for a look – sales have been very low. Lets just say that ProBlogger T-Shirts are collectors items due to the limited print runs at this stage – some of the designs are yet to have any sales at all. I don’t think that this is the fault of the designers – rather there are other factors at play (see below).

The cost of having the shop has been covered but the prize ($100 from Amazon) could take quite a few months to earn back from sales.

Why hasn’t this project been a raging success? Let me offer a few suggestions:

[Read more...]

Amazon Shorts

Has anyone ever tried using Amazon Shorts as a way to sell content? I’ve heard of a couple of people recently who have been using it but don’t know how they’ve gone. Could be interesting – let me know if you’ve given it a go.