I am not one for income reports (in fact I dislike them and I will tell you why in a future post), but this one was warranted because of an upcoming challenge that I am getting ready for.
Because I plan to publicly open my Kimono during the challenge (you have the right to close your eyes), I felt some background is necessary on why I am getting involved in this challenge. I felt this post was not only needed, but also timely given what I am about to embark on.
I will preview the challenge in the next few posts so stay tuned for more information on that one.
But for now, let’s dissect some numbers…
I will explain what each letter (income stream) refers to below.
This is a screen shot of one of my bank accounts belonging to one of my entities that is comprised of three very interrelated semi authority websites.
If you have read my previous posts in the archives, you may have noticed that I typically group multiple websites under one umbrella business entity for various reasons. When I say entity, I simply mean a legal business structure such as an LLC (Limited Liability Company).
Basically, each entity or company has a set number of web properties under it, and the entity as a whole then has its own EIN (Employee Identification Number), bank account, vendor accounts, affiliate accounts, etc. This way, if I was ever to sell the business (in this case the entity), I can easily transition over all the accounts to the buyer.
The websites that make up this entity are all in the specialty finance niche. Finance is where the bulk of digital ad revenue dollars float in. In other words, financial products and services are the most highly spent on or spent after at least in the online space.
Have a read at where and how Google makes most of its online advertising revenue to put things in perspective. Although I don’t have factual data about the offline space, I am willing to bet that the story remains the same.
Fact: Facebook rakes in roughly $4Bn in annual advertising revenue
Now the reason I decided to lump these particular sites together is because of the interrelationship of these topics and the product and service mix they offer.
For example, imagine creating a website about birds, and then one about bird cages followed by one about bird seeds. Do you see how or why someone interested in one may also be interested in the others? This is not only a good way to leverage traffic and readership between your web properties, but also a great way to up sell and cross sell products and services.
The difference of course is while bird seeds and cages may cost you $10 to $100, the products and services in these financial sites average in the thousands of dollars, and even in the hundreds of thousands. And although I don’t believe I have reached the million dollar spender (there are several multi-million dollar online businesses targeting that specific client), the offering of these websites satisfies the million dollar appetite as well.
The two relatively large numbers other than Google Adsense that you see in the image are a result of the product pricing structure that I referred to above. These are lead generation commissions. The beauty of these is that they are passive and residual in nature. Basically, once you refer a client, you keep getting paid by the vendor as long as the client continues to do business with the vendor.
The best example I can give you is insurance. Once you purchase life insurance from your agent, each year you renew it, your agent makes a commission. If the same agent sells you disability insurance in the future to secure your number one asset, which is your career and the income from it, then the agent makes more money on an annual passive and residual basis.
Then you bring in your wife’s policies, your retirement accounts, and all sorts of other things. This is how the income keeps growing off of one client/customer only. The same principles are at work in the above example.
I picked these topics because of my educational and professional background. You can read more about me here. Given my background in the financial services industry, I know where the “real world” or offline money flows. Now I don’t know everywhere that it flows, but I know of a good number of avenues where it flows.
These websites are not micro niche sites either, so unlike micro niche sites where keyword research predicates everything else, my approach when establishing these websites was to start with what I knew first and foremost. I later conducted keyword research to create more content on sub topics that people are searching for.
The key here in a nutshell is that I started with topics I know inside out, or am passionate about, or have interest in, or have a STRONG desire to learn about and then followed with keyword research. Are these the topics I am most knowledgeable and passionate about? No. But I know a ton about these topics and enjoy them as well.
So am I then saying that keyword research is not important? No. It is. But it is not a deal breaker in many cases. It shouldn’t be at least. I think its importance was blown out to unprecedented proportions and we all got carried away mainly because of the niche site craze.
Could keyword research have turned me off given the data I saw? Possibly. But in this case, in spite of the not so ideal data from keyword research, I knew I could establish a successful website because I knew these topics inside out. In fact, as you can imagine, from a keyword research perspective these topics are relatively more competitive given their nature and the “players” in this field.
So the keyword research wasn’t exactly stellar, but I decided to pursue these anyway. I had made a commitment to make these sites semi authority sites because I knew it was going to take a lot of content, and solid content, to stand a chance against the big boys. Semi authority sites are what I refer to as websites that are built with a decent amount of content. However, the content is expert content in that the writer knows about the topic inside out, thus the authority aspect.
When I observed the competition that was ranking high on search engines, I noticed that most were actual service providers that had relatively large websites, but disparate in nature in terms of content coverage. Those that focused very narrowly on either of the topics I chose were relatively thin compared to the sites I had committed to establishing.
The old adage that content is king remains true in this case. I created a lot of it. A ton of it. Way more than the competition has. As a result, over time, I was able to inch higher on search engines and claim a small percentage of a very large pie. Most of the time that is all we really need.
To give you some idea, these sites average about 80 pages each, with more than half generated by myself and the rest outsourced to expert writers and not just the lowest charging writer I could find on Elance.
I did not monetize these websites until a good 4 months into building and marketing them. The numbers you see above are roughly 18 months into these websites. Another anecdote that demonstrates that if you put in the work, the results will eventually come providing that your strategy and approach is sound (that’s actually the easy part).
Before I breakdown the income, I just want to emphasize here that there are two distinct ways you can establish multiple streams of income. I get so many emails from people asking me what else they can do to create new income streams. A lot of times they already have viable vehicles such as a website that is receiving decent traffic. Why look outside when the solution can be in your backyard?
Here is what I mean. You can surely establish multiple independent streams of income such as multiple websites each of which generate advertisement revenue (the replication or rinse and repeat model), or you can take an existing website that is already generating ad revenue and simply add more income streams to it. For example, repackage some of your content into an ebook and sell it on your website. Or add some affiliate offers. Leverage the traffic you already have.
You will have created multiple streams of income in either case. This is exactly what I did with each web property in this example, thereby establishing multiple streams of income per web property across multiple web properties.
Here is a breakdown of the earnings. A lot of these earnings were generated in May and paid out in June. As you likely know, many vendors pay at least one month in arrears. Some take much longer.
A – this is a royalty payment received from the Google Books program. I had recently submitted an ebook tied to one of the sites to test it out on Google. It made a whopping $15.59 for me in June.
B – this is the same ebook that has been selling on Barnes and Noble. Sales were actually better in previous months. But $94 in royalties nonetheless.
C – the same ebook once again, except on Amazon
D – this is the big one. An exclusive affiliate relationship with a vendor that compensates for each lead. Each lead can be worth tens of thousands and even hundreds of thousands to the vendor, therefore I am sure they are happy to offer a mere $13,909 payout in exchange for the leads.
E – $6,710.26 in Adsense. Some of these financial keywords pay in the $60+ range.
F – ($202) A check I issued to a local freelancer in town
G – $2,495 in private advertisements
H – $74.02 from Commission Junction (thinking about getting rid of this completely)
I – $222.36 in commissions from supplemental products I market on the sites as an affiliate
As you can tell the focus of these websites is primarily lead generation. That is quite apparent if you were to visit the sites. They are designed with lead capture as the first and foremost purpose.
The secondary focus is advertisement revenue. I will be focusing on shifting away from Adsense and concentrating more on private ad placements going forward.
The biggest understatement that I can give you at this point is that it took a lot of hard work and patience to get to this stage. I don’t think I can ever articulate that well enough in words to truly convey a true sense of appreciation for the work and time it takes. However, anyone can do it in their respective area(s) of expertise and that’s a fact.
I know that I invested a ton of hours thinking through and building out the content of each of these websites. Even when I outsourced some of it to expert writers, not only did I pay a good amount for their work, but I spent just as much time reviewing and adding my thoughts on each piece as if it were my very own. Content relevancy and congruency is huge for me, and Google Penguin will agree with that!
And after having said all that, there are two main things I want to conclude this piece with:
First, I will be publicly experimenting with an online project from start to finish (if you can ever call something a finished product). This will be around a topic I not only know inside out, but one that I live and breathe.
Second, the micro niche site craze took us away from what is truly important, including myself, who lost perspective for a minute and got carried away with several micro niche sites chasing the dollars. Sadly, but deservingly so, many of mine failed flat on their face. They were bound to frankly.
We often loose perspective when shiny objects are flashed in front of us. Every blogger, including myself was talking about niche websites, keyword research, the tools and resources and everything that came with it. We were all chasing a temporary solutions that eventually got caught up on by search engines.
It’s time to go back to the basics. It’s time to offer something we are true experts in.
Topic selection is still key, but for all the reasons we forgot when we chased solely the dollars. Let’s refocus on what has always worked and what will continue to work.
Let’s get real. Let’s put in the sweat. Let’s focus on what matters. Let’s focus on longevitiy. Let’s focus on expertise. Let’s focus on quality. And in doing so collectively, let’s focus on excellence, and success (money) will follow us . . .
What are you working on these days? Are you still chasing after the dollars or building a solid, long term sustainable business in a subject matter you know inside out? Are you for or against income reports? Why?Previous: Why I Declined a $40,000 Offer to Sell My WebSite