Tag Archives: strategy

Monetize Yourself Media – Share Your Expertise For Free

This post is part a series on specific media for monetizing yourself. Today I’m going to talk about another category of potential media: sharing your expertise for free.

That Doesn’t Sound Like Monetizing Myself

This is the least intuitive category, so let’s take a moment to examine it. As I discussed in Distillery Tours and Alternate Monetization, “free” doesn’t necessarily mean that you’re not making money. That post used the example of Maker’s Mark Bourbon, who will let you tour their facilities for free, and make a lot more money selling you souvenirs than they ever could have made on the tour itself.

Free is the newest craze, and it works really well in some cases. The best example is our favorite search engine: Google doesn’t charge you for the use of its amazing search technology. They make their money “through the side door”, as Jeff Jarvis would say.

You, too, can open a side door.

Share your expertise…

Make a website

A website is actually just another form of Information Product: a way to provide information to those who need it. It can be less daunting than writing a book, and may be a better fit for the information you want to provide, since it lets readers easily browse information in whatever order is useful to them. It’s also easier to edit and update than a book, which is great if your area of expertise is expected to change itself in your lifetime.

Start a blog

Blogs are another way to share what you know. Since the days when they began, as a way for teenage girls to keep each other constantly updated on their social lives, blogs have evolved into a great source of information for whatever you may be interested in — from fantasy football to making money. And whatever you’re an expert in, you could write one, too.

…or site-blog

Blogs are great because you can keep them constantly up-to-date, and can write about whatever comes to mind. But websites are really nice because your readers can find the information they’re looking for (without digging through years of chronological posts). A compromise that’s coming into vogue is the site-blog: a blog that has all its posts in chronological order, so you may read back issues to your heart’s content, but also has the posts sorted into categories like a website, so that you can find specific, targeted information.

Make a podcast

Does your area of expertise lend itself better to audio or visual media than to text? Make a podcast or a video podcast. It’s not as hard as you think, and it can probably be done with free software.

Check out my first YouTube video.

You can do better than that. So why don’t you? You get to talk about your favorite stuff once a week, and you can call your mom and tell her you’re in a video.

… and monetize

If you make good stuff — a website with good information, a podcast that’s entertaining, or a blog that keeps people up-to-date in your industry — people will enjoy receiving it. And then all you have to do is monetize. Do this by

  • Selling ads
  • creating premium content, available for a fee
  • selling your services as a consultant
  • selling related products through an affiliate program
  • creating an information product you can sell to people who want more
  • selling t-shirts and coffee mugs related to your work

Low Risk… So Why Not?

All of the above can be done for free, or for very low cost. So why not try it out?

Resources For Further Reading
Site Build It! (A great resource for making a website – but the only resource on this list that isn’t free.)
WordPress (This is where I started my blog)
How to Podcast: 4 Basic Steps
How To Make Money From Your Blog

Distillery Tours and Alternate Monetization

Since I’m in Kentucky right now with my family, in the heart of Bourbon country, we decided to take a tour of a distillery. We toured the grounds at Maker’s Mark in Loretto, Kentucky, and it was pretty cool. We got to walk down the bottling assembly line, stand in the room where they cook down the corn at 212 degrees Fahrenheit (not actually very appealing on a day when the ambient temperature was 98 Fahrenheit), and look at the 500-lb barrels of White Dog Liquor aging itself into Bourbon. And best of all? It was all free, even the two servings of bourbon at the end of the tour.

There are other ways to monetize

A lot of people have come up with ways to make value. I mean, there’s always something you’re better at than other people, by talent or training, or both. It’s not that hard to come up with something that other people like.

But then, many times, they insist on charging for it.

Now that’s OK. If you’re providing value, you should be able to get people to pay for it. But it’s not the only way to monetize.

“Free” doesn’t mean you’re not making money

Take the distillery tour. They let me into their factory, gave me an education on bourbon, and let me drink some of their product, for no charge. Suckers, right? Giving away their product for nothing. Providing value for free when they could have charged.

Well, let’s look at the “nothing” they got in return.

Shoppers

The tour, naturally, ended in the gift shop. Where, it happens, you can buy their bourbon. Or any number of other souvenir items, most dipped in red wax (the signature style of Maker’s Mark). Since a single bottle of bourbon probably pays the tour guide’s wages, and there were 15 of us on the tour, they’re certainly not losing money. The probably could have charged $5/person for the tour, for a total of $45 in revenue. But by not charging, they made us feel appreciated, and that we were getting something for free, and like we had money to spare. And at $20 per bottle, with 5 bottles sold (that I saw), they made $100 in revenue.

Educated bourbon drinkers

Bourbon is different from beer, and should be drunk differently. Appreciating the distinctions between bourbons, and recognizing a fine bourbon, is much easier when you know how to appreciate the scent, the taste, and the aftertaste. The tour guide educated us on the correct glassware, where the bourbon should be placed on the tongue, and other notes for proper bourbon appreciation. This education won’t make a difference in dedicated abstainers like me, but it could well make the difference between an indifferent bourbon drinker like my father and an enthusiastic bourbon drinker like my brother, which can in turn make the difference between a bottle every few years and a bottle every few months.

Brand Loyalty

People like familiarity. They like stuff they know about. I now have a relationship with Maker’s Mark: I’ve met their people, walked their grounds, learned about their signature red wax. When I walk into a liquor store, there’s only one bourbon I’ll recognize. Which am I most likely to buy?

Product Exposure

As I mentioned, we each got two servings of bourbon at the end of the tour. Glass #1 was the standard, original Maker’s Mark. This glass would be worth giving away just for the benefits mentioned above. But we also received, in Glass #2, the new pre-mixed Maker’s Mark Mint Julep. This product (dipped instead in green wax), is fairly new, and relatively few people are even aware of its existence. By offering it to everyone who goes on tour, they have an effective way of spreading the word about a new product for way less than the cost of a Superbowl Ad.

Think about your monetization

Does this mean you should never charge people for your value? Of course not. Even in the above example, the distillery is charging for their bourbon. The goal is simply to get the proper mix of direct and alternative monetization.

Don’t just slap a price tag on everything you create. Look at everything you do, and ask yourself.

  • Is this of value to my customers? Why is it of value to them?
  • How much would someone pay for this?
  • How else could I monetize this? Sell ads? Advertise my own products? Affiliate marketing? Lead customers towards high-margin products?
  • What other benefits could I derive from this? Traffic increases? Education? Buzz in social media?
  • What is the best way to derive maximum benefit from this value I’m providing?

Resources for Further Reading
Free: The Future of a Radical New Price

What Would Google Do?

The above product links are affiliate links. If you enjoyed and appreciated this information, you can give me monetary reward by buying products through those links. Learn More.

The New Concept of Marketing

Once upon a time, when I was a kid growing up in the 80s, mass production was the rule. The economics looked something like this:

  • My local cobbler can make a pair of shoes that fits me perfectly. It costs $50.

  • My local Payless Shoes can provide me with a pair of shoes that fit OK. They cost $20.

By ignoring their customers’ needs, and focusing on what will turn out the most shoes in the least time, manufacturers were able to drastically reduce the cost of shoes. In turn, we all got used to ignoring our own needs, in order to get lower prices.

The 4 Ps of marketing, then looked like this:

Price (as low as possible) ->
Product (whatever we can make cheaply) ->
Promotion (make people think they want our product) ->
Place (wherever we tell them to go)

In other words, you made what you wanted to make, and then spent money to convince people to buy it.

The new rules

I admit that shoes are still pretty much produced the same way. But your local shoe store has many more options, and there are thousands more online. Whatever your requirements, you can find a shoe that meets them.

There are several driving forces for this, but the long and the short of it is that power has shifted. We no longer have to settle for a product that’s good enough. We can almost certainly find a product that’s ideal.

Many, many companies have yet to realize this. But the intelligent ones have shifted their focus from internal to external. A 5th P has been added, to look like this:

Participation (Talk to people, find out what they like and what they want) ->
Product (Whatever the market wants) ->
Price (as low as the market will bear) ->
Promotion/Participation (let people know that you have what they want) ->
Place (wherever is convenient for your customers)

That is, you make what people want to buy, and then let them know it’s available.

What it means to you

The good news: you no longer have to be a conniving, deceptive weasel to be successful in business. Marketing is no longer about manipulating people into buying stuff they don’t want or need.

The bad news: you can no longer make what you want and manipulate people into buying it. You have to make what other people want.

This brings us back to the venn diagram of happiness in business:

You have to find something that overlaps between what you want to make and what people want to buy.

But at least you don’t have to be a lying scumbag.

Resources for Further Reading
Happiness In Business Diagram
Product Is the New Marketing
The Price Is Right

You Need a Business Plan — maybe

“Plan it today or later you’ll pay!”
“You need a business plan”
“Failing to plan is planning to fail”

….

Actually, you don’t need a business plan. “Need” means something that is necessary, and since businesses are started, run, and even grown every day, without business plans, it’s hard to argue that a business plan is a need.

But they can be very helpful. Of the 95% allegedly “failed” businesses that actually did fail, a significant portion of them could have been successful if they’d thought about and prepared for contingencies, which a business plan would have done.

But I don’t know how to write a business plan

This phrase I learned from my father, and you’re going to hear it a lot whenever you bring up something you don’t know how to do:

Whose problem is this?

A business plan is something to help you… it’s of no benefit to anyone else. So isn’t it worth the effort to figure out how to write a business plan? In fact, learning how to write a business plan is one of the items on the long list of things you get to learn while starting your first business.

Happily, even though this is your problem, I’m going to help you with a solution. I can’t promise that you’ll ever enjoy the process as much as I do (I’m an organization geek) but you can learn the process well enough to write one when you need it.

The following layout won’t make a business plan that you can take to the bank and use to get a loan. But it will ensure that you’ve given consideration to all of the big pitfalls and thought of ways around them. It will also give you something to look at a year from now so you can remember what the heck you were thinking.

Step 1: Questions

I don’t necessarily expect that you will know all of this off the top of your head. Some will require brainstorming; others will require Google. All I ask is that you have answers to these questions before you move on.

Click here to get these questions in PDF format so you can print them out and follow along at home.
Click here to get these questions in .doc format so you can follow along on your computer.

What will you need to start your business? A laptop? An oven? A car? A location with a counter? An app phone? A whole bunch of merchandise?

How much will that cost?

Can you afford to go a few months without income? If not, how are you going to get that income? Factor your salary into the loan? Keep your day job? Get a day job? Not start the business until you have enough savings to go a few months?

How much will it cost you to be open for a month, even if you don’t make a single sale? Factor in heating, lighting, employee salaries, your salary, rent, phone, internet, monthly payments on equipment, advertising expenditures, etc. This is called your overhead, or fixed costs.

How much will it cost you per transaction? Factor in the cost of what you sold (wholesale price or cost of components), employee bonuses, your bonuses, gasoline, milage, delivery costs, sales tax, etc. This is called your variable costs.

Is there a manufacturer’s suggested retail price? How much do your competitors charge for similar products? What’s the standard markup in this industry?

How will customers get to you, or you to them?

How will your customers find out about you? Advertisements? Signs on your store? By finding you on Google? Word of Mouth? Where will you advertise? Flyers? Classified ads? Twitter? Referral or affiliate programs? Telll-a-friend-get-a-bonus cards?

How many potential customers read the papers in which you plan to advertise, or walk by your store, or search for your keyword? How many people have the problem you solve? How many of them know they have that problem?

What hours will you work? Will those hours be convenient for your customers? Do you need employees to cover extra hours?

Step 2: Analysis

Now take all your answers; we’re going to go through them one by one.

Click here to get these questions in PDF format so you can print them off.
Click here to get these questions in .doc format.

Promotional Plan
How do you expect your customers to find you? List out all the ways you think you might get potential customers.
For each item on the list, write down the implications of it. If you expect a lot of people to find you through newspaper ads, which newspapers will you advertise in, and what will it cost? If you expect to get a lot of referrals, what can you do to encourage your customers to tell a friend? If you expect a lot of repeat business, what can you do to increase the odds of customers’ returning?

For each advertising method, how many people will have the potential to see your ad? (This is called your number of exposures). That is, how many people subscribe to this magazine/newsletter/newspaper. How many people search for these keywords? How many people drive by this billboard, or walk in this mall? To how many people will you send coupons in the mail?
Divide the above numbers by 100 — this assumes that 1% of the people who are exposed to your ad will actually act on it. (This will be low for some media but high for others. Feel free to change the number if you have good evidence that the conversion rate is not 1%. But 1% is a pretty reasonable average.
Add up all your divided-by-100 numbers; this is the number of customers you can expect to get from all your promotions.

Start-up Capital
List everything you can think of that you’ll need to start your business. Next to each one, write down how much it will cost.
Whatever your total cost comes out to, multiply it by 1.1 — this gives you a 10% “cushion” for things that you’ll need but didn’t think of.

If you’ll need to take salary out of your start-up capital (you’re going to be doing this full-time, and don’t have the savings to go without income), factor in at least 3 months’ worth of salary, and maybe 6-12 months’ worth.

Add all of that up, and it represents what you’ll need for start-up capital. You’ll need to get loans from the bank, loans from friends/family, your personal savings, angel investors, venture capitalists, or some other method to provide this much money.

Distribution
Will your customers come to you, or you to them? Either way, what will it cost you?

Pricing and break-even
If you charge somewhere in the same vicinity as your competitors, will you be able to make a profit? (is the price they charge higher than what it costs you to buy/make each product?) If not, can you lower costs? Can you think of a way to make your product so much better that consumers would pay more to have it?

Given all that, what will you charge, and why?

For each product you have, what is your gross profit?

    Gross profit = (price you’re charging) – (what it cost you to get it)

How many of those will you have to sell in a month to cover your fixed costs? This is your break-even point

    Break-even point = (Cost to stay open for a month) / (Gross profit)

Step 3: Feasibility

1) Does your pricing seem reasonable, based on MSRP, competitor’s pricing, and the standard industry markup? You can be higher than your competitors as long as you have some competitive advantage that will make the higher price worth it to your customers.. perhaps a more convenient location, better service, or higher-quality products. But you can’t be too much higher, or your customers will decide that organic notepads aren’t worth it.

2) Is the number of expected customers per month substantially higher than the break-even point? All of these numbers are estimates, and you want to leave room for the estimates to be wrong. If you’re guessing that you’ll have enough customers per month to break even, and not enough to make a profit, you’re running a risk that you won’t be able to pay the bills.

3) Can you obtain the required start-up capital?

If the answers to the above 3 questions are “yes”, then you are good to go. You can start this business knowing that it’s got a pretty good chance of success.

If the answer to one or more of the above questions is “no”, despair not. You still have a chance, you’ll just need to get more creative. Tomorrow we’ll discuss ways to tweak your business plan to let you turn a “no” into a “yes”.

Tactics vs Strategy

The Belisarius series (one of my favorite sci-fi series, available in the Baen Free Library), makes a big deal about the fact that Belisarius focuses on the strategic, not the tactical. Crucial plot points,

    “So. Let’s put it all together. We have one of history’s most cunning generals – who always subordinates tactics to strategy – engaged in a campaign which, for all its tactical acumen, makes no sense at all strategically. In the course of this campaign, he drags along a bunch of mercenaries he has no use for, and which have no business being there on their own account. What does that add up to?”

depended on me knowing the difference between strategy and tactics… which I didn’t. And subsequently missed the no-doubt brilliantly-crafted hints that the author dropped.

But I’ve learned the difference, and I’m here to explain it to you.

Before Strategy OR Tactics

Neither strategy nor tactics makes sense without a goal. This is often ignored, because in military endeavors it’s usually pretty obvious what the goal is. But it all starts with what you want to accomplish. Once you’ve got that….

Strategy is the concept of how you’re going to accomplish it.
Tactics are the details of how you’re going to accomplish your strategy.

It’s easier to understand with a few examples, so let me offer a few:

Chess
Objective: Checkmate
Strategy: Control center of board
Tactics: Move bishop to D5

Health
Objective: Lose weight
Strategy: Eat less, exercise more
Tactics: Join Weight Watchers & get a gym membership

Monetization
Objective: Make money from my hobby
Strategy: Sell stuff in online store
Tactics: Decide whether to use Ebay or Shopify

Productivity
Objective: Quit losing important papers
Strategy: Make sure everything has a designated home
Tactics: Buy a filing cabinet and alphabetical folders

On this website, I’m assuming that your objective is to make money off your skills, talents, and passions.

There are a bunch of different strategies available to you: build a home-based business, work freelance, start a website, start a blog, start an online store, write a book, make an info product….. I’ve mentioned these, and will talk about them in greater detail in the future.

And each of those has their own tactics… buy business cards, go to networking functions, pick wordpress vs blogger, pick ebay vs Shopify, self-publish vs finding an agent…

I won’t talk about these as much, because
(a) I’m not an expert on all of them
(b) There are other people who are experts on them
(c) The correct tactics vary significantly from situation to situation
(d) Your options change constantly

So you’re better off running a Google search yourself to see what you can find. But I’ll try, in the near future, to get you a resources page for your further research on tactics.

Resources For Further Reading (Thanks to my cousin Megan for finding these.)
First Things First: Strategy Before Tactics
Marketing Strategy Vs Tactics
When Tactics Drown Out Strategy
Identifying Strategic Problems