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How do Websites Make Money

Abhijit Naik
Though we spend a considerable time on the Internet, not many of us know the mechanisms which go into making these websites and maintaining them; one such aspect being revenue generation.
World wide web has considerably widened its horizons to near infinity. There are millions of websites in the world, with vast amount of information pertaining to all walks of life. Such is the intrigue and temptation of the virtual world that the layman, who is fascinated by the way these websites work, is often left wondering how they make money.
Frankly speaking, not many people out there really know how these websites generate revenue, and that's despite it being a lucrative business. In fact, there are many ways a website can fetch wealth for you, ranging from the most-common means, such as advertising, to least-known means, such as monetization widgets.

PPC Advertising Networks

In Pay Per Click advertising (PPC), the website owner gets registered with a PPC network and pastes code snippets on his website. The PPC network then serves contextual advertisements in text or image format. The owner will earn a specific amount of money every time a visitor clicks on these ads and hence, it is known as the Pay Per Click method.

Cost Per Mile (CPM) Advertising Networks

The process of CPM advertising is quite similar to PPC advertising, except that the owner of the website gets paid depending on the number of page views the ads on the site generate. The phrase Cost Per Mile refers to the cost of 1000 page views. This method of earning through a website is ideal for websites having a high page views-per-visitor ratio.

Direct Banner Advertising

In direct banner advertising, the website owner sells his own advertising space. This is one of the most lucrative methods of earning through a website, as the owner is free to decide his own rates for the space and, more importantly, there are no middleman commissions.
Some of the most popular banner formats used in the world of advertising are:

  • 728×90 Leader-board
  • 120×600 Skyscraper
  • 300×250 Inline Rectangle
  • 125×125 Button

This method of earning through web is ideal when the website audience is big, as it helps to get qualified advertisers easily.

Text Link Ads

In this method of making money online, the owner of the website can sell text links by using his website as the platform, or use specialized networks, such as the Text-Link-Ads, to automate this process.
Once very popular means of Internet advertising, the method lost its value when Google decided to penalize those websites which sell text links without the nofollow tag. This method is followed by many websites even today; sometimes legally, sometimes illegally.

Internet Affiliate Marketing

Internet affiliate marketing is a popular method of earning on the Internet. In this process, the website acts as a merchant who is willing to let his affiliates sell their products through his website directly or indirectly in exchange of some commission. This is also known as Cost Per Action (CPA) or Cost Per Lead (CPL) based monetizing of the website.

Monetization Widgets

The use of monetization widgets is the latest trend of earning money through a website. In some cases, the service is utilized under PPC advertising, while in others, it is used in the form of text-link ads.

Premium Content and Private Forums

In some websites, the owner gives visitors the access to a part of the website for free and charges a sum to get access to the other parts of the website. This part, wherein you need to pay the premium membership fee, is the premium content part.
In private forums, you have to pay a membership fee to become an active member of the forum and gain access to it. The membership, which costs a specific fee, gives you access to features which free members are denied.

Paid Surveys and Polls

There are some services which pay the owners to carry out some surveys or polls on their websites. The website owner has to register with the service provider and choose the type of polls or surveys he is willing to run on his website. These services most often work under the Cost Per Mile method.

Pop-up Advertising

Pop-up advertising is the most common and lucrative form of advertising on the Internet. Its major drawback though, is that it can turn out to be quite annoying for visitors at times, and lead to negative publicity. Pop-up advertising has also suffered heavily since the advent of pop-up blockers.
Other than these methods, you can also earn by indirect methods, such as selling books in e-format or hard copy format, selling templates, starting a consultancy service, or e-mail advertising and newsletters. Just having a website or blog is good, but having one that helps you to earn some money is great.