Chapter 1- monetization
How to Make Money Selling Information Products
Ok… let’s talk about the types of Content and Traffic you have available to you at the Monetization stage.
It looks like this in the Business Growth Framework:
Let’s begin by exploring the types Monetization Products:
Types of Monetization Information Products
You have five products available to you, as an information business, at the Monetization stage:
Digital course – A course, class or training that is delivered online and/or in-person.
Services – Any number of “do-it-for-me” or “do-it-with-me’ services can be offered at this stage. The most common are one-on-one or group coaching or consulting services.
Membership – An information product or service that is paid for monthly or annually.
Small group events – High-ticket, usually in-person events where peers network and assist each other. (e.g. Mastermind)
Large group events – Paid, high-ticket, usually multi-day events. (e.g. a conference or summit. )
Characteristics of Monetization Information Products
Before we take a deeper dive on each of these product types, let’s look at the characteristics of Monetization products.
Characteristic 1: High-Commitment
Monetization products like courses, masterminds and coaching services are higher cost in both money and (usually) time.
Characteristic 2: Often Recurring
At the Monetization stage, you will be able to sell customers products and charge them every month or year like a membership website. (By the way, recurring revenue is the “Holy Grail” of revenue because it makes your business much more predictable.)
Characteristic 3: Low Volume, High Customer Value
You might be thinking, “Hmmm… I like the sound of this Monetization stage. I think I’ll just sell products in this stage.”
Not so fast. You’ll have a limited number of prospects that will buy
As a result, you’ll have a low volume of Monetization transactions. But, the good news is those transactions will really make that cash register ring!
Ok, now let’s take a deeper look at each of the product types you have available in the Monetization stage.
Content that Monetizes Customers and Leads: A Closer Look
The digital course is a staple Monetization product for the information marketer.
Most information businesses have digital courses available, like this one from Tony Robbins:
Pros of digital courses:
- Add scalable, passive income to your business. Depending on the deliverables in your digital course, there is no limit to the number of customers you can service.
Cons of digital courses:
- High-ticket digital courses are difficult to sell to prospects that don’t yet know, like and trust you. You’ll need to build a relationship with audience members first before they will part with that much hard earned cash.
For those getting started with an information product business, offering a “do-it-for-me” or “do-it-with-me” service like Entreleadership has done below is often a must-have to stay financially afloat.
Pros of Services:
Services typically come with a much higher price tag than digital courses or events that merely train or teach someone how to get a result for themselves. These big pops of cash are often what an information business needs to feed the more scalable, passive side of an information business — particularly during the start-up stage.
Cons of Services:
- Services are difficult, if not impossible, to scale as the very promise of the service is to be more “hands on” with a client/customer. At the end of the day, raising prices and/or building out a team of employees or contractors to fulfill on service-based products are the cards you have to play.
- Most information marketers (including me) believe that recurring revenue (paid monthly or annually) is the most desirable revenue model. The most common form of recurring revenue (sometimes called ‘the continuity model’) is membership as you see with The Hitting Vault below.
Pros of Membership:
- Selling one-time payment courses, services, events, etc. requires hunting for new sales every month. Many information businesses operate on the “launch model” where an online course, service, event, etc. are heavily promoted for a few days. This can cause “lumpy revenue” where one month you have high sales numbers and the next month you hit a drought. Membership or continuity billing for products allows you to smooth out lumpy revenue numbers and get off the launch “hamster wheel,” creating a more stable and predictable business.
Cons of Membership:
- To sell membership, you’ll need to have developed a high level of know, like and trust with your audience. Your audience will be weary of agreeing to subscription billing.
- In addition, membership typically comes at a lower price than it’s higher ticket cousins, the digital course, service, or event. In fact, a free trial is often needed to convert membership customers at scale. This can cause cash-flow issues for the information business as they struggle to reach the break-even point.
Small group events
While there is some gray area, events at the Monetization stage can be generally categorized into large group events (like conferences or summits, etc) and small group events like the War Room Mastermind group shown below.
Pros of Small Group Events:
- The intimacy and higher level of connection at small group events command a higher price and, often, a membership component. For example, the War Room mastermind shown above has a price tag of $25,000 per year. The group meets four times per year and boasts over 100 members.
Cons of Small Group Events:
- The promise of the small group event is intimacy and a higher level of connection, networking, and support. These constraints make a product like this difficult to scale. After all, how many members can you add to a Mastermind, as an example, before it loses its value?
Large Group Events
The large group event (e.g. an industry conference or summit) like the one shown below can range anywhere from a few hundred attendees to multiple thousands.
Pros of Large Group Events:
- Not only are ticket sales a source of revenue but it’s common to sell more products and services to attendees at the event. This makes a live event both a product in and of itself as well as a channel to sell additional products.
Cons of Large Group Events:
- It’s difficult to put butts in seats. There is a lot of competition in the large group event world so it can be difficult to get an event started and even more difficult to keep it growing each year. Live, large group events can require an enormous amount of time and money to execute. But, if you can pull it off, there really is nothing that compares to the impact it can have on your information business both from a revenue and branding perspective.
The Traffic Sources to Sell Monetization Information Products
You have nine traffic channels at your disposal at the MONETIZATION stage:
- Stage Pitch
- Webinar Pitch
- Instant Messaging
- Ad Retargeting
- Content Referral
- Search Engine Optimization (SEO)
- Social Media Marketing
- Digital Advertising
Let’s look at each of these in turn:
The stage pitch at large or small group events is one of the best ways to drive awareness and sales for a high-ticket Monetization product like a digital course, service (e.g. consulting/coaching) or even a higher-ticket event.
Pros of the Stage Pitch:
- There are multi-million dollar information businesses that do nothing but sell high-ticket Monetization products (like courses, services, and even more high-ticket events) at live, large group events. Why? Because the intimacy and the level of know, like, and trust that is created at a live event is second to none.
Cons of the Stage Pitch:
- Pitching from the stage can turn your attendees off and make it difficult to sell tickets to future events if it’s not handled with taste.
- Events are difficult to scale because they require you and your audience to be physically present.
- Some information marketers are not comfortable with selling from the stage. (I know it’s not easy for me to do!)
The Webinar Pitch overcomes some of the obstacles of the Stage Pitch while creating some new obstacles of its own.
Pros of the Webinar Pitch:
- Webinars are infinitely more scalable than physical, in-person events because people can attend online from the comfort of their home or office.
- It often feels less nerve-wracking to pitch a product on a webinar than it is to do it in-person from a stage.
- The webinar recording is instantly available to be used again and again as a selling tool. Some information marketers use software to create what are called “evergreen webinars” or “just in time webinars” that are available 24/7/365 and appear to be live but are actually just recordings of previous live events.
Cons of the Webinar Pitch:
- Show-up rates to webinars (particularly free webinars) are extremely low. It is likely that far less than 50% (I’ve seen as low as 15%) of those that register for a webinar will attend the live webinar.
- As compared to an in-person event, an online event doesn’t produce the same level of intimacy and know, like, trust. This means it’s more difficult to sell your high-ticket Monetization products via webinar.
Email is still the king of high-ticket (and low-ticket for that matter) information product sales.
Pros of Email Marketing:
- Email is the most accepted communication channel to receive low and high-ticket offers from brands. It simply converts better than any other channel we have available as information product business owners.
Cons of Email Marketing:
- Most information marketers are unable to build an email list in a predictable and scalable way.
- It’s getting harder to reach an audience through email because:
- Email open rates continue to decline with clogged inboxes and features like Gmail’s Promotions tab filtering promotional email before the subscriber even sees it.
- Email has no shortage of competition from communication channels like Facebook, Facebook Messenger, text, WhatsApp, Instagram and on and on.
Messaging applications like SMS, Facebook Messenger and Apple’s iMessage have become formidable communication channels in recent years.
Pros of Instant Messaging:
- As email open rates continue to drop (averaging 20% or so), messaging apps boast nearly 100% open rate. When was the last time you didn’t read a text you received?
Cons of Instant Messaging:
- Sending promotional texts and instant messages can be seen as spammy by your audience. It’s best not to lead with promotional communications in these channels. Instead, lead with value such as an article, podcast, free webinar, or video.
- There are some legal restraints that remain fuzzy about the use of text to market and sell. Similarly, apps like Facebook Messenger are still solidifying how promotional communications should be used.
One of the most powerful forms of traffic we have at our disposal is ad retargeting or what Google calls remarketing. These are digital ads that are shown to a prospect because of a prior behavior they have taken such as visiting a web page, buying a product or subscribing to an email list.
Anywhere you find an audience (and it’s legal), you’ll find advertising.
Here’s how it works:
- Great Content = Value
- Value = Audience
- Audience = Advertising (<< This is important)
- Advertising = Awareness
- Awareness = Sales
If you’ve created great content and amassed an audience, you can choose to:
- Advertise other people’s content, products, and services
- Advertise YOUR own content, products, and services
When you embed advertising into your content and send clicks to your own content, products, and services — you are making a ‘content referral.’
Pros of Content Referral
- An audience that is getting value from you or your brand by listening to a podcast, watching a valuable video or reading an article on your blog, is more trusting of you and your brand. In short, they are a warm audience that is much more likely to want to take the next step in the Audience Ascension Ladder.
- When a member of your audience engages with a piece of content, they are segmenting themselves. For example, anyone reading the article from CreativeLive (pictured above) is showing interest in editing photographs. Savvy marketers will advertise a relevant Subscription, Conversion, or Monetization offer to those reading this article. Perhaps an online course called, “The Amateur Photographer’s Photo Editing Masterclass.”
Cons of Content Referral
- Click-through rates will be low (averaging around 2% to 5% of total traffic) because there are so many distractions (think other places to click) in a blog post or on a video. The more congruent the offer is to the piece of content the audience is consuming, the higher the click-through rate will be.
Search Engine Optimization (SEO)
Optimizing your website for search is a tactic as old as search engines themselves. (Anyone remember Lycos and Alta Vista?)
With paid traffic costs from Facebook and Google on the constant rise, there has been a renewed interest in “free” traffic from search engines.
Pros of Search Engine Optimization (SEO)
- Traffic from search engines tends to be higher quality as the visitor to your site was (presumably) actively searching for whatever your web page is about.
- Traffic from search engines is earned, not paid. In other words, you’re not paying per click when you get organic traffic from search engines like Google.
Cons of Search Engine Optimization (SEO)
- Search is a “long game.” It can take months or years to see results from consistent Search Engine Optimization.
- As opposed to paid traffic that has precise control, search engine traffic can be difficult to predict where and when the traffic will appear.
Social Media Marketing
The vast majority of traffic on the web today is confined to a very few websites and apps including Facebook, Instagram, YouTube, Pinterest and LinkedIn.
It’s no wonder why business owners and marketers are interested in getting a piece of the pie.
Pros of Social Media Marketing
- Like search engine optimization (SEO), social can be a source of “free” traffic to your content and offers.
Cons of Social Media Marketing
- Social channels are primarily for networking, sharing and listening rather than posting promotional material.
- Similar to search engine optimization (SEO), it is difficult to predict where and when traffic will materialize from social media marketing.
Facebook, Google, YouTube, LinkedIn, and Twitter are just a few of the sites that allow people and brands to buy traffic.
Pros of Digital Advertising
- Digital advertising is a predictable method for generating traffic. As opposed to SEO or Social Media Marketing, you’ll know roughly how much traffic is coming and exactly what page the traffic will hit.
Cons of Digital Advertising
- Paid traffic is like a water faucet. You can turn it on and off whenever you want. When the faucet is on, you start paying for the traffic. If you stop paying, the water shuts off.
Ok… phew. Still with me? That’s it for the Monetization stage of the Business Growth Framework.
That’s good. Most of your lazy competitors have decided this is too complicated and hard and stopped reading about 10 minutes ago.
Seriously… give yourself a fist bump and let’s move on to Chapter 2, where we will discuss a critical component of growing an information business: Customer Acquisition.
What’s inside this Ultimate Guide?
The Ultimate Guide to Starting and Growing an Information Product Business
Learn what information products are and why now is the time to build your information product business.
Chapter 1 - Monetization
How to Make Money Selling Information Products
Learn how pro information marketers create a product and traffic mix that monetizes their business. This is where the money is made.
Chapter 2 - Acquisition
How to Get Customers for Your Information Product Business
Without customers, you don't have a business. Most information businesses fail because they don't understand what is taught in this chapter.
Chapter 3 - Subscription
How to Get Leads for Your Information Product Business
Leads (sometimes called subscribers) are the lifeblood of your business. You'll learn how to create a predictable lead generation machine.
Chapter 4 - Attention
How to Build an Audience for Your Information Product Business
They can't buy from you until they know you exist. This chapter is all about the tactics to use to grow a massive audience.
Chapter 5 - Getting Started
How to Start an Information Product Business
You've learned about a lot of different tactics. Which one should you do first? Simple. Don't skip this chapter or you risk wasting a ton of time and energy.