5 Online Businesses You Can Start With No Money

1. Drop Shipping

The basic idea behind an online drop-shipping business is that, as a small business owner, you don’t have to maintain a large inventory (or any inventory whatsoever) of products or handle any delivery to your customers. That eliminates the financial cost and risk of having a warehouse full of stuff you might not sell and the hassle of arranging to send orders all over the country or the world. In fact, you don’t have to manufacture or store any products at all.

The only thing you have to focus on is marketing and advertising to find the customers and make the sales. Once the sale is made the rest is handled by others. Your only cost is the expense of marketing and advertising to acquire a new customer.

Once that is done, you’ll work with a company that specializes in drop shipping. Here’s how it works:

1. You list products for sale on your website or a platform like Amazon, eBay, or Etsy.
2. When one of your customers makes a purchase, you buy the product from a third-party company (the drop shipper, usually a manufacturer or wholesaler) for a lower price. This process is as simple as forwarding the order from your customer, a process that can actually be completely automated. (Remember you don’t have any risk here of buying inventory because the sale has already been made).
3. Your drop shipper then sends the product to the customer.1

Easy enough, right? With drop shipping, you can offer a wide range of products, so the operating expenses for your business are super low.

What are the downsides to the drop shipping business model? You have to find a reputable drop shipper you can count on to deliver to your customers. If an order is late or doesn’t go out—or a product is of poor quality—you get blamed, as your company is the one representing the product and customer experience.

Also, because this market is so competitive, the margins—that is, the difference between the wholesale price and how much you can sell a product for—are lower, so this will need to be a high-volume business to generate a serious income. But still, it is a worthwhile low or no-cost startup option.2

One way to stand out from the competition with a drop shipping business is to private label your products. This simply means you put your own label/brand on the products that the manufacturer is creating. That way you’re not selling the same product brand and just competing on price; rather you can use your own brand and face less competition—just make sure the drop shipper allows it.3 Think about when you’re looking at medicine at the pharmacy; the brand names sell for higher prices and people think they are different from the generic brands even though the ingredients are exactly the same. Consider these important factors when looking for a good drop-shipping product.

Anyone considering a drop-shipping business should seriously consider leveraging Amazon.com to grow their business because Amazon is an established marketplace that people already trust and has an existing customer base. Eventually, you should also consider having your own online store.

2. Affiliate Marketing

Affiliate marketing is somewhat similar to drop shipping but with some key differences. With this e-commerce model, you again don’t maintain an inventory of your own products, and you don’t have to worry about shipping products to customers.

You pick a profitable niche for your online business, and then you find an affiliate partner who has products available in that niche. Some of the most popular affiliate sites are Clickbank.com, Amazon.com, and CJ Affiliate (formerly Commission Junction). Between them, they offer just about any digital information product (like ebooks, audio files, video files) or physical product you can think of. Many big-name companies and brands like Walmart and Home Depot run their own affiliate programs.45

With affiliate marketing, you offer the products for sale on your blog or e-commerce website. Each product has a unique link that tracks back to your account with your affiliate partner. A prospect who clicks on the link is taken to your partner’s shopping cart for checkout. Once they buy, that purchase is recorded and you receive a commission.6 Commission amounts vary depending on the affiliate partner, but are generally 5 percent to 25 percent, or 50 percent or more with digital information products.7 As you can see, there’s little risk on your part, and virtually no investment is needed either. Just like with drop shipping your only costs will be marketing and advertising to drive traffic and generate the sale.

The key difference between this and drop shipping is that the business model is even more hands-off. You mainly have to provide a link for the customer to click on, and the merchant handles almost everything else: billing, order fulfillment, customer service, etc.

You also handle the marketing to get your prospects to buy (through social media, email marketing, blogging, or whatever method you choose). But after they click the affiliate link, it’s out of your hands. You don’t have to ship products or handle any customer service questions. And you certainly don’t have to maintain an inventory.

Affiliate marketing is among the most hand-off types of online businesses you can start.

3. Blogging

If you have the expertise, passion, or interest for a subject, consider making money with a blog. With a service like Blogger (www.blogger.com), you can start up your blog totally free. However, note that many free blogging sites have restrictions on what you can say or do, including making money or advertising.8 Alternatively, you can create your own site and secure your own hosting for a low price.

You may think blogging is all about writing. And it can be if that’s what you want to do. But written blog posts are just the start. You can post photos, videos, and links to other sites. You can even repost news and other articles. Anything is game, really, as long as it relates to your niche.

The key is you want to post original content that is useful to your target audience, and you should post regularly. That is the best way to rank well on search engines and get your audience to take action.

What sort of content should you provide? Anything that is engaging to your prospect. How-to topics, top-10 lists, commentary on trends in your niche, tips and tricks articles—basically, you need to provide useful content. There’s no shortage of ideas for your blog.

You make money in a variety of ways with an online business blog.

Google AdSense

Have you ever been to a website and seen an ad on it? Chances are it was an ad being run through the Google advertising network.

These pay-per-click ads appear on your blog. Every time somebody clicks on an ad (which is supposed to be about a subject related to your niche), you make a few cents or more. Small amounts each time, but it adds up. This is extremely hands-off. You just need to get a code from Google and place it on your website, and the ads will automatically appear on your blog. Google will only show ads that are relevant to your blog so it’s a good experience for your visitors and maximizes the number of clicks you get, meaning more income.9

Blog Ad Networks

You can also work with ad networks other than Google, like Blogads, and run banner ads on your blog. As with Google Adsense, you place the code once on your website, and when your visitors click on the ads, you get paid. In addition to banner ads, you can also run video ads on your site.

In many cases, you can make more money with blog ad networks, but they tend to only work with blogs that are getting tens of thousands of visitors a month or more. On the other hand, with Google Ads, you can start right away regardless of the amount of traffic you get.

Affiliate Marketing

You know this one already. You include links to products you are promoting as an affiliate and every time somebody buys the product, you get a commission. With a blog, you can integrate advertising with content to make it even more likely you’ll get the sale. For example, you could do a product review and then include a link to buy the product under an affiliate link.

Here are a few successful blogging tips to make sure people can find your blog—and will keep coming back. This is key to building a following and making your blog a profitable venture.

You need to provide useful content engagingly.
If your blog is boring or the information can be found everywhere else, nobody will read it. Don’t hesitate to put your personality into the blog.

You have to post content regularly.
People thirst for the new, so make sure you put up articles, videos, or updates consistently. It could be one post per day or three times per week. Whatever it is, maintain the same schedule. A scattershot posting history means losing readers.10

Be genuine.
Yes, your blog is supposed to make money. But you can’t make marketing pitches all the time. Focus on useful content so that your readers come to know, like, and trust you. Then they will naturally click on your advertising or buy the products you recommend. In this era of the internet and social media, people are looking for authenticity.

Do all of this, and you’ll attract the notice of search engines like Google, which are always looking to put sites with useful, relevant content on top of the search results.11 This is what content marketing is all about.

You could start a blog in less than an hour. But it takes time to make money as you build readership, and only a small percentage of those folks end up buying your products.

4. Online Video

Have you watched a YouTube video lately? Of course you have. It’s one of the world’s most popular websites, with more than 2 billion users watching over 1 billion hours of video each day.12 And it’s not all cats doing funny things, by any means.

You can leverage YouTube’s reach to make money online. No, you’re not trying to create a viral video, so to speak, although if it does go worldwide and is seen by millions, that’s a good thing.

Instead, you’ll be following a proven strategy for maximizing views of multiple videos regularly. You’ll be creating useful content—something engaging that people want to watch. And it works in many, many different niches. It could be a how-to video or a talking-head video on a topic of interest for people in your niche—the sky is the limit.

You make money with ad revenue. Your first step is to create a YouTube account and start uploading videos. Then you enable monetization on your YouTube settings.13 Basically, this gives Google the go-ahead to include short AdSense ads with your videos, which you’ve seen if you’ve watched a YouTube video. When viewers click on those ads, you get paid.

Another opportunity to make money with a YouTube channel is through paid sponsorships. Build a large enough following and companies will be more than happy to pay you to promote or mention their products and services in your videos.

Some tips to create professional-looking videos (no expensive pro equipment needed):

1. You can use your smartphone or a simple video camera. But make sure the lighting is good so everything in your video is clear and easy to see.
2. Make sure the audio is clear. You don’t want an air conditioning hum, construction noise, or other distractions.
3. Use simple editing software like iMovie to put titles at the beginning of the video and to edit out any flubs.

Above all, remember that your videos can be simple and don’t have to be slick. Just provide useful content and be engaging and interesting. Funny helps, too.

To extend the reach of your videos, be sure to post them on your Facebook business page, Twitter, your blog, and other channels. Let people know you’re in the video business now.

In addition to ad revenue from YouTube videos, you can also use your YouTube channel to drive traffic back to your website, where visitors can read your product reviews, click on the ads on your website, or even get onto your email subscriber list—where you can make multiple sales with your email list.

5. Information Products

When you have an internet business, it doesn’t have to be about selling physical products. In fact, digital information products are one of the easiest and quickest ways to make money.

There’s no shortage of ways to create information products, but the most popular formats include:

• Audio: a recorded teleconference, interview, course, or some other spoken-word product
• Video: a recorded webinar, a how-to, an interview
• Text: an ebook, an instruction booklet of some sort, a travel guide

In each of these categories, you can really get creative and make any type of content, as long as it’s engaging and useful.

No matter which way you do it, it can become passive income—money you earn while you sleep because you put these products up for sale on your website, and a customer can buy and download them any time of day or night, automatically. You can then check the sales periodically to see what topics or types of products are selling best so you can make more of those.

Putting It All Together

The trick with any online business is to make sure you’re in a profitable niche market. So be sure to keep an eye on trends, check out bestseller lists on sites like Amazon, and consider what people are discussing on social media.

Start out with one and get it going. Then add new revenue streams as you’re able. That will grow your income and ensure that you have something to fall back on should one business start going south.