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This week, I’ve covered a lot of information about passive income and affiliate programs. As we wrap up our talks about passive income, let’s take a quick look at selling advertising space to other companies.

Option 1: Ads on Your Website

Why Add Ads to Your Website?

If you have a standalone website (not Etsy or another marketplace) you can add advertisements to your website. In this type of passive income, you get paid each time that an ad is shown or clicked. The ads shown are generally based on the visitor’s search history. As an example, you can see ads on this website at the top of the any page and in the sidebar on the right hand side.

How to Implement Ads on Your Website

The easiest way to get started with ads on your website is through Google Adsense. Simply visit Google Adsense and sign up for a free account. After being approved as a publisher, you’ll install a piece of HTML code on your website and ads will be shown. After installation, there is no maintenance and you’ll be paid monthly.

Thinking to Your Future Ads

As your website grows and gets more traffic, you might be able to join an ad network. Ad networks install code on your website and manage the relationship between advertisers and your website. When joining an ad network, you typically make more money per ad – but they have minimum traffic requirements.

Option 2: Sell Ad Space to Businesses

If you don’t want to put random advertisements on your website, you can also sell ad space directly to advertisers in newsletters, social media, or your website. In this case, you look at the amount of people in your audience, set a price, and set a duration for the ad length. You then find an interested business and charge them for you to advertise or mention them. Let’s look at a few examples:

• If you make wood signs and have a large Instagram following, you could mention the supplier where you get your wood for signs cut. In this case, you’d get paid to mention your supplier.
  • “I’d never be able to get so many signs done if it weren’t for @ABCWOODCUTTER. Here’s what just arrived from them.” #ad
• If you are active with local customers, you could team up with local service providers like realtors, cleaning services, or babysitting services.
  • On a flyer advertising an upcoming sign party, advertise for a local ‘Kid’s Night In’ at the local trampoline park. Mention that while the kids are jumping, Mom and Dad can be making signs.

Still looking for more ways to make money in your craft business? Head to this post on multiple streams of income in your business.

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Yesterday, I defined active versus passive income in your Silhouette or Cricut small business. While most businesses are active, you can have a passive component. How? Through the use of affiliate programs!

What are Affiliate Programs?

As I mentioned yesterday, affiliate programs pay affiliates for promoting or recommending products. As you’ve seen here on the Cutting for Business blog, I often recommend products and services. When you click my referral link and purchase, I get a small percentage of the sale price. It’s important to note that the buyer doesn’t pay more from clicking on the link. Since affiliate income works in a hands off manner, it is considered passive income.

How to Incorporate Affiliate Programs in Your Craft Business

There are a few different ways to start using affiliate programs in your small business. Here’s an overview:

• Identify products that your buyers would be interested in purchasing. You’ll need to make sure that your recommendations make sense! Here’s some examples:
  • If you sell customized shirts, you could recommend coordinating bottoms like leggings, shorts, or pants that match or complement your designs. Similarly, if you sell customized infant bodysuits, you could promote coordinating accessories like a bow or headband. An affiliate program through Etsy is available on the Affiliate Window platform (see link below) if you want to promote other handmade goods.
  • If you sell planner accessories or stickers, you could suggest planners to your buyers. As an example, Erin Condren offers a referral program where you can earn money on each planner related sale you make on their site.
  • If you sell cut files, you could recommend cutting machines, vinyl, paper, or fonts. Cricut has an affiliate program, as does Amazon.
  • If you sell party decor, you could recommend coordinating party supplies like tablecloths or cups to match your decor line. Affiliate programs at party suppliers might work well.
  • If you sell wooden signs, you could suggest coordinating room decor to your buyers. Affiliate programs like Wayfair or Amazon might be a good fit.
• Apply for the affiliate program. Usually, you fill out a quick application and wait a few days to be approved.
• Use a special link to promote a product or service.
• Earn passive income each time someone makes a purchase through your link(s).

Where to Find Affiliate Programs

The best way to find affiliate programs is to go to the site you want to promote and search for affiliate programs. Another easy way is to join affiliate program networks. Here’s a few of my favorites:

1. Shareasale
2. Affiliate Window
3. Amazon
4. Commission Junction

Once you join a network and are approved, simply browse or search for companies and products to promote.

Where to Put Affiliate Links

You can use affiliate program links on social media, your website, or even within your Etsy listings.

Required Disclosures

One more important note about affiliate programs. The FTC requires that you disclose that you are using affiliate links. Here’s a link to read more.

Affiliate programs are a great way to bring in passive income to your Silhouette or Cricut small business. Tomorrow, I’ll share concrete, real life examples of using Amazon’s affiliate program in your craft business.

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For the rest of the week, we are going to look at active versus passive income. Most Silhouette and Cricut small businesses are classified as active income businesses, but there is no reason that a small business owner can’t also collect passive income.

What is the Difference Between Active and Passive Income?

Active income is income that you receive for selling a product or a service. Typically, you are “hands on” (hence, active) when you earn active income. Here are some examples of active income:

• Working a 9 to 5 job is considered active income. You receive money for completing tasks.
• Selling at a craft show is active income, you make products, set up shop, and sell products to customers.
• In general, selling online is active income because you create the products, market them, answer customer questions, and package and ship them. There is a component that is passive, because if you sell online – you are often making money 24 hours a day, 7 days a week.

In contrast, when you earn passive income you are generally “hands off”. You are not doing anything for the money. Here are some examples of passive income:

• Investments are passive income. You invest one time and receive income based on that investment.
• In the craft world, cut file designs and ebooks are generally considered passive income because you design or write them once – then sell them digitally which is hands off.
• Silhouette and Cricut small businesses can take advantage of affiliate programs to earn more passive income. This style of program works by using special links that a company has given to you to promote or suggest their products.

In my mind, there is nothing better than passive income to accompany the active income you are already making. Now, why did I tell you all this? Tomorrow, we are going to talk about affiliate programs.

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