The Importance of Diversifying Your Online Income
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As I wrote a couple of days ago, my Google Adsense account was banned. This was the primary source of income for my niche sites. Ouch!
I received by far the most traffic and comments for that post than I have ever received on this blog. For the most part, the comments were all very supportive and caring…and I thank you all for that!
However, as expected, there were a few people that felt I was naive for relying on Google Adsense or couldn't believe that I put “all my eggs in one basket. ” Some people still just don't understand my business apparently, so let me explain a little bit better.
So, you may be thinking why I would be writing about the importance of diversifying my income; after all I must not know what I'm talking about right? Well, I want to show you that I've actually diversified my income pretty well. In fact, even though Adsense was a big part of my niche sites, I have a number of OTHER income sources outside of niche sites. Overall, Adsense was much less than half of my overall income. (And I expect to have most of that lost Adsense income back in a few month through other ad networks, etc).
You see, about 2 years ago, my only income source was indeed Google Adsense; so I felt like it was time to diversify outside of SEARCH ENGINES. That is the entire reason I started this blog, to talk about “Niche Pursuits”, which are small business ideas outside of niche websites. Don't believe me? Well, check out the Purpose of this Blog that was essentially the first thing I wrote on here over a year ago. That is STILL the purpose of this blog, to discuss how to diversify with niche business ideas.
Currently the first niche business idea that I am publicly documenting to diversify outside of search engines is building an iPhone App. You can read about that here.
So, in my post here today I want to discuss how I have diversified my income and the importance of doing so.
The Big Misunderstanding About Income Sources
I am still baffled that people don't understand that the risk is not losing your Adsense account, but the real risk is losing search engine traffic with your sites. People constantly tell me, shouldn't you be using CPA offers, affiliate links, or other ad networks to diversify your income away from Google Adsense?
My response, is that you don't understand.
You see, now that I have lost my Adsense account, yes it hurts, but the reality is that because I still have all the traffic to my sites, I will have income flowing in the door in no time. (And I already do). Using different ad networks on your niche sites is not really diversifying your income…this is a very naive thought.
The search engine traffic is the source of your income…NOT ADSENSE or any other network. Sure you can make more with different strategies, but the search engines should be seen as your income source. I am a perfect example, my Adsense account is gone, but technically I could open a new business and get a new one, or as Im doing now can simply install other advertising to replace most of that income. But if I lose my search engine traffic, I'm REALLY toast. I could “diversify” my income using other ad networks all I want, but if I don't have any traffic from search engines, there is no business. Make sense?
So, the real risk with Niche Sites is Google algorithm changes or getting penalized. I wrote about this a long time ago right here.
How I Am Diversified
So, to diversify your income away from niche sites; its not as simple as using something besides Google Adsense. Its all about doing something outside of niche sites completely, something that does not rely on search engines at all. Let me show you what I have done. Here are my 4 business ventures that I have outside of niche websites that help to diversify my income:
- Long Tail Pro. I own this product and my customers do not primarily come from search engines.
- Niche Website Theme. I own this product and my customers do not primarily come from search engines.
- Welcome Splash. I own this product and my customers do not primarily come from search engines.
- iPhone App (to be released soon). Ironically its an app for checking Google Adsense. But I expect this to be the first of many apps.
In addition, I do own the property NichePursuits.com which brings in a little bit of affiliate income. Its not alot because I don't promote very many products as an affiliate, but its some.
So, as you can see I own essentially 4 products outside of Niche Websites that don't rely very much on Google Adsense or search engine traffic. These products will earn me more this month than my niche websites would have.
Luckily, I did have other income sources and so I will be able to continue to build and grow my business. However, if you are thinking that you are diversified in your business because you have lots of websites or because you use lots of different types of monetization strategies, I would suggest that you are sorely mistaken. If you are relying solely on search engine traffic, you are terribly exposed.
I don't want to say that Niche Websites is a bad source of revenue. Its a GREAT source, but its just one source. I started out with one source and then built additional revenue sources for my overall business with time. But you have to start somewhere.
So, if you aren't making much with niche websites, I wouldn't worry too much about diversification at this point because you don't have anything to diversify. Build up your income with just one method, when it starts working, THEN look to diversify as you continue to build that income.
My Future Diversification Plans
My first priority is of course getting back some of the income from my niche sites. I am already back to about $20 to $30 a day with Infolinks and Kontera, but this is just some of my sites, and I haven't tested many other things out yet. So, in the next month or so, I fully expect to have recovered a good portion of the revenue lost from Google Adsense. (I sure hope so!) However, I also have additional plans.
I am just about done with my first iPhone app, and I hope it goes well. If it does goes well, I can definitely see the possibility of building a few more iPhone apps, perhaps even this year. This will be also be part of my diversification plan.
In addition, I am always mulling over website ideas that are not as reliant on search engines. More destination type sites that people visit directly. Unique ideas with cool functions. I don't have any solid plans yet, but I'm on the look out for great ideas!
And finally, I am always looking for additional “Niche Pursuits” to even further diversify. That could be anything from selling Kindle books to creating a physical product. I'm an idea man, and always will be.
So, overall I hope that gives everyone a little better understanding of my business. Losing my Adsense account hurt…really bad, but it was not a fatal blow. Because I have diversified my income over the past year or so with my own products and a soon to be released iPhone app, I still have income rolling in. Yes, my business is not perfect, but my eggs were far from being all in one basket. I am still happily self-employed, and the wife and kids still have plenty of food on the table.
I would love to hear your thoughts on the subject. I know that many of you did understand my business and so this is nothing new. But perhaps for others this post will help shift your thinking a bit about diversification. Its not about revenue source, its about traffic source. Do you agree? I would love to hear your thoughts.
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