Building an Online Empire: The 13 Most Popular Online Business Models

by Empire Flippers

With retargeting, when someone clicks on an ad, but doesn’t buy the product, they will subsequently see the same ad elsewhere on the internet. This means you could have an AdSense site about medieval warfare, but the actual AdSense ads that your site visitors see might be related to kitchen remodeling, if they had been looking at getting their kitchen remodeled earlier.

As a newbie, this is fantastic, as retargeting increases clicks considerably.

However, although there are a lot of benefits to Google AdSense, it com...

One of the big issues with Google AdSense is that you will always make less than you would being the direct affiliate.

If someone was selling an expensive blender using Google AdWords, and they paid $5 per click, as host of their ad you would get a portion of that $5. However, when they make a sale, they will have made potentially hundreds of dollars.

Since you only get the money per click, and are not directly affiliated with the retailer of the product, you don’t get any money from the actual sales that the ads on your site bring about. This is why you will nee...

Outside of the need for high traffic volumes, there is always the possibility that your account will be banned. If your website’s entire monetization strategy is Google AdSense, you are putting all your eggs into one basket, a...

When you compare the Google AdSense business model to other models, though, you will find that the Google AdSense model is the one with the least amount of risk, and the easiest to implement. The only other business model that has a similar level of risk and is also newbie-friendly is the Amazon Affiliate Business Model.

When you compare this kind of business model with Amazon FBA, Dropshipping, Ecommerce, Apps, or any other online business model, Google AdSense typically comes out ahead of them all in terms of safety and ease of use.

The first thing someone looking at buying an AdSense website needs to know is that these kind of sites are very easy to manage. If you are just starting out, using this model is probably the easiest way to have a portfolio of websites all earning money, but with the least amount of time involved.

see a year of data and strong earnings. The reasoning for this interest is that most Amazon affiliate sites are powered by organic search traffic. Having good earnings for over a year shows that the website has likely survived several Google algorithm updates and can weather any storm that comes its way.

Do proper market research Niche selection is no doubt the most important step in the process of building your affiliate website. A common mistake people make is picking a niche solely based on keyword research. Although it’s not necessarily a wrong approach, it doesn’t give you a full picture about a niche. What I recommend instead is to perform a comprehensive market research in order to really understand the niche and its potential. Your market research should answer these questions: What are your biggest competitors? What are your small competitors that you can realistically beat? What’s the traffic potential? What’s the monetization potential? What monetization methods are available?

DatingAdvice.com Dating Advice is another affiliate site that makes money by promoting their affiliate links to different dating apps and websites (like Match and eHarmony). The dating niche is an incredibly profitable niche for internet marketers of all stripes. They often attracts people who want to make a quick buck, unfortunately, selling gimmicky info products or shady memberships.

This website takes a different tack on that, and offers good advice while keeping its ethics alive by promoting quality offers that aren’t out to scam those who buy.

Niching down typically gets a fast result. Why? Because it's easy to “explain” to Google what your site is about.

Probably the number one resource out there on the dropshipping business is DropShipLifestyle. Anton has been a long-time friend of us at Empire Flippers, and it is a testament to his course that we have had so many of his students go on to sell the dropship businesses they made on our marketplace for hundreds of thousands of dollars.

In addition to these special little traffic streams you can take advantage of, an Amazon FBA business tends to have much higher profit margins than if you were doing Google Adsense or Amazon affiliate websites. Just like an affiliate though, all of the logistics are handled for you every time you make a sale. Amazon ships the product and handles all the customer service through their FBA program.

Or they could change their policies on you, in a way that could significantly cut into your profit margins. At the end of the day, suppliers are businesses as well, which means they can go out of business, leaving you with a bunch orders to fulfill and no supplier to build your product. Because of this, we always suggest you look into multiple suppliers, so you have back-up channels in case an emergency like this happens.

In addition to all of this, it can be a hassle finding the right supplier. You need to have the supplier send you a prototype of the product you will be listing on Amazon to make sure it is a quality item. After you set yourself up with the right factory, you then need to research whether the product should be shipped via air or via ocean cargo ships.

Usually transferring product via cargo ships to an Amazon FBA warehouse is going to be the cheaper route. Either way, figuring out the logistics is important as it can seriously decrease your p...

As far as the revenue earned from an Amazon FBA business goes, you can break it down using this rule of thumb: ⅓ Product costs ⅓ Amazon costs ⅓ Profit So while your profit margin is actually higher with an Amazon FBA business than if you were selling similar products as an Amazon affiliate, your total earnings is actually much less than if you had your own online store (of course, that’s assuming the sales of the store were equal to the sales coming from the Amazon product listing). Overall, the entire business model relies on Amazon. You are essentially playing in their ballpark. If they change a policy, such as not making your products available for Amazon Prime anymor...

Before buying an Amazon FBA business, you need to know a few things. The product is extremely important. If the product requires electronics, you are going to face some uphill battles of potential technical difficulties. You might get an entire batch of faulty electronics shipped out to your customers without even knowing it, until the one-star reviews start flooding in and kill all the momentum of your listing page!

Another product concern is with digestibles. As much as you want to sell an awesome protein shake and get in on the meal replacement wellness industry, you have to be careful. It is better if these products come from American factories held to American standards. And even if this is the case, if someone gets sick from your product you may be facing more than just one-star reviews from consumers that could become sue-happy towards your company.

The best Amazon FBA products are simple, typically costing $15-40. These are usually smaller products. If you decide you really want to get into an Amazon FBA business selling bigger products — such as foosball tables for example — realize you will be paying much h...

As we mentioned earlier, suppliers are incredibly important to the success of this business. You need to make sure that the seller of an Amazon FBA business will introduce you to the supplier and the shipping company that they are currently using. In a best-case scenario, they will also have a few other suppliers you can reach o...

Before you pull the trigger to buy the business, make sure you also check that the seller has enough supplies to match current demand till the next shipment comes in. The last thing you want is to buy a business with a supply chain issue!

When selling your Amazon FBA business, there are a few points to keep in mind to help maximize the profit you earn from the sale, and make the whole process go as smoothly as possible. First things first: have a solid proof of earnings and a successful track record using the same supplier. While three months is a minimum, the longer you have a track record of success, the more you can ask for your website. Track all of your expenses meticulously. Amazon FBAs are notoriously capital intensive businesses, as people are often shelling out tens of thousands of dollars a month to keep Amazon warehouses topped up with enough product to meet market demand.

You will want to introduce the buyer to the supplier and shipping company that you use. Offer training and support in handing off the business. If you can, also have a small rolodex of backup suppliers that the buyer can use in case the current supplier changes their policies, or in the worst case scenario goes out of business and can no longer create the product.

Flipper Fred Amazon FBA businesses are great for someone looking to buy a business, improve its revenues, then sell it for a higher list price than what they bought it for. Since people are currently rushing to get their hands on Amazon FBA businesses, it is a good time for a Flipper Fred to come in and buy one of these businesses to turn around and sell.

Many Amazon FBA business owners are strapped for capital because they have to reinvest it all back into the “machine” they’ve built. This often means they don’t have enough capital to get to the “next level” with their Amazon FBA businesses.

Paid Traffic within Amazon This is the easiest option for sending new targeted customers to your Amazon listing. Many e-commerce stores make their entire revenue using facebook ads. The nice thing about paid traffic is that there is no waiting around. It is like turning on a water faucet. The great thing you can do that ecommerce stores can’t do though is run paid traffic via Amazon’s display ad network. This lets your sponsored product listing appear at the top for various keywords and product descriptions. As with any paid traffic though, you’ll need to watch your spend to make sure you’re still leaving yourself enough profit margin.

Build a Brand This is one of my favorite strategies. Instead of having a ton of unrelated Amazon products, why not create a true brand for your products? By creating a brand, it will become easier to market in other channels. Instead of having “Random Red BBQ Brush” you might have “Extreme Chef Red BBQ Brush,” and once you have a brand you could introduce other Extreme Chef products to an audience that will recognize the brand and buy your products based off that alone.

Build an Email List This is not always a viable strategy. However, if you are focused on building a brand with a suite of relevant products, this can be very effective. You are turning your Amazon presence from a niche product listing into an authority by doing this. You will need to share good content with your email subscribers outside of just promoting your product launches, but this is a great channel to let people know when you have special deals going on or to email out during high buyer season like Black Friday and Christmas.

Social Media This marketing method will be easier if you decide to go the brand route, obviously. Organic traffic from places like Instagram, Twitter, and Pinterest can be insanely lucrative. The best part about this traffic is that it is usually free, and in the case of Instagram and Pinterest it can be somewhat passive as people keep rediscovering your pictures.

Open a New Distribution Channel Instead of relying 100% on the Amazon platform to sell your goods, you should eventually expand into starting your own e-commerce store selling the same products. Since Amazon FBA will still fulfil the shipping of your product to your customers even if they bought it on a different website than Amazon, this should be something you seriously take advantage of, as it protects you too.

If Amazon ever closed down their FBA program or changed the rules, it will be a simpler matter to transfer your product over to a new fulfillment service, as you already have a second web presence to sell your products through.

Scott Voelker from the Amazing Seller though is cut from a different cloth, and his podcast on TheAmazingSeller.com is a great resource for up to date information on the industry.

Also, we recommend facebook groups that are active in the industry. At the time of this writing one of the better facebook groups is the Amazon High Rollers group.

The difference between dropshipping and ecommerce has to do with how products are sourced. Instead of finding a vendor that ships out a product every time you make a sale (dropshipping), you source the product yourself from a manufacturer and then ship it to the warehouse where you hold all of your inventory (ecommerce).

While ecommerce has a lot more moving parts to it than dropshipping, they are very similar. The main difference is that for ecommerce, you source the product, keep an inventory of it, and have your own fulfillment service to ship it out.

The Pros of an Ecommerce Business Model Cost One of the huge benefits of an ecommerce business is that there are no traditional retail costs. These businesses reduce the cost of the physical location, something which often ends up costing the business owner thousands of dollars per month in rent alone. You also do not need to have any cashiers or clerks on staff, so your payroll costs become very limited –– or even zero –– as many ecommerce businesses are completely owner-operated without a single full-time employee.

Typically, an ecommerce business that is handling all of its own fulfillment is also going to have higher profit margins than an Amazon FBA business or a dropshipping business. This can give you a competitive edge when it comes to using strategies such as paid marketing, since you will have a greater margin of error to work with that dropshippers simply do not have, and Amazon FBA business owners to a lesser extent.

Diversification There is a way you can combine the benefits of dropshipping with your ecommerce business, though. You can easily test out new product offerings on your website by simply adding some dropshipping listings alongside your normal ecommerce products. For example, if you sold coffee mugs, you might want to test selling coffee as well. There are literally thousands of different types of coffee out there. Instead of sourcing all of these yourself, find dropshipping opportunities to put on your website. Then, when you find a winning offer, source that specific product yourself or just sit back and relax, letting the dropship product do its thing while you focus on your main product offerings. This is an easy way to create new offerings for your audience, and it can be very profitable when combined with your higher-margin products that you sourced yourself.

Brand Recognition Finally (and this is one of the biggest benefits of ecommerce businesses), you get to build your own brand. The brand can become something that really resonates with people. This is a major advantage you have going the ecommerce route over the dropshipping or the Amazon FBA route. You can build a brand with these two models, but doing so is more difficult than it is with ecommerce. Drop Shipped products are not really your products, so it can be difficult to build a brand around something that so many other people are selling. You could build a brand on Amazon, but the Amazon brand is always going to overshadow yours when your customers are buying through Amazon. With your own ecommerce site, you control everything from start to finish. You have your own platform and thus your own identity to craft in the eyes of your customers and target audience.

Competition When you start an ecommerce store, unless you are in a really bizarre niche, you are likely going to have some fierce competition. You need to have a way to differentiate yourself from that competition. One way you can do that is by creating a really engaging brand while also offering better products than your competitors. In addition to fierce competition, you are also going to run into trust issues at the start. People are going to take a while to warm up to you and your store. This is a disadvantage for sure, and it is one reason why Amazon FBA is such a loved business model because those owners get to leverage the reputation of Amazon’s brand alongside their company. Both of these are going to be issues starting up an ecommerce store but should later fade away as you get brand recognition, solid traffic, and customer testimonials for your store.

Tech In addition, there might be a lot of technical issues for you to overcome or solve. This is especially true if you build your store on your own platform using software like Magento. Of course, you could get around this by using something like Shopify’s platform, which is a great alternative to building your own. Just realize that if you use someone else’s platform, you are going to have less flexibility.

Logistics Bottom line, with ecommerce, you are going to have to get good at managing a lot of moving parts. Owning an ecommerce store is exactly like owning a physical store in that there are tons of things you need to be accountable for. You have to find the manufacturers for your products, set up a solid agreement, find the right freight shipping company, and find a fulfillment warehouse solution to handle the logistics of actually shipping out the product to your customers. When a customer complains or has questions, you will also need to have some kind of customer service support to take care of those issues.

Marketing Not to mention: you are the marketing arm for your store. Marketing can be an incredibly frustrating part of doing business. In fact, there tons of hats to wear in just the marketing department alone. You need to know your conversion rate, the lifetime value of your customers, where your customers hang out, how to advertise to that demographic effectively on the platform where they hang out, and manage an endless list of things to do to get the business up, running, and hopefully growing. Some people flourish through having to wear multiple hats, but whether juggling all these different roles is right for you is something you will have to decide for yourself. In the end, most of these tasks can be outsourced or delegated to virtual assistants, but you should still know how every task is performed and make sure you hire an effective assistant.

What Buyers Need to Know If you are looking at buying an ecommerce business, there are a few things to take into consideration. Obviously, you want the basics out of the way. This will involve verifying the seller’s income and traffic by actually logging into their analytics. It is never advisable just to trust screenshots, as screenshots can easily be photoshopped. Outside of those basics, there are a few growth questions you should ask before buying an ecommerce business. First of all, can the business be expanded into new product territories? For instance, in our coffee mug example, there are plenty of products someone could expand their store into. These might include tea cups or actual bags of coffee and tea, etc. This differs from diversifying the channel in which you are selling, in that you actually have more things to sell and aren’t just exposing your one core product to a new audience. There is plenty of room for product growth.

Next, ask yourself if this business is a real brand or if it could become one. A business named BestCoffeeMugs2019.com is going to be a dubious brand to build on. Something like “Cool Mugs” has more brand potential, as it’s short and memorable. Look for a business that goes beyond just the niche play and can be expanded into dominating broader niches.