Business people always assess business investment in term of Return on Investment (ROI), which means, how much you can get given a certain level of investment. Put in another way, you can’t tell a business is good or not by only looking at the absolute dollar return, but have to relate the dollar return to your investment. For example, project A needs an investment of $5000 and will bring a return of $10000. Project B needs an investment of $10000 and will bring a return of $15000. As you can see, project B will bring a larger return. However, project A is actually better since its ROI is 2 (10000/5000) whereas project B is only 1.5 (15000/10000).
The same logic can be applied to website building. Let’s assume that you are getting $10 dollars per month from your website, which is $120 dollars per year. You might think $120 a year isn’t worth your efforts from the very beginning. However, you can only arrive at a safe argument by taking your investment into account, too. Then, how much do you have to invest to a website every year in order to earn $10 per month? From my own experience, only $47.6 (domain and hosting fee) will do. The organic search engine marketing will be enough to accomplish otherwise costly marketing task. So, the ROI should be around 2.5 (120/47.6), which is quite attractive.
Generally speaking, you can’t expect a huge return without incurring a matching degree of investment. Don’t blindly envy those webmasters who claim to earn $1000 a day from their websites. It’s not because they have mastered mysterious technique for online business, but often because they have spent a lot on their online business, in terms of the following ways:
- Work full time on their online business
- Have engaged in online business for a long time
- Operate tons of websites.
- Spend a lot on traffic, marketing and advertising
- Others…