Don’t put all your eggs in one basket.
That old phrase has a lot of truth to it and yet it is often ignored by online marketers, especially newbies.
The idea of having all of your business and money making efforts focused in one place makes sense to a degree, in that there’s less chance of spreading yourself too thin and it allows you to focus your entire attention on something.
There are however a whole slew of issues with this and that’s why you should be embracing diversification.
Some of the issues that could occur if you don’t diversify are:
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The internet is an ever evolving place, especially when it comes to search engines. The constant arms race between search engines and people trying to game the system means that the goal posts are forever shifting.
This makes it quite difficult for the rest of us.
You may have heard one of the numerous stories around of the effects a Google algorithm change can have on even white-hat, completely by the book websites.
The likelihood of your website being affected by one of these changes is not farfetched at all, but by diversifying your business you can at least mitigate the damage should the worst happen.
This can be done in a few ways: by having several sites in different niche, using multiple traffic sources and also income sources.
Multiple Income Streams
Talking of income sources, one of the best ways to diversify your online business is by achieving multiple income streams.
Imagine if you will that your site’s revenue is solely sourced from Amazon commissions. What if Amazon one day decides to stop providing affiliate commissions? Your business will tank!
Now, it is unlikely Amazon will do this but there have been companies in the past that have and the consequences for people solely promoting them or as a large part of their business were dire.
On a lower scale, it’s still possible to be banned from an affiliate scheme for whatever reason, such as when Amazon decided to pull out of several states leaving affiliates high and dry.
By using multiple income streams you can help avoid this.
As an affiliate the easiest option is to simply affiliate with a wider range of companies.
This is OK, but it’s not proper income diversity.
Other options include:
- Creating and selling products (digital or physical)
- Membership programs
- Offline gigs such as consulting
- Writing and selling books
- Online services
The idea is to have your income streams completely divergent (though ideally still as ”passive” as possible, otherwise you’ll run out of hours in the day.
Diversification can have added benefits, as it can open up the way to new ideas, markets and followers.
By diversifying traffic for instance, you can potentially find new visitors or customers that previously didn’t find your site.
Or by creating new websites in a different niche you can potentially explore new markets or spark an idea for a product or service to sell.
Staying in a single niche is not only a financial risk, but can also create stagnation within your own business.
Ability to Cross Over
Another great thing about diversifying websites is the ability to cross over between them.
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A good example of this is the Kinja group.
Kinja has a number of websites under its umbrella and cover a wide spectrum of interests. They have connected each of these sites on every website as they realized that a lot of their visitors have varied interests, and this helps keep their visitors on their sites for longer.
It’s a great example because diversity in websites doesn’t have to be wildly divergent, they can still be related and this can help create a strong network of sites.
Of course, having a few oddball sites that are in completely different niches is also a viable option, but this makes connecting them very hard to do.
Not Just Websites
Even if we exclude websites in general, there are other areas where diversity is an excellent idea.
OK, so this is closely related to websites, but still it’s an important aspect.
Solely relying on Google for your traffic (or Facebook, or any other single source) is a recipe for disaster.
Having a wide range of traffic sources spreads out the point of entry for your visitors and means that should the worst happen people can still find your site.
You should at the least be looking to have:
- A strong SEO aspect for organic search traffic
- A PPC campaign or two
- A solid social media presence on two social media channels
- A well-treated email list
If you’re main revenue comes from products, then having a wider range can help reduce problems should a product need to be pulled or retired for any reason.
As well as that if a newcomer to the niche you’re in markets better or has a better product then having other products to replace it or at least keep you afloat is necessary.
Similar to traffic, having a variety of content types is beneficial. It not only can help keep visitors entertained and informed, but it can target those people interested in a certain medium.
As well as that varied content can help with traffic as it allows you to target different traffic channels differently (you can’t exactly get YouTube traffic from a 3,000 word article!).
Not Always the Right Option
While diversification is definitely something everyone should look into, there are some situations where diversification is actually a hindrance.
Diversifying Too Soon
As a beginner in online marketing or online business in general, it’s very easy to suffer from “shiny object syndrome”.
This is where you end up leaping from one product to the next trying to learn, or one idea to the next while trying to earn.
All you tend to end up with is a mess!
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Diversification is something that should be done slowly and with thought. If your first website or business is not making money then diversification should be off the cards until you are making regular income or decide that that business is not viable.
A Lack of Focus
The problem I have with diversification is a lack of focus. This is in part due to the shiny object syndrome making me add too many things at once, but it’s really a focus thing.
If you have a lot of sites for instance, it can become increasingly hard to manage them all while still providing a quality experience to your visitors.
This ends up with you being unable to focus on the right things at the right time.
The main solution here is to go slowly and to build up a reliable team beneath you that can help handle the day to day work while you focus on the bigger picture.
The Bottom Line
If you’re looking to make money online, then it will pay for you to look into diversification, but remember that doing it too soon can be harmful rather than beneficial.