To answer the question in the title "Is selling items online profitable?" I'll have to answer yes. Yes it is, and you probably already know that it's one of the least expensive businesses to start. Just because it doesn't cost an arm and a leg, it doesn't mean that it's easy to do. Matter of fact there is a large learning curve, but it's worth it.
What Mark Gibbs wrote ,in an issue of Forbes, pretty much sums it up.
Nope, when it comes to online stuff, there’s a certain minimum level of being informed and knowledgeable that you can’t avoid if you want to be running with the big dogs or, at least, stop the little dogs from biting at your ankles.
I'd like to say that quality and credentials win, but unfortunately it's not always the case. Often times a new online site tries to target a broad audience, not realizing the fierce competition. They'll get their site looking nice and quickly get it hosted. They can type in their address in the search bar and viallah! They see their site... then a week, maybe a month later, they start to wonder why they aren't getting any traffic.
Unfortunately making the site and getting it hosted isn't enough. You have to make the connection through a search engine because that's how your visitors find you. Learning how to please search engines and getting your content listed in the natural search results is a whole different ball game. It's a delicate dance between pleasing an algorithm, that the search engine uses to list your site, and providing your visitors with what their looking for. I can hear the argument now, "But all those sites above me are junk or spammy..." Well, if that's the case, than they've pleased the search engines better than your site. They've won the algorithm game. It doesn't mean that they are providing content to the visitors, just that they've become knowledgable online marketers. Their ahead of you on the learning curve.The good news is, that if their going through the effort, there's profit to be made. The bad news is, you now have to beat them at the algorithm game.
Yes, you have to please an algorithm ( a computation that determines where your site will be listed within the search results ). Without doing that you're site might not even get indexed ( listed within the search engines ). Not only that, you'll have to pay more than your competitors pay, just to drive paid traffic to your site. In a nutshell, you'll hardly be seen and you'll have to pay through the nose to get visitors. We'll use Google Adwords for an example. If your competitors only have to pay .10 a click while you have to pay .70 a click, they've got a huge advantage over you. Not to mention their ad placement will be better too.
There's two major parts, of your site, that search engines look at. The first part is on page optimization. That's the code that makes up your site. Search engines are constantly hungry for new information. To satisfy this constant need, they send out programs to gather sites. The programs that gather information about your site are called spiders. These spiders gather information about your site. The gathering of information is called crawling. When the spiders crawl your site, they look for key components that tell them what your site is about. These key components need to be optimized properly, or those spiders return to the search engine with the wrong information. The first and easiest step with ranking naturally in the search engines, is to have the proper code on your site. Proper code will help with your listing and drop your ad cost. The second part is how the world wide web is interacting with your site.
The second major part, that search engines look at, is basically populartiy. The popularity is measured by backlinks and what other people are saying about your site. Those same spiders also crawl the links on your site to the sites you link to. They can also crawl other sites and find your site if you have a link there. So, if you want your site to get indexed (listed in the search engines) you can get a link from a site that's crawled often. Social bookmark sites like: Technorati, Digg and Propeller are just a few examples of where you can post a quick description of what your site is about and get a quickly crawled link. However, not all backlinks are measured equally. There's several factors that measure the strength of the link that's directing to your site. One of the most important factors is the page rank of that site. Page rank is determined by the amount of content on the site, the number of links going to that site, how visitors navigate that site and it's age. Links can also be hyper texted (linking using descriptive words) instead of just a URL. Hyper texted links help the spiders determine what the link is about. So if a spider navigates a link on a site and it directs to your URL and the words of that link are relevant to what your URL is about, it will boost your indexing for those words.
Even though this information may seem daunting, it's a skill worth learning. The payout of learning and implementing this correctly has worldwide potential. The internet and how it's used for commerce is growing at an astounding rate. Every year there are more searches online than the previous year and the numbers keep growing. The earning potential is virtually endless and the skillset to be seen online is well worth the reward. One skill set that I'd wished I had learned before starting my first URL is niche marketing. A narrower focus of a broad market keeps those little dogs, that Mr Gibb was talking about, from nipping at your heels. Here's some more information about Profitable Niche Marketing and how to get into smaller, less competitive areas within your market. Here's an example of How to Find a Niche.