My Passive Income Online Blog

This has been another record month for me in terms of earnings. For the month of August I earned a total of $1,159.38, just about $40 shy of my goal of earning $1200 for the month.

Here is the overall breakdown of my earnings this month:

AdSense: $332.40
Clickbank: $782.47
Amazon: $27.24
Other Affiliate Programs: $17.27
Total Earned: $1,159.38

In May (when I started this blog) I earned just a little over $17 a day from my passive income streams and now, three months later, that amount has grown to almost $40 a day. I still have a lot of work ahead of me, however, if I’m going to reach the $100/day mark by the end of the year.

However, I have to say that earning over $1000 a month for the second month in a row is a huge emotional milestone for me. First, it means that last month was not just a “fluke”. But more importantly, earning over $1000 month provides some sense of financial security for me. It feels like a “real” income to me now, and it’s at the minimum I would probably need to support my son and myself if for some reason I had to move out of my mother’s home and cover all my living expenses alone (which is very unlikely).  It would, of course, still be below the poverty index so I certainly wouldn’t be living large, but it still feels good.

However, right now I have the ability to invest much of that back into my business to allow it to continue growing – which is a real luxury I know that a lot of people starting out don’t have. A recent rant by Carrie is a reminder that making money online takes time and effort and it can take years to see real results. It really does take most people at least a year to earn any decent income, and often quite longer, from this business and I suggest you read Carrie’s post for a dash of cold, hard reality about the IM business.

One of the useful points Carrie makes is that many people do not include their expenses when they include their monthly totals, which can mislead many new to the business about the earnings possible through IM. I certainly am guilty of this myself and I am going to start talking about my expenses in my monthly reports as well – so that people have a more accurate picture of what is involved.

My monthly expenses have actually fluctuated quite widely. During the first year or so, they were quite minimal and my monthly income net earnings (after expenses) was often nearly the same as the gross ones I’ve reported. This is because I relied on free tools for backlinking and did not outsource any of my work during my first year. My only expenses during my first year were the domains I was purchasing, my monthly hosting fees, and one software tool (MicroNicheFinder). Of course, this doesn’t include my time in the equation – so that must be kept in mind as well. I’m not going to put a price tag on the time I have invested in my business but on average, I put in about twenty to twenty-five hours of work a week.

By the end of my first year doing internet marketing I was averaging around $300-$400 a month. However, I found that I was pretty much stuck at this earnings level using the methods and the time I had available. In order to increase my earnings, I decided I had to take a risk and start learning about new programs to automate much of my work and also invest in outsourcing. I called this my B-O-A-T plan: Build more sites; Outsource more work; Automate what I could; and Track the results.

I would say the plan has worked so far, but it certainly involves me investing much of my earnings back into my business.

• Outsourcing Expenses. Right now, I have two full-time employees working for me (both based in the Philippines). One of my employees is building sites for me and writing the content for those sites (just starting this month) and one is building backlinks to my sites.  Total cost of outsourcing work: $700 a month.
• Monthly Subscriptions. I’ve pretty much decided on which monthly services are worth while to me to help automate my backlinking. These are Blog Blueprint – for high PR blog backlinks; Unique Article Wizard – for massive automated article and directory submissions that I can slowly drip feed over a month or two,  TheLinkJuicer – for a nice, diverse mix of links I use on new sites primarily, also slowly dripping out at a rate of a couple a day; and SickSubmitter – for building profile links. I’ll also probably include a Web 2.0 automated site builder in this mix in the next month or so (I just finished a trial of SENuke, I’m a beta tester for SEOLinkRobot, and I’ll probably try out Magic Submitter soon as well – and from those experiences I’ll eventually decide which one to use). On top of this, I also have monthly hosting fees and an Aweber subscription. My total monthly subscriptions right now runs around $200.
• Other Expenses. The main other expenses I incur are domain purchases and the occasional piece of software or (even more rarely now) WSO or other ebook purchase. These fees vary quite a bit from month to month – for example, last month I purchased Backlink Indexer Express to help index my backlinks.  This month I plan on purchasing Scrapebox and maybe a guide to learn how to use it most effectively. How much I spend on domains varies depending on what kind of domains I’m purchasing and how many. In general, however, I keep this under $200. For August, my “other” purchases totaled $163.40.

So, for the Month of August I earned $1159.38 but I also had expenses of $1063.40. This means my net income was under $100 for the month!

Now, I might add that if push came to shove, I could fire my workers, cancel all my subscriptions (except hosting and Aweber) and I would still be earning over $1000 a month for a long time to come. That’s the beauty of passive income sources like these – once you have the site built and it’s ranking and bringing in money each month, that income is unlikely to disappear any time soon (unless you get deindexed by Google).

What I’m paying out right now in expenses is an investment in future sites – and my future income. But it’s taken me a long time (well over a year) to get to the point that I can invest $1000+ in my business each month. My business expenses have always been dependent on my earnings each month. That is why I had to rely on free methods when I first started out.

I do think that those who are just starting out can build their business well using only a few (if any) paid services. (For example, check out my budget backlinking post for some ideas). You will build your business much more slowly using primarily free methods, but it can work if you have the patience to stick with it.

Earnings Goal for September: $1500

Today is a busy day on this blog! I’ve just posted my one month update for the ClickBank journal project, right now I’m doing my weekly update, and shortly there will be my Monthly Earnings update posted as well. Whew!

Anyway, here are this week’s totals:

AdSense: $101.89
ClickBank: $127.43
Amazon: $20.18
Other Affiliate Sales: $8.28

Total Earned: $257.78

Reflections on Individual Programs:

AdSense: This was the best week I have ever had with AdSense, and also the first time I have earned over $100 in one week from the AdSense program. My daily average was $14.56. Most of the increase was the result of one of my AdSense site’s moving up and taking the #1 spot for a keyword I was targeting. Now, if only I can get another dozen or so sites to do the same! Here is a screenshot of my weekly earnings (click to make larger):

ClickBank: This was a very frustrating week with ClickBank because of their analytics problems (which have now been resolved). Wednesday through Friday, my hop counts were showing as zero and I was unable to track the performance of my sites those day. Saturday morning the tracking issues was resolved and everything has been fine since then, but coincidentally, I did not have any sales for the three days that the tracking system was messed up.

It is probably just a coincidence, but the tracking problems fail to inspire a lot of confidence overall in their recording ability. I might add that I don’t suspect ClickBank of “stealing” any of my sales – but I do sometimes wonder if their recurrent problems with their analytics means a sale or two gets lost in the mess. Anyway, for this week I only had six sales (recorded) and earned only $127.43 – one of my lowest totals for several weeks now. Here is a screenshot:

Amazon: I had one of my strongest weeks ever with Amazon. I got a nice $10+ commission from one of my new sites that I put up last month this week, plus a couple other smaller sales from some of my older sites. I’m seeing a lot more clicks coming in daily as now, although my conversion rate is not great – only just over 1%. I may need to try new layouts to see if I get a better conversion. But overall, the new sites seem to be generating visitors, clicks and now income as well. Total weekly earnings was $20.18 – one of my strongest weeks ever.

My Amazon site building is now progressing at a nice pace as well. The new assistant I hired is great! Between him and I, we were able to get four sites built this past week, and I’m hoping we will be able to continue this pace for the next few weeks in preparation for the upcoming holidays.

Other Affiliate Sales: Got a first sale from Plimus for one of my websites, which was great and also my first Aweber commission (thanks Justin!). Total for other affiliate sales came to $8.28.

In summary, I want to add that this is one of those weeks that shows the importance of diversification. While my ClickBank sales were down, AdSense and Amazon were both stronger than ever. I’ll have my monthly report up shortly, so stayed tuned!