This may be a bit “out there”, but it has important implications for making money online.
I’ve looked into using Pay Per Click advertising (PPC, primarily Google’s Adwords) to promote affiliate products and earn commissions on any sales.
The principle is simple… pay less to the search engines than you earn in commissions and you’re in business… profitable.
However, you have competitors thinking the same thing.
If you bid for high-traffic words and phrases, you have to pay more per click. Not smart.
So you look for lower-traffic words and phrases to pay less per click. If the words and phrases are highly targetted to the end-product, you will hopefully convert more visitors to sales and be more profitable than paying for high traffic words. Now we’re being smarter.
Guess what? Our competitors are doing the same thing, which forces UP the price per click, even though the traffic is lower.
This is like Spinoza said… “nature abhors a vacuum“… so you won’t find unbid valuable keywords! In a perfect system every keyword would be bid to its maximum value. If a keyword is valuable, it’s fully bid.
It there room in that system?
Yes, but only if you go the extra mile and extract MORE value from that keyword than is currently “priced in”. You could build advanced squeeze pages targetted to each keyword or capture names, emails and demographic data. But now you’re looking at a whole lot of work… will the rewards then be worth the effort? There’s no “easy money” available because the easy money attracts lots of competition… which requires you to work harder for the money, so the easy money becomes difficult money.
It’s like making money online in general… the barrier to getting online is tiny… you just need a computer and a web connection… so millions of people jump onto the Internet wanting to make money online, which raises the level of competition ensuring that there’s no “easy money”.
If you want to succeed as an affiliate, you have to work harder than most other people who want to make money as affiliates. If you want to succeed as a digital author, you have to work harder than most people who want to make money as digital authors.
Cause and effect.
However, if you think backwards… when Google Adwords first came along, when Adsense first came along, when the Internet first came along, then there was easy money for a short period of time… until the competition arrived. So, seeking out new opportunities could pay off handsomely. For example, finding the first nugget of gold in the Rockies… that was “easy money” until thousands of other gold prospectors turned up… then it became more difficult.