How to Earn a Passive Income Online in 2012

Are you an entrepreneur looking for a way to earn a passive income?” Having a passive income (sometimes called residual income) allows you to earn money from work you’ve done, over a long period of time.

This is often a desirable way to make money instead of being paid for time worked. Passive income online allows you to create content once, and earn income from it for years and years.

If you have ideas and passion about one or more topics, you can convert that into extra income using a blog or website.

If you’re not tech-savvy, don’t be put off by how much work or difficulty there is in setting up a blog or website. Blog and website development is faster, cheaper and easier now than it has ever been in the past.

This article gives a step by step guide to making money online, and also provides links to plenty of useful articles, resources and free eBooks that can help you to start generating income immediately.

Recommended for YouWebcast: 4 Steps to Creating a Marketing Content Plan

5 steps to earning a passive income online

Does the thought of generating long term residual income from a blog or website while you are at work, sleeping, on holiday, or doing housework, appeal to you?

Anyone can earn a passive income online, provided you are prepared to put in a bit of time and effort into learning the right way to do things. The extra cash you earn may be the difference between struggling to make ends meet at the end of each month, and having enough cash to take the family on a yearly vacation.

Here’s how to do it…

1. Pick a topic

Making money online is about being able to create content that inspires other people. It doesn’t hurt to think of cool ways to present that information.

Make it unique, fun, exciting, or different.

In order to write blog posts, make YouTube videos, create eBooks, or any other type of content of sufficient quality to blow people’s minds, pick a topic that you are interested in.

Don’t pick a topic because you think there is more money to be made in that industry!

Your passion for the content you create will help engage readers and help create buzz.

The more people talk about your content, the higher Google ranks it in organic search results. The higher your content is ranked in Google search, the more organic search traffic you get. The more organic search traffic flowing through your site, the more people read and share your content, driving even more traffic.

The following articles will give some advice on what niche markets and ideas you can use to start a blog or other online income earner:

Once you have a topic, it’s time to…

2. Research

It’s important to understand how big your chosen market is. How many people search for the type of information you intend to provide? Where do they come from? Are they wealthy, young, old, English speaking, etc?

Knowing what communities already exist, where your target market hangs out online, and what their preferences are help you to decide on how to create, share and market content in the best way.

The following articles show how to research the market using freely available tools:

3. Set up a blog or website

Setting up a blog, website or even an online store is a cinch – even for seriously non-tech savvy types.

It’s important to remember that modern website builders and CMS platforms like Drupal can get you 80% of the way to having a site just like you want it, with little effort required on your part.

That final 20% doesn’t have to happen over night either. Provided your blog or website is easy to use, easy to browse, and contains great content, you can add special touches as you build experience.

The following articles and resources show everything you need to know about setting up an online platform:

4. Monetize

Good news! Making money from a blog or website is also easy to do.

Affiliate and advertising networks make it a cinch to add income generating links and banners to a site using copy and paste.

Be careful not to overload webpages with ads and affiliate links because Google will not rank pages it suspects have little value – one of the indicators of a low value webpage is that it has a high ad or affiliate link to content ratio.

Limit advertising and affiliate links to only the most effective places, and where it is relevant to do so. Think about webpages you enjoy and find useful – look at where they have placed their advertising.

The following links and resources will give guidance on setting up advertising and affiliate links:

5. Market, analyze & refine

During the early stages of any blog or website, it is unlikely that there will be sufficient traffic to generate a decent income. The passive part of passive income only comes when a blog or site is established and driving traffic without requiring regular effort.

Until then it is important to market and promote content via social media, forums, communities and anywhere else.

Don’t resort to spam or self promotion!

It can be frustrating at first, but be consistent and persistent in your efforts to provide high quality content.

Share that content only where appropriate, and build up a following using social media.

Once you have a following of engaged readers, they become a powerful marketing team by sharing your content with their own social groups.

In this way, a single blog post may be shared thousands of times, generating thousands of hits from social media sites and, ultimately, ranking higher in Google search.

Use analytics to monitor which content works and which doesn’t. Use analytical data to refine your marketing, promotions and content creation skills. The better you are at creating the right content for the right people, the less you have to work to make more money.

The following articles and resources show you everything you need to know about analytics, marketing, and SEO:

Do you earn an income from a blog or website? Are you earning enough to quit your day job? Has blogging failed to bring in cash? Share your tips, thoughts and experiences on earning passive incomes online in the comments, or join me on Twitter, LinkedIn or Google+ to continue the conversation.

  Discuss This Article

Comments: 6

  • Earl says:

    Totally agree with the first point. Finding and writing about a topic you like is always the best way to blog. Not only will you have tons of material to write about, but you’ll also be more well-versed in the topic. You never know. You might answer a question about that niche that nobody has before, and that gives you traffic.

  • alain says:

    This is the formula that I keep on seeing over an over again, in thousands of blogs. It must work, a lot of people are doing it, but boy, it is hard to establish an audience of people that continue coming back to your blog. At this point, it is no longer passive income, but a very active way of trying to earn extra dollars. One way or another, I am in love with the idea and here I am today, trying to write another blog in order maintain an engaged audience.

  • David J says:

    Great Post David! If you can get others to read and apply these tips they will begin to make money. I am making $100 to $500 a day on the blogs that I have now and Success is just a decision away for most people. Again a great post and I am reading more of your stuff today!

  • Rhys says:

    Great article…I recently did a youtube video 10 mins long on the exact topic, you can find it at my blog highlighted on my name. Thats what im actually doing right now following that exact formula. great article again

  • Dave says:

    We’ve been blogging for around 6 months and are above 4k a month phase so I guess that’s doing really welll! See our income reports here (another one for March coming out soon).

  • Chris says:

    I have been blogging since May 2012 and I am in travel niche. I am not making too much on passive income and around 0.5k per month.

Add a New Comment

Thank you for adding to the conversation!

Our comments are moderated. Your comment may not appear immediately.