This is because an Internet Business promises the things that we all want:

1. Leverage
There are close to 2 billion Internet users now with many millions more joining every single month. If we’re doing business on the Internet, the entire world is truly our oyster. We can reach out to many more people we never could otherwise.

2. Freedom
Anybody can now use the Internet to start their own business and make money doing so, in the comfort of their homes. We answer to nobody but ourselves and all we need is a computer, an Internet connection and the desire to do so.

Of course, we’ll also need some know how, which we can acquire along the way.

3. Cost-Effectiveness
It’s cheap. A domain name costs only $10/year, and hosting can be lower than $5/month. There aren’t many businesses we can start and maintain with that sort of investment. It’s truly easy to say goodbye to our bosses, although we want to be making our money first before doing so.

4. It’s A Part Of Life
That’s because the Internet links us to the latest information, and we all need to be updated all the time. It’s also a huge libary of knowledge and the vast majority of the information we want can be found for free. It’s also an entertainment outlet with millions of channels in the form of videos, created and uploaded for all to see by fellow Internet users. As such millions and millions of people use it every single day.

The Reality:
1. Many of us in fact have become successful Internet Entrepreneurs, in one way or another.
I have documented those ways in my classic Mini-Encyclopedia of Low-Cost, High-Profit Internet Business Models:

2. Many of us also failed to succeed as Internet Entrepreneurs
This can be due a number of factors. One of the main factors is the lack of knowledge or guidance. The other is the lack of proper IMPLEMENTATION of the things required to succeed.

In fact, I would rank the lack of implementation or improper implementation of best Internet Marketing practices as the main cause for failure, over and above a lack of knowledge since all the knowledge or guidance in the world is useless without the correct actions being taken.

The Success Factors For Freedom With An Internet Business
Note that we don’t just want to have a successful Internet Business – but one that gives us TOTAL FREEDOM from having to run, manage and maintain on our own.

Otherwise it’s no different from having a JOB – and that’s the very thing we’re trying to get away from.

There are many successful Internet Entrepreneurs who are tied to their Internet Business 24/7. They can’t take a vacation or even go to the movies during their waking hours for fear of missing a sale.

Or they’re overwhelmed with the multitude of roles they have to play that they get nothing done properly.

This isn’t how an Internet Business should be.

At the very least, not for me.

We should get leverage not only in how many people we can reach, but also in NOT having to do everything that is related to our Internet Business, on our own – and still make a handsome profit in the process.

With FREEDOM as the goal, let me now show you the essential elements of an Internet Business so that you know what’s involved to make money online, with the lowest amount of our money and with the least investment of our time.

To do this, I have to bring you back in time and see what are some of the most essential tools that we HAD to use to create a succesful Internet Business.

Then I’ll show you whether anything has changed along the way and if so, what we can do to adapt to the new Internet Business landscape – AND still maintain our freedom with our Internet Business working for us 24/7, instead of the other way around.

Let’s begin.

1st Generation Internet Marketing System
These are the components required:

Website + E-Mail

A website is basically our “permanent” online presence. We got a domain name and hosting account and we then uploaded whatever design and layout we wanted for our website on that domain’s host.

If we were selling products as a Merchant, we could also integrate an online payment system with our website so that we could accept payments directly from our customers via their credit cards, at the point when they decided to buy it after looking at our products.

If we were Affiliates for Merchants, we could set up a website providing useful information on topics related to the products sold by the Merchants, before recommending that they checked out the Merchants’ websites through our Affiliate Links or banners.

This would be our basic setup. We could get by with nothing else if we had lots of marketing money to spend on TV ads, newspaper ads and other places, to publicize our domain far and wide.

But we thought of using the Internet to market our websites too, since it was already being used by millions of people around the world.

The 2 Pillars
We knew Internet users then mainly used the Internet to check out:

1. Websites

2. E-mails

And because of that:

1. On Websites:
* Search Directories (like Yahoo.com, which started off as a Search Directory and later morphed into a Search Engine) and Search Engines (like AltaVista.com) were created to make the process of searching for information found on webpages much easier and quicker;

* Web Page Creators/Editors became an essential piece of software for Internet Entrepreneurs to create their own websites from scratch without needing to know HTML;

* Specialized FTP software to upload webpages to our host server became an essential tool for making our webpages seen on our domain;

* Web design and maintenance services were much sought after since most people didn’t have design skills even if they were willing and able to create the webpages themselves;

* Domain Names became hot assets to own since each one was unique and nobody else could register the same name once it was already registered by someone else

* The web hosting industry exploded and generated billions in recurring revenue.

SEO or Search Engine Optimization
Since search engines got millions of visitors per day looking for all sorts of information found on webpages throughout the world, and the engines didn’t want to create their own content but rather used software to find, index and show our webpages (without paying us a single cent to do this) to display to their visitors, who could see the results for free – we could tap into the Search Directories/Search Engines’ own traffic to get free prospects to our webpages.

And so SEO (Search Engine Optimization) became a popular topic ever since with the entire focus being on getting top rankings for our webpages for searches on keywords we wanted to target. The higher our webpages appeared on Search Engines’ results, the more free traffic we could get since Search Engine users checked out their search results starting from the top listing and moving down.

SEO companies started forming to offer SEO services to website owners who didn’t have the time or knowledge or desire to do SEO activities and tasks on their own.

Banner Ads
We could buy space on other webmasters’ websites too. We could put a banner that linked back to our webpages, and tap into the existing traffic those other websites were getting.

This marketing method required us to invest some money and while some of us did it, there were more of us who didn’t, preferring to rely on free Search Engine traffic and other free marketing methods instead.

2. On E-Mail:
Webmail services like Hotmail.com and Rocketmail.com were created to make the checking of e-mail possible through the same browser used for surfing websites instead of a separate e-mail software like Microsoft Outlook running on our computers.

This sort of simplified things for the Internet user and made things even easier for them to use, which in turn helped even more users to go online.

Mailing List Software
With e-mail being the first thing users checked when they were connected to the Internet, and being free to use, it became obvious to Internet Entrepreneurs that they needed to get their message into their visitors’ e-mail inboxes somehow.

We started asking for our website visitors to join our mailing list so that we could e-mail them offers to buy stuff, again and again. But of course, unless we were a big retailer of a range of products, nobody on our list would enjoy receiving offers from us in their e-mail boxes all the time.

And so we promised a free Special Report and tips on doing something better in our e-mail communication with them, so that they would continue to receive our e-mails. And we then interperse those e-mails with offers for our products from time to time.

This worked very well. Every time a promotional e-mail was sent out, there were bound to be sales made.

E-Mail Broadcast And Sequential Autoresponder Systems
Because of the need to constantly use e-mail, mailing list software became more and more sophisticated.

Rather than e-mailing our Prospects manually, we could use a special mailing list software called a Sequential Autoresponder System to AUTOMATICALLY e-mail our Prospects for us, with a series of pre-written e-mail messages uploaded to the Autoresponder System in advance.

So someone who just joined our mailing list would automatically receive an e-mail from our Sequential Autoresponder System, thanking him for being on our list and telling him what e-mails he could expect from us in the future.

We could also automatically send out a tip for helping him do something better (related to our topic) exactly 2 days later, and another tip on something else could be set to go out to him automatically exactly 5 days after this second automated e-mail had been sent to him.

We could also greet them by their first name in our e-mails (if we had their first name information in our database through their filling up the name field on our optin form), or have them remove themselves from our mailing lists via a single click on an “unsubscribe” link at the bottom of our e-mails (which saved us from having to manually remove them).

We could also broadcast e-mail messages at any time to the same list, even as they were going to receive those pre-written e-mail messages from us as scheduled in the Sequential Autoresponder System. This would be useful where we had some new offer to make to our list or we wanted them to have information we didn’t have earlier.

Thus all Sequential Autoresponder Systems will usually come with a standalone Broadcast function as well – giving us the ability to both send out pre-written e-mails to everyone who joined our mailing list, and newly written e-mails on an ad hoc basis.

If we were Affiliates, we spent the time looking for new Merchants to represent so that we could refer the same Prospects we had on our lists to many Merchants selling complementary products – thus increasing our commission earnings even more.

The Affiliate Program

Then Amazon.com came onto the scene and brought with it the concept of the Affiliate Program.

Amazon wanted Internet users to be rewarded for referring customers to its online book store. So they programmed an Affiliate Program software that could create unique Affiliate Links for each Affiliate they had in their program.

Anybody could join Amazon.com as its Affiliate for free. And all the Affiliate had to do was to put up banners that linked to their unique Affiliate Links which in turn would redirect the visitor to Amazon’s bookstore, bringing information about the unique Affiliate Link with it. Thus Amazon would know who referred the customer and reward the right Affiliate accordingly. The reward would be a percentage of the selling price.

This masterstroke of an idea resulted in Amazon.com getting millions of Affiliates all working for it for free, until a sale occurred. By then the money was already in Amazon’s bank account and Amazon could pay its Affiliates their commissions from money it had already collected – thus making this arrangement an entirely risk-free one for Amazon itself.

Amazon’s Affiliates in turn set up their own webpages and relied on Search Engine traffic and other marketing methods to draw in the Prospects. With millions of Affiliates all over the world promoting Amazon’s products, Amazon ended up having a huge referral army it didn’t need to pay to maintain.

Smart Internet Entrepreneurs then started copying Amazon’s Affiliate Program system. Affiliate Program software then became all the rage among Merchants for the benefits it would bring them.

The Affiliate Program software became another important component for a Merchant selling products online and soon many of us had either installed a similar off-the-shelf system on our domain, or used a 3rd party Affiliate Program software provider where we run the Affiliate Program off their server.

To make things easier for Affiliates to market for us, we could create ready banner ads for them and as well as ready promotional e-mail messages that they could load up into their own Sequential Autoresponder System or simply to broadcast to their lists.

To get Affiliates to join us, we could also get our website visitors to sign up as our Affiliates right on our website itself. We would also register our Affiliate Program with all the Affiliate Program Directories we could find.

To serve our Affiliates with a minimum of effort, we would have an Affiliate login on a restricted area of our website where our Affiliates could go to get their marketing materials and check their statistics and sales.

The Affiliate Program could also be automated as we could use a Sequential Autoresponder System to train our Affiliates on what steps to take to properly market for us, including how to copy and paste the banners we had prepared for them to show up on their webpages, and how to link from those banners to our websites using their own unique Affiliate Link our Affiliate Program software had automatically generated for them.

This was in addition to putting up the steps within the Affiliate login area which could be seen all the time by Affiliates who were looking for some guidance.

From time to time, we could run contests for the best Affiliate to win something valuable, to create a spike in sales when we needed extra cash to come into our business quickly. We would broadcast an e-mail to our Affiliates (they would sign up to a separate mailing list for Affiliates) to let them know about the contest – and serious Affiliates would then do whatever they needed to do to get the sales for us.

So the 1st Generation Internet Marketing System for the Merchant looks like the following:

Website + E-Mail + Affiliate Program

With a website that didn’t require any updating, Search Engine traffic, banner traffic, an automatic e-mail system, an Affiliate Program and automated Affiliate recruiting and training systems in place, we had everything we needed to make lots of money with online – practically on auto-pilot.

And many of us did.

All we needed to do as Merchants was to focus on our product range, offers, Affiliate and Customer support.

All Affiliates needed to do was to look for more Merchants to represent. (Note they wouldn’t install an Affiliate Program on their domain as Affiliates wouldn’t be selling anything themselves.)

For years, life was good.

Until something else came along that sort of messed up the good life that we had.

Which led to something that I called the 2nd Generation Internet Marketing System.

More on that in my next post!

Cheers
Sen Ze
P.S. Click below to book a seat to my FREE talk on Automated Internet Marketing Systems. I’ll be revealing the 4th Generation Internet Marketing System and what its components are. You really don’t want to miss out on this, because nobody else talks about them the way I do!

I’ve managed in mega corporations with hundreds of people on its payroll working in huge business premises. And I’ve been on my own as a one-person Entrepreneur (where you basically take care of everything on your own).

There are advantages and disadvantages to both – but if you’re not planning on working for an organization any time soon, you really have only one choice.

As a one-person Entrepreneur, you’ll want a business model that doesn’t require a huge capital outlay, or any employees. You can outsource some parts of your work which can be on an ad-hoc basis (like doing up your accounts, for example), but by and large, you’re in charge of everything, and you’ll be doing all of them.

Internet Businesses appeal to individuals without a huge appetite for risks since a lot of leverage can be achieved with a computer, software and the Internet. Many of your tasks that you have to do to run your business can also be “delegated” or assigned to specialized software, like following up with your Prospects, for example.

Not only that, if done properly, Internet Businesses can also bring in HUGE returns which make the costs of running them quite laughable by comparison with other types of businesses.

Well and good – but what Internet Business should you start?

My recommendation is to sell products on the Internet, as a Merchant, not as an Affiliate for other Merchants.

Yes, even when you’re starting off, with absolutely no experience.

For it is only when you’re a Merchant that you can spot good Merchants that you can be an Affiliate for.

In other words, if you don’t know what’s involved in selling – how do you know the Merchant you’re an Affiliate for knows what he’s doing? You’ll want to maximize your efforts in referring Prospects to the Merchants so that you have the highest possible chances of success in earning your commissions.

The other reason is that once you’re a successful Merchant, other Merchants will be flocking to you to offer you their Affiliate or Joint Venture opportunity so you don’t really have to seek every single Merchant out to partake in their Affiliate Program (unless you wish to, of course).

Thus by becoming a Merchant, you’re really making yourself both a Merchant AND an Affiliate at the same time, with the Affiliate role being an automatic option.

Compare this to becoming an Affiliate first, where you seek out Merchants to refer Prospects to. You simply focus on referring, instead of building up your own range of in-demand products that are your ASSETS.

So the vast majority of Affiliates remain Affiliates, with just a fraction of them becoming Merchants themselves, because being a Merchant isn’t an automatic option for Affiliates, as Affiliates don’t learn the skills or acquire the knowledge on building up their own ASSETS that can generate a fortune for them for many years to come.

You may say that an Affiliate’s asset is the LIST of Prospects he builds up, on his way to referring them to the Merchants – and you would be right. However, a Merchant has to build up his own list too – so why not get 2 streams of income as both a Merchant and an Affiliate, instead of just becoming an Affiliate only?

Best of all – a Merchant can have Affiliates marketing FOR HIM too – whereas most Affiliates work for themselves only since most Affiliate Programs only pay on 1 level directly to the Affiliate where he can’t recruit other Affiliates to help him market for the Merchant.

Know what I mean?

To fit within the low-cost, high-profit boundaries you’re setting for yourself as a one-person Entrepreneur, I very highly recommend that you sell DIGITAL products as a Merchant.

Specifically, digital products that can be DOWNLOADED directly from your web site.

Downloadable digital products are automatically duplicated and delivered to your customers once they click on the link that leads to your digital product on your server, which also hosts your web pages selling your digital products.

This is different from selling digital products on CDs or DVDs where you’ll still have to deliver the physical CDs/DVDs to your customers through the mail. This means handling, packing and physical delivery at the post office – all of which will take up your time, and certainly add to your costs.

You can of course outsource the handling, packing and physical delivery to another outfit, with the costs being borne by your customers. But this will increase your customer’s cost of getting your product, and you’ll still have the usual customer support headaches associated with selling physical products. They could say that they “didn’t receive product, please send another one”, or the “product is damaged, please send another one”, or “one CD is missing from the set of 3 – please send it over”, etc.

With downloadable digital products, especially information products (which is what I suggest that you start with) – what’s your headache?

1. Customer couldn’t download product
Give him a direct link to your product in your e-mail to him. Or attach your product to your e-mail. End of story. Will take a minute or two. This happens only a fraction of the time.

2. Customer thinks your product is crappy. He wants a refund
Log into your PayPal account (assuming you use PayPal to accept payments online), and effect a refund. End of story. Will take you a minute or two. This happens only a fraction of the time, unless your product REALLY is crappy – in which case it’s time to make it better until you get very few refund requests. Refund requests will happen, whether your product is digital or otherwise, and no matter how good it really is. You can deal with it and move on quickly.

Is there anything else as far as customer support for downloadable digital product (information based) is concerned?

Right. There is NOTHING else.

Best of all, downloadable digital products can be taken delivery of by your customers even as you’re lazing around in your Pajamas at home, or you’re at the cinema watching the latest blockbuster in the middle of the day (when you’re escaping from the maddening crowd, and when most of your friends are at work in a conventional job) since a CLICK by your customer on the download link is all that is required to complete the sale.

Your web pages do the selling, your host server serves your web pages to anybody with a browser and an Internet connection and your domain name, your PayPal account accepts payment directly from your web site (via credit card or other PayPal accounts), and your host server automatically duplicates and delivers your downloadable product to your customers.

It’s the PERFECT business to do.

Lest you think selling digital products via a web site is for techies – relax!

I’ve figured out ways to make it possible for complete dummies who have only ever used e-mail up to now, to quickly create downloadable products of his own (sometimes this happens instantly!), quickly write a sales spiel for it, quickly set up this sales spiel and download page on his web site, quickly integrate his web site with an online payment system and finally quickly marketing his web site so that the selling can take place – all within A FEW DAYS!

Yes, it is NOW within the reach of MOST people with an interest to become a Merchant of downloadable digital products, FASTER THAN EVER BEFORE – whereas previously the majority of people can’t do it, no matter how much coaching they’ve received.

This isn’t a pipe dream. I’ve spent the last 4 or 5 years of my life trying to crack this code – and I’m proud to say I’ve finally done it.

Which is extremely good news for you, if you’ve always thought of making money online, but never got started, or never succeeded.

More in my next post!

Sen Ze

P.S. You can link to this post with the following URL:

http://SenZe.com/business-blog/digital-products/the-perfect-business.htm

Technorati Tags: internet business, internet marketing, digital products, affiliates, affiliate program, merchant, business strategy, e-commerce, make money online