When most Internet entrepreneurs build their blogs, their primary concern is to get traffic through it for their business. This they can very well do, because if the blog is search engine optimized, then the people who will be coming on to it will already be interested in the topic and in a way, the blog pre-sells the commodity to them. Most visitors will click on the website link provided below each blog post to get more information. Hence, the blog can bring a lot of targeted traffic to the website.
But if you are of the opinion that a blog can be used only to bring targeted traffic to your website, then you are surely mistaken. There are many webmasters out there, who are milking as much as they can from their blogs. You can monetize your blog too, and even make it a source of residual income for yourself.
The best way to monetize your blog is through affiliate advertising. Use an affiliate program like Google AdSense to provide affiliate ads constantly on your blog. Every time a visitor clicks on these ads, you get a few cents. This can be good income considering you do not have to do much. There are also other forms of affiliate advertising, like the pay-per-lead and the pay-per-sale campaigns that pay you much more than these simple pay-per-click campaigns.
Providing something free can be a very subtle way of monetizing your blog. Give a link for a free eBook on your blog page. But do not direct this link to the download page straightaway. Make people go through a lead capture page where they give you their email ids. You can then use these email ids for meaningful promotion of your product through email marketing.
There are umpteen ways of monetizing your blog. Once you have it up and running, you will discover new ways yourself.