This guest post is by Ivan Walsh.
How long does it take to set up a profitable online business? One thing I learned since starting my first site in 1997 is that the more preparation you do, the more likely you are to succeed.
Something that made a big impression on me when I first starting reading ProBlogger was the
six-month challenge Darren’s wife gave him. This made me re-think what I was doing with my blogs. Instead of blogging as fast as I could, I sat down and developed a six-month plan with the specific aim of monetizing my
Let’s look at how I managed to monetize my technical writing blog in six months—along with some of the issues we had to overcome.
Month 1. Develop a monetization plan
What this means is before you start any coding, writing, or design work, ask yourself how the blog will make money. Try to be as honest with yourself as you can.
Earlier in my career, I worked with IBM. One exercise we’d do when starting new projects was to identify the costs, expenses, and net profit. Net profit is the real profit you make, for example, when you’ve taken away web hosting fees, software licenses, training, design work and, of course, your own time. You can do something similar for your blog.
Here’s what I did:
- Identified Revenue Streams: I explored different ways to earn revenue for the site. The simplest way to do this is to analyze your competitors and record how they monetize their sites in an Excel spreadsheet. For tech writing blogs, this was mostly around services, education tools, direct advertising, Google Adsense, and books. Remember some areas are more lucrative then others, so factor this into your planning.
- Establish goals: Identify different ways you could leverage these on your site. For example, how much traffic would you need to generate 100 USD per week? Or, how many books do you need to sell on Amazon to make $50?
- Set baselines: If you’re starting from scratch, your baseline is zero. However, if you’re already selling some advertising, for example $30 per week, record this so it doesn’t influence your end of quarter reports.
- Target dates: Give yourself specific targets for each month. Be realistic. I chose not to use Google Ads for example as technical writing is very niche and my target readers tended to ignore these. Also, I wanted to focus on ‘evergreen’ post posts rather than daily news updates, which attracts passing traffic.
- Set up a budget: If you believe in your site’s business model, set aside some money (even $25 a week) to run Google Adwords / Facebook ad campaigns. The advantages of doing this are that you’ll learn how to run ad campaigns,you’ll raise your profile faster, and you’ll see very quickly if anyone is interested in your site. Look at it as a ‘pilot test’ for your blog. If they are interested, run more campaigns!
Tip: don’t link to your homepage in the ad campaigns, rather link to a specific landing page and tweak it based on the results.
While it’s tempting to run past this phase, take your time and do it right. Spend as much time as possible working out how you can make money from the blog. Don’t forget to explore avenues such as email listings, developing digital products, ebooks, and co-branding with other bloggers.
And ask a trusted friend—one who’s not afraid to tell you what you need to hear, if necessary—to look at the numbers and see if it makes sense. Remember, you’re going to commit to this for the next six months so check, verify, improve as much as possible.
Month 2. Implementation
You’ve now decided which products to add to your site.
Why not services? While I could have made money providing services (e.g. writing technical documents), I wanted to avoid this as it’s hard to scale services and I didn’t want to do more work in the evenings. In other words, while there are only x number of hours in the day to write, you can sell products online 24/7.
The implementation phase works as follows:
- Partner Programs: Sign up to affiliate programs that match your readers’ interests and your areas of expertise, and have a good track record. I used CJ.com to get started but then shifted to other more niche sites as I found them.
- Cost/benefit analysis: Explore the pros and cons of different offerings, for example, while it’s easy to setup with Amazon and start offering books online, look at the profit margin (6-8%) and the number of books you’ll need to sell to earn $100 (it’s about $1,250). Also, look at the buying patterns of your target customers. I found that technical writers took a lot of time researching books before making a purchase and often left to competitor sites to check prices. Ideally, you want to target customers who are more likely to make “impulse buys” or offer products that are very hard to resist.
- Focus on three products: One mistake when you start out is to offer all things to all people. Try to avoid this. Don’t be a generalist, be a specialist. Offer three products on the site and build your content, marketing and networking around these offerings. This also keeps people on the site longer and
encourages them to sign up to newsletters. The other benefit is that you can tailor your ad campaigns to these three items and adjust the landing pages, content, and messages based on the results.
- Offsite sales channels: There is an exception to what I said above. For example, I sell other products through my email list that never appear on the site. Why? Because, I segment the email lists and offer different products (usually special offers I run with co-partners) to each list. Email also allows me to upsell other products and migrate customers across different lists. With their permission, of course.
When starting out, don’t defeat yourself by taking on too much. When you work on the implementation phase, put other tasks on hold for a while and give this all your attention. It’s tempting to stretch yourself and do more than you can.
I’ve created a project plan in Google Docs that shows me what I need to do for each phase. I recommend developing something like this that works for you. Not only does it keep you on track but it helps prioritize what needs to be done today. The siren song of email can wait until tomorrow.
Month 3. Split test
What this means is that you test different pages against each other, see which performs best, and adjust accordingly.
You can also go one step further and test, for example, the layout of ads on different parts of the page, the color of the Buy Now buttons, and the size of your email subscription box.
- Designs: Where is the best place to put your products? Above or below the fold?
- Layouts: Does two or three column work best? Examine ProBlogger very carefully and note where the search, social media icons, email subscription, products and Facebook fan page are placed.
- Colors: Understand how colors influence customer behavior. Analyze sites like Amazon and see how they limit their color palette (e.g. to orange and blue).
- Landing pages: If you sell products, test the pricing, Buy Now buttons (large vs. small, green vs. blue, Paypal vs. Clickbank etc.), sales copy, and incentives. Minor adjustments can have a considerable impact.
- Popups: While this increased email subscriptions, I removed it as it frustrated my most loyal readers. Also most of those who subscribed, unsubscribed rather quickly. Why? They didn’t spent enough time getting to know the site before engaging. Now, I try to keep them on the site longer, which seems to work better.
After a few weeks split testing, orange worked best for the Buy Now buttons. Red signaled emergency/error/warning to readers (at least in the west) and green was too passive. Orange seems to get the balance just right. Your results will be different. Check out Paypal’s ecommerce resource site for ideas.
Month 4. Analyze results
We’re now at the mid-point of our six-month plan. If you’ve ever been on a diet, you’ll know that looking at the results shows what works… and what doesn’t. Once you’ve analyzed the results, you’re much better placed to refine your blog and capitalize on those areas that perform the best.
For example, I noticed that my video interviews had very few comments but ranked very high in the search engine results. Likewise, when I cross-posted them on YouTube, I got more traffic and increases in email sign-ups.
Be careful in the metrics you use to analyze your site. If I used comments to judge my success, I might think the site was failing but these turned out to be my top landing pages. So, I added more content and slowly began to get more comments.
- Metrics: Examine what’s working against the goals you’d set earlier. Don’t get distracted by items outside the scope of your plan. Focus on a few key metrics and really zero in on these. Traffic is probably the weakest metric to use as numerous factors (often outside your control) can influence it.
- Demand: Determine which products are viewed, queried and sold the most. Look at the traffic to these pages, the percentage of bounce-backs (i.e. signals lack of interest or poor web copy), percentage of shopping cart abandonments, and percentage of sales. Note any trends that may explain why they are performing so high/low and what you can do to resolve this, for example, change the price, content, call to actions or offer better incentives.
- Sales vs. Profit: Look at the net profit for each sale. Sometimes you have to pay a commission to third parties or use expensive shopping cart software that eats into your profit margin. You also need to look into the ‘hidden cost’ of answering emails, dealing with support queries, re-shipping lost products, tracking goods via FedEx none of which add to your profit margin.
- Upsell opportunities: In addition to selling your own products, look for ways to upsell other items at, or just after, the purchase. For example, when I sell items through eJunkie, it allows me to offer other items after a sale has been made. The advantage of building your own products is that you can offer these items are part of a bundle or at a discount.
- Tools: One of the issues I had with previous sites was paying for the best ecommerce software ($75 per month) while trying to keep costs down. Ecommerce software such as 1ShoppingCart.com are very powerful but probably out of most bloggers’ price range when starting. If you’re selling physical items, consider PayPal (which let’s you hold monies in different currencies) or eJunkie and Clickbank for digital downloads. Make sure to research all these products and identify potential issues with refunds, payments, commission rates, and other problems.
- Financials: The final step in this phase is to review the financials, for example, check that you’re within budget. Examine where you spent your money, look at the cost of ad campaigns, and expenses such as graphic design work. This helps determine the net profit and see which areas you need to focus on.
Tip: if you are running ads, for example on Google Adsense, make sure to cap the maximum amount for each campaign, so it doesn’t keep running in the background. Also, remember to cancel recurring payments and subscriptions. I signed up for an online software tool, forgot about it, and got re-charged the next year without my permission. Getting the refund proved to be very difficult.
One thing I’ve noticed is that higher value goods tend to have less customer support issues, whereas goods under $10 often generate many nitty-gritty tech support queries. Another issue is refunds. If you’re selling ebooks (for example via Clickbank), you have to offer a 60 day return. What this means is that even if you make sales, some customers will demand the refund. Don’t take it personally.
Month 5. Refinement
At this point, you should have a good idea of what’s working on the site from a financial perspective. In addition, you should see trends and opportunities begin to emerge.
If so, consider adding these to your product offerings, possibly on a limited basis to gauge the potential interest. I use a combination of different Excel spreadsheets to track all financial activities.
Based on the results, do the following:
- Change placement: Experiment by switching the products in different places on each page and rotating banner ads to different parts of the sites. For example, you can test to see if specific products sell better on different days of the week or even at different times of the day.
- Mix: Another tactic is to see where you can combine different products that may not seem complimentary or create special offers for low-selling items. Sometimes it’s easier to sell “2 for 3″ special offers rather than discounts. My interpretation is that the idea of getting something for free is stronger than getting a few dollars off. Or maybe that’s my customers!
- Update marketing strategy: In the first three months, I tested different ways to get publicity, network with others, and find ways to increase my sphere of influence. For example, creating an online glossary of terms for the technical writing industry worked very well. I emailed this to others who then shared it to with other writers. In a low key way, it went viral and generated lots of backlinks. You can try something similar on your site. It just takes a little creativity. Keep your marketing strategy flexible and adjust it based on the results you’ve seen to date. Also, don’t blindly follow what others experts suggest you need to do. What works for them may not work on your site.
- Email campaigns: You’ve probably heard the saying, “the money is in the list,” and it’s
true. When I started out I used Google Feedburner, mostly as it was free. Feedburner is fine for emailing your blog to readers but is essentially a one-way email broadcast tool. Email marketing tools such as Aweber (or MailChimp) let you segment your list, send special offers, and create a stronger connection with readers. While Aweber is not inexpensive, learning to write and implement different email campaigns paid for itself within a few months. The trick is not to abuse the list (which are real people, remember!) and provide value above and beyond what they get on the site.
- Buy advertising: Now that you understand your customers a little better, it’s easier to invest (not spend!) in more advertising. I took out small ads on other tech writing blogs which generated very good responses. Most of the bloggers I contacted were very open to the idea as it gave them some income, even if it paid for the hosting. Maybe you can identify 5 medium size blogs and run some ads on their sites or in their newsletters. Another alternative is to swap ads across each others site. Also remember to change the budget allotment for different ad campaigns, for example, on LinkedIn, Facebook, and Google.
During this phase, the emphasis is on refining the overall model without making any drastic changes. Resist the temptation to change too much at once. Why? When you examine the changes in a few weeks, it will be very hard to determine which adjustment had the most negative or positive reaction. Instead, make small incremental changes.
One of the problems with my technical writing blog was that most technical writers buy things thought their company, i.e. they don’t use their own credit cards. What this meant is that I had to give them enough information to persuade their line manager to buy the product. If you’re selling a product, one suggestion is to include a feature list or product matrix (with a PDF download) so others can print it out and share with the decision maker. If you’re selling a service, include endorsements, headshots of happy customers, and links to professional bodies, if possible. Don’t underestimate social proof.
Month 6. Track and optimize
We’ve now come full circle. We’ve defined the financial opportunities, implemented the products, tested the results, and made the adjustments. The final stage in the process is to track the different revenue streams and optimize where possible.
To do this, look at:
- Statistics: You can link together different Excel spreadsheets (i.e. sales, returns, tax, goals, costs etc) so you can monitor sales at a high-level and also drill-down into more granular information. This doesn’t need to be complicated but I’d recommend having systems in place where you can see (and print out) your sales performance and see at a glance any warning signs or trends that need special attention.
- Goals: In Google Analytics, setup different goals; for example, enter the date when an ad campaign starts, and track its performance for the campaign’s duration. This gives you a more objective view of your site’s performance and is more reliable than your subjective feelings about what’s working. You can export Google Analytics as a .csv file and import it into Excel.
- Investment: Plough the sales profits back into the site. Everything I earned from the site in the first 6 months, I put back into it. This helped the site gain traction faster, build a larger audience, and establish itself as an authority, albeit in a very small niche.
- Quality: If you plan to develop your own products, which I highly recommend, explore how you can improve the quality, not only of the product but for all associated activities. For example, how can you improve the design, boxshots, security, ecommerce software and customer service? Having a dedicated tech support email address gives customers more confidence in your business than a Hotmail or AOL account. Small things like this undermine your credibility very fast. Remember to include a phone number!
- Monitoring: Create (low-tech) ways to monitor your product’s performance and adjust campaigns, marketing tactics, and campaigns as needed. Don’t defeat yourself by creating very complex systems. Instead spend a little time learning how to use Excel and analyze the data.
Tip: If you do decide to sell the website, having this data will put you in a much stronger position.
Six months to problogging
There’s a saying in sports: “fail to prepare, prepare to fail.” If I could share one thing with you regarding running a successful blog, it’s that the more planning you do, the more likely you are to succeed. Why? Regardless of how much you read, tweet, follow, or blog, unless you have a system in place, it’s hard to make real progress.
While you may have random traffic spikes and good sales days, unless you can pin-point what’s really working—and know why it’s working—it’s almost impossible to develop your blog into a real business. And that was the purpose of this post. If you want to move from a blogger to a problogger, see your blog as a business and give it every chance to succeed.
This is the framework that’s worked for me. What have I missed? What would you add?