The first question asked by a novice is usually "HOW do you make money online ?" My answer to that is usually "There are so MANY ways" which further adds to the confusion. Often times, people think there is only one or two ways to make money online. They get more confuse because this guru says he did it this way and that guru says he did it another way. Without a broader perspective, coupled with information overload, plus the inability to connect the dots together, the novice is confused, frustrated and unable to act. Has it not occur to you that all of the gurus may be right and there are so many ways (business models) to make money online. This section will explain some of the models normally used to make money online.

model #1 : The 1 Page Sales Letter

In this model, the author / owner try to sell you 1 product and the whole site is only a 1 page sales letter, albeit a very long page. In this letter, the seller will justify to you why you need to buy his product. This is not a simple letter, in fact, there is a method and formula to writing such letters which uses psychology to its greatest extent. We will delve further into this subject in the "Add Content" section.

The main idea is to persuade you to buy the product and at the end of the letter, there is a link where you can buy it immediately and download the product immediately (if it is a digital product). You make the money when the customer pays by credit card. If they don't buy, you usually persuade them to sign up for a free 7 parts article via your autoresponder.

The autoresponder will automatically send them predefined messages over a predefined time period. The idea is entice them with a little info (bait) so that they will want the whole thing. Some people buy not in the first instance but during the follow-up session.

Normally ebooks and software are sold in such manner. This is by far one of the fastest and easiest way to make money fast online.

model #2 : The Content Site

In this model, the seller runs a site which targets a specific niche. People will go to sites to search for content that they need or are interested in. For example, you like fishing and there is a site that offers you anything you need to know about fishing. Where to go, what rods and baits to use, where to stay, what types of boats to use, how to fish effectively, what clothes to wear, what are the essential accessories.

In such a site, the seller may sell his own product but that is not necessarily so. He may be a reseller of all the products he recommends (that's a bit extreme but he may get a commission for some of the products recommended) For instance, the hotel he recommends may pay him a commission or perhaps he's their sales agent, the rods and bait which are excellent products which he endorses may also put some commission into his bank account. Similarly, the clothing deal and the boat contract etc.

Don't get me wrong, the seller will still recommend those products to you whether or not he gets a commission because he believes in his product review, they are the best. But a little commission from the vendor wouldn't hurt. So you make money by recommending and endorsing other people's products in your content site.

There is a tracking mechanism so that when the customer buys, the vendor knows it came from his site. For the purpose of this discussion, a reseller program is also known as an affiliates program.

Model #3 : The Newsletter

In this model, the publisher of the newsletter is an expert is his topic of publication. Say, Fishing Monthly, is a monthly publication on all things fishing. There offer great articles and insights into fishing. They are so good, that people will pay money for a yearly subscription. That's one way to make money.

Secondly, the publication has such a huge subscriber base who are fishing enthusiast, the vendors supplying boats, rods, baits, clothing, accommodation, accessories would like to advertise on his publication. Advertising is one of the biggest source of revenue for publication. In fact, some publications are given out freely to attract a huge base so as to attract advertisers.

Publications can be as simple as One Joke A Day, with one, even two slots of advertisements. Or it can be a technical journal at the cutting edge of technology with expensive subscription rates. As long as there is a sufficient numbers, the advertisers will be willing to talk.

Model # 4 : The Portal

In this model, the publisher maintains a web portal. Although a general portal can have a huge market penetration, only the establish ones are getting the lion's share. Starting a general portal to compete with the likes of Yahoo and MSN will require an enormous budget and content, with probably unpleasant outcome.

You may however, start a niche portal. Say, a portal for fishing where you can find anything about fishing there. The community logs on to that site as their homepage because they are such fishing fanatics. You make money by charging for advertisement and for renting out "shop lots" in your portal's mall. However, you need to have good content with up to date news, reviews, and good representation of all things connected to the topic.

Model # 5 : Corporate Site / Web Store

In this model, you have a brick and mortar business (not literally, means you have physically setup shop somewhere). The website is an extension of your order takings as well as to disseminate information to your customers base.

You may allow your customers to order directly from your website and to accept payments. These may be your retail customers as well as your dealers. Once the orders are received, the goods are dispatched, shipped or downloaded.

You make money by selling your products and the process compliments your other physical sales and the process is made easier by leveraging on the technology of the internet which makes it cheaper for customers to order as well as less staff for you.

Model # 6 : Provision of Information

In this model, you may provide up to date information to your customer base. For example you are able to provide real time commodities market prices directly to your customers. You make money by charging a subscription fee for the supply of the information.

Information can come in may forms. As long as you are able to get up-to-date information which can be retrieved by your subscribers, you can make money by supplying such information.

Model # 7 : Provision of Services.

In this model, you provide a service where you accept payment on behalf of some other entity. For example, you run a service of cinema tickets booking. You may represent several cinema networks and since you buy in bulk, they may offer you a preferential rate. Your service will be to accept bookings from customers directly over the internet and then to deliver the tickets to their choice of destination. There is a nominal charge to the customers for delivery.

Customers don't mind because it saves them the hassle of going to the cinema to buy and they may miss the show if the tickets are sold out. You make money for the delivery charges and the commission from the lower ticket price.

Model # 8 : Buy Low, Sell High at Auction Site

In this model, you source for products, usually low cost products and in big volume from 3rd world countries or where the price is just very low. You then auction them off using Dutch Auction at sites like eBay. eBay is known to be one of the BIGGEST auction sites which attracts huge amount of traffic but it is very price sensitive as well.

Quite a number of people make their full time living just trading off the auction sites. There are also some books written on how to make money at auction sites with wholesales sources too. Check out the recommended books to the right.

There are many more models but these serves to illustrate that there are many ways to make money. There are 2 main principles involved :

Principle #1 : You sell something directly (a product, info or service)
For that you can ask thousands of affiliates to do it for you, get a good placement in the search engine or create some viral marketing. (We will cover marketing in a different section)

Principle #2 : You generate sufficient traffic to your site
You need not have your own product, you sell advertisement space and rental space to people who needs exposure. You also get commission from sale of other people's products.

As long as you fulfill either principle, you can make money online. As long as you make more money than spending it, you have a profit. Profits alone won't make you wealthy but positive cashflow will. So, make sure that the inflow of money is always more than the outflow, then you have made it. Lastly turn your business into a system, something which can run on autopilot or minimal interference from you, then you have a money making machine which will work tirelessly for you. You can then start another money making machine by either duplicating the same process or try another business model

Recommended Readings :

eBook Secrets
Exposed

Software Secrets
Exposed

The Affiliates
Master Course
(Free Download)

The Complete Moron's Guide to Selling on Ebay

The Auction Sources Big Book to find Wholesalers, Dropshippers, Closeout Sales & Suppliers