BigStarMarketing

The best way to make passive income is to sell a digital product. This simply requires that you make or find a digital product to sell, build a ‘sales page’ from which to promote said product and then use advertising or marketing strategies in order to drive more visitors to that sales page.

This is a very ‘hands off’ method of earning an income that will generate money while you’re sleeping – and you don’t even need to worry about delivering a product!

But the problem is that this is limited in scope. Eventually, you are likely to exhaust the market for your product and find that the cost of advertising starts to outweigh the profit from your sales.

You aren’t delivering any value to the end user, you aren’t building a relationship and at the end of the day, this is a technique that won’t last forever.

And that’s why a lot of people are interested in making money from a website. That way, they can build their own brand, build a big audience and then sell products that they’re really interested in and proud of.

But is it possible? Can you really generate the same kind of passive income from a website? How long will it take? Let’s find out…

The Challenge

There are a number of challenges that make it harder to make a passive income from a website right from the offset.

For starters, you will immediately find that the money you make from adverts such as Google Ads is not truly comparable to the money you can make from a digital product. Ads will typically pay out a few cents per click and most of your visitors are not going to click them often. This is especially true these days with so many people running ‘ad blockers’ and the like.

The other problem is that it can take a long time and a lot of work to gain a big audience on a website. You’re going to be competing with the rest of the web and many of the creators you’re going up against will have gigantic advertising budgets.

The Strategy

But as with most things, the secret is to work ‘smart, not hard’.

That means picking the right niche to begin with. By selecting the right niche to enter into, you will be able to avoid going up against huge competition (as you might do if your niche were something broad like ‘fitness’ for example) while at the same time ensuring there is enough of a demand for what you’re selling.

Choose a niche that has clear products to sell to a specific audience and one that will allow you to avoid the hugest competition.

The next strategy is to recognize that you need enough content to climb the ranks of Google and that this content needs to be high quality. This is where it can be hard to keep your model ‘passive’ but the solutions are either to hire someone who will create the content for you, or to spend a while writing lots of content so that you can post it gradually over time.

 

Earning a passive income may be synonymous with making money from a digital product or affiliate product but that is far from the only way you can make money while you sleep and travel.

In fact, what you’ll find is that it’s actually possible to make a passive income even offline! This is something we consider a lot less often but the strategy simply involves building a business that can eventually run itself. You hire staff and you train them up to replace you, so that eventually you can run the business while having very little actual input!

The same thing works online but you can get there a lot quicker by using freelancers. And this is what we call ‘arbitrage’.

What is Service Arbitrage?

The term arbitrage normally refers to trading and it effectively describes taking advantage of different prices in different markets. So for example, you might buy a product from one market and then sell it to another for more. This could mean stocks and shares or it could mean currency even.

So what is service arbitrage? Hopefully you’ve already guessed that this means buying and selling services, while scraping off a profit for yourself.

If you can find a client who is willing to pay $4 per 100 words for content writing and you can find a writing service that is willing to offer their writing at $2 per 100 words… all you need to do is act as the middle man! You simply look for the clients and then pass their order on to the writer – without even necessarily explaining that the work isn’t for you.

Better yet, is that you can automate even this small amount of work by using online tools that let you schedule tasks. Find long term clients and let them use these programs to schedule work, then use the writers to write the content for you.

The same of course works with a huge number of other services – from web design to video editing!

How to Find Cheap Services

The question is how you find the work and how you find the clients. That’s up to you but there are a few things to note that can help you.

Firstly, know that ‘white label services’ are services that are actually designed for this very purpose. If you can find white label web design services for example, then that means they expect you to hire them to do work for other people… and the prices normally reflect this!

You can also find cheaper labor by looking for students (and offering it as ‘experience!’) or by looking for services from other countries where the money is worth more.

You should also make sure to try different websites. Webmaster forums for example will often have a lot of more affordable services when compared with freelancing sites. So you can find work on the freelancing sites and then hire workers from UpWork or Elance!

There is a lot more to service arbitrage but hopefully this short introduction has given you enough information to decide if the this passive income strategy is for you!