We’re at the time of year when a lot of aspiring AND established entrepreneurs are thinking about their next move. You may be one of them!
Chances are, if you are planning to pivot in 2022, you’re drawn to the idea of creating a passive income product.
The sad truth is that a lot of people dive headfirst into creating passive products without having the full picture of the kind of work required to make them successful.
Before you go down this road, let’s talk about what is truly involved in creating, marketing, and selling “passive” products.
Do it at the right time for the right reasons.
More often than not, service providers decide they want to create a passive product right when they’re overwhelmed or burnt out on client work.
Similarly, 9-5ers venturing into entrepreneurship will set out to turn their expertise into a passive product right from the start.
The problem with that is that passive income products are not passive initially. They require up-front work so that you can bring in recurring or passive revenue later.
You still have to create it, market it and either build or nurture an audience who wants to buy it. If you don’t have these pieces in place, your product will not sell and you will not make any money on it.
Let’s look at some numbers.
On average, roughly 1% of those who view your product or service will purchase from you. This is true across different offer types along with most industries and niches.
Whether you’re selling an e-book for $25, a training for $149, or a service for $2,000, your conversion rates are likely to be about the same.
What does that mean?
It means that you’ll need a lot more people in your audience, on your email list and clicking through to your sales page to earn decent revenue on a low-priced item.
This is why I teach my clients to operate with a “Premium Service FIRST” strategy for business growth.
With this strategy, you create a sustainable offer that allows you to earn more revenue per client, work in your zone of genius, and create a sustainable business model quickly.
Then, once you’ve done this, you’re in great shape to introduce passive products into your offer suite.
The added benefit of starting with a more premium-priced offer first is that you’re able to help a small number of clients or customers in a meaningful way while making enough income to sustain yourself.
Simultaneously, you’re growing your audience so that when you’re ready to introduce a more passive income stream, you have enough people seeing that offer to create meaningful revenue from it.
How the Premium Service First strategy works.
To leverage this strategy, you’re going to focus on 5 simple steps.
- Identify the thing you love doing most within your work
- Choose the type of person you want to serve through this offer
- Select ONE problem you want to solve for them
- Determine how you’ll help them to solve that problem
- Put a timeframe and price on it
That’s your offer. That’s it. It’s that simple.
Whether you’re pivoting in your business or starting a new business from square one, this formula will help you create a profitable offer you actually want to deliver.
This strategy focuses on getting your clients where they want to go in the quickest way possible, while you work in your zone of genius.
And here’s where things get really cool.
Once you’re delivering a simple offer like this, you have increased capacity to create a passive revenue stream.
You also have more data to help you decide what it should include.
When you work with clients in a focused and intimate way like this, you’re witnessing the areas where a digital product or training would be most useful.
That way, you can create something your clients actually need, instead of guessing or doing market research based on what people who haven’t bought from you are telling you.
You’re gathering the data to create your passive product directly from paying clients based on their needs. It doesn’t get much better than that.
Connecting your passive product to your premium service
One of the great benefits of productizing your service through online training, courses, or info-products is that you can create a natural progression from your products to your premium service.
For example, one of my passive products is the 21 Day Dream Business Journal.
Because I created this based on what clients of mine truly needed, I knew how to make it a success.
When readers purchase this journal, I know they are aspiring or established business owners who want to create a business they love and that they’re in the exploratory phase.
This means that I’m able to give them what they need now, then when they’re ready for more help, my higher-level programs are likely to be a great fit to support them.
This strategy works in all industries.
You can do this with any niche, any area of expertise, and in any industry.
When you begin with a premium service FIRST, you create enough revenue to sustain your business.
Then, you can build out a symbiotic suite of products that work together to support your clients along their journey.
Doing it this way also allows you to grow your business without burning yourself out in the process. If you’ve been around me for a bit, you know that’s what I’m all about.
Grab this free Revenue Goal + Pricing Comparison Calculator to see how you can reach your revenue goals in a way that leverages your time and energy most effectively, without the burnout.
Jackie is an Author, Speaker, CEO, Certified Business Coach and former Fortune 500 and Inc 500 Entertainment Executive.
After hitting severe burnout from years of overworking in high-stress environments, Jackie vowed to slow down and started her own consulting company in 2019. She quickly realized that the same cycle of overwhelm and burnout she experienced in her corporate career is what a lot of women fall into even in their own businesses. These days, Jackie helps Service-Based Entrepreneurs employ smart strategies to grow businesses without the overwhelm through her Education and Coaching Program, Full Circle Freedom™.
In her column on Women’s Business Daily, Jackie draws on her own journey along with the countless lessons she’s learned helping clients transform their work into businesses that put their quality of life first.
Learn more about Jackie’s work and gain access to educational resources at JackiePrutsman.com.