Business model for a community - what's most profitable?

[Ravedesigns]

Hey all - I've had some excellent discussions with many of you before, and I'm back to serve up another big question or two for ya!

Many people start communities as a hobby and offer anything and everything to their visitors to make it more "sticky" - and typically these folks are losing the shirts off their backs. I think that's great if you have a hobby you love and want to have a place you can meet other likeminded people at your expense, but I'd like to be able to pay my expenses and turn a good profit at it too. Am I asking too much?

My BIG question for you all, is what components of a "for profit" community do you think help to build it up and make a buck or two - and what components are nothing more than a waste of bandwidth?? For example - so many community type sites have forums, articles, news, reviews, business directories, classifieds, photo galleries etc etc etc... but which of those is beneficial to really help grow a site and which is just a wast of time?

The reason I'm asking is because I'm planning a site for the community I live in, and I want it to be something that adds value to the community and also a few $$$ to my wallet. Right now, I'm planning to offer free listings in a business directory, a listing of valuable - internet only coupons from local merchants, and maybe offering some how-to/instructional articles written by local business owners. A large part of my plan to make money will be to offer a newsletter offering a select few special coupons and deals from local businesses to my visitors, and charge the businesses a few $$ to list their coupon in each issue.

Are their other components you think I should be adding to the site? Like forums, or free classifieds, or user submitted reviews of local businesses and restaurants?

Thanks for you time to help me sort this all out, and best wishes to all of you in your own community building efforts!

Have a great weekend!!

Steve

[anode]

I'd say add only those things that will complement your business model. If your only planned source of revenue is the newsletters, examine each option to make sure that it will directly or indirectly help your subscriber base.

For example, you could make newsletter subscription a requirement for your forum members or those placing classifieds (make sure to state this in your privacy policy and add a screen to the signup or classified placing process that states this clearly and tehy can't miss it.)

[Ravedesigns]

Hi Anode, and thanks for your comments!

My newsletter ideas are a large part of my plan to make money, and as such receiving it will be requirement for any business to list theirs online or for visitors to receive the special deals I hope to advertise. This way I develop two in-house mailing lists, one for local business owners (to sell my web design and marketing services to) and one for consumers to sell ads to the business owners in!

Take care,

Steve

[gloryzone]

I would have to agree with anode.

Stay true to your business model. The more you do that, the less you will find yourself spinning your wheels on activity that will not benefit you in the long run.

I am currently doing this for my community site- www.michianaonline.com

I hope to get things much more organized and streamlined so that the time I invest in it will be more profitable.

Great ideas though Steve.

[DaDaHost]

Hi Steve,

How is your community site coming along? I am starting one for my town right now. I personally feel that forums, a calendar, and news are a must for a local site followed closely by a business directory and classifieds. For my site, I see the main revenue streams being advertising, upsales in the business directory, and upsales in the classifieds. Since it is only me managing the site I am keeping its functionality very focused.

For the first six months of my site I am offering several nonprofits advertising on my site in exchange for stories and forums participation. This has several advantages:
1. Gives me quality content
2. Builds community relations
3. Fills up unsold advertising
4. Gets the forums started

I would watch out for business reviews as these will be the people you sale advertising to. Coupons are extremely popular, but they require more management and time than the other revenue streams. Also business owners will contribute one or maybe two articles before they lose interest in being an article.

It's still really beta, but here is the site in progress:
http://www.pensacola.cc/index_new.php
http://www.pensacola.cc/forums

Jamie

[Ravedesigns]

Hey Jamie - thanks for your post and also for asking about my site. I haven't gone live with things yet as I'm still trying to find the "best" CMS to use, but I've been learning my way around postnuke and am hoping to finish things up this month. Do you have a favorite CMS you plan to use, or are you staying away from using one at the time?

Looks like you've got some good plans there for your site there, and I'm sure it'll be a success with all that you plan to make available to your readers and members. I took a look at your design and it looks really well put together and very professional - good job! Please keep me posted and let me you when it's finished (is a website ever REALLY finished?)

You'll find my site at http://www.morrisguide.com and I'm hoping to have it together by the end of the month. I've still got mixed feelings about offering business reviews since I love sites like ePinions myself, but I think I'm going to start simply with business listings and news first, then see what people would like to see added to the site.

All the best with the site Jamie, and please keep me posted on your progress!

Best regards,

Steve

[signlink]

Steve- I would LOVE to know the answer to that question.
I used to work for www.ino.com - a content site that also sold books, tapes, etc. It got tons of traffic (800,000 unique hosts per month) - and it made money. Content was the key. People showed up for the quotes, charts and news. Many people who did so signed up for the daily newsletter. At least 50% of people who bought anything, bought something from the email. The company made decent money from advertising - key there was selling leads (for the most part) instead of selling impressions.

I have not been able to duplicate that success on my own <g>. Building traffic is probably the hardest part - once you have traffic, you can at least sell some ads.

[I, Brian]

Building traffic is probably the hardest part - once you have traffic, you can at least sell some ads.

That's the whole issue of websites in general - it doesn't matter how good your site is, what it offers, etc - unless you get that traffic in then there's no reason for any business to want to invest.

I figure if it's local serving then you get as much offline cavassing as possible done.

[JamesAZ]

Content. It's all about content. If you have good content (not just a newsfeeds pulled from other sites, or similar gimmicks) people will come back. If people come back, you'll build solid traffic -- and not just random "hits" but actual interested users. That's when you can do well with targeted advertising and the like.