Business vs Community - Who Makes More Money?
Problogger recently published the results of a poll he ran where he asked his readers whether they disclose their affiliate links or not. While the results were pretty much split 50/50, there were two insightful quotes from Problogger’s readers which caught my eye:
“When you go to a bookstore, employees don’t run around to all the customers, “I should let you know that we’re going to make a profit if you buy that magazine.â€â€ - Dave C
and
“All my aff links are clearly marked. If your neighbor suggested you buy a certain type of insurance and you later found out that he received a commission for suggesting it, how would you feel? Deceived? Used?†- Michael
The reason they caught my attention was that the comments took opposite opinions yet both contained equally valid arguments.
But here’s the difference
What sets the two opinions apart is that the first person is treating their site more as a business, while the second person treats it more as a “community” or “neighborhood”.
While both treatments are a webmaster’s choice, there’s a good chance that the blogger who treats it as a business is making more money.
Businesses make more money
Bill Gates gets cream pies thrown in his face for getting rich from a monopoly but it’s a fair trade considering the billions of dollars that he has. That’s business.
Most MySpace users treat the site as a community and don’t make a cent, while those who controlled it as a business were able to sell the site for millions. Same goes for YouTube.
It’s pretty obvious that those with the “business” mindset make more money than those who think “community”. However, building a community and exploiting it by selling it to the highest bidder is a damn fine business to be in!
But businesses aren’t always hugging trees
Making the maximum amount of money as a business involves a trade-off. You get to make money, but you don’t always get to be all nice and friendly. Sara demonstrates the difference with this great conversation that we’re never likely to hear:
Mr. White Hat: What are you doing?
Mr. Black Hat: I’m using ******** and ******** to scam Google.
Mr. White Hat: Why are you doing that?
Mr. Black Hat: Because I make mad money with it.
Mr. White Hat: But that’s unethical!
Mr. Black Hat: Oh no, it is! Forget about the money, I must stop right now!Never. Gonna. Happen.
Mr. Black Hat knows what he is doing and he is okay with that. Mr. White Hat is wasting his time preaching to another church’s choir. His time would be better spent finding ways to be a more ethical blogger.
Nobody is going to stop businesses from making money, despite how often they’re criticized for doing so.
Which side are you on?
If you want to make money online, you should definitely be business-minded for all your sites. As soon as I started treating my sites as a business instead of a community, I went from earning around $50 per month to earning several thousand per month in a very short period of time (and have received a lot of criticism for doing so).
But hey, if you’re community-minded, that’s cool too. Just don’t expect to make as much money and don’t get jealous complain about those who are harsh and business-minded and making more money. Oh, and continually asking if a post is sponsored is rather annoying too.
Never forget:
GREED IS GOOD
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Personally, I think a site can be community driven and have a community spirit while still maintaining as high a level of income as the more business orientated Web sites.
There’s a fine line to cross whereby a site is a community earning money in a manner which doesn’t impede the community users, and a site that steps over the line and becomes a business and impedes the use of the site from the community. Of course, there’s also that pefect balance, but we all know once balanced, the slightest bit of wind can knock us down.
Honestly, I being community minded means making a little less money, I would rather be on that side of the line. The return of making lots of new contacts, associates and friends and having a great community spirit is well worth that small loss in cash. But that’s just me… I’m soft when it comes to being friendly.
Of course, those on the other side of the line get my full respect too. We’re all different, as are all our blogs, as are all our readers. Because of that difference, every single one of us finds something different that works for us. 
by Jamie Harrop
Maybe the ethical bloggers have to be more business minded for a short period of time, we’ll see what they think when their paypal account becomes a little bigger . . .
by icedragon
Excellent post. I’m one of the “old guys” in this problogging/make money online game. therefore, to at least some, my opinions are suspect … that’s why I have a “Curmudgeon” category on all my blogs.
But I have learned one or two things about business and people in the last 40+ years … and one of the things that still amazes me are the number of folks who think that “the world” or their daddy, or someone owes them a living. They surf the web constantly .. a servic eoriginally built and funded by taxpayers and now mainly a for profit venture of service and bandwidth providers and continually carp at those who attempt to trade their time and content for money. Money and business is what makes the world go ’round … it’s also the fuel for every “good thing” we. as a world people do … from feeding orphans to exploring outer space … nothing good happens unless someone makes a profit, directly or indirectly.
The comment you highlighted about people feeling used or abused if they learned that their neighbor had made a profit for recommending an insurance policy is understandable and valid. If my neighbor was, say, a plumber or a college professor I too would feel used if s/he was secretly uisng me to profit from insurance recommendations. But if my neighbor was an insurance agent? How many are really so naive’ as to think insurance agents _don’t_ make their living from commissions?
I sometimes identify links and/or recmmendations as profit making for me, if I feel like it … but anyone visiting a site about “making money online” should wake up and smell the coffee … if we say we’re about making money then we’d be pretty dumb to pass up opportunities to do so, would we not? ce n’est pas si difficile que ça.
by Dave Starr --- ROI Guy
My answer to Michael would be that my neighbor would have earned the trust to follow his recommendation, commission or not.
If community means absolutely nothing, the MyBlogLog widget needs to go.
by James - DigitalKeyToInfo
The widget serves other purposes than just “community” - and those purposes are very much “business”. Don’t forget that businesses still need to look after and be concerned about their customers.
by Cash Quests
nevertheless, if you disclose your links or not, the business will still continue to grow with the amount of buzz that was created.
but sometimes people delete your affiliate id at the back of your referral link which gives you lesser income.. but that is just plain evil.
I disclose my links
by Michael Woo
I don’t think there is an either / or here. I would suggest that the absolutely most successful people are those who manage to build their business around a strong community and get the best of both worlds.
Remember, all businesses are still about people.
by Caroline Middlebrook
That’s a very nice observation - I would say most of it depends on the niche you are in. For instance, in your niche, you’ll most likely have readers who are looking to make money online and would perhaps do the same thing (affiliate linking) eventually.
by Karthik
I agree with Caroline. This is not an either or situation.
Any good salesman develops relationships with his customers. This is how you get repeat sales.
I think a very effective online strategy is to develop a strong community who trusts you and wants to buy your products or services.
by Fred @ Newest on the Net
[…] Kumiko at CashQuests asks whether a blog works better as a business or a community. […]
by Sunday Speed Linking - 4th Nov 07 : Jamie Harrop | Young Entrepreneur | Video Blog
why does the reader say: 456
? I thought you were over 900 rss’ers?
by jackbravo
hi kumiko:
hey, what happened to all of your rss readers?
by johnCard
It’s a feedburner fault. Every site is affected.
by Cash Quests
“Greed is good”??? Chow wannabe! You ain’t no Chow, even though you probably read everything he’s written, and most likely more then once.
by Seeds For Wealth
who is chow??
by Cash Quests
You are so funny. LOL. What you are saying is actually true. Everytime someone is making money from something they don’t tell you if you read this you are making money when in actuality going to someone’s blog helps make them money because you are adding to their traffic.
FlavaOfBlog
by Ginene
lol!kumiko has a point there though but i cant fully agree with what she said all.
by constructicle boy