This is a guest post from Mike Piper, a long-time GRS reader and the author of Oblivious Investor, where he blogs about such thrilling topics as Roth IRA rules and 401k rollovers.

Blogging is often touted as a means to earn some extra income. But many people believe that you need tens of thousands of people reading your blog everyday before you can make any real money from it.

I can tell you from experience: That’s simply not true.

In the first twelve months of my blog’s existence, my writing generated over $20,000 of revenue. And by the end of those twelve months, I still only had 588 subscribers to my blog — barely half way to 1,000. Now, I’m not trying to make the case that a large readership isn’t valuable. Of course it’s valuable. A big subscriber list is not, however, the only way to make decent money with a blog.

So how does one go about making significant income from a blog without a ton of subscribers? You could try my method: writing, publishing, and selling your own books on Amazon.

Why Not Sell E-Books?
One reason: traffic.

According to Google, Amazon gets approximately 81 million unique visitors per month. By tapping into that traffic, you can make a meaningful amount of money without having a huge following of your own.

You will need some traffic, though, as you’ll be responsible for generating your book’s initial sales. But after 60 sales or so, Amazon starts to take over. Your book will begin to appear in various places on Amazon’s site, such as the “also bought” and “ultimately bought” lists for other books on related subjects.

Eventually, Amazon will be generating more sales than your own blog.

To be fair, publishing physical books does have some disadvantages as compared to the E-book method.

  • You have to compete on price. If there are several similar books on Amazon that sell for $10-$15, you’re going to have a hard time charging $47 for your book.
  • Updating paper books costs money and takes time, whereas updating a pdf is both quick and free.
  • You don’t get to collect your customers’ names or contact information, so you have no way to reach out to them when you release a new product.

In short, the less important it is for you to be able to tap into Amazon’s traffic (i.e., the more traffic of your own that you have), the more attractive the E-book method becomes.

Why Self-Publish?
But if you’re going the physical book route, why not go through a traditional publisher? Your reasons may vary, but these are mine:

  • I don’t have to work to find a publisher — a difficult task for a low-profile blogger.
  • I get complete control over what goes into each book.
  • The time to market is shorter, which can be important for books about timely topics.

The biggest reason, though, is profit margin. For most authors who work with a traditional publisher, the profit margin per book is in the $1-$2 range. When you self-publish, you get a bigger piece of the pie. (For example, my books sell on Amazon for $12.55, and my profit margin is roughly $8 per book.)

But, as with the comparison to E-books, the comparison to traditional publishing isn’t entirely one-sided. If the primary goal for your book is to build up your reputation, the traditional publisher route is probably your best bet.

How to Self-Publish
The actual “how-to” of self-publishing is actually surprisingly easy — so easy, in fact, that it’s also rather boring. Rather than outline everything here, I’d suggest that you pick up Aaron Shepard’s Aiming at Amazon if you’re seriously considering self-publishing. It covers the entire process step-by-step, including things like which printing company to use and how to get your book listed on Amazon.

Getting the Ball Rolling with Sales
As I mentioned above, you’ll have to generate the first several sales before Amazon starts to promote your book, so getting traffic to your own site is still important.

When selling information products, high-volume, low-value keywords are your friends. If a phrase is low-value for everybody else (because they’d be relying on Adsense to monetize it), but high-value for you (because you have a related product to sell), you can afford to work harder to rank for that phrase.

For example, in my niche (taxation and investing), the phrase “tax brackets” isn’t exactly high-value. In fact, according to the Adwords Keyword Tool, all the variations of it are worth less than $1 per click.

But because I sell books on the topic of taxation, my article explaining how tax brackets work actually pulls in a decent amount of money. As a result, I can afford to spend time working to rank that article.

Have Any Questions?
I’ve only been blogging and writing books since the end of 2007, so I’m still definitely in the “learn as I go” stage. Also, while my revenue is steadily growing and I’m now making enough to do this full-time, I’m still not exactly going to be an overnight millionaire.

That said, if you have any questions about self-publishing, I’d be happy to do my best to answer in the comments section below.

J.D.’s note: This post was originally going to be part of my GRS blog project, which is now on hold. It’s good info, though. Instead of letting the article languish, Mike and I scheduled it for a Saturday so that those who don’t give a fig about blogging can just go watch football instead.