For the past few months, I’ve used two online reward programs to generate modest amounts of passive income. I’ll be honest, I know the phrase “passive income” has a negative connotation, but I’ll show proof below that it actually works.
It’s based on the industry funded by advertising and affiliate traffic. Outlined below are a couple of companies that offer revenue-producing benefits for people like you and I.
But first, a short story …
Flashback: AllAdvantage (1999-2001)
In 1999, there was a company on the web that was innovative and was one of the first to implement a legitimate advertising program that people voluntarily installed on their machines. Even when connected via dial-up, it worked well and would be a great way to monetize the use of the Internet. That company was AllAdvantage, which eventually fell victim to the dot-com-bomb and ceased operations in 2001. It functioned by delivering ads to users and would compensate users by the time that the AllAdvantage software was running on their machines. From what I recall, it translated to about $1 per hour. This amount wasn’t bad when you considered that Internet services typically costs $10-24 per month. It was an effective way for users to offset their Internet access charges without doing any work. I recall one of my highest payouts in a given month was $200-something since I referred friends to use it. It all came to an end when online advertising experienced a recession and the company went with it.
At the time, I was a pretty frequent user of IRC and met a number of like-minded friends that would discuss and engineer better ways to maximize the software to our ‘advantage’. We bonded over the concept of advertising, technology and of course, money. We discussed various rumors about the company, the underlying architecture and even dabbled a bit into releasing small-time hacks and exploits to maximize our earnings. The size of the group was small enough to be intimate, but large enough to be respected. For me, it was fun to learn programming by way of Winsock, the Win32 API and think critically about various methods to emulate human behavior on computers. At the age of 14, this was one of my first forays into programming and reverse-engineering. It also got me interested in the online advertising industry, too.
In retrospect, I believe this helped me become comfortable disassembling things, examining them and discovering how to
exploit improve seemingly complex systems — essentially nurturing and growing my analytical, investigative skills. Had I continued my passion into this, I’d either be in jail or a successful programmer. Don’t worry; I eventually pursued more acceptable interests like Cisco and CompTIA certifications in addition to my education. But I can’t neglect the lessons and skills I’ve learned in the process and how I adopt them into my present-day work.
Today: Online Reward Programs
Fast forward to today, 13 years later, the online advertising market has grown exponentially. There are many ways to deliver ads and many more consumers who are receptive to them. There are also more widely-used technologies such as re-targeting to follow a consumer around the web until (or even after the moment) they make a purchase. To put it lightly, this click-stream between watching an ad to the sale is a big business.
I eventually encountered the /r/beermoney subreddit, which is a community abuzz with how to generate a few dollars here and there. Look, I’m not desperate for income, but if there’s a way to earn a few bucks here and there, why not? People discussed various online sites and how to hustle them. In fact, many of the threads reminded me of the conversations we had in the AllAdvantage days. But the difference today is that the market has become more lucrative and healthy for these companies (and individuals) to succeed.
These companies typically generate revenue a number of ways from users. This is a good thing. The downfall of AllAdvantage was that they didn’t diversify their income stream and fell victim to the one revenue source drying up. The methods that these two companies mentioned below drive income through a number of sources: paid surveys, video ads (impressions), affiliate commissions, paid search traffic, manufacturers coupons, and cost-per-action lead generation. I was skeptical because I know a lot of publishers, large and small, know how to do this and have done this for years. However, what ‘sold’ me was the seamless user experience. These sites don’t do anything sneaky; they make it fun and engaging to take part and get paid.
What also made these companies successful to me was the low barrier to entry. Users don’t provide their social security numbers or have to maintain a website like typical affiliate networks like ShareASale require. Simply start browsing, clicking and earning. So, what’s the deal with Swagbucks and Perk? I’ll explain.
Swagbucks is probably one of the more popular online rewards programs. Users earn “swagbucks,” which equal one penny each (500 SBs = $5.00 USD), for performing various tasks as well as engaging in online shopping. The passive income aspect comes from watching videos on your mobile phone or tablet. They have a very active network of paid surveys that compensate users from $0.50 to $5.00, depending on the expected length and demand from the survey organization. One of the more fun ways to interact and earn swagbucks is to watch for Swag Codes that are typically published on their social networks. In just a matter of days, you will earn enough Swagbucks that can be converted to gift cards to the like of Amazon or a number of other major retailers. I prefer Amazon because it is the quickest and is a retailer I use a lot.
You don’t have to take my word for it. Here is a screenshot from my account showing the Amazon Gift Card payouts. I’ve watermarked it to discourage people from using it for their own purposes.
I’ve earned $30 easily — with practically no effort at all. Here’s what I do:
- Take the daily poll when I wake up
- Complete NOSOs once every couple of days or so
- Watch the News channel of videos on my tablet
- Take a survey or two every Saturday
- When shopping for something at a select retailer, browse site for discounts/cash-back offers
- Follow /r/swagbucks on Reddit and @swagbucks on Twitter to keep up on current events. Check it every other day or so.
- Search for various topics through their white-labeled Yahoo search. Mainly do this to compare to Google occasionally.
… That’s it. Lastly, if you sign up through my link, we both get an added bonus in our accounts.
Perk is like Swagbucks, but they differ in the ways users earn Points. Their specialty is working closely with mobile video advertisers, primarily mobile apps and movie studios to deliver a near-endless stream of ads for you to watch. Users earn four points per video played and can be used on multiple devices (with a few fair and reasonable restrictions). They also offer a network of online retailers that pay out a specified number of points. The value of their point system is bit more complex; each point is worth of a 1/10th of a penny (5000 Points = $5.00 USD). Compared to Swagbucks, Perk still computes and is worthwhile if you have a family of users with mobile phones or tablets that can watch ads.
To drive engagement, Perk offers users the ability to Thumbs Up or Down a given video. In this process, the user earns 50 Tokens that can only be used for raffles and sweepstakes. While I’ve not won any such sweepstakes, I don’t mind trying on the off-chance I do win. It’s not a big feature, but it is one of the ways to make watching the videos a bit more interactive.
And here is my proof that Perk also pays out well. Similar to Swagbucks, I choose Amazon Gift Cards since it is a frequent retailer for me. Watermarked the screenshot, too.
You can see from the screenshot, I’ve earned $80 easily. I can confidently say that I earned all of it by watching ads on my tablet and mobile phone. I have used Perk a bit longer than Swagbucks and has proven itself to be a reliable source of passive income. You can sign up through my link and we both earn a bonus 50 points. It’s easy and free to rack up points on the site.
Maximizing Your Earnings
So, here are my tips no matter if you sign up for Swagbucks or Perk. These tips hold true when you are determining your use of either rewards program. Like AllAdvantage from over a decade ago, there is a strategy to maximize your earnings, so pay attention:
- Understand the conversion rates when determining the real-world value for various tasks. It’s easy to fall for what appears like a good payout for a task, but if it takes 30 minutes to earn $0.02 for it, you’ve wasted your time.
- Use WiFi when participating in video-watching activities. You will rapidly burn up your data usage plan from your mobile carrier.
- Disable the use of a AdBlocker and anti-tracking plugins (Ghostery) when using these sites in your browser. At the least, whitelist them. These will interfere with the ability to credit your account because, these sites are essentially advertisers.
- Don’t buy stuff simply to earn points. Instead, earn points simply because you buy stuff. Before you make that impulse purchase, check the rewards site for a promo code or a cash-back offer. Typically sites offer between 10-20% back to your rewards account. You could earn a lot when shopping for others… hint, hint, holidays.
- Understand how cookies work. Don’t clear your cache and cookies between the time you click off for a special offer and actually making a purchase. Don’t use sites like Retailmenot as those promo codes often overwrite the cookie used from the rewards program. Doing so could erase the ability to be credited for such purchases.
- Cash out often. It’s tempting to accrue a large account balance, but don’t do it. While nothing wrong with a large balance, these sites are not guaranteed to last forever. I typically cash out at $5 and $10 intervals.
- Have fun. It’s not a job — it’s a few bucks here and there. I earn roughly $10 per week, which is $520 per year. It works.
If you’re uber-skeptical like me, I’ve included a screenshot of my Amazon account’s gift card balance. I’ve only displayed the confirmed Amazon Gift Card amounts that I’ve redeemed. I’ve blurred out the other gift cards and orders I’ve redeemed. Watermarked, as well. This image might be scaled down, but you can right-click on it and view the image.
What do I think will happen to these sites in the future?
They have an expiration date. I don’t know when, but at some point they will need to pivot to stay sustainable and profitable. Right now, some ad agencies bill their clients for a set number of impressions for their ads. Low click-through rates and lack of meaningful outcomes will compel the ad agencies to become more selective with their ad spend. Now, it’s a gold rush, so it’s okay to be a part of it. The affiliated (commissioned) structure will likely remain in effect forever. MyPoints has survived the dot-com-bomb and likely these sites will as well.
Some people can question these sites because of the poor-quality traffic they send around the web to retailers. Today, they win from volume. Be sure you follow through on the spirit of making a purchase here and there so everyone wins.
Photo credit: quinn.anya