How Do Websites Make Money?

You're reading this on a website, so we'll go ahead and assume that you understand the basics of how websites work, and that they're important to pretty much every business on the planet. Websites are probably the single most important part of a business's personality, next to the service they provide and overall product quality. We're going to talk about how different websites make money for their business and other businesses. Some website are very straightforward: you go there, buy something, and that's the end of the relationship. Some websites make money through their content and advertising. Some websites, on the other hand, make money by exploiting your browsing habits and selling them to other companies.

Making Money with Websites: Strategy 1: Basic Data Analytics

 Most people know how cookies work, and most people have come to accept that "online privacy" is a bit of an oxymoron. Many/most companies use your basic demographic data to inform their marketing decisions. This might not make you feel great, but demographic data is generally very anonymous. In most cases, there's not much to worry about from a privacy standpoint. Companies just want to understand their audience better. By using basic information--age, gender, interests, advertising can be more targeted. This helps companies reach the right people, and in turn make more money. Nothing new here, it's been done this way for decades in various ways.

Strategy 2: Exploit Customer Data

 When we say "exploit" customer data, that might be misleading. A true data exploit is personally identifiable information, like social security numbers. But what some companies do is still pretty intrusive. Not every company has the same level of access to your information. Some companies have a level of access to your data that might make you second-guess ever getting back online. We're not talking about Google or Facebook--everyone knows that they have huge amounts of data. We're talking about less-obvious companies who make millions of dollars by selling your browsing habits to other companies. Let's look at an example, based on a real-life company. Let's say "Company A" owns a proprietary software...let's call it Intertrode. Intertrode is able to track your web browsing habits on EVERY SINGLE WEBSITE YOU VISIT within a given browsing session. This doesn't seem very different from what most website cookies do. But consider this: software like Intertrode can track you even outside of a traditional website. So let's say "Company A" is hired by your favorite ice cream shop. The next time you visit the Facebook page of that ice cream shop, you're now on the radar. Every single website you visit after that Facebook page will be tracked. The pages you visit in that website will be tracked. The exact amount of time you spend on each page of those websites will be tracked. And best of all, all of this can be done in REAL TIME. This means that someone from "Company A" could technically watch your entire browsing session as it happens. Most people probably don't have that kind of time... but the fact that it's possible can cause some people concern. So how is this legal? It seems invasive, right? Well, invasive as it may be, it's 100% okay'd by Facebook. If you read the terms and conditions carefully about third-party software and affiliates, you will see the clause that allows this kind of thing to go on. So as a consumer, this is  may seem concerning. But, as a marketer, it gives you a lot of sweet, sweet valuable data, which you can then in turn sell to companies for a nice profit. P.S. we do not mine data this way, and if you visit our Facebook page, you will not be tracked in this way.

Strategy 3: E-Commerce

 This one is pretty obvious. An e-commerce website makes its own money, generally speaking, since it provides business owners a way to sell their products to people all around the world. This doesn't mean that making a good e-commerce site is an easy thing. It still requires good design, functionality and good content. The products also have to be competitively priced and good quality. You also have to understand the laws of your state when it comes to sales tax. An e-commerce site, more than most other sites, also has to be incredibly secure. You need an SSL certificate, a privacy policy, a refund policy, and a page for terms and conditions. Most credit card processing companies will request to see these pages on your site before granting you an API or other credentials. Confused yet? Drop us a line, we can help!

Strategy 4: Quality Content

 One of the most difficult ways to have a profitable website, although the most rewarding, is to simply have content on your site that people want to consume. The more visitors you have and the better your content, the more people are likely to see you as an authority or subject matter expert. This helps build trust, which in turn, helps you sell your product to people. This is the most effective form of marketing, especially when it comes to long-term customer relationships and retention. Another perk of this strategy is you can monetize your site (or videos) and earn a bit of advertising revenue. While too many ads can be incredibly annoying, most people these days have learned to handle the occasional in-line advertisement.

Making Money with Websites: Conclusion

 So how do you make a website from scratch that will help boost your business's bottom line? There are a lot of ways to go about it, some less scrupulous than others. But if you're wondering "how do websites make money" and want some help building one, keep us in mind. We're happy to help--even if it's just to answer a few questions and help you pick the best strategy for your brand.