One of the first things you will have to decide when
setting up an Internet business is whether you want to
sell a product or a service, both of which have their
advantages and disadvantages.
Advantage: unlimited income potential
because you are not constrained by time, the
way you are with a service (the more product
you sell the more income you make - especially
when you are automated).
Disadvantage: requires stocking and shipping
(or drop-shipping from a supplier).
Disadvantage: generally requires you filling
large amounts of orders to make a reasonable
living, unless you have a product with a very
high profit margin.
Advantage: it is easier to make a profit quickly
because the entire price of a service is paid to
you (except for any overhead).
Advantage: services can generate a great
residual income because the client may want
to hire your services again and again.
Disadvantage: you are limited to a modest
income because you can provide only so many
services each day (unless you hire employees
to perform services for clients).
In my opinion, selling a product online has, by far
seen the biggest profit potential in the long run.
Once you get a successful product, you can
automate the system and move on to new products
that will generate multiple streams of income.
If you need immediate cash flow, providing a service
is the fastest way to produce instant income... but it
will never pay off as big, in the long run, as selling a
product with a high profit margin.
If you sell a service, think about how you can
transform it into a product. One of the best examples
I can think of is regarding the people who submit
websites to search engines. Because the
competition got so fierce and their business began
to suffer, some wrote and sold reports revealing how
search engines work and tricks for getting sites
listed higher etc. The reports were priced at $20
-$100, and the entrepreneurs in our example found
new markets to tap.
I hope this helps in your future marketing decisions.