GDPR: New Law That Could Affect Your Blog

GDPR is a set of rules governing how the personal data of individuals is processed.

It is applicable to customers, employees, and suppliers, who are residing in the European Union.

In the GDPR language, the law refers to these individuals as data subjects.

Compliance with the General Data Protection Regulation (GDPR) is mandatory for any business or personal blog involved in dealing with the personal data of EU residents.

GDPR is not a completely new law, but a harmonized, modernized and strengthened revision of the Data Protection Directive of 1995 (95/46/EC).

How Has the Law Been Revised?

1. Harmonization

It compromises a single set of rules across all the member states in the EU.

Thereby, making it easier for companies to comply.

2. Modernization

This way, the directive is relevant to today’s reality.

In 1995, there was no social media, no LinkedIn, no Facebook, no Twitter and the internet was at its infancy.

Personal data, its privacy, and the risks associated with it were different.

The two situations, the one of 1995 and now, are so different that the rules of 1995 can no longer be applied.

The world is now more exposed via social media.

You can now find anyone on social media and find a lot of their personal info online.

This poses a lot of risks for identity theft and other personal privacy infringement.

The world now is in great need of laws governing the collection and handling of personal data.

These data includes emails, first and last names or any other personal data.

For this reason, the GDPR law has been modernized, to suit the nature of privacy issues nowadays.

This was especially critical after the Cambridge Analytica scandal.

3. Strengthening

The law provides what individuals need to be empowered, that is rights to keep their personal data private.

It does so by holding the organizations accountable for any data they collect.

Online entities are supposed to let their users know what data they collect and store and for what purposes.

In addition, they shouldn’t use the data subject’s data for a non-intended purpose.

On account, many blogs, websites and organizations have updated their privacy policy.

Therefore, GDPR is a welcome change that strengthens the rights of individuals.

It puts accountability upon organizations processing personal data, and provides power to Data Protection Authorities for enforcement.

Furthermore, GDPR is a regulation.

Therefore, it does not require ratification from member states (unless a member state chooses to be more explicit or stringent).

The law became legally binding, effective since May 25, 2018.

This means all businesses must enact fundamental changes to their data protection practices to ensure that their processes, policies, systems, and contracts to conform to the new regulation.

This is in fact what happened if you have noticed the swarms of emails subjected as “changes to our privacy policy”.

Important Aspects of GDPR

1. Personal Data

To simplify the definition of personal data, GDPR uses the term “personal data” to refer to any information that can be used to directly or indirectly identify the “data subject”.

This includes but is not limited to identification numbers, IP addresses, CCTV footage, etc.

Further, personal data like race, religion, health, biometric information, political association, criminal history, etc. are further classified as “sensitive data”.

2. Processing

“Processing” pertains to any operation performed on personal data.

This constitutes any action like collecting, storing, using, sending, or deleting personal data.

To be specific, “collecting” includes recording the data.

Collecting the data could be via forms or other tracking utilities, known or unknown to the data subject.

“Using” includes retrieval, usage, modification, and combining or even linking data to create a user profile.

So, if a call centre has read-only access to your customers’ data in Asia, then it is still considered “processing” of personal data as it involves collecting data.

Who Is Held Accountable?

1. Controller and Processor

As organizations process the personal data of data subjects, they are classified as “controller” or “processor”.

Controller refers to the organization or entity that determines the purposes and means of processing personal data (e.g., when processing employees’ data, employers are considered controllers).

Parties can be joint data controllers in certain circumstances.

The processor is an organization or entity which processes personal data on behalf of the controller (e.g., IT providers hosting personal data for their clients are considered processors).

2. Supervisory Authority

“Supervisory Authority” is a public authority in a member state responsible for monitoring compliance with GDPR.

This is typically a privacy commission in a member state.

It may have a different name in each country.

For example, in the UK it is named the Information Commissioners Office, and in Belgium, it is known as the Privacy Commission.

Sometimes, this is also referred to as the “Data Protection Authority”.

Thanks to GDPR, there will also be a European Data Protection Board which unites all the presidents of such local data protection authorities.

Core Principles of  GDPR

The following principles are core to GDPR and must be understood before implementation:

  • Lawfulness, fairness, and transparency: Personal data must be processed lawfully, fairly, and in a transparent manner in relation to the data subject.
  • Purpose limitation: Personal data must be collected for a specific, honest and legitimate purpose (Processing should for this purpose only.)
  • Data minimization: Personal data must be relevant.

In addition, it should be limited to what is necessary for relation to the purpose for which it is processed.

  • Accuracy: Personal data must be accurate and kept up to date.
  • Storage limitation: Personal data should only be retained only to the extent necessary.

That is, you should delete the personal data oncethe purpose for which you collected it is fulfilled.

Of course, certain applicable laws may require data to be retained longer.

For example, most countries define a retention period for medical records in hospitals. So, in such cases, those relevant laws need to be referred.

  • Integrity and confidentiality: You should process personal data in a secure way that ensures confidentiality.

This includes protected the data from unlawful access and refraining from selling it to third-party sources.

Data should remain accurate and consistent while protection against unintended alterations.

Who Does GDPR Apply To?

GDPR applies to all organizations across the world that process personal data of EU residents.

Therefore, GDPR applies to all organization across industry sectors and around the globe if they process the personal data of data subjects who are EU citizens or residents.

Thеrе аrе two dіffеrеnt types оf dаtа-hаndlеrѕ the lеgіѕlаtіоn аррlіеѕ tо: ‘рrосеѕѕоrѕ’ and ‘соntrоllеrѕ’.

The definitions of each аrе lаіd оut in Artісlе 4 оf thе Gеnеrаl Data Prоtесtіоn Regulation.

A соntrоllеr іѕ “реrѕоn, рublіс аuthоrіtу, аgеnсу or оthеr bоdу whісh, аlоnе or jоіntlу wіth others, who dеtеrmіnеѕ thе рurроѕеѕ аnd means оf рrосеѕѕіng оf personal dаtа”

Whіlе the processor іѕ “реrѕоn, public аuthоrіtу, agency оr other bоdу whісh рrосеѕѕеѕ personal data оn behalf of thе controller”.

If you аrе currently ѕubjесt tо thе UK’s Dаtа Prоtесtіоn Aсt, fоr еxаmрlе, іt’ѕ lіkеlу уоu will have tо lооk аt GDPR compliance too.

“Yоu wіll hаvе significantly mоrе lеgаl lіаbіlіtу if you аrе rеѕроnѕіblе fоr a breach.

These оblіgаtіоnѕ fоr рrосеѕѕоrѕ are a nеw rеԛuіrеmеnt undеr thе GDPR,” says thе UK’s Information Cоmmіѕѕіоnеrѕ Offісе, thе аuthоrіtу rеѕроnѕіblе fоr rеgіѕtеrіng dаtа соntrоllеrѕ, taking action оn dаtа рrоtесtіоn аnd hаndlіng соnсеrnѕ аnd mіѕhаndlіng dаtа.

GDPR ultіmаtеlу рlасеѕ lеgаl оblіgаtіоnѕ оn a processor tо mаіntаіn rесоrdѕ of реrѕоnаl dаtа аnd hоw іt іѕ processed, рrоvіdіng a muсh higher level оf lеgаl lіаbіlіtу should thе оrgаnіѕаtіоn bе brеасhеd.

Controllers will аlѕо bе fоrсеd to еnѕurе thаt all соntrасtѕ with рrосеѕѕоrѕ аrе іn compliance wіth GDPR.

You might think if your business operates outside the EU then you are not eligible.

However, if your users/customers are residing in the EU, then the law protects them.

In this case, you are supposed to comply with GDPR.

Whаt Iѕ GDPR Compliance?

Dаtа brеасhеѕ іnеvіtаblу hарреn.

Information gets lоѕt, ѕtоlеn оr оthеrwіѕе rеlеаѕеd іntо thе hаndѕ оf people who wеrе nеvеr іntеndеd tо ѕее it — and those реорlе оftеn hаvе mаlісіоuѕ intent.

Undеr the tеrmѕ оf GDPR, not оnlу wіll оrgаnіѕаtіоnѕ hаvе tо еnѕurе thаt реrѕоnаl dаtа is gаthеrеd lеgаllу аnd undеr strict соndіtіоnѕ, but thоѕе who соllесt and mаnаgе іt wіll be оblіgеd tо рrоtесt іt frоm mіѕuѕе аnd еxрlоіtаtіоn, аѕ wеll as to rеѕресt thе rights of data оwnеrѕ – or fасе penalties fоr nоt dоіng ѕо.

What Are the Consequences of Non-Compliance?

Non-compliance to this law invites fines of up to € 20 million or 4 percent of global turnover, whichever is higher.

Of course, these are maximum fines and the regulators would apply a sanction would gradually to an organization in violation of the law.

For your needs, be aware that fines are significant but applied gradually. Legal counsel can help you with different details of the fines.

GDPR Requirements

1. Legitimate Need for the Data

An organization must know and be able to prove that, for any processing it performs upon personal data, there is a legitimate purpose for doing so.

For example, my internet provider has a reason to monitor my internet usage.

Because I signed an agreement to provide me internet and that entitles the internet provider to monitor usage, send invoices, process invoices, etc.

Similarly, an employer has the right to process employees’ payroll, because each employee signed an employment contract.

In this case, the processing of that payroll is a legitimate purpose as per employment contract.

2. The Information you Hold:

An organization should keep data only insofar as necessary.

This means that if I paid back my mortgage fully, but now only keep a bank account, then the bank has no reason to keep my mortgage history, details of my assets, salary, etc.

Of course, the bank must respect other laws that pertaining to retention of mortgage data; however, the data should not be processed anymore.

3. Individuals Rights:

To be assured that personal data is protected, data subjects have the right to ask what information one has about them and what one does with it.

They can also ask for a correction, object on processing,  lodge a complaint,  withdraw consent, or even to request deletion of their personal data.

However, data deletion is not an absolute right and has further subclauses.

4. Consent:

When processing personal data, there should be explicit and clear consent from the individual.

This means, if you wish to perform an activity like analytics for the purpose of making personalized offers, then the concerned individual should ideally be asked to provide his or her consent.

As part of consent request, you must state what you will do with the information.

For example, this means if the internet provider intends to monitor the type of websites I visit, then they should ask for my consent.

Other Factors

Children’s data: For processing of children’s data, GDPR requires the explicit consent of the child’s parents (or guardian) for minors less than 16 years of age.

In this case, member states can set a lower or higher age of consent, with a minimum at 13 years.

This means, data processors should not send letters to my children just because they may know that I have children who may want to buy mobile telephones.

Privacy notices: Organizations must transparently state their approach to personal data protection in a privacy notice that is easily accessible to data subjects.

This privacy notice should have clear and easily understood language.

For example, on their website, my telecom provider should provide me with information on what data they have, what they do with it, and with whom they share it.

Data breaches: Organizations must maintain a data breach register and, based on the risk, the regulator s.

You should inform the data subject within 72 hours of identifying the breach.

Privacy by design: Designers should incorporate mechanisms to protect personal data s in the design of new systems and processes.

This means an organization should execute principles and guidelines to ensure that business and IT systems (and processes)  protect the data subjects’ privacy from the very beginning of the design phase.

Privacy impact assessment: When initiating new initiatives like a project, campaign, or product that would process personal data, the organization must conduct a privacy impact assessment to review the impact and possible risks.

Ѕtерѕ Tо GDPR Соmрlіаnсе

Hеrе аrе some things tо сhесk аnd uрdаtе tо mаkе ѕurе уоur blоg іѕ GDPR compliant:

  • Inform your users of your роlісу іn clear, plain language.
  • Users can approve or wіthdrаw consent аt аnу tіmе.
  • Users саn mаkе/соrrесt changes to the dаtа thаt іѕ іnассurаtе оr іnсоrrесt.
  • Subscribers can аѕk for personal dаtа tо be dеlеtеd at аnу tіmе
  • Users have the rіght to knоw how you collect and process their іnfоrmаtіоn.
  • Users have the rіght to know what іnfоrmаtіоn you collect and process.

1. Updating Your Blоg and Privacy Policy

In order tо provide сlеаr and іnfоrmеd соnѕеnt, іt іѕ advised tо сrеаtе a рор-uр оn your hоmераgе ѕtаtіng hоw you collect аnd рrосеѕѕ information wіth a dіrесt link to your соmрlеtе Privacy Pоlісу.

When it соmеѕ to your Prіvасу Policy, уоu must be vеrу сlеаr аbоut hоw you gо about соllесtіng dаtа fоr уоur ѕіtе.

It is also important to mention hоw third раrtіеѕ use thе information соllесtеd (lіkе аd agencies аnd аffіlіаtе рrоgrаmѕ), аnd how соnѕumеrѕ саn opt-out.

It should be clear that they have the freedom to disagree and opt out.

2. Updating Your Mаіlіng Lіѕt

Aссоrdіng tо GDPR, you must hаvе еxрlісіt consent to have people’s dаtа on your list.

Thе еаѕіеѕt way tо do thіѕ wіth уоur current ѕubѕсrіbеrѕ іѕ tо be clear.

  • Sеnd out a саmраіgn wіth an аnnоunсеmеnt аbоut GDPR.
  • Rеԛuеѕt thаt they rерlу tо уоur emailed саmраіgn wіth a Yes оr a No.
  • It can also be as easy as clicking a link or ticking a checkbox.
  • Make sure your email is clear as to what they are agreeing on.

You can also give them the option to ѕіmрlу unѕubѕсrіbе.

Tо prepare for GDPR, оrgаnіzаtіоnѕ саn use this six-step process:

  1. Undеrѕtаnd thе lаw

Knоw your оblіgаtіоnѕ under GDPR аѕ іt rеlаtеѕ tо соllесtіng, рrосеѕѕіng, аnd storing data, including the lеgіѕlаtіоn’ѕ mаnу ѕресіаl саtеgоrіеѕ.

  1. Crеаtе a rоаd mар

  • Perform data discovery and document еvеrуthіng.
  • Rеѕеаrсh and analyze what your procedures are
  • Document your fіndіngѕ (what data you collect and how you use it)
  • Plan and make decisions about each category of data
  • create an асtіоn and implementation plan
  • Plan a risk analysis action plan.
  1. Know which data falls under GDPR

  • Fіrѕt, determine іf dаtа falls under a GDPR ѕресіаl саtеgоrу.
  • Next, сlаѕѕіfу whо hаѕ access to dіffеrеnt tуреѕ of dаtа, whо ѕhаrеѕ thе dаtа, and whаt аррlісаtіоnѕ рrосеѕѕ thаt dаtа.
  • It is important to know what happens to the data you collect
  1. Bеgіn wіth сrіtісаl data аnd рrосеdurеѕ

  • Aѕѕеѕѕ thе rіѕkѕ tо аll the private dаtа you collect.
  • Identify each risk associated with each data.
  • Rеvіеw your business роlісіеѕ and рrосеdurеѕ to identify possible chances for breaches.
  • Aррlу security measures to production data containing core аѕѕеtѕ.
  • Finally, еxtеnd those measures to bасk-uрѕ and оthеr rероѕіtоrіеѕ.
  1. Update your privacy policy and let the people know you are compliant (Begin implementation).

  2. Aѕѕеѕѕ аnd dосumеnt other rіѕk

  • Investigate any оthеr rіѕkѕ tо the data nоt іnсludеd іn рrеvіоuѕ аѕѕеѕѕmеntѕ.
  • Better safe than sorry, it is always a good idea to double and triple check.


All in аll, GDPR іѕ gооd for uѕ all.

I bеlіеvе іt’ѕ a nесеѕѕаrу step in оur іnсrеаѕіnglу popular online world.

The way people and bloggers see it can differ.

Yоu can еіthеr ѕее it as a раіn.

On the other hand, you can see it a way to hаvе a bеttеr rеlаtіоnѕhір wіth thоѕе whо іntеrасt with уоur buѕіnеѕѕ, giving thеm mоrе trаnѕраrеnсу аnd сlаrіtу.

This holds you at a more ethically moral position which is never a bad thing.

We hope our guide has helped you understand what this new law is all about.

In addition, we hope you have found useful guidelines on how to comply with this law.

How to Get More Followers on Twitter for Free

Learning how to get more followers on Twitter is everyone’s desire, whether you are a business or not.

Almost everyone, from influencers to ordinary cowboys, is craving for a ton of Twitter followers, for whatever reasons.

That’s right; me too!

Twitter followers are not without their benefits, it goes without saying.

They could make you stand out from the competition, among other things.

More followers on Twitter could mean a ready market if you are a brand who’s doing things “right.”

Twitter FollowersAll the same, it can be a nut to crack to acquire followers, especially if you’re a newbie on Twitter or are looking to run several accounts for your businesses on the platform.

That’s right; how many times have you been unfollowed on Twitter when you were least expecting it?

Or, how many times have you followed several different accounts in the hopes that they could return the favor – and they didn’t?

Like everything else, knowing how to get more followers on Twitter – and retaining these – has a catch.

You need to be a master of the game.

Which is why you may be here!

So worry not, for I have your best interests at heart.

In no time, I should turn you from a novice to an expert.

You only need to stay aboard with me if you want to learn how to get more followers on Twitter.

But first things first…

Why You Should Get More Followers on Twitter

Needless to say, numbers are always tied to some benefits – especially if you are a business looking to gain exposure.

And the “Twitter numbers” are no exception.

These can help do the following:

  • Generate leads
  • Get your message across all and sundry
  • Position you as an influential figure
  • Get you more ideas

Followers on Twitter can help do wonders with regards to generating leads.

Which is why promoting your product shouldn’t be a problem if you have the numbers with you – and you are playing the game right.

When you have more followers clenched in your fist, getting your message to all and sundry is almost hassle-free.

Why is that?

An increased Twitter following immediately positions you as an influential figure.

It’s no wonder that people are always looking to follow accounts with considerable followers.

They are looking to be within the influential radius of these accounts.

In other words, they don’t want to be left out of the persuasive scope of these terrific accounts.

They will follow in an instant.

Which explains why Twitter accounts with many followers are always growing.

Another reason you should have more followers is that these are an asset when you are looking to expand your knowledge; when you are looking for new or additional ideas.

Meaning, should you have a nagging question, all you need to do is tweet it and watch the answers come in – in form of replies, mentions, or even direct messages.

Your question might be retweeted so it reaches a bigger audience, too, attracting even more answers.

Isn’t that good news?

Should You Get Followers for Free or Should You Buy Them?

My take has always been and still is: you should get Twitter followers for free.

It is risk-free that way!

Buying followers on Twitter comes with a price-tag attached.

Your account could be suspended.

Your brand might be in danger of losing credibility; even your most loyal customers may lose their trust in you.

Who wants to associate themselves with a “cheating” brand, after all?

No one, right?

And this is where it stings most:

Your purchased followers are less likely to get engaged in your conversations on Twitter.

They didn’t choose to follow you in the first place, but you purchased them.

So why would they even care to get engaged in your conversations?


Which is the reason you’d be left tweeting to a dormant (bot-like) audience.

Needless to say, if you are here and are still looking to buy Twitter followers, you need to think again.

How to Get More Followers on Twitter

 It’s possible you are reading this and you already have more followers on Twitter.

It’s also likely you are here and have an average number of followers.

Or, maybe, you are this new kid on the block who’s yet to get the ball rolling.

Anyhow, we all have mission; we’re all looking to get more followers on Twitter, irrespective of whatever stage we may be at with regards to growing our audience.

Therefore, let’s all dive in!

Here’s a list of practical ways to get more followers on Twitter for free:

  1. Follow and follow back
  2. Post relevant stuff
  3. Use Hashtags
  4. Retweet others
  5. Have a good bio
  6. Use sharable content
  7. Promote your Twitter handle
  8. Mention Users
  9. Involve influencers
  10. Post the same tweet more than once

1. Follow and Follow Back

Get more followers on Twitter by following relevant accounts.

By “relevant”, I mean those accounts that might be interested in what you do.

Those that are likely to follow back.

Flipping the same coin, you should follow back users who follow you on Twitter.

You need to return the favor.

Otherwise, you risk being unfollowed by new followers on Twitter.

Not following back is a sure way to not retain new Twitter followers.

No one wants to stick around if you are stingy; it doesn’t matter how invaluable you might seem to be.

Ensure you are returning the favor if you’re, in fact, looking to build a considerable following on Twitter.

You don’t want your followers to slip through your fingers while you’re watching, do you?

Of course, not; you don’t want to fall prey to this!

2. Post Relevant Stuff

Another way to acquire more followers on Twitter is by posting relevant stuff.

While it might be fine to tweet about the “me stuff”, not feeding your audience with the “ideal” stuff is a guarantee to lose them bit by bit.

If you are a brand or business especially and are always posting about your latest holiday experiences, your audience is likely to “protest” by unfollowing you.

Unless they are friends or family, followers on Twitter care less about your personal life.

They don’t even care if you are a democrat or republican.

Please save the “me stuff” to yourself.

Most Twitter users only care about what they may have followed you for.

So ensure you are not only delivering it, but also doing so without fail.

Post relevant content!

Give your followers what they want; they will get engaged almost immediately, attracting potential followers in the process.

3. Use Hashtags

If you are looking to get more followers on Twitter, don’t hesitate to use hashtags in your tweets.

This is especially vital if you’re looking to get more niche-oriented followers.

If possible, use trending hashtags, provided they are agreeable.

It is a guaranteed way to gain exposure in your area of interest.

Twitter users are often on the lookout for trending hashtags.

And, chances are high they should follow you when they bump into your account.

In addition, you get niche-rich followers when you use niche-savvy hashtags.

For instance, if you are a blogger looking to get blogging gigs or are looking for followers interested in blogging, you can use such hashtags like:

  • #blogging
  • #blogger
  • #bloggingopportunities
  • #bloggerswanted
  • #bloggersneeded

The list actually is endless.

The thing is, whatever niche it is, use niche-friendly hashtags to get your message across your audience.

 4. Retweet

Getting more followers on Twitter is tied around retweeting other people’s stuff, too.

 Make it a habit to retweet other posts, provided they’re relevant for your audience.

Twitter users are more likely to share your content when you retweet theirs.

You know what that means?

Increased visibility and good chances of being followed as a result.

I always return the favor when someone retweets my content.

In the same vein, you might consider adding a “Please Retweet” note in your posts.

Tweets that include this note attract more retweets than those without.

Usually, some people will do things only when they are prompted to.

So, come on!

Tell them you need them to retweet your posts.

 5. Have a Good Bio

Do you boast a reasonable bio on your Twitter account?

A good bio is key if you’re looking to get more followers on Twitter.

If you don’t have one, you could be missing out on potential followers.

Note that before people follow you, a good number of them visit your profile to determine if you’re worth to follow or not.

Your bio can either make them stick around or scare the hell out of them.

Therefore, ensure you have a clear bio that shows who really are – or/and what you do.

In the same vein, is your profile image reasonable enough?

If it’s a headshot, is it your real image or someone else’s?

If it’s a brand name, is it a real brand or is some counterfeit thing you are going to keep changing randomly?

Followers on Twitter want to be associated with a real person or real brand.

They want to track a prestigious brand and not just some kind of imagination.

They want to see you.

Which also goes without saying that please include your website, if you have one, in your bio.

A website is a professional score on your bio.

It makes you stand out from every Tom, Dick, and Harry out there.

It confirms to your followers that you are someone worth your salt, and that you can be trusted.

Last but not least, you might want to include your city or region name to attract local followers, especially if you’re marketing a local product.

6. Post Sharable Content

This is my favorite!

I post shareable content in order to get more followers on Twitter.

If you are looking to get your tweets shared (everyone does), ensure they’re shareable.

Include relevant pictures in your tweets.

Tweets with an image are more likely to be shared than those without.

Include relevant inspirational/motivational quotes in your tweets.

Everyone wants to be inspired/motivated.

Me too.

The thing is, people easily share inspirational posts, tweets, which are, then, re-shared by other users, and so on.

Another way to ensure your content is shareable is by use of links.

Tweets with links stand a good chance to be retweeted than those without links.

Twitter users are always curious; they always want to get more info behind every tweet.

Links hardly disappoint when it comes to that.

Which is why you want to incorporate links in your tweets – if you haven’t already started yet.

7. Promote Your Twitter Handle

Promotion is not just for businesses alone; it also applies when you’re looking to get more followers on Twitter.

Therefore, let the world know that you need them to follow you on Twitter, and they are likely to do it.

Promote your Twitter handle!

Include it in your business cards and have your business contacts follow you.

Incorporate it on your website and blog and have the online community follow you.

Let your email signature do the hard work: include your handle in it and have more people follow you.

When it comes to email lists, let your prospects see your Twitter handle and they are likely to follow you as a result.

Ask people to follow you on Twitter: you can include a “follow me” button on your website or blog.

Your other social media accounts come in handy, too.

Let your Facebook, LinkedIn, Instagram, etc. feature your Twitter handle.

I call it marketing!

8. Mention Users

It couldn’t be easier to get more followers on Twitter by mentioning other users.

Learn to mention others by their Twitter handle when replying to their tweets.

The people you’ve mentioned are likely to mention you back as a result.

Which is a sure way to increase your visibility and improve your chances of being followed.

The same thing also applies when replying to “public” messages; messages that you feel might be of help to other Twitter users.

What am I trying to say here?

When you’re replying to such messages and feel that your response could be of help to your audience, reply the message publicly.

It’s as easy as 1, 2, 3,…

In your reply, @mention the person who asked the question.

Other Twitter users will see it.

If the reply is quite helpful, these are likely to follow you because they immediately see you as an asset.

9. Engage Influencers

Influencers play a key role when you want to get more followers on Twitter.

Mention influencers in your posts.

Influencers like to be recognized by all and sundry and are likely to follow you when you identify them.

The icing on the cake is when they mention you back!

You get to be seen by their huge following, escalating your chances to be followed.

On the same note, it’s a good thing to retweet influencers, especially those that sit in your niche.

Like I said before, influencers can catapult your follower count notches higher.

By retweeting them, it’s possible they could return the favor – multiplying your exposure to the masses.

This is yet another powerful tactic geared toward increasing your follower count.

Make use of it.

10. Post More Than Once

Last but not least, post more than once if you are determined to attract more followers on Twitter.

A tweet has a lifespan of a few minutes, during which it may be visible to only a portion of your followers – a small fraction of those.

In order to increase visibility and attract more followers on Twitter, therefore, post your tweets a couple of times, at different times.

Get me right here; I am not talking about spamming – avoid an outburst of tweets.

But I’m talking about posting the same tweet in considerable time intervals.

That way, most of your followers and Twitter users are likely to see your post.

In other words, someone who may have missed seeing your post 40 minutes earlier could actually see it when you repost it.

Scheduling your tweets comes in handy here.

Tools like Hootsuite and Socialoomph can be an asset in this respect.


Now that you know how to get more followers on Twitter, I hope you don’t waste a second to make use of it.

Be sure to take one step at a time, nevertheless, but you want to do things right.

You need to know what you are doing in order to build an audience on Twitter.

Yes, nothing comes on a silver platter – save for a lottery windfall.

But the good news is, that once you get the hang of it, it should be easy breezy to attract Twitter followers.

Last but not least, it’s possible there’s something I may have missed in this article.

So, please share in the comments if there is any practical tactic you’re using to get more followers on Twitter.

11 Ways to Make Money Podcasting

Let’s say you have mastered the art of podcasting.

You have invested in the right set of instruments for the podcast, narrowed down on your content appropriately and have also managed to garner a set of die-hard followers who are hooked to your podcasts now and look forward to it.

As an able podcaster, your next question is undoubtedly what now?

How can you make money via podcasting?

11 Ways to Make Money Podcasting

Well, here is a quick lowdown on making money with podcasts.

They will help you to understand how to make money podcasting and also how you can use them as an effective medium to promote your business:

  1. Garnering Sponsorship
  2. Undertaking Virtual Summits
  3. Affiliate Marketing
  4. The Magic of Networking
  5. Ways to Push Your Product
  6. Patreon
  7. Coaching
  8. Create Audio Books
  9. Drum Up Crowdfunding
  10. Don’t Be Shy to Ask for Donation
  11. Creating Novel Apps

1. Garnering Sponsorship

Garnering Sponsorship

The revenue dynamics of podcasting is pretty similar to that of any other audio-visual medium.

Just like you need a loyal set of readers for your blogs, the podcasts also need a set number of followers.

Once you get the popularity quotient right, most popular podcasts can help you make large sums of money every day.

Given the growing popularity of the podcasting trends, you now have a relatively large bevy of brands who are ready to sponsor.

The podcasts which are popular and have a reasonable following can make rather significant gains through these sponsorships.

In fact, we are talking of sponsorships close to Super Bowl ads.

With 21% of Americans above the age of 12 hooked to podcasting, it is now fast becoming a depending model to make money.

The numbers do not just indicate the rising popularity of podcasts but also the heightened buying power of these listeners.

  1. The household income of nearly 22% podcast listeners is above $100,000.
  2. At least 60% of those listening to podcasting have either promoted a show or bought something that was promoted during the podcast.

Though sponsoring podcasts is fast emerging as a highly lucrative proposition, you need to be careful about certain pre-conditions to garner maximum value.

They don’t just help you negotiate better rates but also enhances your reputation as a podcaster.

1. You must make sure that all that you podcast is extremely engaging and people enjoy listening to it.

This is important not just for getting sponsors but also creating a loyal base of listeners who would keep looking for more podcasts from you.

2. You must pay careful attention to the overall content and the production quality of the podcasts that you upload.

3. Moreover, poor audio quality can severely impact the branding potential of any specific content that you might be trying to garner sponsors for.

4. Sponsoring for not just podcasting but for any type of audio visual products needs a close reference to actual numbers.

In many ways, these numbers are the real indicators of actual demand and the kind of viewership they command.

This is crucial data that determines the actual sponsorship that you ca hope to earn.

5. Also, as an efficient and experienced podcaster, it is very important to know your audience well and make sure that you are able to dish out products that appeal to the listeners and help you make money simultaneously.

2. Undertaking Virtual Summits

Undertaking Virtual Summits

Your queries about how to make money with podcasts has an easy answer.

You can liken it to any other audio visual initiative that you can think of and then use the same principles for podcasting.

This is exactly how hosting virtual summits can be such an interesting option to explore.

So what exactly is meant by virtual summits and how can you make money podcasting through this?

Well in the simplest of terms, virtual summit refers to any interview that involves a lot of experts, even 20+ industry veterans at certain times.

The concept that it works upon is viewers drop in at the point of time during the course of this discussion.

The content of this kind of podcasting is generally free for at least the first 24-48 hours.

But if the viewers have missed this window, they would have to buy the content or rather an all-access card that allows them to catch up on all the episodes that they might have missed.

You have to be careful about the choice of the subject and the quality of experts that you rope in for this podcasting.

Remember that mere 20 people talking with viewers chipping in between won’t get you the desired number of eyeballs that you would be targeting.

The choice of subject and the people speaking often set the tone for the podcast and thereby, help you get the right kind of followers and revenue along with it.

If you can host a sufficient number of these podcasts successfully, you can then make this a successful revenue model.

Apart from the real time list of people who would be buying these podcasts, you can also rustle up a list of email subscribers who are ready to buy these podcasts.

That aside, the brand that you create through this exercise also helps you make money.

3. Affiliate Marketing

Affiliate Marketing

The secret of how to make money with podcasts is not very different from other audiovisual media.

Therefore, it is but obvious that affiliate marketing also figures in the list of things that you can do to make money from podcasting.

Basically, affiliate marketing programs help you make money by promoting their products and services through your podcasts.

In case you are wondering how you can sell products to your listeners, the company normally provides you with specific links or codes that aid selling of the products.

For every product that gets sold through these links or codes, you earn a commission.

The exact rate and range of commission will undoubtedly depend on the affiliate marketing company and the number of their products that you are able to retail in all.

The choice of company for the affiliate marketing program becomes a key game-changer in terms of how much money you can make.

For example, if you decide to go ahead with Amazon, you have the potential to earn commission anywhere between 4-15%.

Of course, this depends on the total products that are actually shipped in a month.

This is exactly why it becomes very important to choose the right set of products.

There are two ways of identifying the right set of products.

You can choose options that match with the theme of your podcasting, or you can decide on the kind of products that your followers or listeners would like or have an interest in.

Also when you are promoting products through the podcasting, it is very important to maintain complete transparency and not take your listeners for a ride.

That is exactly why you also need to promote only those types of products that you believe in. It is unfair to mislead your listeners who are attaching great value to every syllable that you utter.

Wrong selection of products from the affiliate marketing initiatives does not just hinder the ways to make money; it also impacts your reputation.

After a bad experience with the product, your listeners could also raise a question mark about the overall quality and content of your podcasts.

That would surely impact the overall monetization plan.

4. The Magic of Networking

The Magic of Networking

Have you noticed that some podcasts are invariably always better that what the peers bring forth?

They would have great quality, superior selection of guests and an engaging debate almost every time.

While superior knowledge is one aspect of the whole thing, there are many different elements associated as well.

One of the primary catalysts of how to make money podcasting would be to further your networking initiatives.

Don’t be shy to tap the possibilities offered by every single member of your network.

The more you keep probing, the better are the chances of getting some real good voices and meaty content enhancing the quality of your podcast.

The kind of content that you put forth has very little relevance in terms of nurturing a strong network.

Don’t think that if you do not put interview based content, you don’t need to pursue networking actively.

In fact, networking can be real handy in terms of helping you to market your product, take your podcast to a relatively larger number of audience base and provide a lot more followers.

The strategy for networking also needs to be carefully chalked out.

Your guest list should not just have A-listers.

While there is nothing wrong with concentrating more on A-listers, it might not be strategic all the time.

That is exactly the key to helping you make money podcasting.

Strategy is one of the primary prerogatives that you must concentrate on.

You have to curate a guest list in a way that attracts the maximum number of listeners, and that is when you gain from the podcast.

Additionally, you should not just focus on creating an influential guest list.

It is very important that the person you liaison with also brings forth some basic business opportunity for you.

For example, if you are networking with a group of enthusiasts who are passionate about the topic that your podcast is about, they can often help you gain a lot more publicity than many big names in the industry.

They will listen to your podcast; talk to ten other people and who knows what business opportunity can suddenly click from these initiatives.

5. Ways to Push Your Products

Podcasting to Push Your Products

While affiliate marketing is one way to make money via podcasting, there is another way to monetize your podcasts.

So before you run around looking for the right options to take forth your affiliate marketing dreams, another simple option would be to promote products that you easily have access to and won’t cost much either.

For example, your sister sells decoupage items and spends a fortune promoting them.

Why don’t you strike a deal at mutually convenient terms and start promoting her products through your podcast?

There can be a cross promotion as well, where your sister includes links to your podcast and you promote hers.

As a podcaster, it is extremely important to understand the kind of listeners that you have and the product profile that would get you the moolah.

For example, you might be podcasting on gaming.

So it is needless to mention that you would have a significant number of listeners who are youngsters and belong to the trendy-funky Gen Y.

Therefore though you are not a fashion specialist or talk about fashion, you can promote trendy apparels through affiliate marketing tie-up.

While you might not be a fashionista, you have identified just the right pulse of the majority of listeners.

As a result, they would then relate a lot better to the type of products that suit their likings.

So, on the same lines, if you promote a great new bakery or stuff for newborns through your podcasts about fashion, it will be able to target the right type of listeners and help you make significant money.

The logic is fashion is invariably followed by women at large and at least 50% of these women would be new mothers or know people who are new mothers.

As a result, they have genuine requirement of these products.

Therefore they are more likely to buy these products and help you make money podcasting.

In short, you have to understand how to convert our podcast into an effective marketing tool and go all out to try and make the desired difference.

In this context, do not be stuck with names and brands.

Depending on the demand, kind of alternatives available, it does not harm to liaison with your neighbor and not a hot shot brand that wasn’t, if the prospect to make money look relatively strong.

The core idea should be maximum publicity for your podcast and strong response to the brands that you are promoting.

Remember the whole theme of your marketing initiative is how to make money podcasting.

6. Patreon


Whatever revenue model that we explored thus far for monetizing your podcasting, is all extremely unstructured.

There is no regular stream of income flow.

There would be times when you get a lot of money flow and then complete dry spells.

So then the question that comes is how to make money with podcasts on a sustainable basis.

This is important because the only way a podcast would be sustainable over the longer-term is via monetizing its content in a systematic manner.

Perhaps one of the easiest options to maintain a regular flow of income via podcasting would be to decide to podcast on Patreon.

This a profitable proposition because Patreon allows its podcasters to receive income on a regular basis.

You can choose a payment scheme that suits you best.

It can be either on a per month basis or on every podcast that you put out on air.

This works equally well for beginners and veterans in the podcasting world.

So it is no more stress about how much revenue you can collect from sponsorships or ads or sales.

By their nature, they can fluctuate anytime but Patreon helps you make money without too much of a problem, and you can focus a lot more on enhancing the quality of products that you are podcasting.

Another big advantage of going the Patreon way is that it enables every podcaster an opportunity to connect with their devoted listeners on a one on one basis.

In the journey towards identifying how to make money podcasting, these interactions can prove to be major game changes with the potential to convert occasional listeners to hardcore followers.

So without any additional work, you are able to regularly interact with the listeners, understand their preferences and even tweak the content of your podcast accordingly to accommodate these additions.

This Patreon platform has, of course, many similarities with that of the YouTube model.

However, given the fact that podcasting is a continuous affair, the one-time funding alternative does not work very effectively.

In comparison, the Patreon model provides a steady source of regular income.

Given the relative wide range of listeners that Patreon commands, even a few bucks for each podcast a month can aggregate to a rather large sum on an annualized basis.

Reports indicate that there are some podcasts that have garnered close to $5000-7000 a month on Patreon even on the basis of few bucks that every listener chips in.

7. Coaching

Coaching Through Podcasting

One of the fundamental lessons in how to make money podcasting is that you need a steady flow of listeners who can be turned into subscribers essentially.

This is particularly useful when you are in the coaching business and want to market your offerings through coaching.

It will be useful for the listeners as they can save considerable time coming and going to your coaching center.

Moreover, podcasting is one unique product that you can hear while on the go and can gain significantly.

Moreover, this enables all those people who stay far away to also take advantage of your coaching.

However, one important aspect of this entire game plan is that the way you promote your coaching endeavors through podcasting often holds the key to most sustainable promotional exercises.

Well in this context, I feel you must adopt the movies’ structure.

Think about how movies make money through their publicity campaigns.

You can pretty much use the same concept with your podcasting too.

Just like a movie trailer, create a short gripping podcast trailer and also promise a free 30-minute session.

You can use this kind of promotion to get your listeners hooked and then turn into subscribers eventually.

The higher the number of subscribers, you can make money faster via podcasting.

You can also throw in a free consultation session for all those who turn subscribers listening to your podcasting.

This will no doubt add another layer of credibility and goodwill and help listeners add to your revenue model.

8. Create Audio Books

Create Audio Books

The general progression from coaching is to books using podcasting.

You are spending a lot of time and energy into creating quality content for your podcasts whether it is about business, commerce, mathematics, IT or even general advice about life and wellness.

This is your opportunity to turn this precious content into a saleable format and make money through it.

You already have understood the quality of content is appreciated, and there is a sufficient number of willing listeners who subscribe to it, all you need to do now is take it to the next level.

Take in all your creative instincts and put them to use creating audio books.

In effect, you are not doing anything extra.

You simply need to collate all the available podcasts done thus far, and then you relocate them into an audio book format.

You can then sell them as a single unit or even look to sell it on a part by part basis.

This will entirely depend on the demand cycle and the model that yields maximum gains for you.

For those who are little more resourceful like Jon Nastor, you can also convert this into a printed book format either.

You can then promote the book using the same podcasts as well.

In this way, you can create a self-sufficient module of both creating content and then monetizing and promoting it.

Surprisingly, all of it is being done using the same set of podcasting that you created initially.

9. Drum up Crowdfunding Through Podcasting

Drum up Crowdfunding Through Podcasting

Sourcing funds through podcasting is one of the biggest ways to make money.

But the biggest problem in this context is the approach for drumming up the funds.

Take a look at how the subscription model works on a platform like Patreon, a few bucks every month hurts nobody but what it helps you achieve is a sustainable channel for continuous revenue flow.

Well, this is what can lead to crowdfunding, as a means to make money via podcasting.

Just like you saw in the case of Patreon, the community of listeners chips in with small amounts and pledges.

When aggregated, this eventually allows you to create a pretty dependable kitty that allows you to take forwards these podcasts further.

Successful crowdfunding is all about creating consciousness amongst the listener community and then making them party to the entire cause.

In this way, you turn your podcasts as a common platform or level playing field.

It brings together people with similar beliefs across the world in a sustained manner and helps you to understand how to make money with podcasts.

In case you are planning to create audio books or full-fledged publication, these crowdfunding initiatives can be rather handy and help you provide the much-required resource to help you move forward.

10. Don’t Be Shy to Ask for Donation

Don't Be Shy to Ask for Donation

Creating a podcast is a rather expensive affair.

You have to organize the fund to hire a studio, instruments for recording, spend time researching and creating an appropriate content.

Plus the idea is to eventually turn it into a source of income and make money in the process.

In this context, you can easily ask for a donation pledge from your regular listeners.

There is no reason you need to be shy about it.

If your content is impressive and there is still time for the number of subscribers to reach satisfying levels, you can still go ahead and raise funds through donation.

Of course, you must remember this kind of method cannot be a permanent way to make money.

This is only a stop-gap measure to tide past a tough phase in your podcasting journey.

After all, it is almost like begging, and you won’t be too happy asking for donations all the time.

Also, this can impact the number of listeners that you might have for your podcasting episodes.

After all, people might easily get irritated by a constant plea for donations.

11. Creating Novel Apps

Creating Novel Apps

In the journey towards how to make money podcasting, there is never any dearth of opportunities to capitalize on.

So if you have quality podcast content and a reasonable subscriber base to bank upon, you can also look at devising unique models to make money.

It could be anything from making it an app for android or iOS devices to something that is offered as a free offering along with other products as well.

The idea is to get the maximum number of people willing to pay the price for the product that you have on offer.

So, Podcasting Makes Money

Podcasting Makes Money

When you are looking at ways to make money using podcasting, there are many alternatives that you could explore.

The overall idea is to generate funds capitalizing on the willing listeners to your podcast.

However, the secret of how to make money podcasting is closely linked to the choice of topic that you might have in mind.

If you want to make money as a podcaster, you have to look at identifying the most gripping topics that can generate the largest number of subscribers.

It should also have the potential to start a debate and involve the listener community into the whole discussion module.

Effective networking is another important tool for generating funds through podcasting.

From creating an A-list of guest speakers to being able to spread the word about your podcasts, your connections can go a long way in helping you create a sustainable revenue model.

Moreover, you must maintain continuous connect with your listeners.

As a seasoned podcaster, this often creates the most reliable tool to improve the quality of your content going forward.

How to Make Money as a Computer Programmer

Software engineers or computer programmers are people who create computer software by writing all the coding in specific computer language.

Computer programmers are the spirit of any hardware and applications because without programming, most of the electronic devices are useless.

With such an ability, computer programmers can make money in various ways.

Computer programmers can make money usually with writing codes for many software.

History of Computer Programming

Programmable devices have existed since 1206 to be able to play some rhythms and drums but they were not the same as today.

In 1843 the first computer program was created by Mrs. Ada Lovelace, the mathematician who published an algorithm to calculate the sequence of Bernoulli numbers for the Analytical engine.

Augusta Ada Lovelace, the First Programmer in the WorldAugusta Ada Lovelace is the first programmer in the world.

She was and English mathematician and writer (born in December 10, 1815 and died in November 27, 1852).

She was the first to notice that the machines should have an applications beyond their pure calculation.

Later in In the 1880, Herman Hollerith invented the theory of storing data in the machine readable form and both programs and data used to be store in the memories of the computer.

The main purpose of today’s programming quality is not the same as before and it has to provide the following:

  • Reliablility
  • Usability
  • Punctuality
  • Portability
  • Efficiency
  • Maintenance
  • Ability of handling the volume, variety, velocity

How Do Computer Programmers Make Money?

Programming is the main logic behind any high-tech devices algorithm.

Programmers are able to make any smart devices with their skills and knowledge.

They are the heart of the data technology and without the programmers the future of digital technology doesn’t exist.

There are many  ways that computer programmers can make money with such as:

  • Mobile developer
  • Mobile app programmer
  • Software Developer
  • Software design
  • Game programmer
  • Database design
  • DBA
  • Program analyst
  • Embedded firmware developer
  • Web development
  • Online application
  • Big Data programmer
  • Big Data analysis
  • Data science

How Computer Programmers Make MoneyThe main computer programmers skills is how to write and read the codes and specific computer languages, but a programmer can also design any application as well.

A good computer programmer, with more than five years of experience and expert in one of the main computer programming language and few additional skills can make a good income.

That good income is various from country to country and from a company to another company.

In general the company’s programmer can be considered a hearth of that company since the company makes money because of their knowledge.

1. Making Money as a Mobile App Developer

Mobile application development is one of the top hot programming skills nowadays.

There are many, many mobile apps that come out every day and all being created by the programmers.

2. Software Design

Designing the software is one of the most sensitive part of any application or software.

The logic behind any application or software being designed by a software designer.

He or she will create all the main structure and blueprint of the software before anything else.

Some information technology departments are using few designers in their team and all of them should work with each others in order to make sure everything is linked properly based on the company’s needs.

It can be the software designer, database designer, web designer, and also the app designer.

They must decide which programming language should be use for their application as well.

All of those steps  must be done before the starting of any coding.

3. Database Programmer

The database programmers are responsible for the back-end of the applications.

That means, they have to make sure the application is able to store, sort, search, update, and more based on the command.

Computer programmers who are working with database are able to make a lot of money.

Working as a database programmer requires the sql skills and the logical queries with the best and fastest result.

Some complex applications with many, many tables are able to communicate and access data with the queries that’s been created by the database programmers.

4. Game Programmer

The programming game is one of the high pay computer programming in today’s high tech world.

There are billions of people who are playing computer games in their daily rooting and all of those games being created by the game programmers.

5. Big Data Programmer

Programming a big data is the highest paying programming languages.

The big data programming uses python and java as their main programming languages.

Moreover, big data is a new way of storing, sharing, visualization, update, search and fetching data in many locations within the same network.

As a result, when a user fetching any data request such as image or any data with a large size of data, the query result will be done withing few seconds.

That happens because the data is not being stored in the sole database on the server and the data in this type of system are been store in various locations in the same network.

Search wains are collecting all the peaces from different locations at the same time and they create a total package and submit it to the end user.

Computer scientists came out with this idea, because of the high demands for medical images and sharing the database information between the medical centers.

Now, the traditional way of storing the data in the single database with many table doesn’t exist anymore with big data.

A copy of any data stores in several physical locations on the same network and they are using the cloud system to create this network.

Main purpose of the big data is a capability of handling the volume, variety and the velocity.

When there is a command, the system will search in parallel in all entire the network and all the physical computers in the system to be able to collect the data.

As a result the search result, will be thousands times faster than the traditional way of querying within the same database.

6. The Big Data Analysis

Since we have a big data programming, there is always a need for analyse the programs.

Data analysis, is the way to find the logic behind the application or program and to make sure the program is co responding with the company’s needs.

Also, the security of data should be concern and data analyst is able to make sure everything is running with the logical and accurate result.

The three Vs; volume, variety, velocity should be concern with the big data analysis to make sure the program can handle all of those requirements.

Since, the growth of data increases everyday very quickly, the governments and healthcare system, security and database data transfers are huge.

Growth of data is 4.2 exabyte every day, the big data is a revolution in a data science to help with data system to be able to handle the such a big data volume.

Computer programmers who are able to work with big data can make a lot of money and there are many demands for big data programmers or analysts.

7. Embedded Firmware Developer

The programmer who works as an embedded firmware developer, is basically programming the machines such as:

  • Cars
  • Microwaves
  • Smart TVs
  • High tech machines
  • Stoves
  • Fridges
  • and so on…

Programming of embedded firmware is not always a simple task.

Sometimes when you write a code for those devices, the code will be store on the memory board which is not easy to change.

Basically instead of software system it will be written for the hardware and transistor layout of the chips on the board and almost impossible to change them.

Usually it’s firm and controlled by the manufactures and not by the end-users.

Although there is a shortage of skilled programmers the average salary for the embedded firmware engineer is between $67K to $90K.

Skills require for embedded firmware engineers are: C or C++, Debugging, Hardware system, Communication, Creativity and being organize.

How Much Money You Can Make as a Computer Programmer?

Computer programmers’ salaries are like the other professions and it is all based on their experience.

People with more than two years of experience can make money in the average of $75,000 to $150,000 per year.

Web developers usually make less comparing to the object oriented programmers.

Application programmers, who are just doing the coding making less than the application analysis.

Java programmers with few additional skills such as Big data and Database, and having more than 10 years of experience are making more than $180,000 in some highly secretive companies.

However, the percentage of being lucky to be hired by the right company with the fair salary is less than 12%.

Programming and coding is a tough job and requires a lot of logic, skills and experience.

Although, all the applications are made by the programmers, they don’t get the salary that they deserve.

There are big software companies that are making billions of dollars by using computer programmers skills and hiring them to create their applications.


Computer programmers are the main reason for the technology advancement.

I have a computer science background with many years of working in the information technology field in the software system.

Working as a programmer requires a lot of logic and focusing.

By being a computer programmer you make your boss rich and you stay as a regular employee with a limited salary.

After ten years of working for various companies as a programmer, I decided to become my own boss and make the money I deserve with my skills and educational background.

The following questions were always in my mind:

  • How can I make money as a computer programmer?
  • Where should I start?
  • Is there any other way that computer programmers can make money through?

So, I decided to do some research and found out that I was just wasting my time and energy for the others to become rich and staying in the higher positions.

However, I made my decision and quit my day job which I wasn’t happy with, although everyone else wished to have the job i had, but I let it go.

I realized that it is true when they say: it’s not about what you know, it’s about who you know…

They’ll try to put you down and taking the advantages of your knowledge because you don’t know any other options available for you.

Therefore, they will keep you busy enough not be able to look around and realize the power of knowledge of being a computer programmer and what they can do.

1- How Can I Make Money With My Computer Programming Skills?

There are many ways of making money with your programming skills:

  • Become an IT consultant
  • Freelance Web developer
  • Running an online e-commerce
  • Having online business
  • Work from home on the internet
  • Internet marketing
  • And more…

There are various ways of making money for an skilled computer programmers that they can make three times more money than the average salary based jobs.

You can work only few hours per day and make a lot of money without any headache.

All you have to do is to do some research and see what you like to do.

Some people are good at internet marketing and communication which is the best way of making money online with a lot of profit.

Others like to sale products and or become a suppliers.

Affiliate business is always another way of making money online.

Make sure you have your own website and make it work and get a lot of visitors.

Have a self confidence and always tell yourself that I can do it and be positive to win and stand out between all other competitors.

Computer programming is one of the multi functional skills that not many people can have, so try to use it in order to move forward with success.

Good luck with your choice!

The Business System to Make Money Online and Get Rich with Gold

So you want to get rich, right?

Who wouldn’t want to?

Please read the below words carefully.

In this article, I am going to discuss some facts that you’ve never heard before, and probably you will never hear from anybody else in future.

The Excitement of Getting Rich :)There is some great news that you can’t afford to miss.

It wouldn’t take you more than 20 minutes to read this article.

So, please be patient and read it entirely, not to miss the excitement 😀

I assure you that there is nothing to lose but a lot to gain.

I am not going to ask you to sign up for a training course.

This article is about getting rich, and then richer and richer…, with an extraordinary system.

But please wait for a second…

“Getting rich” is not what most people think.

Therefore, at first I help you to understand who is a truly rich person and what getting rich means.

Then I will explain about one of the most efficient systems to get rich.

Who Is a Truly Rich Person?

A rich person is someone who just makes a lot of money. Right?


Getting rich is not just about making a lot of money.

Who Is the Real Rich?There are so many who make a lot of money, but still they are not rich.

They spend all the money they make.

On top of that, they end up paying a lot of tax on their earnings.

After all the expenses and taxes, they don’t have much to save.

Therefore, if they lose their income, after some time, they won’t have money even to bear their expenses.

They have an apparently luxury life, because they live in luxury houses and drive luxury cars.

But, in fact they cannot be called rich.

When you don’t know (1) how to make a lot of money, and (2) how to secure and increase the money you make, you will never become truly rich and financially free.

This is the first fact that you need to understand.

So, Who Is a Truly Rich Person?

A truly rich person is someone who (1) makes a lot of money, and (2) secures and increases the money he makes at the same time.

Secure Your Money and Watch It GrowHe knows how to generate different sources of income to make a lot of money.

What happens if he loses his income source for some reason?

He won’t be in trouble at all because he’s already secured and increased the money he’s earned.

Therefore, he can easily manage to create some new sources of income again to keep doing what he’s been doing before losing his income: (1) Making a lot of money, and (2) securing and increasing the money he makes.

Therefore, a truly rich person doesn’t easily get bankrupt.

He gets richer and richer and richer…

This is the difference between a truly rich and an apparently rich person.


You have to do the same if you want to become a truly rich person.

To do that, first you have to start making a lot of money.

Then you have to secure and increase the money you make.

If so, you can become rich and then richer and richer… 🙂

Now, it is time to give you the first good news:

You can do both of these at the same time with an extraordinary system that me and many of my friends follow.

Grow Your IncomeThere is an already built-in system through which you can earn money.

So, you can make a lot of money, and secure and increase the money you make at the same time, without having to take any extra risk or spending any extra time and money.

We’ve created a team here at LuckScout to help you to follow this amazing system to make money.

It is a great opportunity for those who want to get rich and financially free.

Another good news is that The LuckScout Team supports you 100% for free forever… no monthly fees and no charges for any of the services they offer.

Our system enables you to make money without having any experience and without having to work hard. It works for everybody.

Please keep reading… there are some more good news on the way:

All in One System:

(1) Making a Lot of Money and (2) Securing and Increasing the Money You Make

For most people, “Making Money” is the hardest thing to achieve.

They always have a hard time to make some money to survive, let alone making a lot of money and getting rich.

Most people don’t know how to make money.

Therefore, they suffer from having not enough money the whole life.

I will QUIT my 9-5 job finally. Many of them have to make a living through a 9-5 job.

Running a business is only a dream for many of those who have a 9-5 job.

They want to make more money and achieve time and financial freedom.

Many of them love to get rich.

However, over 95% of those who run their own business, will fail.


Because they know almost nothing about running and promoting a business.

They have no proper product or service, or even if they do, they don’t know how to sell to the public.

Therefore, smart people prefer to follow the successful business systems, instead of starting their own business system and plan: They start a franchise business like McDonald’s.

But this is not the solution for 99.99% of people, because they cannot afford it.

You have to be a millionaire already to be able to run a franchise business like McDonald’s.

So, What Is the Solution?

Gold Makes You RichFortunately, our online business system not only can make more money potentially, but also doesn’t have The Risks, Expenses and Hassles of running a brick and mortar business or running a franchise business like McDonald’s or StarBucks.

Additionally, it generates passive (residual) income.

This is because of the nature of this system:

(1) It builds an organization for you.

(2) This organization grows on its own after a while and becomes bigger and bigger.

Yes, you heard it right… it grows on its own.

You just need to join the system.

This system is backed by GOLD.

But it is not another shady gold MLM or pyramid scheme.

Please keep reading… I will tell you what this system is 🙂

Gold is the magic way of getting rich and then richer and richer.

Those who know the value of gold and use it to make money, will get rich.

But Please Don’t Get Me Wrong!

I am not going to encourage you to buy/sell gold through the trading platforms of the retail brokers, because it is too risky and it doesn’t make any profit most of the time.

Retail Traders Lose Most of the Time.The gold spot price goes up and down all the time.

Those who buy/sell gold virtually, based on the spot price and through the retail brokers or banks, usually lose a lot of money.

99.99% of the retail currency, stock and metal traders lose money this way.

What I do is completely different, and if you do the same, you can make a fortune.

We set up the system for you and it takes care of everything.

Please be patient and keep reading…

There is nothing to lose at all.

Here Is How This System Works:

1) It makes a lot of money through the gold market, no matter if the gold spot price goes up or down.

2) It converts a portion of the money it makes into physical gold to secure and increase your wealth.

Therefore, both the big source of income that we need to make a lot of money with, and also the system to secure and increase the money we make, are all in place in this system.

Gold makes money for us and increases the money it makes at the same time.

It means we get rich and then richer just by following this system.

Is There Any Risk?

Can You Lose Money in This System?

You Will Never Lose in This System.

While those who virtually trade the precious metals like gold as well as the currencies and stocks, lose a lot of money and sometimes they lose their shirts in these markets, you won’t have to risk any money with our system.

This system makes money for you consistently when people convert their money into gold to save, secure and increase their money.

You make more money when more people join the system every day.

And more people are really joining this system on a daily basis, because every day more people learn about the value of gold and this system.

Never Lose MoneyTherefore, there is no way to lose in this system, because you don’t make money based on the gold’s price appreciation and you don’t lose money because of the gold’s price depreciation.

You make money based on the increasing activity of the gold market, no matter what the gold price direction is.

Like StarBucks which is backed by coffee, or McDonald’s that is backed by hamburger, this system is backed by GOLD 😀

There is a higher demand for gold every day, not only from people, but also from the governments.

When you enter this system, you will make more money when more people enter the gold market, because you will be part of this market, no matter to what direction the gold price goes, up or down.

Numbers don’t lie:

While you are making money, you can save a portion of your income in gold, and so, your money never loses its buying power over time.

You also make money on the increasing buying power of gold.

After a short while, you will even receive free gold just because you are saving your money in gold.

So, in this system, you make money in the gold’s market, but unlike the retail gold traders who trade gold virtually, you don’t risk any money at all.

Why Saving Your Money in Gold?

You can save your money and income in gold, because gold doesn’t lose its buying power, but paper money does.

The gold’s buying power goes up over time, but paper money always loses its buying power because of the inflation and because it is not backed by anything.

Therefore, when you convert your income into gold, indeed you are increasing your wealth automatically without doing anything.

Gold increases your wealth while you don’t have to do anything.

So, this system not only makes money for you, but also it automatically secures and increases the money you make.

Let me give you some examples.

Gold Buying PowerExample #1:

In 1970, one gram of 999.9 gold, was worth $1.32 while it could buy you five loaves of bread, whereas a $1 bill could buy you four loaves of bread.

Today, the same one gram of 999.9 gold is worth $52.66 and so it can afford you 20 loaves of bread, while $1 doesn’t buy even a single loaf of bread.

Example #2:

$2,000 in 1932 had the same purchasing power as $116,000 today.


The gold price was $20.67 in 1932, but now it is about $1,200.

This is because of the inflation that causes money to lose its buying power over time.

However, if you had converted the same $2,000 into physical gold in 1932, now your gold would be worth $116,000 because you could buy 58 Troy Ounce of gold with your $2,000 in 1932:

$1,200 / $20.67 = 58

$2,000 x 58 = $116,000

But if one saved that $2,000 as cash, now he could buy only 1.7 Troy Ounce of gold:

$2,000 / $1,200 = 1.7

It is amazing, isn’t it? 😀

Let me amaze you more.

Example #3:

Growing Value of GoldIf you had saved $300 per month since 1990, now you would have $72,000.

However, your $72,000 buying power would be $56,000 now.

It means you would lose $16,000 on your saving.

But, instead of saving $300 per month, if you had bought $300 physical gold, guess how much your gold would be worth now.

It would be worth $236,000.

Can you believe it?

I know it is hard to believe, but it is so true.

That’s why I told you at the beginning of this article that I was going to tell you the things that you’ve never heard before.

How Is This Possible?

Physical gold doesn’t lose its buying power.

It even gains more buying power over time, because there is always a higher demand for it.

Although the gold spot price can fluctuate, but the gold buying power increases every year.


Because we work with the physical form of a highly demanding precious metal.

It is not like the other metals and commodities.

It is only gold that has an increasing demand and buying power.

In this system, we are not dealing with some worthless credit or digits that can be bought or sold with one click online.

JP MorganPhysical gold is the real wealth.

That’s why JP Morgan said,

“Gold is money. Everything else is credit. And once you realize this, you will never be poor again.”

Therefore, this system makes money for you based on the Global Gold’s Demand, as well as the Increasing Gold’s Buying Power:

For each participant, this system builds an organization that makes money through the increasing demand in the gold market. Also, you will earn money with the increasing gold’s buying power, while the organization keeps growing day by day.

What does this mean to you?

It means you get rich and then richer and richer if you follow this system.

Why Does This System Has No Risk?

You have to have a lot of money to invest in the stock, real estate or currency markets, if you want to make profit reasonably.

However, the system I am talking about here, is not an investment program at all.

That’s why it has no risk.

Investments always come with some risks.

But you don’t risk any money in this system.

We will instruct and support you to do this.

It is time to give you another great news:

The LuckScout Grant 🙂

The LuckScout GrantThe LuckScout Team has decided to grant a portion of the’s income to those of you who are (1) eager, (2) eligible and (3) qualified but (4) cannot afford to start their own online business to get rich and financially free.

Money is a big help to speed up your success and boost your revenue.

Every month they choose some of you who are eligible for The LuckScout Grant.

Then they grant the money to the chosen members who will need to promote their online business under The LuckScout Team supervision and support.

Not all of the followers and members can expect to receive this grant.

However, LuckScout may increase the grant to support a higher number of grantees over time.

This is just the beginning.

Hopefully there will be a lot more to come.

LuckScout wants to help more people to get rich and financially free.

They want to create a community of millionaires.

Congratulations to all their followers and loyal fans.

And, thanks to The LuckScout Team!

The LuckScout Fully-Automated System

The LuckScout Fully Automated SystemThe LuckScout Team will create A Fully-Automated Online Business System which is backed by gold and works and makes money for you, automatically.

How much do they charge you for this?


It is absolutely FREE.

Although running and managing this system for each member has a lot of costs for LuckScout, they don’t charge you anything, because they care about you and your goals, and because your success is their success.

The LuckScout Fully-Automated System enables you to get rich through the automation power of the computer and Internet.

It makes money for you even when you are asleep.

The LuckScout Team will set up The LuckScout Fully-Automated System for free for the LuckScout members.

How Can You Participate in This System?

You Can Start Right Now:

If you want to join, please submit your email through the below form now.

We will email you the instructions and the sign up link.Start Right Now

After completing a couple of simple steps, you will have free lifetime access to The LuckScout Team special members area.

There is NO FEE to have access to your account and instructions, as well as The LuckScout Team members area.

In The LuckScout Team members area, we will show you how the system works in details.

Then, we will set up The LuckScout Fully-Automated System for you 100% free.

This system works and makes money for you completely on autopilot.

The LuckScout Fully-Automated System has made it a lot easier to make money.

Early Bird Catches the Worm!

Financial FreedomThere are so many senior members waiting for you in the members area.

They are waiting to set up The LuckScout Fully-Automated System for you for free 😀

Don’t You Want to Get Rich and Financially Free?

It is time to take action.

There is no better, safer and easier way.

Those who understand the value of this system, will get rich and financially free.

Those who hesitate, will forever remain where they currently are.

Are You Ready to Start?

1. Submit your email address through the below form now.

2. Wait for our “Welcome!” email to hit your inbox. It doesn’t take more than few seconds usually.

3. Read the “Welcome!” email and then click on the sign up link to register for an affiliate account.

Our welcome email covers everything you need to know to sign up for an account and start using it.

So, please read it carefully.

4. We will email your LuckScout members area login once you pass the first 2 steps that is explained in the “Welcome!” email.

5. You can then login to the LuckScout members area, see how The LuckScout Fully-Automated System works and then have this system working and making money for you, 100% for free, forever.

That is all… You will have a fully-automated online system that makes money, more and more every month.

Start Achieving the Life You Have Always Been Dreaming Of:

Please enter your email address now and then check your inbox:

Keep in mind that today can be the best day of your life.

It is the day that you are starting a lucrative online business that can help you to achieve financial freedom.

It is a big day!

Don’t let your fear stop you.

Vahid ChaychiSee you onboard 🙂
Vahid Chaychi

I am an experienced web developer and internet marketer since 2002. I have been able to become the top seller/earner and affiliate with several different companies. I have launched my own affiliate programs as well. I am a blogging and WordPress expert with lots of enthusiasm in blogging and vlogging to share my knowledge and experience. I am a member of The LuckScout Team. With the help of The LuckScout Team, I will set up a fully-automated online business system for you that works based on the business system I described above. With this fully-automated system, you will make money and achieve financial freedom much easier and faster than what you think. Join us and make your dreams come true.

How ClickBank Affiliate Program Works

ClickBank Affiliate Program is almost the first online affiliate system that we know.

Affiliate marketing or affiliate program is something that you hear quite often these days.

In fact, it would not be wrong to say that this is one of the top online armories to promote a product or initiative.

The effectiveness and reach of these programs make it popular.

In fact, the ClickBank affiliate program enables you to sell your products digitally.

It also helps you make money while you are promoting someone else’s product digitally.

But this ClickBank affiliate marketing is a two-way street.

As a vendor, you have to make sure you are paying commission to those who are promoting your product.

Simultaneously as an affiliate hub like ClickBank, it is imperative to make sure you provide your associates with the best rates.

Simultaneously if you are the one who is placing all these affiliate ads on your web page, you have the additional responsibility of creating content that can attract eyeballs and also promote products that you have selected.

Your earnings are directly dependent on the overall products that you are able to promote and the total number of clicks that translate into buys.

Yes, the total number of buys converts the clicks into potential earnings.

This is the basic foundation upon which organizations like ClickBank are based upon and run so effectively.

In simple terms, this is also the moving mantra for any affiliate marketing initiative.

Making Money with ClickBank Affiliate Program

ClickBank Affiliate ProgramHowever getting started with ClickBank does not come so simply.

More often than not, once you sign up for ClickBank, you end up looking at some sub-standard products and then wonder how you can make money out of it?

Sometimes it happens that you keep trying for months together and are able to make barely $100-200.

The challenge most times with the ClickBank affiliate program is how to make it profitable.

The website gives you details about potential traffic, yearly earnings and overall popularity.

But are you wondering why you are not able to translate them into profit like the website claims?

Well, the fact is that ClickBank affiliate marketing is not as simple as it appears.

While on the one hand, you need to gain practice and hone your skills, on the other, you also have to be very shrewd in your product selection.

In the absence of the right and appropriate products to promote, your entire initiative would fall flat.

Therefore, if you are looking to initiate the ClickBank program to generate an alternate source of making money, it is necessary to chalk out a well thought out strategy.

Not only is it important to understand the implications of the program properly, but also how effectively you should be running it to maximize your gains.

You must undertake an in-depth study of the various provisions of the affiliate program and explore the possibilities of using it to optimize the gains and maximize the earnings from this.

You must remember that the content of the website you are placing these ads also make a huge difference.

So getting started with ClickBank is a multi-pronged strategy that aims to bring out a balance between the vendor’s target, the buyer’s aspirations and your targets.

Therefore it becomes important to keep in mind some basic ground rules.

1. Choose The Right Product

For ClickBank to click for you, it becomes immensely important to choose the right type of products.

This will always enhance the clicks that you get for the ads that you place on your site.

For example, if you have a blog about recipes and cooking, it will make sense to put ads about cooking related products.

Those who are exploring the site for relevant recipes or cooking styles would get interested in the ads that you might place for interesting cookware or spice mix or even ready-made food.

Given the wide range of products that ClickBank has, it often becomes very important to choose correctly.

This is of particular importance as the list of options also has some sub-standard and not so great products.

A wrong selection can quite easily drive down the wrong impression.

It can also deter the visitors to your site to revisit later.

2. Balance of Ads & Content

It is never sufficient to simply sign up for ClickBank and put the relevant ads in place.

You have to look at achieving the right type of balance as well.

Too many ads would mean that your viewers would soon get tired of dealing with endless cookies that get generated.

On the other side, if you put too few of them, it would mean that you will not get sufficient clicks to translate into a reasonably strong earnings for you over the longer term.

The whole ClickBank affiliate marketing initiative would fall flat if you are not able to convert them into the required number of earnings.

3. Do Your Own Research

Another key step in getting started with ClickBank effectively is to do some legwork on your own.

Do not just rely on what others have to tell you about the affiliate program.

It always makes sense to do some research and in-depth study on your own.

This will help you to actually convert this online e-commerce giant into a significantly large contributor to your monthly earnings.

At the same time, it could also help you explore newer means of raising money from the same source.

Need To Develop Appropriate Understanding

Another fundamental factor in making ClickBank a profitable alternative for you would be to understand the payment schemes properly.

When you have sufficient sales volumes, the basic fees that you have to pay do not really pinch.

However, at the initial level, when you have rather small sales number, every dollar counts and that point the ClickBank charges could pinch significantly.

So before you get started, understand the overall fee implications clearly.

This will make sure that your earnings do not get crimped by these charges and you are able to maintain a steady inflow of earnings.

Ways to Pick Right Products on ClickBank Marketplace

Well, by now you have understood it pretty clearly that the best way to get the most out of the ClickBank affiliate program is to choose the right kind of product.

But the basic question that often bothers you is how to end up getting the right product mix and maximize your earnings potential.

Industry experts say that in this context, you must first set up your own sales parameters like the amount of sales you want to achieve, the kind of money you would want to earn and the share of money that you would like to make from ClickBank.

This will help you narrow down the potential options that you can explore to create the product bank.

The whole exercise of selecting the right product on the ClickBank affiliate marketing program is almost like choosing the keyword for a search engine optimized site.

Think about it?

What would happen if you chose the wrong keywords or failed to identify the most appropriate one?

Your website or digital content will not be able to attract the right kind of eyeballs.

The related viewership would be much lesser, and this will harm the ranking of your content to a large extent.

In the same way, if you cannot choose the right type of ClickBank product, your overall earnings would be compromised severely.

You might be great at product promotion but without the right options, the whole exercise can fall flat, and you will not be able to make a lot of money in terms of earnings.

So what are the key terms and conditions that you should base your overall sale pitch on?

1. Earnings Per Sale

One of the key parameters that should dictate your choice on ClickBank affiliate program is the earnings that you can expect per sale.

First of all, shortlist a few items you could promote.

Now compare the average amount of money that you are making after every sale on the various products.

It is almost needless to mention that you choose the one that gives you maximum leverage in this context.

2. Commission Percentage

This is yet again a crucial prerequisite.

The percentage of sale price or the commission on every earning that the affiliates get will determine the extent of your payment.

So compare the average earnings from the various options you have shortlisted.

This will help you make a wise choice easily.

3. Popularity

In the ClickBank terminology, this is known as gravity.

Essentially this outlines the total number of affiliates who sold the product you shortlisted in the past 3 months.

This is an important consideration as a relatively more popular product is invariably the one that has better earnings prospect.

4. Rebills

The average number of ClickBank affiliates who are taking commission from rebills become a vital consideration.

It highlights the percentage of rebills paid to the affiliate and the overall reliability of the brand that you could be selecting.

So when you go through these various parameters, you will be able to create a brief profile of the type of alternatives that you must look for.

The sites or products that you choose to promote must have:

  1. These products or e-commerce sites should have a low offer price
  2. The sites you decide to promote must have at least 3-4 upsales
  3. It should contain reasonable details about the company’s sales and other details
  4. Always go through the reviews that are provided online. An honest user feedback is often more helpful than column after column of information by the manufacturer.
  5. The gravity of the page or the popularity of the site that you select should be above 20. It means it should have been selected by at least 20 people in the past three months. That reflects the overall earnings potential of your choice.

The earnings potential is the key factor for any affiliate program.

You must remember the entire purpose of affiliate marketing by ClickBank or any other network is essentially aimed at getting the right amount of exposure and earnings.

If you are not able to garner that, then your entire initiative will go waste.

The Visual Element Is Crucial

The quality of the content is crucial for any affiliate program.

If you pay close attention to all the high gravity ClickBank programs, you will notice that invariably the ones that have the best content are also the most profitable ones

By content, I don’t just mean the written content alone.

The visual element that constitutes the entire promotional content also needs to be attention grabbing.

Thinking about it, when you are flipping pages in a magazine or surfing pages on the internet, you invariably get stuck on a page that has beautiful visuals.

The same is true about the display ads that you choose from the ClickBank.

You must remember that both the design as well as the visual content of the page is very important.

Ultimately, it is this that will grab the user’s attention and help convert their clicks into buys and thereby helping you earn.

If you thought you could put up just about any content and that would get converted into earnings then you are seriously mistaken.

Remember the reason why most online users get attracted to content is only on the basis of the image that is used on the thumbnail.

As they say, a picture is worth millions of words.

Whether you are looking at ClickBank affiliate marketing for generating additional income or just as an alternate source of making money, it becomes necessary to manage the visual content of the ads that you choose.

By the rule of thumb, all such ads that have a strong and attractive visual presence will garner more attention and would be more common as well.

In comparison, ads that have unattractive visual content will not be able to create that kind of impact even if the product that they offer is great.

Therefore, we can conclude that the ClickBank affiliate program is a complex mix of great quality, shrewd business sense and a strong eye for details.

The only way that you can make ClickBank profitable for you is by maintaining a strong line-up of ads that don’t just grab attention but also result in higher earnings.

This is only possible when you devote a significant amount of time and energy to understanding the various aspects of ClickBank affiliate marketing.

Once you are thorough with the various nitty-gritty of the page, you will be able to channelize the potential of the ads that you select in a profitable manner.

Passive Income Tax Rate

When you look at the various facets of income opportunities available today, passive income is a much talked about alternative.

But often, people are unaware of the exact tax rate and in the process, tend to miss out the advantages of the additional income.

You must understand that the passive income tax rate is very different from nonpassive income.

There are different types of rates applicable for different income opportunities.

You can draw the biggest benefit from these income avenues by understanding your tax liabilities effectively and being able to service your needs and requirement accordingly.

Broadly, passive income tax can be deducted on passive income.

By passive income, the US revenue department refers to all such earnings for which you do not have to earn or make any effort.

It is income that follows its natural course as a result of any previous initiative that you might have undertaken.

At the current moment, you do not have to do anything to maintain the steady cash flow.

Therefore, this gets counted as passive income.

There are, of course, many prerequisites before you categorize the various income options.

Therefore, it is pertinent that you understand the different provisions.

Passive Income Tax Rate & How to Determine It?

So it is important to understand what exactly passive income is and how you can distinguish it clearly.

1. Passive Income

In very simple terms, passive income refers to income or earnings from any activity where the beneficiary has not participated actively.

The source of passive income could range from real estate to fixed deposit to business dealings as well.

This could also include your earnings from certain investments at times.

The crux of the arrangement is such that the beneficiary after the initial legwork can pretty much sit back and relax completely.

Now we all know that passive losses can be only claimed on the passive income tax liabilities.

Most people now try to have simultaneous passive income sources apart from their active ones.

This is exactly why special rules were constituted to put a cap on the amount of tax liability that you can seek to reduce through claiming passive income benefits.

The 1986 Rules

These special rules that were enacted in 1986 specified that you can look at reducing your nonpassive income by as much as $25,000 if your overall income is less than $150,000.

However, this also specifies your active participation in a passive income source like rent from real estate.

But beyond this point, you have to restrict claiming passive loss benefits from passive income.

The losses that cannot be claimed can also be carried forward in consecutive years.

You need to understand to offset the losses; you need to project passive income that can adequately account for this amount.

There are some instances where you can also use the proceeds of a sale to claim tax benefits for passive losses.

But for that, you need to understand the law clearly and make provisions accordingly.

This will make sure you are able to optimize the benefits of a separate passive income tax rate in the best possible manner.

2. Portfolio Income

One of the most popular and interesting investment opportunities is undoubtedly that of portfolio income.

In many ways, it can be considered passive income too as it comprises of various types of dividend, capital gains, interests and royalties.

Though they are all clubbed together as either portfolio income or passive alternatives, the crux of the matter is that this kind of income has a very different tax rate.

Different kind of portfolio income has different rates.

For example, the tax rate for capital gains on an investment that you have held for over 12 months would be between 10-20%.

However, if the capital gains are calculated on investment less than 12 months, then they are taxed at a regular rate.

Social security taxes and medicare expenses are not levied on portfolio income.

So whether you are trying to project your income as portfolio or passive, income will depend on several factors.

But another benefit in case of portfolio income is you can use this to offset tax liabilities and other investment/income losses.

3. Active Income

This is often termed as earned income as well.

It is what you would call as regular income opportunity.

It is one of the easiest types of income and seen everywhere.

You go to the office, earn money and come back.

At the end of the month, there is salary in your bank account.

As the name clearly indicates, this is active income because you are putting in the effort and getting the reward almost immediately.

It is needless to mention that this, of course, comes with the highest income tax rate.

Personal taxes range anywhere between 10-35%, and apart from the direct income tax, there are several other taxes too that are levied on this income as well like social security and medicare taxes.

Therefore, the overall tax on this active income can be sometimes as high as 50%.

Another point where this differs from passive income tax rate is the number of deductions.

Well, the number of deductions is much less in this form of income as compared to other income opportunities like passive income or portfolio income.

So that further exacerbates the need to understand that various prerequisites for what constitutes a passive income and then getting a fair perception of the exact tax rates.

This is important also because the overall deductions that you can claim on a given year, and what losses you can carry forward to the next year is very closely linked to these factors in totality.

You must remember that understanding the various facets of your tax rate is as important as making sure you have a reasonable income source.

This is because only a thorough understanding of tax will help you maximize your income potential and recover maximum value for every dollar that you earn.

This understanding is also crucial in opening up various channels of investment in a constructive manner.

The Effort Element in Passive Income Tax Rate

When you look at the taxation rate of passive income vs active income, one of the most striking elements to consider is the fact that why is earned income or active income come with a higher tax rate.

Technically, you are putting in a lot more effort, devoting decidedly more time and even in terms of engagement, you need to have a far better and greater level of involvement.

So how is it that you need to pay a greater amount of tax in return for your hard work.

Well, you have guessed it right, it is not the time that you devote towards generating passive income that matters but the point is how efficiently are you able to.

In many ways, I would say that the tax department is perhaps telling you something really important.

It is not important for you to work harder but on the contrary, you need to work smarter.

Instead of devoting 8 hours in the office, if you can work at your convenience and generate an income that carries a lower tax rate, then why not?

It will only work better in your favor.

I am sure you already understand by now what it really meant by passive income.

It is, after all, any form of earning for which you do not have to put in any active effort.

Effort or the lack of it is the key factor that distinguishes active from passive income.

One of the possible variants of this kind of income is dividend income.

There are other popular alternatives as well.

These include the likes of:

  1. Income from bank account
  2. Credit card reward points
  3. Royalties
  4. Licensing fees
  5. Rent from real estate

One of the unique features of passive income is it does not necessarily take into account how hard you work or how much effort you put in.

Rather passive income capitalizes on how smartly you can execute a task.

It is completely based on your ability how efficiently you can generate income without putting in a huge effort.

It doesn’t really matter how hard you are working or how many hours you have been devoting for the job.

In fact, it celebrates the fact that you have put in some effort today and can then reap the benefits of it for the rest of your life.

What’s even better is there are many opportunities whereby you can also convert the active income into passive income.

You can generate the cashflow that helps you take advantage of a far attractive tax rate.

Once you are able to turn the active dollars into passive assets, it is needless to mention that you can then take advantage of the more liberal tax policy and look to conserve the cash a lot more effectively.

Why Passive Income Tax Works in Your Favor?

Perhaps I mentioned this already, but it does not hurt to repeat that the tax department’s policy is so geared that it shows a decided bias towards those who are working smarter instead of harder, in other words, it favors those who choose passive income options.

One of the best ways to claim this tax advantage is by choosing the most appropriate channel to generate the income.

In this context, dividend income is one of the most lucrative opportunities.

In fact, if you happen to fall within the 15% tax bracket, you can even enjoy the earnings from dividend absolutely free.

This is because those individuals, who are within this specific tax slab, get taxed 0% on dividend income.

You might now ask what exactly comprises a 15% tax slab.

Well, according to data available online if your annual average income is around $37,000 you qualify for this rate of tax.

As per the existing policies, you can claim a standard deduction of not more than $6000, in case you are filing individually.

On top of that, there are personal exemptions which you can claim close to $4000.

On top of it, if you have a dividend income north of $47,000, you actually stand the chance of paying a big zero in income tax by the end of the year.

Now think about the tax rate at which you are earning at the moment.

The disparity will be visible to you in very clear terms.

But something that I missed out mentioning here is the social security and the medicare rates are still applicable on you.

So you need to account for another 7.65% in tax as well.

Apart from that, the tax rate still remains in favor of passive income

Therefore, it would not be wrong to term the passive income tax rate as one of the best representations of the ways to maximize the value of every dollar that you earn.

It helps you to not just set long-term goals, but add more value to every penny that you set aside in the investment kitty.

So whether you are planning to take an early retirement or compound your existing savings structure, the passive income tax rate can really come in handy in keeping the overall tax liabilities.

While setting long-term targets in one part of the story, the other important aspect is how well you can preserve this entire amount in a way that you pay bare minimum tax for it.

It would mean that you will be able to retain the maximum amount of that money with you and not have to part with it as a tax liability.

The Big Advantages of Passive Income Tax Rate

I am sure all of you understand by now what exactly is meant by passive income tax rate and the reason why passive income comes with a lower tax rate compared to other nonpassive opportunities to earn money for a prolonged period.

But those opting for this kind of tax policy tend to make savings in many other unique ways as well.

That also adds to the charm of opting for passive income and the associated tax rate that goes with it.

1. Limited Cost

If you follow the entire tax rate and way passive income tax is calculated, you will realize that there are no associated costs apart from what is already specified.

Alongside, those who opt for this kind of income, also make a lot of savings in the form of lesser lunches outside, better time spent at home, lower wardrobe costs and far lesser transportation expenses.

Now let’s face it that all of these services carry a certain amount of tax.

Whether you consider hospitality taxes, different kinds of surcharge and the rate of sales tax further exacerbates an individual’s tax liability over an extended period.

You must understand in choosing a specific way of working often means that you can optimize the value of every dollar you earn or save in a comprehensive manner.

2. Flexible & Financially Secure

Let us explore the crux of the entire passive income dynamics.

Why would you choose it over a conventional active income opportunity?

Most times, this is because you get to decide the working hours, you are able to gain more time due to less travel, you inevitably spend more time at work.

But at the same time, you are no longer financially dependent on anyone.

Whether you are earning via rent income or dividend or any other type of passive income avenues, you are able to maintain your financial independence.

A lower tax liability and ability to offset losses over wider time duration makes sure you would be tempted to choose this way of earning money more than any other.

3. You Are No Longer Tied to a Spot

If you have considered working from home ever, you would know that one of the most important reasons that people choose it over many other options is because they are then able to move freely.

Most times, it is only internet connection and a laptop that they needed.

When you consider passive income, the gains are even better.

You do not have to work, you travel as much as you want and choose to stay wherever you want, yet enjoy the benefit of a steady cash flow every month.

The icing on the cake is undoubtedly that your tax liabilities are also distinctly lower than what you would have to pay if you attended office every week and took bare minimum leaves.

Plus, there is no certainty that you will have the job forever.

You never know when you become a victim of a downsizing drive in office.

4. You Can Retire a Lot Earlier

Let’s understand we work, save, invest, work and continue this cycle for almost a lifetime in the hope of creating a cash flow that can sufficiently fund our requirements in a well-structured manner for our old age.

But what if you can create that passive source without much ado and gain financial independence at a much lower age, perhaps 34-35?

Moreover, it would mean that you also have to pay a lesser rate of tax and let’s face it.

Who does not want to take advantage of tax deductions?

Moreover, if time is money, this is one of the biggest income sources for you.

You save decidedly a lot of time, and that in itself can be a huge factor.

That apart, you also have to pay lesser tax, so it is indeed a win-all strategy for you.

The best part is you do not need to have a separate income source, you can easily convert your active earnings into passive income.

Some of the Key Passive Income Tax Rate That You Need to Know

Now let’s say; we have understood the great benefits of taking advantage of passive income tax rate.

But then the question might come that how should you diversify the cash flow source?

Should you depend predominantly on dividend income or can you also explore the option of bank deposit and earning interest for it?

Here is a quick guide on the tax rate of some of the best known passive income sources and how you can get more value for every dollar that you earn.

1. Interest Income

This is perhaps one of the most basic forms of passive income.

Hence, it becomes extremely important to understand the tax rate on this specific kind of income.

Interest income essentially refers to all such income that you earn as interest from various financial institutions and banks.

Whether it the interest that you earn from your savings account or the interest that your money market account yields, it is interest income.

Interest from various deposits and bank certificates are also included in this list.

Normally this interest, when credited to a specific account, is available for withdrawal.

You do not have to pay any penalty and will be taxed as per your normal taxable income.

The income tax rate, in this case, will range between 10-35% depending on the exact amount of your net income.

2. Dividend Income

This one is a very popular passive income source that is often recommended by analysts to generate steady cash.

Essentially dividend refers to any periodic payment by stocks and mutual funds to their shareholders.

This is not dependent on the market condition, and an individual can continue earning them as long as the stock or the mutual fund decides to pay to its shareholders.

Broadly this dividend income is divided into two categories:

– Ordinary Dividend:

These are regular dividend payouts that you see in the market.

The normal existing tax rate is levied.

– Qualified Dividend:

This refers to all those dividends that are paid on stocks that have been held for more than two months but within the 121 days post the dividend date or post the date the stock went ex-dividend.

These are subject to a maximum tax accounting to 15% if regular or normal income tax rate of 25% in levied.

In case, it falls below the 25% bracket, you are not liable for a single penny.

It is absolutely zero.

3. Capital Gains

In the list of the most popular passive income channels, capital gains tax occupies pole position.

Normally this refers to any kind of lump sum money that you might earn if you sell any major asset like stocks or mutual funds.

Normally the amount you earn from the sale is much higher than what you paid for it initially.

Capital gains again can have two primary variants:

  1. Short-term gains: This is the gain that you bag from asset sale that you have held for less than a year. These are taxed at the normal income tax rate that you are eligible for.
  2. Long-term gains: As the name suggests, this essentially refers to the profit that you earned from long-term holdings. The maximum tax rate for them is capped at 15%

4. Child Support

Marriages break, relationships suffer a jolt but what we don’t realize is these types of conflicts also have a financial implication.

The money that a parent pays to the other parent or the child’s custodian for the proper upbringing is also passive income.

This is not subject to income tax as opposed to alimony money that is taxed under regular tax rate depending on the bracket that you are under.

Therefore the passive income tax rate on money received as child support is zero.

5. Social Security

The extent to which this kind of passive income is taxable is entirely dependent on the tax bracket under which you fall.

Depending on your annual income, there are instances that not a penny of the social security retirement benefits is taxed.

For those with income below $25,000 on an annualized basis, as single taxpayers, or below $32,000 when paid jointly, do not have to pay any tax on their social security benefits.

On an average, if you file as a single tax paper and your annual income is worth $34,000 or above $44,000 as a joint payer, almost 85% of this income is included in your regular income.

This is then taxed at the normal rate that you are eligible for.

If your income is in between $25000-34000 as a single tax filer or between $32,000-44,000 as a joint taxpayer, 50% of the social security benefits will fall under the taxable income bracket.

Is Passive Income Tax Rate Complicated?

So I am sure you have understood by now that passive income tax rate is a rather complicated financial arrangement.

You need to have a very clear perspective of the existing tax rate, the return prospects of various income channels and your ability to generate returns from a passive income source.

Don’t get too buoyed by the lower tax liabilities for those with passive income.

You must understand that while it is quite simple to enjoy the benefits of passive income, generating it at the initial stage needs a significant bit of legwork.

You must be convinced about the channels that you choose.

That apart, you also need to make a ballpark assessment of the kind of money that you would require post retirement on an annualized basis.

This will then be able to give you a clearer perspective on the kind of money that you need to generate and what type of passive income platform can help you best.

It is needless to mention that you even need to take into consideration the various tax slabs and the rates applicable.

Does Lularoe Pyramid Scheme Make Sense?

The Lularoe pyramid scheme is one of 2017’s most talked about MLM scams.

The clothing line, Lularoe has been under the scanner lately.

There have been claims that it is a pyramid scheme.

Moreover, the quality of clothes has also been discussed.

The allegation is that this company sells overpriced goods that are of inferior quality.

That further exacerbates the problem.

A quick search on the internet will highlight innumerable testimonials of dissatisfied clients.

Starting from customers to members, the list of those dissatisfied is pretty long.

Lularoe Pyramid SchemeWhat further worsens is the company’s standpoint on the issue.

Most members claim that association with the brand led to huge personal debt.

Finally, a $1 billion lawsuit was filed against the company.

The primary claim is that this company is running a vibrant and active pyramid scheme.

What makes it worse is that you have a battery of housewives heavily invested in this.

So, if this is really a pyramid scheme and comes crashing down, it can wreak havoc.

The $1 billion lawsuit is undeniably one of the largest to be filed thus far.

However, this is not the first time that it has been filed against the company.

There have also been claims of its representatives collecting sales tax in states that don’t have the tax.

Moreover, in May last year, a sudden change in their return policy led to serious losses for consultants.

Like many other MLM, they clocked a sharp growth in initial years.

The founders claim that the company was created to facilitate economic freedom.

However, in reality, it is debt that has been mounting over the years.

The high starting cost and the subsequent expenses have even led many women to sell their breast milk.

Here are more details about Lularoe pyramid scheme.

The Lularoe Pyramid Scheme Inside Story

As we set about analyzing claims of Lularoe pyramid scheme, let us analyze the management view.

The founder, DeAnne Stidham says that this company was created to provide economic freedom to women.

Though just 5 years in business, Lularoe has clocked phenomenal growth.

They sell a line of dresses, tops and their very famous leggings.

We can gauge the popularity of the company by the fact that they now have about 80,000 consultants.

The management led by CEO, Mark Stidham seem rather stoical about the claims and lawsuits.

According to insiders, most of the communication with the staff seems condescending.

There are many references of an online video address in which he chides the consultants for selling to the same set of customers.

He chides them and prods them to keep adding fresh customers every day.

The wave of complaints about the policies too seems to have been brushed under the carpet.

The general approach seems to be whoever is complaining; it is their problem.

The business model has several loopholes.

Online reviews indicate claims of profitability, especially at the lower end is non-existent.

In fact, according to FTC study, almost 99% of people who joined the enterprise are losing money.

That is now a worrying thought for anyone who is planning to join the organization.

The average cost of joining is close to $5000-7500 per person.

So that is quite a significant investment in an organization that has no precedent of profit.

The overall profit margins for the company may be decent.

According to the study by some independent organizations, less than 5% consultants managed $10,000 sales.

As many as 70% of the consultants sold goods worth less than $5000.

With a starting investment of $5000, this is not even helping in recovering the cost.

The Lularoe Pyramid Scheme Product Line

Before any discussion about Lularoe pyramid scheme, consider their product lineup.

That is, after all, the reason why it counts as an MLM and not a pyramid scheme.

After all, a multi-level marketing unit always has a genuine product line-up.

The sale of the product comprises a significant part of their revenue.

This is a basic difference between a MLM and a pyramid scheme.

In this context, Lularoe specializes in creating outfits for women and children.

Their product line for women includes

  • Leggings
  • Skirts
  • Tops
  • Dresses

For the kids too, Lularoe has a rather extensive line of offerings.

But you cannot buy these products off the counter or even online.

You can only buy these through the multi-level marketing network.

But then again, unlike retail customers, you can never buy one or two.

You have to only buy in bulk, in wholesale quantities.

So you can then sell the products after buying from them.

The variety and the cut of their products are what woos customers to start with.

Almost always, that is the first reason that people agree to start as consultants.

Their line of leggings especially is a big craze in a segment of the society.

There is a continuous demand for it.

But there is something unique about the trend for their product demand.

The number of first-timers who buy these Lularoe products is much higher.

But the relative rise in return customers is significantly lower.

That again makes you reconsider their operation module.

The products can be expensive, but the quality is crucial.

Let’s see how Amway works.

The world over there are many who may look at Amway as a scam.

But that said, you cannot deny their superior products.

As a result, you have a continuous flow of reliable and loyal customers.

The Lularoe Pyramid Scheme Product Concerns

That is undeniably the key concern for most Lularoe products.

The quality of the products has been consistently bad.

Reports started pouring in from all over the world about the poor standards.

In fact, it has been considered so bad that the US Better Business even downgraded their quality rating.

Lularoe’s quality rating slipped to F given the complaints from all over.

However, that said, there was a consistent flow of new customers buying the product.

Certain times, the associated benefits also spurred demand.

How else can you justify the demand for new items delivered with holes?

At other times, clothes would tear the moment they are worn or washed,

That emphasized the poor quality of the base material that they used.

What was even more appalling was the Lularoe response.

They never apologized for the poor quality of clothes they made.

Instead, the company trained its consultants to teach customers how to wear them correctly.

The line of argument was very simple; if the clothes tore, it was because they didn’t know how to wear it properly.

The Lularoe consultants patiently explained what is wrong in your approach.

As though that was not annoying enough, they also have a lengthy cleaning instruction.

The idea is Lularoe is creating a set standard of product.

But ineffective care from your end is worsening the clothes condition.

Their cleaning instruction includes standard care procedures like

  • Wash the clothes separately in cold water
  • Keep the Lularoe clothes in a separate basket
  • Turn clothes inside out before putting them to wash.
  • Do not wash Lularoe with any other clothes.
  • Do not put Lulroe clothes in a dryer

The list of these instructions just did not end.

They seemed unending, and all geared towards how you have to care for them.

Lularoe Heroes Poor Quality

What is really surprising is how the company managed demand despite this type of poor quality.

For every hole they found in any outfit, it was about either customers wore them incorrectly or washed them wrong.

But that cannot hide the fact that these clothes are consistently bad.

The manufacturing quality is inferior.

But despite that, people seemed to still want to sign for the Lularoe scheme.

They even got friends and family to sign along with them.

But I think this is also a factor that raised consistent alarm bells.

They surely have a product to talk home about.

But why are they churning out consistently bad quality products?

Moreover, the company seems more than reluctant about improving their quality.

Instead, they are more than happy about shifting the blame.

That undeniably raises key questions about their overall business model.

An MLM that seems to further business through direct promotion is not interested in fixing quality.

They are more than keen on continuing with the same type of sub-standard quality.

They are operating with an F rating and quite happily passing on the blame to customers.

The approach that if you got holes in them, then you are not wearing it correctly is annoying.

More than that, it highlights their lack of commitment to creating a better quality product.

So this too spurs worries about a potential pyramid scheme in making.

They have overpriced the product and compromised with the quality.

They are constantly pushing consultants to get new customers.

The line of argument is obvious.

If one set of customers is complaining, they better look for a different customer base.

It is interesting how there is no recorded acceptance of their poor quality.

The Lularoe Pyramid Scheme Business Model

But the question is how long you can fool customers with inferior products?

At some point of time, this will unravel itself.

As a result, it puts the spotlight directly on the Lularoe business model.

It becomes even more imperative to study how they conduct business.

The packages that they offer and how they convince consultants about earning money.

That will, after all, highlight how committed they are about the business.

The question that got me started is are they in the business for inclusive growth.

The company’s mission statement may boast about that, but in reality, the results still need to be seen.

Evidence of any type of conviction in helping others grow is quite minuscule.

In fact, as most surveys indicate that only a small percentage of consultants had made meaningful sales.

Moreover, how is a company that claims to bring about financial freedom compensating clients?

The consultants seemed to have booked deep losses as a result of the company’s policies.

Given the recent changes in their return policies, there were considerable losses.

Consultants had nowhere to look for any kind of grievance redressal.

Most are so deeply invested in the Lularoe story that it is difficult to extricate themselves.

There is this constant urge to try and even out or average out the losses.

The poor quality of the clothes, however, impedes any meaningful sale for a sustained period.

Sustainability is the primary concern at this juncture for the Lularoe consultants.

That in many ways has been the key trigger for recent lawsuits.

The Lularoe Pyramid Scheme Compensation Package

That brings us to the point about how do you go about getting started with the company.

Though on the face of it this is a thriving MLM, why is it courting controversy?

Perhaps the devil about a potential pyramid scheme is in the details.

Your start-up cost to get started with Lularoe is anywhere between $5000-6000.

You can even spend as much as $7500 in certain cases.

So though this program promises to offer you financial freedom, it does not come free.

This is not a zero investment business venture.

You need a sizeable amount of money to get started here.

Moreover, there are no online openings for this.

You have to buy clothes in bulk and then sell them directly.

You do not have an opportunity to undertake affiliate marketing.

Nor can you look to add to your earnings in any other way.

Most online testimonials indicate that Lularoe has three primary types of packages.

  • Package 1: 336 items for nearly $5000
  • Package 2: 365 items for over $5300
  • Package 3: 463 items for nearly $7000

But unlike in other MLM, you cannot buy as per customer demand.

You have to buy any of these packages and then look for customers to sell.

But the deal keeps getting more complicated at this juncture.

The consultants may be paying money for it, but they have no say.

They do not get to choose the pattern, sizes or colors.

So it is quite possible that you get products that do not fit the demographics that you cater to.

The question is then what do you do.

You are saddled with the package and have to look at ways to sell it.

Is Lularoe Pyramid Scheme Worth Your Time?

You have to buy at least 33 new items every month.

Only then, you can maintain the status of an active consultant.

You can argue that probably this initial investment is much lesser than many others.

But then what anybody will be worried is why you will want to go ahead with this type of investment?

You are paying a reasonably large amount.

You have to keep paying the same amount.

But you can still not decide what color or size of clothes that you want.

The Lularoe team will decide it and give you.

If you ask me, isn’t this a kind of forceful selling.

That too when you are looking to gain financial freedom through this sale.

That is what makes the deal even weirder for anyone.

Instead of achieving any type of meaningful advantage, they are getting into debt.

There is just about no mention of how Lularoe consultants will deal with unsold goods.

That, in many ways, becomes a major liability for most who sign up for Lularoe.

User Testimonials of Lularoe Pyramid Schem

Even by keying in the simple name of the company, you will be appalled by the kind of results on Google.

The very mention of Lularoe brings about tonnes of reviews about bad products.

There are many dissatisfied customers who have voiced their concern about bad compensation terms.

Most importantly there seems to be no option for consultants to get redressal.

Online reviews indicate that once you are stuck with the products, you are stuck for good

The question is why is there still a huge battery of consultants ready to take a plunge?

Often they are being approached by those who are stuck.

Moreover, everyone is looking at some ways to recover some amount of the money they have put in.

That is why you still see many gungho Facebook mentions about Lularoe.


When you discuss financial freedom with Lularoe pyramid scheme, I have a simple proposition.

If you really have about $5000-6000 every month, calculate the interest if you make a basic Fixed deposit.

I am not even suggesting any complicated investment channel.

All you have to do is put it in your savings account and enjoy the interest.

Even then you will get a minimum 10% of the money you are putting in.

Then why will you want to get stuck with Lularoe pyramid scheme?

The jury is still out whether it is an MLM or a pyramid scheme.

But the fact is you cannot make money with Lularoe.

Pyramid Scheme vs MLM

The difference between a pyramid scheme vs MLM is a matter of continuous debate.

Many times, you see both these concepts used simultaneously.

While an MLM is primarily a direct sales initiative, a pyramid scheme is traditionally seen as a fake venture.

If you track down historical information, most times people associate a pyramid scheme with quick money making schemes.

Claims about illegitimacy taint both MLM and a pyramid scheme.

So whenever you get into any venture that is either an MLM or a pyramid scheme, it is better to tread with caution.

Pyramid Scheme vs MLMThe product offering is almost the greatest giveaway about the legitimacy of an organization.

As you may have seen in one of the best-known pyramid schemes, the Madoff fraud.

The pyramid schemes by Madoff promised huge returns but delivered nothing.

This may be the case sometimes for multi-level marketing firms too.

But there are exceptions too.

An MLM is typically always a pyramid scheme, but the vice versa may not be true.

It ultimately boils down to the business model and how effective it is.

The revenue generation structure is one of the biggest factors to watch out for.

It is also linked closely to the business model.

This is ultimately the key factor that decides how the profitability pans out.

The core product offering is also a function of the business model.

Moreover, the extent of gains and losses and recruitment drive is also dependent on the model.

But the biggest factor is perhaps the end product.

Irrespective of claims and tall promises, the end product is the most defining element.

That goes on to prove how reliable and sustainable this business is after all.

In many ways, that helps you distinguish between a pyramid scheme vs MLM.

Definition of MLM

So what do you understand by a multi-level marketing firm?

An MLM or a Multi-level Marketing strategy is a unique selling strategy.

The product promotion, advertisement and selling are all via direct sellers and distributors.

They approach the customers on a one on one basis and sell the product.

But the revenue flow is never through this single channel.

Normally an MLM draws revenue from two major sources.

The commission on selling a product and also by recruiting new members in this distribution network.

In this context, the distribution network has similarities with a pyramid scheme.

Often that is the reason that an MLM has courted controversy.

This direct selling strategy depends on referrals quite heavily.

The whole idea of promotion is based on referrals.

The relationship that you share with other distributors takes the business forward.

You approach recruits too on the basis of this relationship.

So there is a huge personal angle in this professional set-up.

The distributors or the members further their network only on the basis of this personal relations.

The entire business cashes upon the personal repertoire of individual members.

The money that you earn in return is the incentive to put these relations at stake.

In many ways, that defines the social and professional dynamics of this set-up.

Stay-at-home professionals operate most MLMs.

From using social networking platforms to networking parties, individual relationships hold center-stage.

Most multi-level marketing firms formulate the growth avenues in a way that it is linked to this factor.

It directly envisages growing through an inclusive route.

But you have to remember that the product is the central force of the business.

It is what defines what the business comprises of.

Therefore, we can define an MLM as a direct selling strategy.

Definition Of Pyramid Scheme

Now the product is the most defining element and distinguishing factor.

A pyramid scheme is structured like an MLM.

But that is where the similarity ends.

The multi-level marketing scheme is often a legitimate pyramid scheme.

But then you can argue what is missing in a tiered pyramid scheme?

Why is it not considered legitimate?

Why is it an illegal set-up?

Well, the crux of the matter is the product.

If you closely study the structure of a pyramid scheme, you will see there is no product at all.

All they are selling at the most is a hope of a product.

There is no product in reality.

This is one of the biggest concern areas about this business format.

All that this business aims at is generating money for the founders.

New members are recruited only because they will help bring in more money.

Your innocence and ignorance is often the biggest weapon for the founders.

They cash-in on this to catch you unaware and rope you in.

The lure of quick money is used to attract people.

Who does not want to make a lot of money?

But the problem is most people forget that there is no short-cut to making money.

So, a pyramid scheme is only focused on making money.

The payouts to the lower rung of the pyramid are often controversial too.

The sale or manufacturing a product is not the focus at all.

Perhaps that is why selling is never an important aspect.

All a pyramid scheme is bothered about is attracting more members.

The money that comes in through recruits is the only moving force.

That is also the fundamental idea that drives pyramid schemes.

Making money on the sly is the only motive for a pyramid scheme.

Product Offering: Pyramid Scheme vs MLM

When comparing an MLM and pyramid scheme, let us start from the end.

Most times an MLM offers a product or a service.

At least a part of the revenue is generated through this way.

Multi-level marketing businesses are structured mostly around this core product.

It can be anything from a service to a consumer durable good.

It can even be a concept or a financial arrangement.

The idea is whatever this end product may be; it helps the company in furthering business.

That is the key factor to take into consideration.

The core business model is structured around the product.

From product development to product promotion, the business centers on this core product.

The business in case of MLM is all about the product.

The product is a source of a significant chunk of the revenue.

But when you see a pyramid scheme, it is not the case always.

Almost every pyramid scheme operates with the motive of making money.

There is very little clarity about the product that they are offering and how it will help in generating revenue.

These are not listed entities either, so there is no surety about the numbers they quote.

So there is no way of knowing the actual revenue that they are earning either.

As you saw in the Madoff case, they kept making false profit claims.

Most times, people who join these pyramid schemes are blinded by their greed.

They are just not able to see the loopholes and accept the profit numbers blindly.

However, in terms of actual product offering, the details are most times very vague.

Almost always, the end product is more like a concept in a pyramid scheme.

Everyone hears a lot about it, but no one has ever seen it in real.

Legitimacy of Business: Pyramid Scheme vs MLM

When you are comparing a pyramid scheme vs MLM, legitimacy is a key factor.

Like I mentioned, the lack of a product is the biggest pocket of concern for a pyramid scheme.

This is what creates the concerns and prerogatives that determine legitimacy.

Imagine going to a shop and buying a product.

Will you ever pay the shopkeeper money just for telling he has X, Y, Z products?

You will analyze the various products and then choose one.

Check the various parameters and then pay for the one you choose.

But this is not the same in case of a pyramid scheme.

You simply pay for a promise.

It is primarily about making quick money.

There are no details and strategy.

You only know that if you can recruit more people, you can make money.

This is exactly why this is an illegitimate business right from the word go.

So how is an MLM any different?

The focus of an MLM is the product that they are selling.

The MLM then becomes a simple vehicle to take the business forward.

You incentivize new recruits in an MLM surely.

But in many ways, that is also the way they promote their business.

You can further a business only when you have enough hands taking it forward.

In case of an MLM, the network of new recruits help extend the reach of the business and the product.

At the end of the day, the focus of the MLM continues to be the product they are selling.

That becomes very important for the company.

In many ways, it also lends legitimacy to the MLM.

The recruits, users and the customers are all aligned in the same plane.

That also becomes the key factor that differentiates both.

Saturation Of The Warm Circles: Pyramid Scheme vs MLM

Both the pyramid scheme and an MLM rely very heavily on the circle of close acquaintances.

They invariably become the first few rungs of the pyramid.

After all, how do you approach complete strangers?

It is much simpler to request your aunt or close friend to try the cream you are selling.

Gradually then you try and coax them to become members.

In this way, you then convince them to become members.

They then approach their friends and relatives.

So the circle continues to grow in this format at a steady pace bit by bit.

But when you are dealing with a genuine and legitimate MLM, it does not stop there.

The circle keeps expanding, and soon you are dealing with a host of complete strangers too.

What binds you together is the product.

So as long as the product is good, you will keep attracting new candidates.

You have the likes of Avon and Amway continuing for 100 years now.

But that again makes us think how a pyramid scheme is different?

The pyramid scheme does not have any product to boast upon.

Even if there are claims, there isn’t any to see for real.

The result, most people are stuck there to recover their money.

The truth of it is revealed pretty early into the pyramid.

The problem is you have already made a significant amount of investment.

You then start nurturing the hope of at least getting back some amount of money.

But as the lie starts getting exposed, recruits too start dwindling.

Slowly but surely, this flow dries up completely.

As a result of that, the fund flow stops completely.

Soon the pyramid scheme collapses.

The only people who may have made money are the founders of the pyramid.

MLM Companies Nurture Cults

Sustainability is a cardinal element for MLM.

Unlike pyramid schemes, these are never fly by night wonders.

They continue operations for years, generations and centuries for a few.

But the question is how an MLM can remain relevant for that long.

You have to create the need for the product.

That will then help generate demand for this product.

That is where the need to create cults comes into consideration.

In many ways, multi-level marketing is also relationship marketing.

They involve direct one on one selling of the product in consideration.

Creating a cult makes you part of an exclusive circle.

That also gives you the impetus to grow the circle in a steady fashion.

It slowly grows like a huge ant hill.

All your immediate family and friends are part of it.

They have even gone ahead and involves their own friends and extended family.

This has meant that a lot of time, people are also okay with losing money than breaking off relationships.

This is how a lot of MLM continue to grow despite not making money for the members.

Each one is busy trying to average out cost and keep the relationships intact.

Everyone in an MLM is going forward with the hope of recovering the cost.

There is also a feeling of bonhomie between the members who are in this struggle together.

In order to recover cost, they often try to start using the product themselves.

That then becomes their habit.

So when you are used to a certain product, you also grow comfortable with it.

That is all part of a typical cult system.

Compared to this, a pyramid scheme normally collapses a lot earlier.

There is never enough time for people to nurture the cult feeling.

It collapses long before that.

Caution Important: Pyramid scheme vs MLM

However, despite all of these differences between pyramid scheme vs MLM, caution is important.

An MLM is a legitimate pyramid scheme after all.

Even in the most successful MLM, the bulk of profit is hardly from the product.

The major chunk of the profit is derived from those who sell the product and the recruitment by them.

The amount of commission is minuscule, so the real motivation is almost always about getting more people.

The more the people join the MLM, the better the chances of individual gains from incentives.

This is why the incentive for getting new people is always higher.

Only what works in favor of an MLM is there is a real product in the offing.

This means that the interest for it can be sustained for a longer duration.

Additionally most MLM deal with consumer necessities.

That means the overall interest will last if the product in consideration is good.

The compensation plan is however never based on the product offering.

It is primarily about how effectively you can rope more people in.

In that way, the objective of a pyramid scheme and an MLM converge beautifully.

Only number of recruits will help members earn more money.


Either you join an MLM or a pyramid scheme, the scope of profit remains very low.

Most times, the only people who are making money are the founders.

The main source of income is all about recruiting new members.

At the end of the day, the product promotion may matter to an MLM.

But buying the product will erode all your profits.

The chances of making money in an MLM are almost as low as that of a pyramid scheme.

Before you join either an MLM or a pyramid scheme, thorough research is necessary.

You must be very clear about what to expect.

In that context, meeting former distributors or members can help.

But legitimacy is the only difference between pyramid schemes vs MLM.

The profitability remains questionable and there is no comparison between pyramid schemes vs MLM in this context.

Top MLM Companies You Must Know

The list of the top MLM companies is a very dynamic one.

It depends on a huge number of factors.

From the kind of product on offer to the type of response, there are several aspects.

Most importantly, the MLM should help people make money.

That is by far the most important factor.

The reason why any multi-level marketing company comes under the scanner is the business model.

This is exactly why we have created this list based on sustainability.

The ability to thrive through ups and downs is very important.

Think about why Amway or Avon are so popular amongst MLMs.

The long-term sustainability is a key consideration for any great MLM.

Needless, to mention, it depends a lot on their business model.

The frequency with which they can offer earnings becomes a crucial factor.

That alone decides how dependable the story is.

However, attractive the core story may be, if it does not make money, it is no good.

Moreover, that alone will decide how well they can manage demand.

This is because demand is a direct function of profitability in the market.

The absence of profitability and effective revenue generation will immediately impact response.

Here is a quick look at some of the top MLM companies.

The Top MLM Companies

Here is the list of the top MLM companies and their full analysis and description:

  1. The Wealth Network
  2. Herbalife
  3. 4Life
  4. NewULife
  5. Motorclub of America
  6. Rodan and Fields
  7. Advocare
  8. Pampered Chef

1. The Wealth Network

The Wealth NetworkThe business model is similar to how most top MLM companies operate.

However, this business does not have a multi-tiered payment policy.

But whatever type of membership you choose, you will get 40% of the proceeds as commission.

Just like most other MLMs, you join this firm for free.

However, there are other related products that you have to promote alongside.

That is not for free and have to pay upfront for them.

The revenue generation starts from this level.

The kind of upsell that you clock, decides the extent of your income.

However, there are various tiers of membership that you can choose from.

One of the most interesting features is the circle of affiliates they help you create.

Unlike most other affiliate programmes or MLMs, the stress is never on tapping your warm circles.

The idea is when you contact them, the number of ‘No’ and ‘ignore’ will be much higher.

Moreover, this warm circle exhausts after a certain period.

But when you approach complete strangers who evinced an interest, the success potential increases.

This also improves the sustainability aspect for individuals trying MLMs.

2. Herbalife

HerbalifeThis is a health nutrition maker and is amongst the most popular multi-level marketing firms.

It has expanded its operations in over 75 countries.

It has close to 2.5 million members as of now.

For a company that has started in the 1980s, it is a significantly big jump.

They have a wide range of product options and has a cult following in select Latin American countries.

However, you can think how it can be amongst the top MLM companies, despite claims of scams.

The fact is it had spats with the FTC with respect to the business model.

The company had to pay $200 million to former members as compensation.

But they are now in the process of business reorganization.

That said, the core business model looks fairly dependable.

The compensation plan is fairly well structured and offers decent revenue generation opportunity.

Additionally, members earn profit on every packet that they sell.

It means that the commission too forms a formidable part of the income structure.

Unstructured recruitment is one of the most important reasons for so-called failures in income generation.

The stiff competition and a massive number of members have also resulted in muted impact.

3. 4Life

4LifeThis is undeniably one of the most popular health supplement manufacturers globally.

When you search for 4Life reviews, almost 90% is positive.

That goes on to signal that perhaps the company is doing more things right than wrong.

Its flagship product that supports the auto-immune system has been acclaimed as a great product.

However, if you think that this is a magic wand that can help you become rich overnight, you are mistaken.

Just like every other MLM promoted product, you have to look at gradually creating the market.

The scaling up of business happens as an extension of it.

The idea is about providing families better nutrition levels across the world.

They call their compensation structure at the Life Reward Plan.

Quite needless to mention, it offers significant scope to grow.

They pay four times every month and in a certain case, 64% of the points amassed.

The overall plan about seven ranks in all.

The more ground you can cover, the better is the compensation structure.

That surely makes this an extremely attractive MLM proposition for members.

Though you can join the MLM with a bare minimum investment, it continues to yield favorable results.

What is particularly positive is the global acceptance of the product.

All over the world, the 4Life products have gained a certain amount of acceptance.

It is quite hard to find negative reviews about it.

In a way, that proves one fundamental factor that you cannot doubt the efficiency of the offer.

Moreover, that also goes on to establish 4Life amongst the top MLM companies.

The core point being that good quality product will undeniably ensure a better profit.

Profitability and effective revenue generation are after all the key elements.

They go on to decide on the authenticity of any product in long-term.

4. NewULife

NewULifeThis is another US-based wellness form.

It has catapulted in the list of the top MLM companies primarily on the business model.

The health and wellness niche is one of the most popular ones in the MLM space.

They offer FDA registered human growth hormone products.

These products are laced with a variety of health benefits from improved stamina to better heart rate and regulated blood pressure.

The compensation plan is multi-pronged like most multi-level marketing firm.

Members earn from selling the product and also recruiting more affiliates.

The compensation plan includes a total of seven levels.

The compensation level is totally dependent on the number of products one sells.

The residual compensation through a binary compensation method is an additional benefit.

So as you move up the cycle, the remuneration also increases in typical MLM style.

There is also a bonus element that gets incorporated with the rise in the levels.

Therefore, the expected list of benefits is quite stupendous.

But at the same time, the fine prints make it a much less impressive story.

Another key point to remember is that they have a FDA registered product.

The management is fairly silent on the potential approval outcome.

5. Motorclub Of America

Motorclub Of AmericaThe list of the top MLM companies comprises a varied range of companies.

There are some that may have a great revenue generation model.

At the same time, there are others which are phenomenal MLM stories.

Though profitability is important, the profitability of customers may not be the only concern.

In many ways, it is about highlighting MLM stories who have held their steed amidst tough competition.

The Motor Club Of America is amongst the oldest MLMs known so far.

Established in 1926, it is pretty much in the League of Avon and Amway.

In business for a little under 100 years, they operate in 50 states in US and Canada too.

They have over 6,000 repair centers and automobile service centers across the world.

However, this company does not sell motorcar insurances.

The members pay money to get the advantage of a variety of other services

These range mostly across a wide range of roadside assistance services.

So whether you are looking at tire change, filling up fuel, boosting battery, they cover it all.

These services are extremely beneficial for many who undertake frequent road travel.

It also helps members with travel assistance, reservation and other planning needs.

The benefits for members even account for discounts on prescription, dental treatment and the like.

Needless to mention, members get an advantage depending on the sale of distributorship.

While the service per se may not be bad, the level of income it generated is questionable.

It is possible that after spending a lot of money and time, you may not find enough customers.

That is a major source of worry about the firm.

It cannot be sustainable as an alternative source to raise money by an individual.

However, the fact that company has survived so long reflects some subtle demand.

6. Rodan and Fields

Rodan and FieldsAnother top ranking MLM company, this deals with skin care products.

Most of the reviews online indicate a largely positive outlook.

However, the products are priced slightly towards the higher end of the range.

This though is not any miracle cure for skin problems.

So in terms of value for money, it may not be very attractively positioned.

If you simply judge the product performance parameter, it may not be a great option.

But if it counts among the top MLM companies, it sure needs a relook.

Especially the business model of the firm needs to be analyzed carefully.

However, there is no different story outlined either.

Overall you can say that the story is lackluster one.

While the product is developed by some well-known names, the efficiency is mediocre.

In terms of the MLM structure too, there isn’t a huge difference either.

While the product is pricey and the company is making money, the same is not true about members.

Perhaps this is also a reason that it is not as popular globally.

Moreover, the products are priced significantly higher than peers.

The cost factor limits usage to a large extent.

The commission component is much lesser when you compare to options like Mary Kay.

You can attribute this to a flaw in the overall business model.

Primarily this system is created in a way that encourages the sale of products.

Product promotion is the primary objective of the business structure.

That is the most striking element of the overall MLM layout.

Profitability for individual members is a distant dream.

Perhaps a better idea is to try out the products as a retail customer before you take the plunge.

At the most, you can hope to earn some extra money being a member of this MLM.

7. Advocare

AdvocareThis is yet another dietary supplement product that has opted for the MLM route.

This company offers a wide range of products including vitamins, minerals and other nutrients.

The ultimate objective is promoting health and wellness of the users.

Just like 4Life, this too has a special appeal for sportsmen and other personalities.

On the whole, if you study the business model carefully, it is a mid-level MLM.

You can be a registered customer with the company, or you may also qualify for discounts.

If you are keen on additional income, you can also qualify for the role of a distributor.

Primarily these are the only two available positions in this MLM.

You can either be a distributor or a customer with Advocare.

This Texas-based company also has an A Plus rating from BBB.

BBB stands for Better Business Bureau and lending it considerable credibility.

As a distributor, you can get these products at 20-40% discount on an average.

That undeniably offers a significantly large window to book profit if you are interested.

Its product line primarily targets weight management and enhancing athletic performance.

On the whole, you can either opt for the 24-day challenge or the 10-day program.

However, a detailed study will reveal that the ingredients used cannot be trusted completely.

The complaints on BBB also point to a certain trend.

The concern is you have multiple sources of complaints about the efficiency of the product.

Many online reviewers, who personally tried this product, have given a thumbs down.

So the risks seem to weigh heavily on the entire lineup.

After all who wants to spend a lot of money on a product that may not help them?

If you want additional income, perhaps it is a better idea to save it from spending on these products.

8. Pampered Chef

Pampered ChefThere is so limited information about this MLM,  that doubt reigns all around.

Almost the first search result about it is whether this is a scam or legitimate business?

That surely engulfs the entire MLM in a cloud of doubt.

Are you then wondering why would I put it on a list of the top MLM companies?

Well, this is a product line geared towards pampering chefs, as the name indicates.

They sell a wide variety of kitchenware and cooking aids.

Established in 1980, the business has been building a base gradually over the years.

What adds a lot of credibility to it is that Warren Buffett’s Berkshire Hathaway picked it in 2000.

That alone highlighted the strength of the business fundamentals.

The Oracle of Omaha, an investment guru, has earned the reputation of backing strong stories.

The fact that he bought the company and appointed a CEO to run it says a lot about its potential.

The current business structure is also an outcome of this association primarily.

They start from basic accessories and expand to a range of options including stoneware.

Like most other multi-level marketing firms, their compensation is commission based.

So apart from selling the products, you can even expand your own team to earn more money.

You get a percentage for every recruit, discount on product and bonus payouts too.

So this is an out and out MLM outfit.

The profit percentage is closely linked to the projected commission and recruit potential.

Just the product sale will not churn a profitable proposition for you.

That way, the compensation plan is very straightforward.

The product cost is also in the affordable bracket.

However, it may still not be sufficient for a long-term living.

Sustainability is a decided problem with them.


So, all in all, the list of top MLM companies is pretty varied.

Assessment of the revenue generation potential is only one aspect.

There are several other elements that you have to pay attention to.

The most important aspect is, of course, authenticity and credibility.

But that is also subjective in certain cases.

Most times, those who are successful post rave reviews.

But those who have failed post negative reviews.

MLMs are not everyone’s cup of tea.

It needs decided strategy and sharp business planning.

Only that will ensure sustainable profitability.

We have taken all these factors in creating our list of top MLM companies.

They don’t just have a great product or affordable rates.

They are also facilitating an easier money-making opportunity for people.

That is what makes them one of the top MLM companies.

How Does eBay Make Money?

In the world of e-commerce, if there is one name that has become synonymous with success and innovation is undeniably eBay.

Founded in the mid 90s, it has played a crucial role in connecting buyers and sellers from across the world and helped them make money.

It is known both for the variety and the depth of products that is on offer on eBay.

Perhaps in this context, one of the most interesting stories is the fact that one of the first products that sold was broken laser pointer.

When Iranian founder and chairman, Pierre Omidyar, pointed it out, the seller specified that he collected and sold ‘broken’ laser points and that surely highlights the market and range of esoteric products that are on offer across the world and that which you could make money by selling or buying on eBay.

It won’t be wrong to say, eBay managed to bring about the marriage of technological advance and retail success just about the right time.

eBayIt did not just bring retail spending out of brick and mortar stores and into your bedroom, it also managed to make the physical store an option for the buyers and sellers alike.

You can well understand the depth of the eBay market when I put some basic statistics in place:

  1. eBay has over 150 million users in all, this 3000x the total users of the next biggest online marketplace, Bonanza.
  2. Though Bonanza has a pretty low listing fee of 3%, eBay managed to maintain its supremacy over others
  3. The entire market operations undertaken by eBay needs 52,533 servers
  4. The eBay servers need a total of 20 megawatts power to run efficiently
  5. From Sweden to Hong Kong, the eBay brand has a localized version in almost every corner of the world

Perhaps the point that I was trying to make with broken laser points is the also a unique element of the eBay model.

The pithiness and the esotericism overshadow almost every e-commerce site that you have ever heard or thought about.

You have everything on sale from really old cell phones to collector’s items like porcelain dolls.

Apart from a few forbidden items like guns or ivory, pretty much everything else that you might think about is simply a click away and gives you an option to make money from it as well.

But in all of it, one basic question comes across and that is how does eBay make money?

It is rather interesting to understand this key fact because often this question also holds the key to the answer, how you can make money with eBay.

This revenue model is just so successful that despite being in business for 20 years, they have never felt the need to alter or re-calibrate it.

It, therefore, highlights the sound business sense in it as well.

The eBay Business Model

On the face of it, if you analyze how does eBay make money, it is a pretty simple proceeding.

The seller lists the product, and the buyer buys it, and because both are operating a neutral platform, eBay, they earn a pre-determined sum as commission based on the pre-tax value of the product.

Pretty straight forward you would say.

But I believe that it is only the tip of the iceberg.

If you really want to get to the bottom of how does eBay make money, it almost becomes mandatory to chart the growth path that eBay followed.

Quite early on during its operation, eBay received funding of over $6 million from Benchmark venture capital and from there on followed a mix of organic and inorganic growth channels.

In fact, the number of companies that it has bought is astounding.

Pretty much every three months, this e-commerce innovator bought companies and sold some as well.

For example, Skype was first bought by eBay and then sold to Microsoft.

Not just Skype, but there are many other interesting buys as well by eBay.

It becomes extremely important to understand these various acquisitions because in many ways they tell you how does eBay make money.

Revenue Channels

The revenue channels or fund flows decide the extent of money that eBay has at its disposal to fund future growth.

In this context, one of the most noteworthy acquisitions by eBay is undeniably PayPal.

They acquired the company in 2002 for $1.5 billion and hived it eventually into a standalone entity in 2015.

This is a rather interesting development as PayPal was a major revenue driver for the e-commerce giant.

As far as 2014 results, PayPal was responsible for 40% of revenue inflow.

The reason why eBay and PayPal made the perfect pair is that though both these market players did not have an absolute monopoly, they achieved success pretty close to it.

While on the one hand, eBay is one of the most striking virtual markets for consumer goods, PayPal is also the uncrowned king of online payment.

That allows them to operate in a symbiotic and profitable manner.

But the question that comes to play now is how the split with PayPal has materially impacted eBay’s performance and the way it plans to make money.

While its success trail surely floundered for a while post the separation from its long, associates, eBay did not lose time in rebranding its image and looking for drivers that channelize the next level of growth.

It is also in the process of undergoing a complete makeover.

It has roped in supermodel Karlie Kloss as one of the brand ambassadors and reworking on its entire gamut of growth drivers.

Not only that, the San Jose based eCommerce giant also managed to deliver online results with revenue reaching $9 billion.

For 2017, they aim to better it to $9.5 levels.

What was even more striking was that eBay managed to deliver strong operating cash flow and that exactly brings to our old question- just mere commission, does that earn adequate revenue for eBay or do they make money by some other means?

How Does eBay Make Money?

  1. The Revenue Structure of eBay
  2. Exploring eBay Market Place as Way to Make Money
  3. Enterprise Helps eBay?
  4. eBay Makes Money via Auctions?
  5. eBay Makes Money via Dropshipping?

1. The Revenue Structure of eBay

Well if you have delved into the entire topic of how eBay makes money long enough, you would know that the listing fee is not the only source of eBay’s revenue flow.

You must remember that it comprises a significant chunk of their revenue at 10% listing fee.

Given the wide and deep market presence they command, the company does make money and a huge sum at it.

Therefore, while the listing fee is not everything, it surely makes some key contribution to the revenue outlook.

So how else does eBay make money?

– International Revenue

eBay today is a global entity.

This San Jose company is not just limited to the jurisdiction of United States.

In fact 2011 onwards, its international revenues have clearly outshined the domestic ones.

Compared to the domestic sales, international revenues now account for near 62-63% of the total money that eBay makes.

For market services and other revenues, the percentage or the international contribution is now close to 68-69%.

What is particularly interesting is 2015-2016 numbers take into account the planned separation between eBay and PayPal.

But despite that, the share of the international revenue has remained quite steady and highlights their intrinsic importance.

Some of the most important markets for eBay where they make significant money includes

  1. UK: This is the second largest for eBay just after the United States, and sales here are north of $2.6 billion
  2. Germany: This follows UK in terms of the money that eBay makes. The revenue collection from that market is above $2 billion
  3. The sales from the rest of the markets globally are pretty much what eBay makes from each of these markets individually.

– Advertising Revenue

Think about it- how does eBay make money from advertisements? You will be surprised that eBay sells ads worth nearly $3 billion.

On a standalone basis, if they were just an ad agency they would have been counted amongst the biggest names in United States.

Therefore, it would not be wrong to deduce that this advertising revenue too forms a major contributor to the overall kitty for eBay.

Online advertisements form the most important chunk of revenue generation for eBay in this segment.

The time period for these advertising contracts can range anywhere between 1 week to even as long as 5 years.

The normal action plan through which this advertising revenue is derived is by way of impressions that are received on the website.

The impression in simple language indicates the total number of instances when this ad appears to a specific page on eBay.

Every time a user clicks on these ads and reach the advertiser’s site, eBay can make money on a per click basis.

Normally these contracts with the advertiser firm are held on a monthly or quarterly basis.

The fee and the other details for these advertisement contracts are fixed on a set term basis that accounts for revenue rotatably.

eBay understands the potential

Increasingly eBay understands the potential and ways to make money with these advertising revenues.

As a result, eBay even expanded the list of products where the advertising feature can be used.

This new initiative has been rebranded as ‘promoted listings’ and was launched a year or so back.

This particular feature highlights a completely new approach by eBay in terms of attracting revenue and increasing the overall visibility.

The sellers get an opportunity to feature their products rather prominently through the website.

This helps them to make money and also becomes a convenient alternative for eBay to make money.

The e-commerce giant adapts fair trade practices by charging the seller only if a sale is made after users clicked the specific ad.

If you are a seller who has eBay store application, you can take advantage of this feature.

Not only does it bring about a convenient solution to how does eBay make money, this feature has a dual benefit.

It helps increase this e-commerce behemoth’s transaction as well as advertisement revenues simultaneously.

It drives significant traffic, and this transaction revenue often works up to even 70% of the total worldwide revenue collection by eBay, hence a key link in the chain that enables eBay to make money.

Key Advantage of the Dual Benefit

Another key advantage of the dual benefit is that earlier on just advertisement basis, eBay’s revenue follows a per sale approach.

This is a rather limiting opportunity but with this new feature, the chances of increasing the average user spend on the network is significantly higher adding to both transaction and ad revenues.

Therefore, in many ways, this acts as the double-edged weapon to push revenue for eBay in a constructive manner and a sustainable business model.

We could follow the company’s 2017 financial results more closely to better gauge how this step helps eBay make money.

In fact, if you closely follow the eBay 2016 full year performance, you would notice that the transaction revenue has increased significantly.

This means that eBay is using this tool to make money quite profitably.

This key data is particularly of relevance after they split with PayPal as it brings in the entire revenue structure of eBay in the new light.


This is because after eBay had parted ways with Paypal, its marketplace business became the most important growth driver apart from the revenue inflow channels that we already discussed and analyzed the broad ramifications.

Apart from the marketplaces, in your tryst to understand how does eBay make money, StubHub, the sports and concert ticket platform, would find a prominent mention in their platform for sports and concert tickets.

As per industry watchers and retail industry veteran, StubHub is undoubtedly a major player and most investors would keep an eye on its progress to better assess how does eBay make money.

In this context, it will be worthwhile to keep a tab on the transaction revenue recorded post the PayPal split.

Numbers do not lie, and often they provide the most dependable and trustworthy analysis.

For just the fourth quarter of 2016, eBay clocked transaction revenue of $274 m Vs $232 m on year on year basis.

Perhaps more than anything, this is a major pat on the back of the eBay management in assessing the most impactful growth drivers going forward, in the absence of PayPal.

The healthy transaction revenue is also indicative of the fact that eBay continues to make money with its 2-decade old policy, though the sheen might have been lost a bit tackling the struggles and competition in the e-commerce environment globally.

2. Exploring eBay Marketplace as a Way to Make Money

We already mentioned that in the absence of PayPal, the marketplaces on eBay globally are one of the most influential and important revenue generators for the e-commerce giant.

As we had seen for advertising revenue, eBay depends heavily on the transaction revenue from the marketplaces.

This transaction fee is usually levied on the seller when people approach the marketplaces to buy products internationally.

The company puts a cap on free items that users can list every month at 50.

Beyond that, eBay uses the listings as a vehicle to make money.

It charges sellers a specific transaction fee based on the product variety and keeps the revenue meters jingling without a break.

Generally, there is a fixed price that is levied by eBay depending on the product profile.

  1. It charges 5 cents for Movies, Music, Video Games, Books and DVDs
  2. The amount reduces to 30 cents for auction-style alternatives and products from the fixed price segment.
  3. They can click addition 35 cents for larger images or a strong auction style promotion

Readers must understand this amount is over and above the 10% listing fee that it charges the moment the company kicks off its association with eBay in a meaningful manner.

However the maximum amount of fees that eBay us $250. But the prices of these fees are not uniform and similar across the board.

They have different billing rates of different kind of products.

Additionally, I must mention that when you are exploring how does eBay make money.

With eBay clocking close to 150 million active users, the transaction fee even at this rather insignificant rate adds up to account for well over 50% of the overall revenue collected.

It is in general upward of $3 billion in all.

So it won’t be wrong to infer that when you are analyzing how does eBay make money, the transaction revenues comes across as one of the most serious game-changers.

It goes on to highlight how sheer volume can completely change the revenue landscape even with an insignificant base number.

3. How Enterprise Helps eBay?

In your quest about how does eBay make money, one of the biggest answers would be no doubt the role of the Enterprise.

Often in common parlance, the Enterprise, is known as the final revenue stream for the e-commerce giant.

So the question that comes into the limelight now is how pronounced is the contribution of the Enterprise and how exactly does it help eBay to make money?

Essentially for this, we must understand what Enterprise is all about in the eBay parlance.

This is that crucial branch of eBay that facilitates and often convinces brick and mortar retailers to join the internet bandwagon and experience the convenience of the online shopping sites.

The biggest challenge, in this context, is to explain the revenue inflow retailers and how it can materially improve through your liaison with an online retail portal.

Like I already mentioned, Enterprise is a comprehensive tool.

Its work is not just about convincing retailers for a transition.

They are also the one-stop destination for helping clients with every kind of market solution that they might be in need of.

This arm has come into being about half a decade ago and takes on the main responsibilities in

  1. Customer care
  2. Processing payment
  3. Detecting potential fraud
  4. Engaging consumers in a meaningful way

The impact and importance of this arm can be gauged from the fact that this alone accounted for close $300 million or almost 6% of the total revenue that eBay collected over an extended period.

What is even more worthwhile to note is that the role of the Enterprise is continuous.

At no point in time, can you wash your hands off saying that the company does not need any of the above-mentioned services?

Therefore, in your overall journey in exploring how eBay does make money, you must remember that though Enterprise is a small segment, it is a major contributor to the overall eBay wealth and therefore, takes up a strategically important position in the revenue inflow chain.

The extent of scalability that this enterprise division promises is also seen as a major positive.

4. eBay Makes Money via Auctions?

Another key revenue contributor for eBay is undoubtedly the auction division.

But the question here is how does eBay make money through this channel.

Well in very simple terms, the revenue that is collected is a happy mix of listing fees and the commission that eBay levies on every transaction of the cost.

First of all, the collector or seller in this case makes a listing of the rare items that they are interested in auctioning.

Next, the bidder or the buyer put in their bids.

Once there is a happy match achieved, the deal is finalized in totality.

Given the fact the eBay is one of the most active hunting grounds for curios and collectibles outside the regular and conventional auction houses, it remains a fundamentally strong source to make money for eBay.

In fact, with the introduction of promoted listing, creating traffic for these types of products have become even simpler and thereby, the number of users exploring this avenue has also increased.

In short, it means better sales and more listings and therefore added commission for eBay.

5. How Does eBay Make Money via Dropshipping?

This is another crucial arena to explore in understanding how does eBay make money?

You must understand that the entire eBay model is very closely linked to the delivery competence.

Not just for eBay but most e-commerce alternatives cannot make money if they do not have appropriate delivery channels in place.

Perhaps this is exactly why understanding the eBay revenue flow via drop shipping becomes so interesting.

Dropshipping is that unique arrangement in which sellers do not have to stock the product.

Once they get the order, it can be directly shipped to the buyer.

In this case, it is the logistics company or the shipping firm that handles the entire responsibility of collecting the product from the manufacturer and then taking it to the final buyer.

Apart from the listing and commission that eBay charges from the seller and makes money, there is an additional revenue source.

The shipping company pays a fixed transaction fee to eBay.

This is, of course, dependent on the type of product and the place that it needs to be shipped, and there are no uniform shipping charges.

But given the crucial role that shipping plays in the entire success of the overall e-commerce module, it becomes a key contributor to revenue for eBay.

It is, therefore, needless to mention that this revenue percentage might be rather minuscule in the entire gameplan.

However, it is undeniably one of the most crucial foundations that eBay business model is based upon.

The company is also in the constant process of improving the quality of service extended to customers.

That said, we can conclude that the answer to how does eBay make money is rather complex and multi-layered.

There are many aspects to this entire business model.

When you are trying to understand how eBay makes money, it is also extremely important to gauge the impact of seasonal forces.

For most e-commerce entities, competition becomes even more intense, and in the absence of a strong revenue model, their sales would plummet significantly.

For example, the eBay CEO mentioned that the holiday season is one of the biggest revenue earners for eBay.

It becomes one of the hottest destinations to shop online and in fact ranks as second in the list of most visited websites during holidays for shopping.

No wonder that eBay wants to put this progress in top gear and make money at an even better pace than before.

The company’s business strategy is geared to rake in revenue through this channel and improve the fund flow in a pronounced manner.

The structure data initiative, in this context, is one of the primary catalysts driving revenue for eBay going forward.

It aims to make money is a rather constructive manner by taking advantage of the ‘keyword tag’ feature provided by Google.

It is expected to ramp up transaction fees further through increased traffic.

Another initiative undertaken by eBay to help make money faster and on a much larger scale is expanding the scope of the fixed-price products.

This is also seen as a direct strategy to tackle competition from players like Amazon, who might have denied the money they make significantly.

The overall growth of the company has been slow and the 2017 guidance relatively muted.

It also signals that the company’s effort into revamping the way eBay makes money is bearing slow but a steady fruit.

Revenue might be expected to see a quiet 5% jump.

But it means they still can make money a lot better than many other new players.

What Is Conversion Rate Optimization?

Conversion rate optimization is one of the most critical buzzword in ecommerce.

It is a science about convincing visitors to a site to fulfill a certain pre-decided action.

It is a powerful marketing tool that analyses customer behavior.

Also, it persuades visitors to a website to engage in a specific action.

This desired action can differ from website to website and product to product.

Essentially, this is the catalyst that motivates visitors to fulfill an action.

So, this is also the technique that converts passive visitors to active users.

But this optimization strategy can differ from product to product.

As an entrepreneur, it is necessary to have your own optimization plan for improving the conversion rate.

There is no uniform law for maximizing the conversion rate.

Every business or website has its own special set of features that attracts visitors.

As an entrepreneur, you will have to analyze the key business points and create your own plan.

Moreover, conversion rate optimization is all about a continuous change process.

Conversion Rate OptimizationYou have to keep tracking the smallest changes and then adopt the necessary course correction.

Creating value-based models of operation is crucial for sustainable results.

You already understand the basics of marketing via driving traffic to a website.

Conversion rate optimization is all about taking it to the next level.

It is bringing about science to the trend and gaining a mathematical edge on it.

The primary idea is enhance the overall acceptance of the brand and drive revenue through it.

It is not just about gaining new traffic.

Often this is also about optimizing the existing traffic in the best possible way.

So it is a multi-pronged approach in enhancing the overall revenue base.

It has now become the backbone of effective online marketing strategy.

Why Undertake Conversion Rate Optimization

One of the most commons myths about conversion rate is you optimize when sales are lower.

But conversion rate optimization is never just about higher sales.

Broadly speaking, it is about improving the entire package for the customers.

The idea is not just about a great product or good business.

It is about creating a comprehensive solution for every website campaign.

Every page on the e-commerce ambit comes with a definitive purpose.

Whether it is about enhancing the user experience or attracting new eyeballs, the conversion rate is primarily about targeting the appropriate objective and ensuring its proper execution.

The dynamics in the ecommerce space is very different.

Perhaps what is particularly interesting is the pace of the change.

Practically nothing stays for too long.

Change is the name of the game, and it is fast-paced change.

The broad outlines of what right today has no bearing on what will be right tomorrow.

Ecommerce and online marketing are all about keeping your eye on the ball every moment.

There is no scope for any lapse in attention or execution.

Just more visitors to your website cannot guarantee better revenue inflow.

Bringing in more traffic to your website is only part of the story.

It is no doubt one of the key stepping stones for better gains.

But maintaining a similar quality of traffic is also important.

Moreover, you will also have to look at sustaining traffic inflow over long-term.

Once the initial euphoria disappears, creating a superlative user experience is what matters.

It is this exercise alone that will ensure longer-term efficiency in operation.

Conversion of traffic is all about taking your marketing exercise to the next level.

A holistic growth in business is dependent on the kind of sustainability you can acquire through these steps.

Purpose of Conversion Rate Optimization

When we discuss conversion rate optimization, it may not always indicate buying conversion.

Though that is also an important conversion but there are many other types of conversion too.

It can be a conversion for completing a survey or creating a user base.

Also, it can be a conversion to generate the greater mass opinion.

It can be something like conversion to download an app.

The maximum number of users is encouraged to download a specific app.

So it is essentially related to any action that is completed as per pre-designed plans.

So, in very simple terms, you can look at conversion rate as a percentage indicator for a specific cause.

This can be a sales goal, an ad campaign or even an introduction to an innovation.

Therefore it is needless to mention that a higher conversion rate is always welcome.

For any type of ecommerce, this is one of the biggest indicators of steady improvement.

It covers any initiative that attracts more visitors to a website and helps in enhancing the brand.

Whatever may be the target action; this is one uniform approach to make sure it is completed with success.

As an ecommerce operator, there are many areas that you may want to optimize.

Each, in its own way, is created towards enhancing the business model in a unique way.

The different alternatives may include

  • Optimizing the navigation through the website
  • Customer feedback
  • Overall business approach
  • Testing a variety of initiatives
  • Abandoning cart, checkout trends
  • Use of special offers and discount
  • Segmenting sales
  • Search optimization

If you pay close attention, these are all varied action.

But there is one basic goal or outcome expectation.

The idea is to further the business in the best possible manner.

Increasing revenues and sustainability is the core motive.

A/B Split Testing

The A/B Split testing is one of the basic media for conversion rate optimization.

This is also called the multivariate tests.

Most successful ecommerce businesses conduct this test for at least once a month.

It is a basic test to introduce innovation on a website.

The final idea is to enhance the overall conversion rate of the business.

The most basic format is to create two landing pages, with a few different elements.

Maybe the color scheme in one is extremely garish, and the other one is comparatively sober.

The traffic to your website is split into these two pages.

One half is exposed to the garish one while the rest access the sober half.

This is an ideal way to register the smallest changes that you undertake.

You can take note of the variance in response to your call to action.

The most common tweaking can be even changing the color of a button on the page.

But that is not the only innovation to improve conversion rate.

From the image of the product to the background color to your product layout, there are myriad changes.

You can bring in variation in the text size and font also.

Any element that indicates a potential improvement in conversion rate needs to be explored.

All of these will then be a part of the multivariate test.

As the name indicates, it means splitting your visitors to multiple versions of the same page.

The larger the number of combinations you test, the bigger is the audience base.

However, something unique about this testing methodology is there is never any end to it.

This is one of the continuous processes to enhance revenue generation.

Even small changes can improve conversion rate significantly.

There can never be enough of innovation here.

Analyzing Customer Experience

The customer experience is one of the most popular platforms for CRO.

In fact, customer satisfaction and conversion rate optimization go hand in hand.

A satisfied customer automatically translates into better sales.

Studies indicate that close to 60% users take advantage of these customer journeys or experiences.

It will not be wrong to say that this is decidedly one of the most reliable tools to optimize conversion rates.

As technology advances and trends improve, customer response is increasingly becoming unpredictable.

As options and opportunities are increasing, gauging customer behavior is becoming difficult.

It is not just complex but also varied depending on geographies and local trends.

As a result, the whole journey from visiting a website to buying, getting delivery and seeking customer support is a complex labyrinth.

It takes into consideration a massive amount of resource mobilization.

This includes both offline and online resources and channels of operation.

It is now even more complicated for businesses to gauge the trends.

This is exactly why recognizing and responding to the overall trend is complicated.

Marked improvement in their profitability is the primary motive for this exercise.

Reducing bottlenecks for customers is one of the most significant advantages of this exercise.

Improved conversion rate is directly proportional to ease of customer navigation.

This is why a wide gamut of data points are collected for appropriate analysis.

A comprehensive customer behavior analysis is seen as the backbone of better conversion rate optimization.

Often organizations also collate data and also user experiences from varied call centers.

In fact, the call centers are treasure troves for crucial customer feedback.

From the most common customer complaints to their top expectation, it is a minefield of information.

Needless to mention, all of them can go a long way in enhancing the conversion rate.

Addressing Customer Need Better

Perhaps one reason why improving the conversion rate is better is because of the long-term impact.

Unlike gaining new customers, conversion rate optimizations need continuous introspection.

It does not allow an entrepreneur or a business to rest on their laurels.

There is a continuous exercise to upgrade and better services.

Whether you sell a service or a product or an experience, conversion rate optimization always gives an edge.

It trains businesses and entrepreneurs to gauge customer needs better.

The idea is never about just doing what they think is important.

This is a unique model that gives customers an undeniable prominence.

It is never just about satisfying customers but more about how to make it better.

Customer experiences and requirements are both extremely dynamic.

No two customers have the same type of need.

Neither can you satisfy two customers the same way.

Each one visits a website with a different set of expectation.

Each customer is using the website and the business as a platform to address certain aspects.

As a result, just making customers happy will never solve the problem for them.

The challenge is always about how to enhance the service.

The idea is about creating a concept that is indispensable.

Most times return customers come because they have got something additional.

For example, every apparel website will offer trendy outfits with a long range of sizes.

However, what can set you apart through better conversion rate is introducing simple innovation.

Supposing, website X started introducing hand-written thank you note, and a care manual with every package can do the trick.

You can introduce these through effective conversion rate optimization and analyze results.

If users give thumbs up to this, and this results in better conversion, it becomes a positive outcome of the effort.

Better Brand Positioning

Effective conversion rate optimization is also about furthering a brand.

The dynamics in the ecommerce space makes it necessary to establish a brand.

Competition is extremely stiff in this space.

You practically have a new player making a foray every day.

In this context, staying relevant is all about how you present your brand.

Presentation and positioning your brand makes all the difference.

Conversion rate optimization provides you with key inputs in this context.

They are not just indicators about better sales.

They provide you a necessary peek into what exactly  drives a brand.

Businesses develop understanding about what and how works to maintain the brand image.

The profile of the customer who visit the website is crucial.

It gives you key information about those who are accepting the brand.

Also, it helps you to narrow down the segment that is not accepting the brand still.

It is not possible to go and satisfy every customer’s needs separately.

But the brand can surely introduce measures that create a distinct and strategic position for it.

Customers will get attracted to the brand essentially for these features.

This is what will then help create a meaningful image of the brand.

So, in short, conversion rate optimization helps entrepreneurs develop a better perspective.

They don’t just create avenues of increasing eyeballs.

But at the same time, they can make meaningful inroads in long-term customer relationships.

For most successful brands, these relationships are often the fine-line between success and failure.

Better conversion rate, therefore, undoubtedly improves success prospects.

It makes potential avenues for long-standing customer appeal.

It also helps the business expand through word of mouth.

That is always a very big step in a business growth chart.

Often word of mouth is what creates a distinct level of credibility.

Successful Strategies for Conversion Rate Optimization

Certain strategies are very effective for long-term conversion rate optimization.

1. Call To Action

A call to action that is included in the text is traditionally seen as a more effective option.

It undeniably works more effectively in improving the conversion rate.

When you have a blog spot or an e-commerce site, text-based call to action brings forth much greater impact.

2. Pop-ups Attracting Attention

On an average, there are certain pop-ups that attract more attention amongst users.

One of the most effective ways to improve conversion rate is identified these.

An intelligent placement of these will automatically generate way more customers.

3. Regular tests of Landing Page

Conversion rate optimization is a continuous process.

In fact, regular tweaking can undeniably improve business to a much greater extent.

The A/B split test invariably highlights meaningful channels of improvement.

4. Compelling Copy

This is an old-fashioned concept but always an effective one for better conversion.

There is nothing quite as compelling as a copy that attracts a customer’s attention.

Whether it is a description of an outfit or a blog about motherhood, it can drive users to complete the call to action quite effectively.

5. Auto-generated emails

When it comes to conversion rate optimization, you can use technology to your advantage.

It is now possible to track the visitors to your site.

Maybe they left an unfinished cart on your website.

Connect with them through auto-generated emails for long0standing gains.

6. Re-engage with users

In many ways, this is why re-engaging with users on a website helps.

It helps establish that human connect with them for better gains.


Therefore, effective online marketing is also a lot about efficient conversion rate optimization.

It is not just about improving sales but create a long-standing strategy to engage with customers.

That is exactly what enables a meaningful conversion rate.

So if you want an edge over peers online, the primary key to it is effective conversion rate optimization.

How Does PayPal Make Money?

The moment you talk about the online transaction, it is impossible not to mention PayPal.

Today, it is almost synonymous with any type of money transfer online.

Whether you think of paying credit cards or transferring money to friends or family, PayPal is popularly known as the world’s favorite middle-man now.

Perhaps the ease with which you can transfer money online using PayPal is often seen as the biggest contribution.

Compared to the complicated and costly wire transfers that used to happen earlier, the PayPal transfers are absolutely free and minus all the hassle.

But that also highlights a key question in our mind, how does PayPal make money?

This is relevant because when we are getting the service for almost no cost or bare minimum charges, it is interesting to understand how PayPal makes money.

How Does PayPal Make Money?

This is the question I am usually asked because people know me as a person who knows a lot about currencies and their transactions.

Many entrepreneurs think about running an online business like PayPal.

That is why they want to know how PayPal makes money.

I answer this questions first and then I will tell you what I prefer not to use PayPal in my business.

How Does PayPal Make Money?Maybe that is even more important for you to know if you are interested in running a business like what PayPal does.

Better grasp of their revenue model will also help you better understand the dynamics of online transactions and the primary factors determining the movement of funds and how it can help you make money.

A detailed study of the mechanism based on which PayPal works is crucial to the overall revenue model that dictates the money flow the world over.

1. Understanding the PayPal Business Model

So the primary question is how does PayPal operate?

A premiere e-commerce merchant service provider, it was founded in 1998.

Currently, they cater close to 200 markets the world over and have almost 100 million active users.

eBay acquired the company in 2002 for $1.5 billion, and almost every big business worldwide features in the client list of this company.

Their clients include the likes of Netflix, Starbucks, Dell, WalMart and many other international plays with the global operation.

Online fund transfer is one of the most cardinal functions that PayPal specializes in, and in many ways, has revolutionized the entire concept.

It facilitates this transfer using a simple email address, irrespective of whether you are a member of the site or not.

All you need to do is to link your account to a credit card or bank account and undertake the overall transaction.

However that said, you would surely need a PayPal account to receive the money.

Now let’s reach the crux of the key discussion point; how does PayPal make money if the transactions are free on the website?

Well in this context, you must remember that though the basic account on PayPal is free, there are many other options like Premier and Business accounts which are offered to you for a price.

The Premier account is more suited for amateur sellers, and it allows you to a few other features apart from fund transfer.

It enables access to a shopping cart along with payment reporting tools that are crucial for business deals and those with regular customer interactions.

The PayPal Business Account is essentially targeted for those who handle large-scale online businesses.

This includes several full-fledged players with active online businesses in eBay and other similar accounts.

They have the ability to generate accounts under the name of their business as well as facilitate recurring payments.

Moreover, they have no cap on the debit card use and can even take advantage of extended customer service facilities.

It is needless to mention that both the business and Premier accounts involve some amount of payment to PayPal.

But it is understood that for the business model to function smoothly, just this much of payment cannot really suffice in terms of providing a long-term revenue solution for the most celebrated online middle-man.

Well, there are a few more avenues that PayPal uses to generate revenues on a sustainable basis.

2. How PayPal Makes Money?

One of the best adaptations to the growing need to replace paper money, PayPal, relies on two cardinal sources of revenue to make money.

These are the sources that primarily fund the overall monetary movement that determine the extent of PayPal’s earnings.

What is particularly interesting is that this revenue model was evolved after a detailed and multiple adaptations of the original concept.

As the service provider matured and the range of services expanded, the revenue model underwent a series of changes to reach its current avatar.

So there are some basic routes that PayPal adopts to make money.

These include:

a- Transfer of Money:

Not only was it the cardinal model on which the entire PayPal business is based upon, but in many ways, this is one of its primary sources of revenue for the online middle-man.

You must be wondering now how that is possible.

Doesn’t PayPal provide free transfer of funds from any email account across the world?

Well, the fact is that while most of the domestic money transfers are free, all international transfers entail some fixed charges on the entire transaction.

For all international transactions, PayPal charges a fixed 2.9% of the money that is being transferred along with a fixed charge for being a facilitator of this service.

This percentage, of course, reduces if you transfer more than $3000.

  1. For transactions between $3000-10000, PayPal charges 2.5%+fixed fee
  2. For $10,000-100,000, PayPal charges 2.2% along with the fixed charges
  3. Transactions above $100,000, PayPal charges 1.9% of the transaction along with the fixed mandatory charges. The fixed charges is a basic rate of $0.30 that PayPal levies on all its international transactions.

So in this context, the answer to how does PayPal make money, would be the usual route that most payment gateways offer.

They are offering a service facilitating easy and hassle free fund transfer and charging you a set fee for doing the same.

So it operates more in lines with the escrow format and PayPal in the entire transaction takes on the role of a middleman.

It is needless to mention a lot of it is on account of the safety of operations that PayPal undertakes.

It guarantees both the sender and receiver about the surety of them receiving their funds.

The number of their active users and a number of transactions that happens every day can give you a realistic idea how PayPal makes money through this mode.

The rate of PayPal charges, however, varies from country to country.

These are more or less the basic transaction charges.

There are some changes, of course, depending on the geography and the specific country that PayPal is catering to and that surely impacts the overall payment model that they depend upon.

The format that PayPal operates on to make money is quite similar to that of a payment aggregator.

All the successful fund transactions go through Transaction discount rating.

It is interesting to note that the transaction charges for PayPal are rather low at $0.30 compared to close to 3% percentage cuts that they levy.

Essentially the $0.30 is the amount of money that PayPal requires to process your overall payment and make sure that it is sent to its destination within the specified and the promised time frame.

They currently service close to 200 countries with 2016 revenues close to $11 billion.

  1. This accounted from an annual payment volume of over $350 billion
  2. On an average, every active user undertakes about 29 transactions every year on PayPal
  3. The average weekly one touch PayPal transactions exceed 1.5 million, and 17% of active users use this facility globally
  4. Over 4 million merchants use PayPal now globally
  5. In fact, the annual PayPal payment through the mobile facility increased by 55% in the past few years and averages $100 billion annually. The mobile payment is particularly important as often this is a chosen way of payment given the ease of operation and relatively swift and efficient results. The recent rise in smartphone usage over the last decade or so can also be attributed to the gradual rise in the transaction via mobiles and the rising revenue for PayPal via that route.

What is also striking is the share of international transactions in all these statistics.

Almost 22% of their digital payment was a cross-border transaction.

As PayPal makes money primarily through these international fund transfers, it is needless to mention that it is one of the key revenue indicators to analyze if you want to get a clear perception of how does PayPal make money.

On an aggregate basis, PayPal makes a total of $315 million transactions every day.

Of these e-commerce sales, the share is expected to be less than 25%.

So we can easily assume predominant portion remaining is from fund transfer and from that, you can easily deduce the monthly revenue that PayPal earns from this route.

Given the active number of users range from over 200 countries worldwide makes the mathematics even more complicated.

So overall we can say that PayPal uses this model to make money on a sustained basis.

This is by far one of the most long-standing and primary sources to earn revenues.

As the number of PayPal users keep increasing and the amount of money transfer continues, the revenue for PayPal will keep tickling.

But as you can well imagine, this is not the only source of revenue for PayPal.

b- Arbitrage Value:

PayPal can make money via arbitrage as well.

Arbitrage essentially means taking advantage of two different rates and pocketing the difference as profit.

On an average, PayPal undertakes transactions in 25 currencies globally.

They have their own unique conversion rate.

This is generally at a premium compared to existing exchange rate.

Most times, users ignore this predominantly because of the ease of transaction that PayPal facilitates.

Now have you considered what happens to the difference?

Even this is a few pence every one dollar, multiply with the total transaction that is undertaken by PayPal even on one given day and the outcome, I am sure will make you dizzy.

Let me explain to you how PayPal can make use of this opportunity to make money using an example.

Let’s assume, I am a resident of Unites States, and I am suing PayPal to send $1000 to a friend in India.

The current USD-INR rate is above 64, but PayPal offers around 61.64.

Now I know that this conversion rate is way less than the market value, additionally, I must also pay PayPal about 4% as transaction charges along with the fixed transaction fee.

The mathematics is there for you to calculate and make an assumption.

PayPal will never advertise that they are charging you close to 9% on every transaction but let’s face it; this is the business they are in and want to make money.

So you cannot possibly fault them.

For those, who are not interested, can look for other options where the average rate of conversion and the transaction charges are much lesser.

But the advantage dealing with PayPal is that it has access to 25 currencies, many of them exotic and hard to get a fair rate.

Moreover, there are very few money transfer routes that are as convenient as PayPal in terms of accessing through just your email id.

If you have old parents far away in your home country, often this is the most convenient option to send money, albeit a tad expensive.

But who cares when you can rest assured about the fact that your money is in safe hands and your loved ones who need it will get the money within the promised duration.

There is another form of arbitrage too that PayPal can undertake.

Though it is hard to confirm and the company will not talk about it, it is fairly plausible.

After all, if you are out there to do business and make money and this is surely an interesting window to explore.

Let’s say 1000 PayPal customers transact $1000 through PayPal on a given day.

Now depending on the nature and the type of the transaction that is undertaken, this money will remain in PayPal account for a minimum of 4-5 days.

All of this money 1000×1000= $1 million gets deposited in the PayPal account for those many days till it is not diverted to its final destination.

Now it is up to you to calculate the interest that this kind of fund would generate.

Also, even if there is regular inflow and outflow of funds in the PayPal account, the amount of money that would be there on any given hour/day is sure to attract a basic minimum interest.

This surely can be a way to make money for the celebrated online middle-man.

After all, who wants to give up on some handy cash that they might be able to generate?

So if you ask me how PayPal makes money, this would be one of the alternatives for sure.

c- Interest on Money in Your PayPal Account:

Now let’s say, you are a 70-year old senior citizen staying in Vietnam.

Your son has a relatively cushy job in the US, and he sends you about $5000 every month.

Now given your age and frugal expenses, you do not have to withdraw money every month.

The result, the money remains in your account for more than a month also at times.

Now, you and your son are not the only PayPal users.

According to the last count, this ‘online superpower’ has close to 200 active users, and I am sure most of them do not withdraw the money instantly.

Has PayPal ever offered you any kind of interest?

No, of course not, but that is surely a way for them to make money from the surplus fund that remains parked in their account for a given period of time.

While I would refuse to get into any debate about why or how PayPal earns this money, this is surely a means for them to generate that extra revenue.

When you are exploring how does PayPal make money, this is surely a revenue generation route that you cannot possibly ignore.

You must understand that it is a regular business like any other.

Don’t we know of huge corporates who earn tons of interest in extra cash that might be lying in their account? In fact, it is seen as a big positive for these corporates.

Often it is seen as a sign of financial security; many listed entities even give a share of this money to their shareholders as a dividend.

This reflects rather positively on the company’s fundamentals.

So in PayPal’s case also, we must look at this cash just like we would view it while analyzing the prospect of a banking firm.

Moreover, apart from the US users, the cashing out of money from PayPal electric account is not that simple either.

There are several restrictions that are applicable.

This again means that at any given instance, all the 200 PayPal users are not withdrawing the money they have or cannot withdraw it in many cases.

But the money is safe and secure in that account.

PayPal, which is the safe keeper, in this case, can then easily make money from the cash lying in its account on behalf of the close to 200 million users who access this online middleman quite actively.

d- Online Sales:

Now comes one of the most important sources that helps PayPal make money- i.e. online sales.

According to last collated data, e-commerce contributed to nearly 25% of the total revenue generated by PayPal.

Not just that, the company’s statistics as updated in 2015 indicate that almost 80% of their revenue was an outcome of processing the online transactions of various merchants associated with PayPal.

In fact, as many as 202 of the top 1000 e-commerce retailers in not just US but entire North America engage Pay Pal as their primary processor for payment.

Even a chunk of the remaining 20% is mostly from the processing of transactions by various consumers who use PayPal to buy various products online.

Now you can compute the exact impact when I give you a few more numbers.

  1. PayPal at any given point of time has close to 200 million consumers.
  2. Almost 13 million merchant consumers are associated with PayPal globally.
  3. Globally close to 500 of the top online retailers accept PayPal as a secure means of transaction.

Therefore now if you put this entire information flood in perspective, the exact answer to how PayPal makes money is not hard to gauge.

Also, you must remember that while PayPal was part of Ebay group between 2003-2014, there was a tsunami of payment from people who sold their ware on eBay.

Now you can imagine the kind of impact it had on the average revenue outlook for the company as a result of this association.

What is interesting is for most online sales, this still remains one of the most preferred ways of making payment.

This is simple, swift and convenient with a relatively much larger access than most other similar payment gateways in recent times.

Even for their online sales, PayPal operates on a fixed slab.

For example, the rate they charge for transactions below $3000 and those above $100,000 have different rates applicable to them.

Along with this, there is also the fixed transaction fee that sellers must pay PayPal.

The implications can be well understood given the steady money flow that is expected from online sales in the current scenario.

Independent studies have indicated that e-commerce is a potentially high growth avenue.

According to current data, almost 40% of the current internet users, whether you consider a laptop, desktop or even mobile devices like tablets and smartphones, are steadily joining the group of individuals who are more keen on buying products online.

This 40% totals to almost 1 billion online buyers at any given point of time.

Now you can make rest of the calculation to identify the kind of user base you can boast of and the percentage that uses PayPal.

Therefore if the rate of e-commerce keeps rising, it will soon become one of the top contributors to the PayPal revenue and no doubt, a great way to make money for them over the longer term to keep the growth projections on track.

e- Miscellaneous Fees:

Now these are no doubt the top contributor to PayPal revenue model.

But that does not mean that there is no other way to monetize its services.

Let us remember that one of the biggest contributors to PayPal’s growth is undoubtedly the free money transactions that it has come to become the brand ambassador of.

While you know that you can send and receive money within the United States for free and also open an account free of cost, there are some other services for which PayPal charges you and it no doubt helps them make money.

These include

  1. If you prefer checks to cash withdrawals, PayPal levies basic fees on you. Every check transaction entails a $1.50 fee
  2. International transactions all carry a fixed fee as well
  3. If you are a seller on PayPal, all your transactions attract a certain minimum fee apart from the percentage of sales that you would have already agreed to pay to PayPal. That apart, individual rates for specific currency differs and you must understand the exact transaction fee that is levied on you. So if you are analyzing the means of earnings, these are all various sources that PayPal uses to make money.

f- The PayPal App

The mobile or digital payment is a big money spinner for PayPal.

About 30% of all PayPal transactions happen via mobile.

The scope of this can be well gauged by the fact that the company processes $8000 worth payment every second.

So you can quite imagine the PayPal founders looking to capitalize it better make money even faster.

Therefore, it is but obvious that they have been instrumental in developing several mobile apps like Venmo which are essentially made with the purpose to make and receive payment.

So these are the many alternative platforms that PayPal has been focusing on to make money.

How Do I Like PayPal?

I use PayPal for some of my small personal transactions but I don’t like it for the business at all.

The most important reason is that they charge a lot through the exchange rates.

They apply their own exchange rates to make a lot of money through the arbitrage.

They never answer to any questions regarding their extremely high exchange rates and it seems there is no regulation or third party supervision on this.

Above all, their support team looks arrogant sometimes and they ignore the clients questions and objections.

Maybe they think they can do this because they are so big and popular, but time is a good teacher.

When a new system comes that not only offers all the services that PayPal does while they make less money for themselves compared to PayPal, but also they work as user-centered company that put more value on their clients, then PayPal will understand what their mistake has been all these years, but it can be too late.

Exactly like taxi drivers who thought they were kings of the streets but now Uber has changed everything and has made many of them cry.

Paypal Is a Good SystemDespite the above two problems, PayPal is a good system.

So when you set out to find out how does PayPal make money, the short answer to it is in myriad ways.

An immensely popular online payment facilitator with close to 200 million active users and owner of one of the most visited websites in the world; they have leveraged their earnings on both the global necessities and individual requirements.

They make money essentially helping you undertake your needs in a hassle free and convenient manner.

It is needless to mention that their revenue model is a direct outcome of the internet boom.

So, no doubt, transaction fee remains one of the platforms for PayPal to make money.

Whether you are an online seller or average professional sending money to your family and friends, PayPal becomes the facilitator of convenience and comfort to you.

In return, they charge some fees for making these transactions possible.

Given that now the active PayPal users are on the verge of crossing the 200 million mark, even $1 charged annually would yield $2 million in revenues.

So PayPal is able to capitalize on this base to make money pretty swiftly.

Last but not the least, as you explore how PayPal makes money, you cannot ignore the contribution of online sales that is soon promising to take up a dominant position.

That along with the fact that PayPal is one of the few international operators to provide service in 26 currencies globally makes sure they always have myriad channels to make money.

So to find out how does PayPal make money, all you have to do is explore the range of offerings they provide and the current number of active users they have.

Rest as they say is history.

Passive vs Nonpassive Income and How to Have Both

When you look at the various income sources, you can broadly classify them into two categories.

These are passive income and nonpassive income.

The moment you think of a passive source, you could consider any form of business or earning where you do not have to be involved on a day to day basis actively.

Nonpassive source of earning, by definition, points to any kind of activity where the level of initiative or activity is more pronounced.

Often the difference and debate about passive and nonpassive income is seen in the taxation perspective in a most pronounced manner.

The rate of tax that you pay is often dependent on whether you have passive vs nonpassive income.

The US revenue department, in fact, has incorporated several tests to identify whether a source of income is passive or nonpassive.

Passive vs nonpassive income have a direct correlation to the amount of tax that you pay.

Additionally, in many ways, it impacts the exact amount of income that you can hope to generate from a profession.

It also often decides on the career path that you eventually zero in on.

Definition of Passive income

Passive vs Nonpassive Income and How to Have BothIf you look at the classification made by the tax department, there are broadly three main classifications of income:

  1. Passive income
  2. Active income
  3. Portfolio income

So, what exactly is meant by passive income?

As the name suggests, it is any income where you are not actively involved.

So, it could be the earnings that you could generate from a rental property or for that matter, a business where you have a limited partnership.

You are not actively involved in the day to day running of the business and have no material involvement in the overall running of the business.

Even for that, portfolio income is considered as passive income by some analysts.

The argument is rather simple.

The dividends and interest that you earn are often without your direct involvement in the entire procedure.

Of course, you might have worked hard in getting the portfolio created but beyond that, the market forces come to play, and an individual’s role is almost non-existent.

If you notice the recent trends, passive income has often been used rather loosely in the modern perspective.

The most basic derivation is any regular source of income where you have little or no role beyond the conceptualization part.

Most times, when people seek to adopt a better-quality life, devote more quality time to family, this is seen as the most convenient arrangement.

You work from home on your own terms, and that is often the biggest pull for opting passive income.

While it might not be something as effortless as a lottery win every time, but surely the capital gains that you incur can be termed as passive.

But if you are trying to classify these from the taxation perspective, then passive income has a relatively more precise positioning.

For example, it does not include a lot of online work from home in that category.

Therefore, a very technical definition of passive income would be any kind of earning where there is no material involvement of the taxpayer.

So, material involvement becomes the key point of consideration when you are trying to differentiate between passive and nonpassive income.

Perhaps this is the reason that often instances of self-charged interest and situation where you earn profits from shares issued to you as an incentive is termed as passive income.

Here are some basic income options that get termed as passive:

1. Property Income

When you go on to define passive income, this is perhaps the most popular format of income that is considered.

Whether you own a commercial property or a residential one, any income that gets generated through these channels will be termed as passive income.

However, it won’t be considered passive if you are a real estate professional actively involved in buying, selling and leasing of property.

Though this income is not strictly passive in the IRS book, you can surely claim the advantage of the passive income loss rules if the property happens to see a depreciation in value.

In the taxation terminology, all holdings in land and otherwise is termed as active or nonpassive income.

2. Self-Charged Interest

Essentially this is the income generated from the interest that is accrued from a partnership or a corporation.

This is a business arrangement that is often undertaken to nullify the impact of double taxation.

So, the interest accrued is seen as a pass through impact that gets taxed as passive income.

Also, care has to be taken to make sure that the loan proceeds too are used for the passive activity.

In simple terms, this is a unique situation that refers to the kind of income that you might gain through a chain of passive involvement or rather lack of involvement in a business venture.

3. Why You Would Choose Passive Income Options

Often when you are trying to figure out the difference between passive vs nonpassive income options, the benefits of each individually comes to play do proper justice to the overall concept.

As we discuss passive income options, let us first understand their benefits:

1. This arrangement makes an investor take maximum advantage of the available tax deduction.

This is because when an individual claims loss on a passive income avenue, they often have the deductions offset against the taxpayer’s overall tax claims.

The earnings of consecutive years are also sometimes taken into consideration for arriving at a reasonable tax computation.

2. Moreover, a tax paper who is involved in multiple passive income avenues has the option to group all of these into one large unit.

Then the IRS would not count your material involvement in each of these activities individually.

On the contrary, they will be able to project their involvement in one economic unit that groups all these passive activities together.

This is particularly important in terms of how the tax liabilities are computed in the overall service profile.

Tax Deduction Advantages

The reason being the grouping activity helps you to claim the various tax deduction advantages in the most beneficial manner.

In case it suits your purpose, you can also look at keeping them ungrouped as standalone entities.

It is a kind of business arrangement that is aimed at bringing about the most sustainable value addition to the overall service profile.

Most times, passive income opportunities are more an extension of the individual’s need to generate multiple earning avenues.

As against popular notion, passive income is not just a chosen channel of earnings for retired persons or aged people.

Often, those at the pinnacle of their professional career could look at exploring these opportunities to value add to their existing income opportunities.

However, the concept of passive income strictly in the IRS terms is not exactly how you would consider the options in the practical terms.

It is needless to mention that if you intend to take the maximum possible advantage of this opportunity, you must understand the tax implications very clearly.

Definition of Nonpassive Income

Now that you understand what is passive income, it is time to understand the comprehensive details about what constitutes nonpassive income.

You must understand that just by referring to it as nonpassive income, you cannot term it as active.

In fact, nonpassive opportunities can be

  1. Active Income: This will include the likes of salary, daily wages and the like
  2. Business Income: This is essentially the earnings generated from a business or an investment where you are actively involved

In general, nonpassive income comprises a significantly large number of active income opportunities.

Here there is no via route to get your earnings.

Your income is directly related to the overall work you are doing.

In other words, you are doing something and getting paid in return.

That is also what you would think is active income.

So, while nonpassive income is not equal to active income, this later one forms a very important part of the former larger group.

Without it, the core concept of nonpassive income cannot be judged or considered adequately.

Therefore, it needs to be seen in appropriate perspective.

It is worthwhile to understand in this context that nonpassive income is taxed differently from that of passive income.

You cannot use the losses incurred in one to offset the losses incurred by other type of income.

So nonpassive losses and income cannot be used to offset passive income and losses and the vice-versa as well.

This is particularly important when you are trying to offset losses in a business operation.

However, you must remember that while passive losses can be carried forward, in the case of nonpassive losses, it needs to be settled against income in a specific year.

The concept of carrying forward does not function here in any way.

So, it would not be wrong to define that nonpassive income is essentially a full-time job.

You are putting in a lot of effort and then seeing the returns from this in the form of the income generated through it.

Whether you are in a business or a service, as professional is almost always in control of the nonpassive income that they generate.

It is common sense that if you put in 8 hours of work, you will surely earn more than what you would from 4 hours of effort.

Also, not all nonpassive income opportunities are office based either.

You can also be home and be part of a non passive or active engagement.

One of the best examples of this might be the job of IT professional.

Given the advancement in technology and the easy access to internet, a lot of IT professionals are working from home.

They are doing so to spend more quality time at home, but their earning is directly proportional to the hours they are putting in to get their job done.

In contrast, if you see the role of an app developer, they surely put in effort in developing an application.

But once that is built, and they have sold it for a profit, it ceases to be a nonpassive income destination.

It instantly becomes a passive income opportunity.

They are at that point of time not actively involved in the amount of money they are earning.

Neither are they in control of increasing it as per their requirement.

Till they are negotiating for the right price of the app, this is an active income destination.

But the moment they have got the money in the bank and start enjoying the interest, it is a passive income.

However, if they used the money they earned to develop a new application or used this income to start some new venture, this will again be counted as nonpassive income.

The point here is that whenever we discuss passive vs nonpassive income opportunities, the quality of your participation becomes the crucial and the biggest deciding factor in the entire game plan.

In fact, in the entire differentiation process of the two distinctly different income opportunities, it is the engagement level that makes all the difference in the core profit that is earned or loss that is booked.

Therefore, the involvement in any venture is a primary factor to consider.

Material Involvement in Passive vs Nonpassive Income

Often when you set out to differentiate between passive vs nonpassive income, material involvement is a key term that you often come across.

I think this is one of those unique terminologies that needs to pe explained with an example for better and deeper understanding of the various income formats.

Let’s say I am an investor.

I decide to invest $30,000 in a business initiative, perhaps a mom & pop store at the corner of the locality I stay in.

But I have no time or understanding of the business. So, I find out someone else who runs a similar store but is in need of fund.

I get an agreement from that person that they would pay me a certain percentage of the profit in return for the money that I am investing in.

This earning would then be classified as passive income.

So essentially this means that as long as the investor is not actively involved in the overall business operation and has no role in its profitability apart from providing the money for it, it gets counted as passive income.

As an investor, I do help the owner manage the same store, my earnings would then be termed as nonpassive income.

According to the US tax department, any situation where the overall involvement is beyond mere capital payment would be termed as nonpassive or rather active income opportunity.

One of the simplest examples to understand the difference between passive vs nonpassive income is perhaps the difference between a venture capitalist and a limited business partnership.

The VC firm involved with a company is very actively involved in the running of the business, they oversee the various business decisions and often have a very important voice in board meetings, etc.

But in comparison to this, when you analyze the role of the limited partners in a business and the income they get, it would be considered as passive income in entirety.

Apart from the money they have invested in the company, they have no material involvement in the entire operation of the business.

Therefore, material involvement is often the catch phrase that seeks to differentiate between passive vs nonpassive income, especially for taxation purposes.

So how exactly the tax department seeks to make this differentiation.

The IRS terms an involvement decidedly material if it exceeds involvement of 500 hours in a business where you are invested.

The minimum hours of the range are seen at 100 hours at least.

In other words, the IRS terms any business activity where you have participated for at least 100 hours as material involvement in the entire business.

Therefore, there are some clearly defined rules that will help you grasp material involvement in a business with relative clarity.

More than the actual implications, this is material from grasping the resultant tax implications of this arrangement.

1. The overall individual participation of a tax paper needs to be above 500 hours on an annualized basis.

Often, this will be counted as material involvement that can actually bring about a meaningful difference to business profitability.

2. This essentially comprises the business activity by the group of investors who are not direct owners in the business.

3. However, a taxpayer’s 100 hours of participation in a business can also be termed as non-passive, in case no one else participates for longer hours than this specific individual, who has put in 100 hours.

Therefore, it is very important to identify the entire business activity in relative levels.

4. In terms of total tax computation and difference between passive vs nonpassive income, it is also important to see the period of this material involvement or active participation.

So, on an annualized basis, it can be 500 hours a year but it is also important to calculate the number of years that this has continued.

It is needless to mention that both the individual levels of participation, the group activities and the groups in which the entire list of passive activity is considered all make a huge difference to this core concept of material involvement.

Ultimately, it is the material involvement aspect that seeks to differentiate between passive vs nonpassive income, at least in terms of tax computation and overall tax liabilities of an individual.

Basically, the material involvement is the IRS’ way of understanding about how substantial is the quality of your overall involvement in the entire business activity.

1. What Is Passive Activity & Loss Rules

That brings us to the other important aspect in understanding the difference between passive vs nonpassive income.

What exactly is passive activity? Let us understand this concept with the help of an example.

Let’s assume you have a rental property, the income generated from this source comes to be termed as decidedly nonpassive income.

In the case of a loss, the taxpayer can then claim losses against income from these passive activities.

You cannot look at offsetting this loss against your active income channels.

Though it is possible to pursue both these opportunities simultaneously, a taxpayer needs to be extremely careful about how they put up the claims and tax liabilities.

In case if you cannot offset your entire passive loss in one year, you can also carry it forward in future to get a comprehensive and complete deduction.

This is a direct fallout of the passive activity loss rules.

It is only pertinent in the case of those income opportunities where they are not materially involved or active engaged.

The moment you are not able to substantiate claims of the passive engagement, or if your material involvement is higher than the predefined standards, it comes to be termed as active involvement, and your tax liabilities get computed accordingly.

So, if you are not able to stay within the predefined boundaries of passive income, you cannot claim deductions on the basis of the passive loss rules.

So, while the colloquial definition of both the income opportunities often merges into each other, in the tax department’s rulebook, there is a clear demarcation.

A proper understanding of this demarcation helps you take proper advantage of the tax deduction.

2. Is Portfolio Income a Passive or Nonpassive Income?

However, there is one more avenue to explore before you understand if you can pursue passive income and nonpassive income simultaneously.

That is the grey zone called portfolio income.

The debate on whether it is a passive or nonpassive out is not completely settled.

Often the income generated from portfolios can involve significant engagement in the initial stage and almost next to nothing involvement in the later phase.

Therefore, this is an opportunity where you do some bit of both of these.

Essentially portfolio income refers to Portfolio income refers to the kind of income that you earn from the various investment that you might have made.

It could also comprise of dividends, royalties and capital gains that you might have earned.

While you may not be working too hard for this income at the moment.

It is important to understand it is not possible to create a portfolio with passive investment.

At some point of time, you would have had to put in significant work to create a reasonable investment portfolio or create a music album from which you can earn the royalty.

Identifying and having a clear sense of what is passive and nonpassive income is very important.

This is because most taxpayers tend to lose money by not being able to categorize their business in the appropriate channel.

After all, nonpassive losses cannot be offset against passive income and the vice-versa.

Therefore, inaccurate categorization of these different income opportunities can severely impact the kind of income and losses that you have to report every year.

This is particularly important to understand because while passive losses can be settled over a few years, active losses need to be settled within a particular financial year that they have been filed.

3. Pursuing Passive and Nonpassive Income Simultaneously

Therefore, we come to the basic point we started this entire article about- can you pursue them together? Yes, it is possible to pursue passive and nonpassive income opportunities together.

But you need to be careful about how you compute the taxes for it.

After all, we all want to take advantage of the best tax saving opportunities, and often an inaccurate analysis of these two different income options could severely impact your tax liabilities.

So our advice is to get in touch with a good CA with an in-depth understanding to help you tide through this.

They will be able to help you understand how to work out your income and liabilities to and take advantage of the maximum deduction.

This is also an important consideration when you think about the future prospects and your need to create a comfortable retirement kitty.

After all, you do not want your retirement money to get eroded paying passive income taxes because you were not careful or clear about the various distinction between the two.

Passive vs Nonpassive Income

Essentially the debate between passive vs nonpassive income reaches a definitive point with the term ‘material involvement’.

This will define how actively you are engaged in generating the income.

Apart from determining how much income you generate through the level of your engagement, the ‘material involvement’ angle also has very serious implication on your overall tax liability for a year.

The passive and nonpassive income have different tax computation rules, and that is exactly why you need to be rather careful about how you group your income avenue.

This is particularly useful if you have multiple channels to earn money and you would want to consolidate them and conserve maximum gains for yourself.

After all, who pays the tax department willfully?

But yes, it is possible to pursue both these forms of income simultaneously.

For example, when you write a book and put in an effort to write a book, your material involvement is in the active segment.

But when the book becomes a success, and you begin to earn the royalty, it is passive.

But in case you are constantly updating the contents to make it relevant, or write another one with the money you earn you are simultaneously involved in passive and nonpassive income options.

Residual Income Formula Is Defined Differently Here

Calculating your residual income can never be difficult if you get the residual income formula correctly.

The basic formula is based on the net inflow and outflow of an individual or a company as might be the case.

However, the formula is tweaked a bit depending on the key purpose that this valuation metrics would be used for.

There are various applications of the residual income starting from assessing an individual’s capability to repay a loan to a manufacturing unit’s expansion potential.

Therefore, calculating it can be quite simple.

Below, I am explaining how to calculate your residual income based on an accounting point of view.

However, as I have already explained here, residual income has a different definition from our point of view.

It is the income that will not be stopped if you stop working.

So it is completely dependent on the nature of your job and whether it is able to generate a residual income or not.

It is very important for your future to spend your time on the jobs the will keep on making money even if you stop working.

You can’t be dependent on social security, RRSP and things like that.

The Residual Income Formula

The Real Residual Income FormulaThis is why one basic formula that you must remember is

RI = A – (B x C)

RI, in this case, stands for Residual Income.

A is the total net income on an operational level.

B represents the minimum expected return.

C is no doubt the average assets, again on operation basis.

Therefore, it is quite clear that formula uses actual figures more than the notional or estimated profit level.

As a result, they always become a way more accurate assessment of the financial state.

This is an important valuation entity not just for large corporates.

But it is also for many small time businesses and even self-employed individuals.

This becomes a very handy approach to judge the overall valuation for many individuals who are not really working at the moment to generate income and residual income is important for them.

But the mere formula for residual income would not be useful at all if you do not understand it in the appropriate context and use the right type of variables to truly bring forth its relevance.

It becomes extremely important for you to grasp how it works in sync with the other various elements of the balance sheet.

For example, the component ‘A’ in residual income formula is the net operating income.

But you can’t just have a reference figure.

You need to take into consideration your entire monthly income or the revenue that has been generated and then go on subtract the various capital costs and loan liabilities that you might have.

Let’s say you released a music album and perhaps sold about 10,000 copies.

Then your net operating income will be the actual amount after you subtract the cost involved in creating it, editing it, marketing it and designing the cover.

Once all these expenses are accounted for, the resulting amount would be your net operational income.

If you create an e-book, you won’t have any costs because you can sell millions of copies without having to pay for any hardware and duplication fee.

Therefore, any money that you make through selling your ebook, will almost be your profit.

Digital products are better to generate residual income because once they are created, they can be sold unlimitedly.

The cost of capital is no doubt the kind of cost involved in mobilizing the said assets to start generating income.

When the return on this basic investment is able to cover the cost and also create a surplus, you are then able to calculate the residual income based on the percentage of relative return.

The other aspect of the equation is the operating assets.

This essentially involves the kind of money that needs to be ploughed back into maintaining and further the production level thus far.

As a result, the more successful a company is, the better residual income can be expected from them.

Such is the value of this metrics that many companies base their business ethics on the principle of generating larger residual income.

How Is Residual Income Not Always Passive Income?

Perhaps one of the greatest benefits of using the residual income formula to work is that it easily enables you to identify the difference between residual income and passive income.

This is one of the core formulas that are enabling lots of businesses today to focus more on generating substantial residual income as opposed to passive income.

Another major advantage is that you can use this formula conveniently to create addition income channels.

The trick is as long as the result of the residual income formula is positive, it means that the business is generating additional revenue despite the cost involved.

Therefore, it would make sense for you to continue and further the scopes of such a business.

The Formula for Personal Residual Income

You already know the core formula for calculating residual income.

But you must understand it needs some tweaking depending on the specific purpose that it is employed for.

So when you set out to calculate personal residual income

The fundamental factor is that it is often also referred to as discretionary income.

It would be pretty simple to calculate it.

All you have to do is subtract the various expenses like loans and mortgages and look at the net amount remaining.

Therefore the formula is relatively a more simplified version incorporating these two simple parameters.

Residual Income (RI) = Total salary – debt outgo

For example, if your monthly salary is $10,000 and you have one mortgage payment of $2000, $1000 loan EMI and other expenses worth $2000, your residual income would be $10,000 – $5000 = $5000

Now if someone’s loan worthiness needs to be assessed, it would be based on this RI figure of $5000.

A higher RI would always entail a greater possibility of getting a loan.

The Formula for Business Residual Income

Now when the same residual income formula is used for assessing corporate accounts, it takes into account the many facets of operational income that go hand in hand with a business establishment.

The net operational income would be the total revenue subtracted from the cost of capital used up to create the kind of revenue that it starts to generate.

So it is not just the profit level, but profit subtracted from the basic return that the business is set to generate.

Residual Income = Net Operating Income – (Min Required Return x cost of operating assets)

When the residual income turns positive from this calculation, it is a major plus as it denotes that the business is profitable after all the costs and is creating a surplus profit over and above the basic minimum rate.

There the residual income formula is not just an easy way to grasp the true profitability of business.

But it also enables you to get appropriate indicators in terms of the financial viability of a business.

Even in personal employment terms, this formula is also beneficent in creating multiple channels of employment.

An individual can use this formula for getting the right perspective about the kind of surplus income they need to generate, and this leads to a far effective fund allocation.

That was all about the accounting aspect of residual income and the formula that accounts use to calculate it.

MLM Companies that are the Most Famous

MLM Companies have been mushrooming across the world.

Irrespective of the kind of money they make for their representatives, they are growing.

Their popularity is essentially on the basis of the products they choose.

Often the unique concepts and the expectation of the people add to their valuation.

There is also a degree of aspirational value that’s attached to these companies.

The most famous MLM companies are invariably the ones that sell a unique concept.

Often it is this novelty element that supports its growth.

Sometimes it can also be the relative difference in approach.

The concept is all about how effectively you can sell the product and how many you can sell.

But not all companies can get the right mix.

While there are some that falter in the product conception, there are execution issues for others.

This is exactly why there is some special about the most famous companies.

These firms have been able to create sustainable business models.

In some cases, like that of Avon, they have managed to continue the business successfully.

It is not that the product is exceptionally great.

But the point is the company has managed to maintain revenues thus far.

This is why the list of most famous MLM companies is a saga of some brilliant business models.

Whatever, the target business is, they have executed it appropriately.

The idea is to sell it to the potential customers in the right manner.

That is what keeps the demand cycle going.

Moreover, the warm circles are the first go to destinations for any MLM business.

That is why these businesses have to be such that can easily sustain the interest in these circles.

Ultimately, this is what sustains long-term sustainability to a large extent.

Most Famous MLM Companies

Here is the list of the MLM companies that are among the most famous:

  1. Amway
  2. Young Living Essential Oils
  3. Jeunesse
  4. DoTerra
  5. Le-vel Thrive
  6. Avon
  7. GiraCoin

1. Amway

AmwayIn any list of most famous MLM companies, this ranks high up.

This is not just because of the type of global revenue that it clocks.

It is also because of the way it has made the MLM concept a household affair.

From good living to good looks, Amway’s product range includes everything.

The overall revenue is the best reflection of their unique business model.

Needless to mention that sales have now risen above $8 billion.

There is often a claim about Amway representatives buying the bulk of them.

What you cannot deny is that they do a great quality product.

Perhaps that is exactly why they have been able to maintain their own in this industry for more than 50 years.

But what’s unique is the way, the company has learned to adapt to new challenges.

If you see their 2018 growth plans, they are actively scouring opportunities through a digital platform.

They are constantly expanding their investment through these digital platforms.

Most importantly, they are also looking at ways to enhance their online distributor tools.

As a result of these initiatives, the new product launches are bettering expectation.

They have been able to make successful inroads in most global markets.

South Korea and Thailand are some of the most important markets outside US.

But they have also maintained steady progress in challenging destinations like China.

They are involved in skin care products, household goods and healthy living alternatives.

Perhaps the product range is one of Amway’s strongest points.

You cannot fault the company for their quality.

This is what continues to maintain the long-term momentum to a large extent.

The business is progressing through a steady mix of local e-commerce digital footprints and global initiatives.

The idea is to maintain steady growth across markets.

2. Young Living Essential Oils

Young Living Essential OilsIf you are looking for famous MLM companies, it is hard to ignore this.

Though a relatively new entrant, it is already a market leader in its niche.

Yes, this company is the world leader in the essential oil business.

If you see data 2015 onwards, the company has clocked revenue above $1 billion every year.

In fact, the 5-year growth chart highlights stupendous 800% growth for the company.

It is in business for close to 25 years now.

In 2018, the year to date increase in sales is already over 30%.

Their specialty is essential oil and renewed interest in it.

People across the world are becoming more and more health conscious.

Young Living provides them the Elixir to make headway in this context.

They have a unique seed to seal technology furthering their sales.

This is what helps them provide alternatives for every kind of lifestyle and families.

This is what helps maintain the long-term demand portfolio.

The company’s growth can well be gauged by their global footprints.

They have over 4 million members since the business started.

Moreover, their global employees’ count is now close to 3000.

That apart they are now shipping to a strong 130+ markets.

That is not all.

The company is also effectively operational in 22 markets.

The strong control over the complete oil production helps them ensure great quality.

What makes them a reliable product is, of course, this strong control.

They have essential oils that are genuine and free of harmful chemicals.

While the money-making potential of this MLM is questionable, the product is undeniably great.

You have to, however, accept the reality that MLM is not a profitable concept for every member.

Some will make a lot of money while others may not do so.

3. Jeunesse

JeunesseThis is another top-rated MLM company that you may have heard about.

They are also in the wellness business.

The company specializes in nutritional and skincare products.

Their exclusive items help them take forward the youth enhancement range in a comprehensive way.

As you see a steady 30% year on year growth, you can understand the true mettle of this company.

They use new age technology and a variety of innovation to take the growth forward.

Moreover, they specialize in a niche that can ever see the waning of interest.

After all, most of us want to look good and feel younger.

Jeunesse is helping further this idea in over 140 markets at the moment.

What’s really spurred their recent growth is the string of football sponsorships.

These deals have given them the much needed global recognition.

Moreover, it gives their brands a distinct sense of credibility.

Additionally, it also helps them reach out to a large body of audience in one go.

Think of a football stadium.

It can have anywhere between 30,000-80,000 audience in one go.

The sponsorships help them reach out to this huge body of potential customers in just one go.

Perhaps the most striking one is the multi-year sponsorship deal with the Turkish club, Galatasaray.

This football club is one of Europe’s best known and most famed football club.

So it creates a distinct advantage for one of the fastest growing MLM companies.

The strategy of introducing the brand on a far-reaching global platform seems to be paying off.

The revenue has not just stayed consistently over $1 billion; there are other advantages too.

The company has won recognition for the second consecutive year at the AVA Digital Awards.

This undeniably projects an impressive picture of the overall business model of this MLM Company.

4. DoTerra

DoTerraAn innovative US-based organization, they are one of the most famous MLM Companies.

The chances are someone has already spoken to you about their flameless candles.

Or better still, you are already a member of the affiliate networking program here.

They also address the now famous niche, essential oils.

Just like Jeunesse, though they operate out of a small US province, they have managed global reach.

Their growth is primarily channelized through consistent growth and awareness about the healthy lifestyle.

Their global network now comprises of over 5 million customers.

The revenue for the company tops $700 million.

Projections indicate that it is steadily clocking 10% + increase in sales every year.

That does not just indicate a steady rise in sales.

At a different level, it also indicates a sound strategy to attract a continuous flow of customers.

A fair compensation plan for local growers and stable supply chain enhances their sales.

It is said to help maintain a strong control over their unique single-plant formulations.

This has undeniably made sure that the company gradually enhances its global presence.

The range of their oil-infused offerings includes home care range as well.

This is in addition to their personal care options and the dietary solutions that they specialize in.

The recent partnership in Bulgaria is said to be a crucial revenue trigger too.

They have entered a unique pact to distill Lavender and Mellissa apart from many other essential oils.

It does not just add to their global supply chain.

It also establishes the brand as a credible social participant.

The association in Bulgaria is seen as crucial in supporting the local youth.

So members can also take pride in being associated with a socially uplifting cause.

On-time payment and fair pricing are two great advantages of this brand.

5. Le-vel Thrive

Le-vel ThriveThis company is one of the fastest growing MLM companies.

To add to that repertoire, it is also amongst the most famous MLM companies.

What is particularly striking are the search results on the internet.

A quick random search hardly mentions the word scam in any of the search results.

This goes on to establish that it is famous primarily based on the quality of the compensation plan.

Of course, this is in addition to the quality of the product it offers.

You cannot deny that is undeniably the key growth driver for any genuine MLM player.

It is essentially a health supplement manufacturer.

Their promised health awareness campaign and weight loss program is the cardinal growth driver.

They have dermal patches, health capsules and shakes in the comprehensive health package.

The herbal extracts in their ingredients are what is said to create the unique efficiency.

However, that said these products are not entirely herbal.

They do have certain chemical constituents too.

Their 8-week Thrive Experience is the most talked about concept.

It does not just allow people to lose weight and gain confidence.

In many ways, this is what has helped the company maintain close to 30% sales momentum.

Most scientific researchers also support their claims about the success rate of metabolism boosters.

The compensation plan in tandem with this helps representatives maintain the sales momentum.

Moreover, caffeine and green tea are globally famous for triggering higher rates of metabolism.

Needless to mention that this company latches on this fundamental factor for enhancing sales.

The base level compensation package costs about $200.

From then on members have to maintain a steady sales volume close to 100 units for earning money.

The 20% retail discount to members is said to attract new members to their kitty.

6. Avon

AvonAny mention of famous MLM companies is incomplete without reference to Avon.

In many ways, it is the grand old dame of the MLM community.

They are primarily into beauty and skin care solutions but have been consistently diversifying.

In terms of sales, Avon is second only to Amway.

However, over the past two or three years, sales have been significantly slow.

The company has responded to it by cutting down its operation.

But the good news is that they maintain their lead in their core bellwether markets.

As a result of this, the sales momentum has not suffered too badly.

Moreover, Avon now services close to 200 markets globally.

Apart from other innovation, they are also actively adapting to the digital push.

This beauty product specialist is already making inroads through the digital sales platform.

Apart from their own MLM based digital sales platform, they are augmenting sales via retail websites.

This means the sales triggers are not just affiliate marketing by MLM representatives.

It now includes a fair bit of retail customers who buy from neutral online e-commerce websites.

This is seen as a major boost for the sagging sales in many of its core markets globally.

7. GiraCoin

GiraCoinThis also is top rated in the list of famous MLM companies.

In terms of revenue, the current reading is close to $2 million.

But what makes this cryptocurrency based MLM company shine is the sheer momentum growth.

Reviewers have consistently top rated the company on a sustainable basis.

It essentially cashes in on the momentum in the cryptocurrency space.

This is a concept that users feel gives them the option to be successful and rich at the same time.

Interested members can start an investment with capital as low as $60 in this firm.

Most reviews speak favorably about the compensation plan.

This is undeniably what makes the company stand out amidst competition.

The exceptional customer support team is said to maintain the growth momentum for this company.

However, that said information about the exact product line-up is rather vague.

Though in terms of momentum, Giracoin scores favorably, fundamental information is scant.

The website says precious little about the range of opportunities that they peddle.

However, it is quite clear that retail sales contribute to the revenue significantly.

In fact, they comprise of the maximum revenue share.

This is considered to be primarily driven by the exceptional compensation plan.

Well, this is a typical MLM in this context.

Like most other MLM companies, participants can earn a lot through getting more members.

Their affiliate program is constantly attracting new potential customers and representatives.

Overall there are more 10 different compensation packages to choose from.

The tokens that affiliates bag are converted into GiraCoins.

However, the value of these GiraCoins is determined by the company.

GiraCoin also maintains its access close to 10% referral commission.

Affiliates also get to earn from residual commission on investment.

These are the two fundamental ways to enhance their return on investment.


Therefore, the list of famous MLM companies is a comprehensive list.

It does not just comprise of a certain type of product specialties.

The core idea is that that it includes all types of products that attract consumers.

Needless to mention, health, wellness and finances are the clear winners.

These have been traditionally associated with steady consumer demand and higher sales.

The idea is not just having a great product but being able to sell it successfully.

A robust compensation plan is often a key requisite in this case.

This is what takes the company’s growth forward.

In many ways, this also maintains the overall sales performance.

The global reach is also crucial in maintaining a steady growth for MLM companies.

All of these together help create a comprehensive list of famous MLM companies.

Clickbank Review: What Clickbank Is as the Pioneer of eCommerce

If anyone asked you, what is ClickBank, what would you answer?

If you deal with selling or buying products digitally, you must have surely heard about ClickBank.

Well in very simple terms, they are oine of the pioneers of e-commerce the world over.

In the world of affiliate marketing, it has the largest presence.

Most interestingly whether you are new to affiliate marketing or a seasoned affiliate marketing veteran, you can participate actively.

No wonder, it has become one of the largest networks on the digital platform.

Clickbank at the moment has over 100,000 affiliates, the world over.

Together they connect close to 12,000 vendors in one go across the world.

Since their inception over 12-13 years ago, they have paid as much as $1.7 billion as commission to their members in affiliate network globally.

They have a great reputation for timely payment and clear operation terms.

However that said, ClickBank does have some cons as well.

Along with the good will that they have earned, they have also had their fair share of controversy.

But before undertaking a detailed analysis, it is important to understand what the basic business fundamentals of ClickBank are all about.

What Is ClickBank?

ClickBankIf you are interested in undertaking a ClickBank review, it is very important to understand when the company came into being.

This company was formed in the late 90s, 1998 to be precise.

Like all startups, they started small and gradually expanded their operations.

After rather humble beginnings in a garage, they are now amongst the top rung leaders in e-commerce.

They now fall into the category of the top 100 digital players in the ecommerce world.

While their sales have crossed $3 billion, the daily transactions equal 26,000.

Most importantly, you can employ the advantages of this sales platform across a wide range of digital content.

However, ClickBank’s key focus area remains as software and e-books.

The active affiliates associated with ClickBank at the moment are well above 500,000.

A large number of members are actively associated; it indicates that this collaboration brings many advantages together.

The most important reason for this can be ascribed to the rate of commission they pay.

Most ClickBank reviews will indicate that this affiliate network pays one of the highest commissions across the industry.

In fact, in certain cases, you can earn as much as 75% commission with Clickbank.

ClickBank covers a widespread network of products.

This ensures that every kind of customer and target audience get to connect with the right product mix.

Not just that, there are many other features as well that make ClickBank unique.

It is one of those networks which offer subscriptions on a recurring basis.

So what it means for you is that your earnings will continue for as long as the subscription does.

That’s not all; even the terms of payment are totally at your discretion.

You can choose a weekly payment basis or even twice a week depending on what is convenient for you.

ClickBank also chooses multiple options of payment to ensure that you get paid right when and how you need it.

The handy tracking system makes sure that even if the customer waits for as long as 2 months before making a purchase, you can earn your commission.

Moreover, like any astute business person, you can also look at promoting products with higher commission prospects.

Additionally, ClickBank offers partnership possibilities to its customers as well.

You can create a joint venture with other ClickBank associates and split the earnings.

Moreover, you can use the various analytics that ClickBank offers.

This helps you to fine-tune their overall ad campaign and gain maximum exposure from it.

The whole idea is to promote the product as best as possible with the highest earnings prospects.

You can always sort it out better depending on the type of products that match best with your website’s profile.

In this way, you will be able to attract a lot more clicks and get lot better promotional facilities as a result.

For both the end user and the product manufacturer, it becomes a mutually beneficial deal.

– Convenience Is Primary

One of the key provisions that make it to the ClickBank review is the widespread popularity of this digital platform globally.

While infrastructure and resource availability is one aspect of it, there are many factors that contribute to the overall popularity of the medium.

Customer’s convenience or ease of use while applying it to the day to day usage is one of the most pertinent factors that you must pay attention to.

Right from the point where you need to sign up for the services, ease of use is the most striking feature of ClickBank.

Unlike a lot other affiliate networks, signing in for ClickBank is not at all difficult.

It does not involve any complicated approval procedure.

If you want to join in to the ClickBank program, all you have to do is log into to their website and sign up.

Also, the kind of products that you choose to promote is entirely your call, and no one has any role in it.

Merchants have no choice in this regard.

They cannot decide beforehand who they want to partner with.

It is essentially the user’s discretion and depending o their priority.

The user interface is another key element that takes forward the ‘ease of use’ concept with a far greater clarity.

Whether you are a beginner or a seasoned internet user, navigating through this space is a child’s play.

In one clean sweep, you can sign up and then go ahead with the entire proceedings.

The layout of the ClickBank page is no neat that you can quite easily choose appropriate titles and select category with ease.

Whether you are looking at finding proper headings or clicking on the right subject, this platform gives you the most relevant and simple solutions.

Another aspect in which ClickBank maintains user convenience is the way it maintains the various filters to screen out products.

You can customize the search options as per your priorities and get the best possible alternatives to take advantage of the various deals.

Also you can choose the various categories from high to low or low to high or on the basis of popularity or relevance.

Then you can get the most viable and constructive list of product ranges.

Additionally, you can even make your selection on the basis of language or even the upsell potential of the specific one that you are selecting.

– Why Would You Select ClickBank?

That brings us to the point about the obvious advantages of why you would use ClickBank.

There are many benefits of ClickBank, here is a lowdown:

Wide Range: Whenever you select an affiliate network, one of the key factors that decide the choice is the kind of range that you might have on offer.

There are some affiliate networks that specialize in lifestyle products, while there are others which have software, e-books as their area of specialization.

What you would choose is something that would be able to get you maximum clicks and most earnings.

Perhaps for that reason, sometimes choosing a network with a wide range of offerings can be very beneficial for you.

In that aspect, ClickBank scores well over many of the other affiliate networks.

Not only is the range of products comprehensive but in each product type or genre, you have a distinctly wide number of individual offerings.

This plays a very crucial role in helping you incorporate the largest number of potential clickable options that you could explore upon.

Most importantly, ClickBank’s huge range of options also helps you get the most appropriate number of clicks from across the world.

You do not have to depend on any specific region to guarantee your earnings.

You can look at a more widespread user base to tap your earnings.

Maximum Product Guarantee: ClickBank assures 100% product guarantee for its users.

Whether you are a customer or a product vendor, you would not have to bother about the genuineness of the terms and condition of operation that you get.

This product assurance is also a key factor that helps customers and vendors to repeatedly select this platform over a lot of other alternatives.

High Commission Rate: Another major advantage of the ClickBank portal is the fact that it normally translates into very high earnings.

Typically the ClickBank commission ranges anywhere 50-70% on every sale that is executed through these clicks.

This relatively large amount also makes sure that you are able to latch on to a relatively more long-term income source for a greater duration of time.

A Home Based Source of Income

The whole idea of a ClickBank commission is to generate a home based source of income, so a higher commission rate would make it a far more viable alternative compared to other affiliate networks.

Easy Tracking: The success of a great affiliate network often depend on the ease with which you can track the clicks.

What if you miss a click? What if your click converts into a buy, but you do not get paid because the buyer takes more than a month to decide?

Well, these are all the various types of problems that you might be facing while using different types of affiliate networks.

This is exactly why, when you go through a ClickBank network, the tracking feature of this platform surely makes it a much in demand alternative.

The tracking system is so advanced that you can get paid for buyouts that happen even two months after clicking the specific ad.

So, as a result, the chance of a click not getting paid is very rare.

Even when a buyer decides on buying a product even weeks after the click, you can still get money from the remuneration.

The excellent tracking system also makes sure that wherever in the world, the clicks happen, your earnings in not impacted in any possible manner whatsoever.

The reliability that comes along with it also makes sure a lot more people would choose it.

No Investment Involved: If you are wondering how ClickBank makes money from the entire operation, rest assured you don’t have to pay anything to sign up with ClickBank.

This e-commerce pioneer makes money solely on the basis of its association with vendors.

When you sign up with ClickBank, you don’t have to pay up any type of start-up fees or possible registration charges.

The association is absolutely free of cost.

You simply have to create your profile and select the category of ads that you might be interested in taking up.

So if you are taking this up as a career to earn while you are at home, you do not have any investment involved.

Yes, this is one of those careers where you start earning after the commission starts trickling in.

Once the content for your website is ready, all you need to do is choose a product that you would want to advertise and then start placing the ad on your website.

Once you give access to ClickBank’s digital products, you automatically get access to their payment gateway, checkout norms, subscription profile and refund policy that they provide.

ClickBank comes across as a comprehensive package with all the possible features of an electronic commerce platform.

So you do not have to spend additional money in setting up the infrastructure on your website separately.

You can easily take advantage of the options available on ClickBank.

So with ClickBank, you do not just start a business without any investment, but also you will get an opportunity to use their well-established internet resource base.

This will mean at no additional cost, you can make this as a successful business model as such.

So it becomes a unique mix of opportunity and savings.

Customer Service: ClickBank is known for great customer service quality.

The customer service is available 24×7 to customers.

Whatever big or small problem that you might be facing, the ClickBank customer representatives are never too far away for your comfort.

You can call them, email or even message them about your query.

This makes the company a lot more approachable to people who are looking at possible work from home alternatives.

Even if you want to get started, getting in touch with the customer service representatives is the easiest way to sign up with the company.

Disadvantages of ClickBank

However, that said, most ClickBank reviews also indicate that there are some disadvantages of incorporating this product line-up.

Some of the terms and conditions do not quite work in the interest of the customer and might even impact the interest of the business.

So what are the cons of associating with ClickBank?

Moreover, how you look at creating a relatively more sustainable source of income will also depend on how well you can look at tackling these issues over an extended period.

This also indirectly impacts the type of home based business that you select eventually.

1) Legitimacy Is A Problem

One of the biggest disadvantages of ClickBank is the lack of legitimacy.

They do not have any way of screening porn or non-porn sites.

So when you select a specific category, you cannot double check if the particular site you are promoting is a fake/scam site or even a pornographic site.

Only when people click on the link, they would be able to understand it.

Moreover, the click also activates the cookies associated with it.

The user is then bombarded by similar content a lot more.

So it could become a potential problem.

Getting redress is not that simple either as there are many sites that deal with continuous customer complaints.

2) Refund Issue

Another key problem is the lack of a well-defined refund policy by ClickBank.

There are no clearly demarcated conditions that define the circumstances under which you can claim a refund or become eligible for the refund.

As a result, it becomes extremely difficult to establish a code of guarantee.

This severely impacts the authenticity of the overall program.

So when you get engaged with the company, you cannot rest assured about the genuineness of the payment scheme.

While there are many payments gateways and several online options, ClickBank does not spell out the terms very clearly.

3) Payment Timeline

Another payment related concern with ClickBank is the timeline of the payment.

A lot of websites do not pay up that instantly as many others do.

So as a result, your payment could get delayed depending on the website or company that you might be looking to promote the firm.

So, most ClickBank reviews highlight the need for bringing in more transparency in the overall payment date.

4) Inadequate Sales Picture

There are many ClickBank affiliates which do not convert into sales very well.

But there is no way to identify or decide right at the beginning.

Many sites are not well covered and do not convert into sales very well.

But this is a fact that you would only realize eventually.

ClickBank does not have any filter that will help you list out the different sites as per these parameters in a constructive fashion.

So while you might select well-curated ads to promote, if they do not convert into sales, your earning becomes less.

5) Wide Range

Are you surprised that I am listing this as a disadvantage for ClickBank?

Well, the fact is this is one of those advantages that could very soon become a disadvantage as well.

While on one hand, you have a lot to choose from, you also need to deal with a lot of useless junk that is peddled in the name of variety.

So when you are placing ads or selecting potential alternatives, you need to be extra careful.

Otherwise, it is quite possible to get saddled with a poor grade promotion and the popularity of your website can also get hampered as a result.

6) Need Thorough Screening

Curating your customized ClickBank solution is never simple.

You need to undertake thorough due diligence to ensure that only the right kind of options make it to your website at the end of the day.

In the absence of any pre-decided parameter to judge it, the only option is hit and trial method.

This is significantly more time consuming as well as the relative earnings can be a lot less to start off with.

It is only when you get into a specific order and start understanding the business basics, can you start making long-standing calls.

7) Heightened Competition

Given the great product response under the affiliate umbrella of ClickBank, a lot of new players are mushrooming up every second.

As a result of this, the atmosphere is a lot more competitive.

That, however, does not mean that you will get a great product in the bargain.

Sometimes competition also leads to some enormous and useless products being put up on offer.

So here competition leads to a surplus supply of useless products across genres.

What makes it even worse is that identifying these products is that much more difficult.


So, a simple answer to what is ClickBank would be that it is one of the best, oldest and reliable work from home options.

They facilitate helping you earn money sitting at home with a relatively reliable source of earning money.

The ClickBank reviews indicate the high billing rate and commission amount of ClickBank.

Therefore, ClickBank is also an extremely profitable opportunity for anybody looking for home based options.

The wide range of products that ClickBank offers, makes it possible for you to curate and customize the ads as per your preference.

That said there are some problems that you must pay attention to as well.

The most important concern with respect to ClickBank is undoubtedly the vague refund policy that they have.

Many sites even charge you money for any money refund as a result.

Also, a lot of sites with a long line of complaints could also get featured in this list.

As a result, you sometimes run the risk of promoting sites which might not get you the right kind of sales.

However that said, ClickBank is one of the better affiliate network options.

Once you get the hang of the overall affiliate networking market, it is possible to earn a lot of money.

Affiliate Marketing on Instagram to Make More Money

Affiliate marketing on Instagram is becoming a “thing too.”

Everyone from your mate at school to those top models is looking to make their follower numbers count.

If you’re into social media you’ve probably heard of Facebook marketing.

InstagramWell, you’re missing out if you’ve not been tapping the benefits of Instagram too.

With over 800 million active users, there’s just no community you can’t find on Instagram.

As an affiliate marketer, the goal is to drive traffic to your target site how ever you can.

Instagram’s app engagement ranks above some of the other giants like Twitter and Snapchat so that’s a metric you need.

This post would go in-depth into how you can gain recognition in very profitable niches and of course, make money.

The Untapped Potentials On Instagram

You may not believe it, but there are very regular people earning money on Instagram just living their life.

I mean you’ll hardly spot anything, they’re wearing Nike hiking shoes on their posts and making money with that.

And I’m not talking about celebrities or your favorite reality TV stars here.

Of course, that helps to an extent, but with the right strategies, you can build a following too.

Does Instagram Allow Affiliate Marketing?

Instagram hasn’t clearly come out to say they permit affiliate marketing on their platform.

But they haven’t said they don’t want it either.

In fact, the launch of Instagram for business is a nice marker.

It’s a statement from the company that they understand that people would also like to use the platform for marketing.

And affiliate marketing falls under that.

Some Ways You Can Do This?

You can charge companies to create a post or use their tags on your account.

Instagram makes linking out of the platform difficult so thinks like tags from huge accounts are expensive to get.

And I’m guessing you’re asking what it takes to be seen as a big account?

Like, how many followers do you need to get things started?

How Many Instagram Followers Do You Need To Earn Money?

OK, you need to get this shocker, it’s not really about the followers!

Yes, there’s something called paid followers on Instagram and other social media platforms and many brands know about this.

The metric that really matters on Instagram is engagement.

Look at it like this, how would you feel paying for “30,000” fans to see your product and only three people land on your site.

You’ll feel you’ve been swindled, right?

That’s why very few brands care about follower numbers except you have tens of millions of them.

I mean, it’s not possible that someone would have 20 million fake followers.

At least, a lot of that number will be real human beings active on Instagram.

And you should be working to improve engagement on your posts.

Yes, there is something like boring your followers with your content.

You don’t want that because they’ll unfollow when they can’t take it anymore.

How To Improve Engagement On Your Account

So, a little away from increasing your follower numbers and actually making your present followers count.

The first thing you can do is a “don’t” actually, so don’t use bots.

If you’re on a service that automatically likes and shares your posts every time you publish, that’s dangerous.

That’s because you can get your account shadowbanned or even banned completely.

A shadow ban is a penalty given to Instagrammers who use these shady tactics.

And the funny thing is it’s a bit hard to know you’re on a shadow ban.

How it works is that people who don’t follow won’t be able to see your posts.

A second tactic to use is getting innovative with your use of hashtags.

You shouldn’t use banned hashtags in your posts because that’ll prevent your posts from appearing for the other tags.

Also, try to use hashtags that relate in a way to the business you’re promoting.

You want to prep the minds of your followers for what’s to come.

Look for times when your audience is most active.

You shouldn’t be posting at all times because you won’t get the results with that.

Using Hashtags To Generate Interest In Your Offers

Affiliate marketing on Instagram is all about promoting products you feel will be beneficial to your followers.

And to make as much money as you can, you need to use hashtags that pique their interest.

There are a lot of hashtags you could use and they could be grouped into branded and community hashtags.

Branded hashtags are peculiar to your brand or your company.

So if you’re using a branded hashtag, you’re saying your brand endorses the product you’re promoting.

But this can’t work for everyone, for your branded hashtags to drive sales, you need a brand that exhibits value.

So a Michael Jordan can put on Nike’s latest boots and make affiliate sales off it.

But if you do the same thing, not many people would care.

One reason many marketers recommend using branded hashtags is because it makes tracking the success of your campaign easier.

You can gauge this by looking at the hashtags people are interacting with and those they aren’t.

It’s easy to get too pushy with affiliate marketing on Instagram when you’re watching the sales coming in.

So one way to keep yourself and your brand in check is by monitoring those hashtags.

Community hashtags are the second type you can include in your affiliate posts on Instagram.

With these hashtags, you’re harping on the general endorsement of your community to drive sales to your offers.

So still on the Nike shoes, you’re saying something like, hey look, Michael Jordan loves this too.

Community hashtags make your content available to a wider audience because people are actively using these tags in search.

The easiest way to win on Instagram is to combine both models and optimize.

And that’s because it’s all about getting the best.

How To Find The Best Hashtags For Your Affiliate Offers

It’s supposed to be an easy thing to do but many people still do it wrong.

I’m talking about those hashtags that drive affiliate conversions through the roof, you should be using them too.

And there are many ways to find them.

The first thing you can do is just a simple search.

When you start typing keywords into the search bar, the Instagram algorithm spits out popular alternatives that have worked before.

Put yourself in the mind of a searcher and niche down until you can find tags that can work for your business.

So if you’re an affiliate for a hosting company, web hosting will be too competitive if you’re just starting out.

Something like WordPress hosting or WordPress e-commerce hosting is a good start.

That’s because very few people would be competing for those keywords.

When you include a hashtag in your Instagram post, you’re asking Instagram to rank your post for that tag.

The problem with this is that they’re only nine slots up for grabs on mobile which is the platform that dominates usage among users.

To get into any of those nine spots, your posts need to show better engagement that those already ranking.

That’s why it doesn’t make any sense to compete with posts with millions of likes and thousands of comments.

Especially when you’re a small brand, so start small and target those low hanging fruits.

Another way to find winning hashtags is looking at what competitors are using in their affiliate posts.

You can bet you’re not the only one promoting that fancy jacket or that wristwatch.

There are others who’re already making affiliate income from those products.

So go through your competitor’s posts and start using their hashtags.

So How Many Hashtags Should You Be Using?

Of course, if you’ve been following through up till now, you should have gotten a lot of hashtags to use.

There’s one question many marketers have on hashtags and it’s about just how many should they be using.

It’s a good question to ask because people don’t want to get caught spamming ‘cause they’ll get shadowbanned.

Instagram isn’t as strict as Twitter on the number of hashtags you can include in a particular post.

And for now, the limit on Instagram is 30 hashtags in each caption but some marketers think it’s not enough.

But you don’t really need thirty hashtags or more than that for all your captions if you’re doing it right.

You need to find what’s just perfect for your brand, and there are two ways to get this done.

The first way involves going to your competitors for help again.

So look at how many hashtags they’re using in their captions and check how it’s affecting engagement.

Are they getting more engagement with fewer hashtags or is it with more?

The second method is looking at your own Instagram account, so separate your posts into two halves.

Check how successful posts with more hashtags have been and how those with less have been also.

There are different Instagram analytics tools you can use, both free and paid options.

You can start with free or trial options for your account and that will still be okay.

And there’s a particular problem many marketers, especially less experienced ones have with using many hashtags in their posts.

It’s very difficult to know the hashtags that are driving engagement, you’ll need to do lots of A/B testing.

That’s why it’s advised to start small and move from there.

Can You Add More Than 30 Hashtags In Your Posts?

There’s always that little crowd out there that wants to try how things will be if they go overboard.

And if you’re looking for a one phrase reply, well yes you can.

If you add more than thirty tags before posting your photo or video, you’ll get an error message.

But there’s a little tweak you can use and here’s how it works.

You need to post your photo or video with no hashtags in the original caption.

Yeah, leave that space empty for now, and then move to the comments.

Copy and paste 30 hashtags into a comment of your post.

Then edit your original caption and add an additional 30 hashtags in there.

This brings the number of hashtags you’ve used in one post to 60, surpassing the Instagram limit.

So that’s done, but here’s a little advice, if you really have to use up to 60 hashtags, use spacing.

You don’t want your post looking spammy which is something many affiliate marketers are associated with.

If people see you’re trying too hard to earn a commission, they’ll begin to doubt the value of the product.

And it wouldn’t matter if you were genuine in your review.

So try not to look like you’re selling something, let your posts help people buy.

Any Other Tips For Using Instagram Hashtags?

You can bet they’re. Hashtags are the only way to drive Instagram traffic to your posts.

So we can’t really say everything about them.

But one tip you should be using to make your posts more effective is matching them with the right photo.

If people can connect your hashtags to your photo, it will improve your click-through-rates as people would want to find out more.

It’s normal to get confused when you’re just starting out with this, but do a search with your hashtags.

You’ll see the top photos that are ranking for those tags and that will provide direction.

When you’re studying the grid for direction, look out for what everyone is using.

What’s similar about all the photos or videos that are using those hashtags.

These elements are what you need to implement into your own posts so that connection will be there.

A second technique is using hashtags that are trending.

If a hashtag is trending, that’s a huge chance right there because so many posts won’t be optimized for that tag.

So do a good job with yours, get the engagement juice to your posts and rank for that hashtag.

There are two ways to get this done, the first is using hashtags that are directly related to your product.

So let’s say the product you’re promoting is a very cheap web hosting plan.

A good time to jump on that trend will be when something like $1 hosting is trending.

The second method is doing it when hashtags not directly related to your industry are related.

Call them shoulder niches if you like.

So if site speed is trending, fast web hosting is a way to improve site speed.

So there’s nothing wrong with using “related” hashtags.

How To Break Into The Top Posts Section Of Instagram

When you do a search on Instagram, there are nine posts ranking in the grid for that search term.

Appearing on this grid is like appearing on the first page of Google, you’ll be getting all the traffic.

The algorithm is responsible for determining what posts occupy the first nine spots and the ones that should be pushed down.

Of course, Instagram hasn’t revealed the script they’re using, so it’s all down to doing what has been proven to work.

One key tactic is improving engagement, and a lot has been said about that already.

Getting enough likes and publishing content that makes people want to leave comments are some techniques for boosting engagement.

But a key factor not many people talk about is consistency, maybe because it’s not exciting to do so.

Very few people have the patience to do the hard work.

That’s why there are a lot of people using sleazy tactics and getting themselves banned.

You’re not going to rank your affiliate posts in your first week.

But to have a shot at success, you need to be consistent.

Use your hashtags, especially your winning hashtags in different posts.

Once you notice they’re starting to get a little engagement, you can start including some medium and high competition hashtags.

Using Everything You’ve Learnt

There are many tactics that have been outlined in this post.

But there’s no magic pill that will change your affiliate fortunes overnight if you start using them.

The effect of these tactics on your Instagram account will only be noticed when you’re using them together.

So make use of the followers you already have and as you implement these techniques you’ll get more.

Use the techniques to improve engagement on your posts.

Creatively search for those hashtags that generate interest and use them.

And don’t use hashtags just to reach the Instagram limit, if it’s not necessary, leave it out.

That’s it, affiliate marketing on Instagram can make you money, but that’s if you know how to do it.

Well, now you do.

ClickBank Complaints: Top 10 Reasons of Complaining Against ClickBank

Whenever you look at any ClickBank reviews, it is generally a complex mix of several positive and negative features.

However, there are some types of ClickBank complaints that have been doing the rounds recently.

They range from uncooperative customer representatives to unexplained product refunds to even delivery products.

The various kinds of complaints highlight some of the operational issues that customers face on a day to day level.

It is needless to mention that these types of complaints also highlight the concern areas that you must pay attention to while dealing with this e-commerce giant.

Top 10 Reasons for ClickBank Complaints

Here is a quick lowdown on some of the top ClickBank complaints that you would see across websites:

  1. Uncooperative Customer Representatives
  2. Unexplained Refund
  3. Cancellation Problems
  4. Unauthorized Payment
  5. Inaccurate Card Usage
  6. Irregular Payment & Bank Charges
  7. International Transactions
  8. Gravity Score
  9. Online Payment Scam
  10. Inability To Send Complaint Form

1) Uncooperative Customer Representatives

If you go through the top 15 websites that include ClickBank reviews, most of them seem to highlight the lapses on behalf of the customer care representatives of ClickBank.

Some did not get satisfying responses while others kept getting referred from one person to another till they got tired.

Often the customer representatives act as the bridge between the company and customers.

But if they are not able to maintain the channels of communication effectively, there will be a huge communication gap.

When hassled customers have tried to contact the ClickBank representatives, more often than not, they have been able to contact anyone.

In the occasions when they have actually managed to touch base, these reviews indicate that the advice that was extended did not help the individual at all.

On the contrary, their confusion increased even further leading to a lot more complication.

Be it an unexplained refund or product return initiative, ClickBank has a long list of very dissatisfied customers who did not get a response as per their expectation.

On the contrary, the response has been rather tardy.

2) Unexplained Refund

Quite a few of the customer reviews indicated that their order was canceled without their permission.

They only got to know about the development when they got a message about the refund in their bank account.

The worrying point as a ClickBank customer is a frequency within which these incidents have occurred.

When the customer service representatives were contacted, they had a different explanation for it at different instances.

The end user was thoroughly confused and completely at a loss to come to any conclusion regarding the entire episode.

This generally leaves a bitter aftertaste about the entire buying experience.

Not just that, even for the other ClickBank associates, this experience has led to a negative perception of the brand’s value and their ability to deliver over the longer term.

Most times customers felt that no attention was paid to their complaints and the lack of constructive feedback often resulted in a negative perception about the brand.

The unexplained refund also indicated inefficient delivery module and lack of appropriate screening on the ClickBank platform.

Canned email responses to every type of query that customers had are pretty much the maximum that they could ever expect from the company.

3) Cancellation Problems

Well so many times, it so happens that you buy a product and then change your mind about it eventually.

What happens then?

Well, a simple solution would be you just cancel the order.

Well, ClickBack Complaints will tell you how harrowing this simple experience can be.

Lack of proper feedback and appropriate response from the company has resulted in additional confusion for the customer.

As the customer feedback indicated, in one instance, the company even posted false responses allegations.

It said that the company had a different version and was untrue in many of the details included.

What made the experience even more bitter was the fact that the customer’s dissatisfaction was not given due credence.

The company claims that they offered the customer technical assistance.

But the customer’s version is completely different and even claims that the company did not contact them.

It happens in the entire process most times that your cancellation request gets unnoticed.

You get saddled with a product that you might have already changed your mind about.

You might get seriously demotivated and even cancel your registration with ClickBank.

This could be detrimental to business in the future as well.

4) Unauthorized Payment

This is not just a major risk for ClickBank users but a possible threat as well for all types of online consumers.

As per the feedback put forth by one of the users, the ClickBank software managed to hack into their computer and authorized payment illegally.

While this particular consumer user was rather alert and managed to identify it within a loss of $400, others might not be as fortunate.

If they are not very confident and just clicking on a product can lead to it getting bought by them, it shows the advanced technology used in hacking the system.

They did not just hack into the system but are even authorizing payment on behalf of the customer.

So more than a mere complain, it is a serious threat to all possible online e-commerce activities.

When the hacking exercise can actually help in authorizing online payment, the possible theft of other sensitive information from your system is also possible.

One of the key reasons could be the lack of adequate screening facilities for the possible merchant players.

They could be highly ethical alternatives, and at the same time, they could involve some serious cyber offenders and scamsters too.

Moreover, there are moments when the payment gateway freezes soon after you have made a payment but the delivery address has not been fed in.

The result is the company has your money, but they don’t have your address to deliver the product.

As per user feedback, despite making repeated attempt to contact the ClickBank associates and the relevant customer representatives, there was no use.

The money could not be recovered, and neither was the product delivered.

Moreover, even attempts to claim a refund met with disappointment.

Most times the page freezes on refund claim as well.

But other operations continue unhindered.

5) Inaccurate Card Usage

Another common problem that many ClickBank users have complained about is the erratic payment gateways.

A lot of times credit card payment might not get processed on its own, but when the same card is used via Paypal, it goes through smoothly.

The reason why users normally get very hassled is because the relative feedback and response from the customer services team are very limited and hardly helpful.

This further adds to their confusion and concerns about the authenticity of the payment gateway.

It could also drive away viewers from possible websites associated with ClickBank.

6) Irregular Payment & Bank Charges

Think about it; why did you think about joining ClickBank? More often than not it was a means of generating a reliable alternative income source.

It was created with the idea that if this source of income became satisfactorily adequate, you could even look at quitting your day job.

But you would agree that all of this would depend solely on the frequency with which you get paid by ClickBank.

Most reviews maintain that this e-commerce pioneer processes payments even twice a week.

But the point is are you getting them at all.

Well, instances of delays and untimely payment are just too frequent, and the people suffering, as a result, are many.

Overall, you have a significant list of customers who either received no payment or have got it after a rather long wait.

Many of these users consider ClickBank to be a scam or a fake money making body with no real earnings as such.

There is another group of people also feel the company is not really trustworthy to put your money in it and it is best avoided.

Instead, people should look at other possible money earnings sources.

Charges on the Bank Statements

Levy of illegal bank charges is another top grouse of many people using this payment gateway.

Many ClickBank complaints on the internet show record of unaccounted bank charges that have suddenly shown in the user’s account.

This payment suddenly made an appearance, and before that, there was no mention of this charge either.

Most times they only realize much later when they might be analysis the bank statement in details.

This problem takes up an unpleasant form because of the lack of response on Clickbank’s side.

Many times, their customer service representatives have even tried to explain to the user the genuineness of the charges levied.

The user gets cornered and often apart from accepting the so-called charge, there isn’t much to accept.

There are very few examples of alternative recourse.

Even email after email urging ClickBank to refund the balance went completely unresponded most times.

Users tried to contact their customer service representatives, but there was no response regarding these incorrect charges that were asked to be reversed.

It is needless to mention that this leaves a bad aftertaste for those who had to bear the charges.

7) International Transactions

Several international transactions faced a similar fate as well.

When the user tried to cancel the product selection, the payment went through.

One hapless user account mentioned how they tried to keep canceling the payment for close to three days but without any luck whatsoever.

In most of these cases, the silence or the non-cooperation of the customer service representatives worsens the problem for them.

They have nowhere to, turn to and sole representatives of the company suddenly become absolutely quiet.

If at all some respond, it does not help the individual in recovering their payment.

8) Gravity Score

If you have plunged into ClickBank without proper and adequate study, you could be facing this unique problem.

This is one of the most basic pre-conditions that ClickBank works upon and bases its success model upon.

You have to always remember to choose sites with gravity score above 50 to ensure better sales and a more sustainable assurance of getting money from the entire deal.

But there is no explicit information base to get these details.

As a result, people, in general, plunge into the entire ClickBank business forum without being prepared for it adequately.

9) Online Payment Scam

Another common ClickBank complaint that you hear of getting charged for a service that you might not have subscribed for one to which you did not get adequate access.

Think about it; you chose a movie downloads site online.

You like the terms and conditions and also the movie collection, so feed in your card details.

But you would notice soon after you fed in your card details, the page completely froze, but money gets deducted from your credit card.

You try accessing the site after this, but chances are you will not be able to recover the money that they deducted from your account.

10) Inability to Send Complaint Form

In most cases when you face a problem with the ClickBank products or services, chances are that they ask you to fill up the complaint form and upload it for further action.

However, the fact is that you would face a lot of differing opinions about the overall efficacy of the complaint form.

Most ClickBank complaints reveal that most times you can’t even upload the form, forget about seeing action on your complaint.

The page freezes every time you try uploading the complaint page and send it to the officials involved in the entire process.

Even speaking to the customer service representatives about this won’t bear any fruit because they would want to see the complaint form.

Unfortunately for most the complaints, the form is either very hard to upload or even fill it up.

This adds to the woes of the hapless customers.

For ClickBank, this could spell double trouble.

Apart from the loss of credibility, this could also mean that a lot of people might want to switch to other more reliable affiliate network platform with higher dependability.


Therefore, the ClickBank complaints clearly highlight a distinct lacuna of the customer care representatives who work for the firm.

Repeatedly their inaction or slow action highlights the lack of coordinated response system aimed for a comprehensive customer care program.

While the basic concept might not be fake, the execution aspect of ClickBank has a lot of scope for improvement.

From ensuring smooth buys, flawless delivery to uneventful launches, every aspect needs a more thorough inspection and reduction in the room for complaints.

Therefore for it to gain a better reputation in the market and unlock its true potential, ClickBank has to invest significantly more in customer care.

Rodan and Fields Review: A Pyramid or Multi Level Marketing?

This review doesn’t mean that Rodan and Fields is a Pyramid Scheme or scam.

It is just the analysis of a company’s marketing method that more looks like a legitimate MLM.

However, you are the one who should decide after reading this article.

The Rodan and Fields History Review

Rodan and Fields is yet a skincare company that uses the multi-level marketing strategy.

It was started by Dr. Katie Rodan and Dr. Kathy Fields and is known for its rather popular skincare product called the Proactiv Solutions.

This skincare line was launched in 2002, and after trying to sell through high-end department stores, they decided to take on the word of mouth MLM strategy of sale eventually.

In 2006 finally, they stopped all over the counter sales and introduced ‘House Call’.

This was nothing but a type of multi-level marketing approach where the representatives showcase the product to interested buyers.

The question, therefore, at this juncture is that if Rodan and Fields multi-level marketing is legal or illegal and scam?

Is it a legitimate way of earning profits or can this be termed as yet another scam and illegal pyramid scheme opportunity ready to take advantage and exploit the financial hardships of many hapless individuals?

Before I go to details, I have to explain that MLM or multi-level marketing and even pyramid are not necessarily illegal and scam.

They are just some marketing methods that many companies use.

So you can’t call a company scam and illegal as soon as you you find out they promote their products through multi-level marketing.

Something which is illegal and is scam is in the way that members make money.

This is clearly explained here.

Is the Rodan & Fields a Scam or It Is a Legitimate Multi-Level Marketing?

Rodan & FieldsIf you want to prove the legitimacy of the business model of the Rodan and Fields multi-level marketing, a much closer attention to their overall working style is extremely crucial.

How exactly does Rodan and Fields function?

Well, they operate quite similar to many other MLM in many ways, but the overall compensation plan needs a closer look and detailed study.

The core fact, however, remains same.

You get paid for selling their products and also for recruiting people under you to operate the same way you are doing under someone.

Apart, sales representatives earn profit via:

  1. Selling the Rodan & Fields product to both retail and preferred Customers.
  2. Commission earned from sales clocked by consultants and preferred customers in your circle.
  3. Overall team commission based on the entire team’s performance. The team is essentially the team you sponsor.
  4. Generation Commission is basically the commission that you earn on extended sales of the entire team.
  5. Performance bonus on achieving various milestones.

Well, you do not need anyone to mention it to you but their compensation strategy is not as simple as they make it appear.

And, it is rather convoluted in terms of realizing absolute level of profitability from them in any way.

Often, the profits in multi-level marketing companies deeply depends on the quality of the product.

However, that sure is not sufficient to help you earn a sustainable source of living.

The US Federal Trade Commission has clearly outlined how 95% of sale representatives associated with MLM are not earning more than $1000 every year.

That number in itself projects the sorry state of affairs.

The Rodan and Fields product might be great and the promotion of these could be relatively easier than a pyramid scheme with an unknown product range.

However, the fact is that the relative difference is not much and it essentially outlines the fallacy in the system.

Would You Term Rodan & Fields a Scam?

So the question that crosses your mind at this juncture is would you term Rodan and Fields multi-level marketing a scam?

Well, that is too strong a word and perhaps a regulatory authority like the US FTC is best geared to take a call on that.

However, what we can all accept in our personal capacity is that it surely is a risky type of business.

It is common knowledge that any MLM or a pyramid scheme has a slight bit higher risk potential as compared to other conventional business formats.

In almost all the cases, the only ones who make money are the ones who are at the top of the rung, the business owners and the initial few who comprise of the top of the pyramid.

Another reason why MLM can be a risky business is that it is illegal to promote any type of pyramid scheme.

Almost always, you will see the authorities are in the process of probing these multi-level marketing businesses.

We see the pyramid collapsing at some point or the other and the business shutting down for good.

So even if you have made a sizeable amount of money in this pyramid scheme, it is never a great idea to stick with this business option for too long.

You never know when they might just collapse suddenly and shut shop leaving your money in jeopardy.

While I would not hazard a guess about the legitimacy of the actual business, the MLM genre of businesses has been attracting bad publicity, and moreover, it is simple mathematics.

At some point in time, the demand for these products sold as pyramid scheme would begin to fade away.

This would herald the beginning of the downfall and eventual collapse of the business model like a pack of cards.

Recruits Slowing Down

One fact that inevitably sets Rodan and Fields apart from most of its other predecessors is the fact that they are not trying to push the huge financial incentives of joining an MLM.

In fact, the company has been quite candid in putting up the fact that 65% of its revenue is from retail direct sales to individuals who are not consultants.

High earners who get Lexus of their choice as incentive are free and far between.

In fact, a majority of them might make only a few thousand dollars every year.

To quote the numbers on the Rodan and Field multi-level marketing website, only 400 of the total 100,000 consultants have reached the Lexus level of success.

So… Is Rodan and Fields a Scam?

Rodan and Fields BBB Records Shows That It Is Not a Scam.That said, the allure of money is often tempting.

And, more and more aspiring potential sales reps tend to believe in the Rodan and Fields Lexus stories and consider them within reach.

That is what alone drives the recruitment initiatives.

However, the fact is that demand will at some point of time wane away irreversibly.

The consultants closer to the bottom of the pyramid often find it difficult to get fresh recruits.

Though many are gung ho about the product, the business aspect of it is seeing a major dent.

The question is what is the way forward for Rodan and Fields multi-level marketing now?

Rodan and Fields has been in business for 16 years.

According to their BBB records, they are good in resolving the customers complaints.

Therefore, Rodan and Fields is not scam because if it was a scam, it couldn’t work for 16 years.

The question is why some people think that Rodan and Fields is scam?

This can be related to the name of MLM or Pyramid that triggers the word “scam” in some people’s minds.

I mean some people think that the company is scam as soon as they hear that it is a MLM or pyramid scheme.

Ponzi schemes are always scam and illegal.

But multi-level marketing and pyramid schemes can be legal and legitimate if they don’t break some special rules.