Picking a Profitable Site Topic
Now that we have our WordPress framework setup with all the functionality needed to get started, we'll be turning our attention to how Akira's Custom Tattoos looks - the theming and branding of the site.
That's where we really breathe life into the business and make it something unique and appealing to visitors.
Up to now, you may have been following along as I put together Akira's site, or you may have generated an idea of your own and you're using what I'm doing as an example to get yourself going using the same blueprint.
That's actually how I see you using these lessons most effectively and why I refer to this course as a guided implementation plan. At the end of it, I want you to have a fully functioning, data-driven, highly automated, and sustainable business that is generating an income for you and your family.
Ultimately, that means you need an idea of your own to use from here on out.
If you've been following along, you've setup an Azure trial, installed WordPress and the best plugins and now have a site running somewhere at http://yourchosenname.azurewebsites.net. It really doesn't matter what you called it - as we'll eventually be pointing a top level domain (TLD) such as http://yourchosendomain.com at it. So don't despair if you started something and after reading this, decide to change it. If it really bothers you, you can always delete the current web app in Azure and start over. Unfortunately, you can't change the name of it.
So - now - you're going to need some inkling of what you want to build and invest your time and effort into. More than that, you need to be fairly certain that what you want to build is a good business idea with a potential to generate income. Compared to everything else, coming up with that topic or idea is the most difficult part of all of this.
There is no magic solution or easy button for it. Topic or niche selection is a bit of an art. But, what you can do is use data to validate the idea before spending too much time, effort, or money on it and there are best practices for deciding what to focus on. Like the Google X Factory does - any idea you pick - if it's going to fail - has to fail fast rather than waste time and resources.
You won't truly know that an idea or product has potential until people physically pay you for it. It's not good enough that friends or family tell you it's a good idea. It's not good enough that strangers are willing to sign up for your newsletter or visit your site. It's not good enough that you've checked all the numbers, the traffic and competition, and are sure you have a winner in front of you. The only thing that matters is that someone actually hands over hard earned dollars in exchange for what you have. Only then, do you really know you have an idea that can develop and grow.
So what makes a viable business idea or niche?
It's a combination of traffic, competition, and value. There has to be enough people looking for what you have to generate a decent amount of traffic to your site. You have to be offering something that is different than what your competitors are offering in some way. You have to be offering something that has enough value that people are willing to pay you for it to solve their problem or enhance their lives in some way.
To top it off - you ideally want to sell something that keeps your customers coming back and buying multiple times. This increases the lifetime value of your customer. It's far easier to keep a customer who has already bought from you and trusts you, than it is to continually generate new customers for one-time sales.
Vital Point - Conversion Rate
Conversion, measured as conversion rate, describes how effectively one thing changes things into another thing. In concrete terms, one conversion rate you'll track is the conversion rate describing how effectively your sales process (website) turns visitors into buyers. The higher your conversion rate, the more profit you'll make so it's obviously a data point you want to track and continually try to improve.
Using a concrete example, a site with 1% conversion rate means out of every 100 visitors, 1 person buys. If your product costs $10, that 1% conversion rate means you make $10 for every 100 visitors. If you increase your conversion rate to 2%, you increase your profits by 100% - going from $10 to $20. Now consider it at scale where you have 50000 visitors to your site each month (which is totally doable). 1% conversion rate equals $500/month, 2% is $1000/month with no additional work other than optimizing conversion rate.
You can increase profits further without much effort by increasing the value of the product you provide - but I'm starting to stray from the focus of finding you a profitable topic or niche. We'll get into monetization strategies to turn your site into a profit making machine a bit later on. For now, we need to focus.
Different Schools of Thought
There are people who will tell you that your topic should be based on your passion. I don't know about you, but my passions change and if you were to ask me what I'm interested in to the exclusion of everything else - I would find it super difficult to come up with an answer.
Other people will tell you that your topic should be whatever has the potential to make the most money regardless of whether you have an interest in it or not - making money is the goal of business after all.
It's not so black and white - I believe the answer is somewhere in the middle - a place where the topic has the potential to be profitable as well as being something that you're interested in learning more about or already have an interest in.
When I came up with the idea for Akira's Custom Tattoos and identified it as the project to use for this course back in the beginning lessons, I didn't just pull it out of thin air or choose it on a whim. It was because it has commercial viability. We'll cover the actual data behind it in another lesson, but there are people looking for custom tattoo designs, tattoo equipment and supplies, information on tattoos and so on. It was also because I know my daughter has an interest in designing and drawing things people like to permanently etch into their skin. So - the topic and the potential for profits generate and idea together that has a fighting chance of turning into a profitable business.
Something like cat videos, while interesting to some, may not have the same level of commercial potential. And similarly, something like computer monitors holds zero interest in my daughter's eyes. Without that interest, there is no way you're going to maintain the motivation to consistently work on your business day in and day out. This whole process must provide some kind of enjoyment and have importance to you.
You're looking for the sweet spot - the place where interest and commerciality overlap.
The Right Kind of Business to Focus On Building
People long to connect with other people and feel a sense of belonging to something. Clubs have long served this need offline, and technology has evolved to the point where an online club is just as interactive and capable of fulfilling the same needs and wants. Arguably, an individual will more readily join an online club due to the relative level of anonymity and decreased perception of effort and commitment involved.
It is simply a natural tendency for people to gather and form clubs around similar interests and goals. With few exceptions, human beings are not solitary creatures.
Now, think for a second what would happen if you were able to create an online club that provided valuable digital content, released regularly to a like-minded community of people willing to pay for it. You’d have a thriving, profitable business and by paying for access, members of that club automatically feel part of something exclusive. When a helpful community is built around that, their loyalty to the group soars.
The online club membership model provides instant access to almost unlimited numbers of potential members to provide recurring, passive or near passive income requiring little to no technical knowledge or overhead.
When I say recurring, I’m talking about developing a constant revenue flow. This is usually accomplished by charging a weekly, monthly, or annual fee to be a part of the group. Monthly is the most common and creates the most reliable, stable environment for your business. Weekly can be too short and results in customers developing a sense of under-value due to constant charges or withdrawals on their account. Yearly provides little incentive for members to remain active and many will potentially forget they joined, and then wonder a year from now when another charge hits their account.
Broadly speaking, monthly seems to be the optimal length of time for a membership if for no other reason than it is what the majority of people expect when joining any type of club. That’s not to say one can’t experiment with other forms and lengths of payment. Testing is an integral part of business that we’ll explore later on.
By passive, I’m referring to income that comes to you whether you do any additional work for it or not beyond the work of the initial business setup. Your online club will provide a product or service and helpful community. If that community is enough to retain that member, then great, you don’t have to do anything else and that monthly membership fee will continue to be paid on time generating a completely passive, recurring income.
More realistically, you will have to provide additional value to your members, incentives, answer questions, and release content on a pre-defined schedule to persuade your members to stick around. The more work you have to put into the business, the less passive the income becomes. With a membership model business, I use the term semi-passive because the amount of additional effort you have to expend will depend on the health of your community and the loyalty you have built up with your members. That loyalty and trust will incidentally be the bedrock of backend income you can make in addition to the monthly membership charge – but more on that later.
Focus your time, effort, and money on building a club based on a great product that has loyal, active members and you will have a thriving and highly profitable business.
STEP 1: CHOOSING A PROFITABLE TOPIC
Build it and they will come is not a viable business strategy. You may get lucky, but if you pick wrong, you will spend weeks, months, even years developing a product for a market that does not exist. You will waste your time and money.
You need a real reason for people to join your club. It has to provide outstanding value and be something that potential members crave and will continue to crave. Ideally, your product and club will improve some aspect of your member’s life or his or her perception of it, whether that is by solving a problem, teaching something, providing entertainment, creating connections and so on.
Consider who the product is for
Remember that your potential club members will possess varying levels of knowledge and skill. Ideally, a vibrant, active, helpful community will form when there is a suitable mix of skill levels from beginner to expert. The experts in the club eventually become a valuable resource to help the beginners. When this occurs, they will free you up to focus efforts on building additional clubs and income.
However, in the beginning, you target the beginner with your product. I’ll cover this in more detail later, but targeting the beginner allows you to do market testing to confirm your chosen market is viable. You build and release your product one chunk at a time, staying one step ahead of your member’s craving for what you’re promising. After some time, your product will mature, develop, and naturally cover more advanced topics. At this stage, it ceases to become a club just for beginners and you can expand marketing efforts to recruit other experts.
In the beginning you are heavily involved in the club. You will answer questions and help your members with every issue. You focus on the beginner –someone who is new to your club and is eager to learn what the club is teaching or doing. You provide a product that will take that beginner from being a beginner to being a novice – someone with a limited amount of skill. Then you release, on a set weekly or monthly schedule, additional content that keeps them paying the monthly membership fee to continue to progress in the club.
Your goal, though, is to ultimately develop your product over time to appeal to both beginners and experts. When your product matures to that point, the magic happens and your club starts to run itself. Those with more skill will begin answering the questions and dealing with the problems that only you could answer before. You can then diversify and start another club to further increase your income or simply manage the club and enjoy the additional time and money you have.
Also consider that as you progress to higher levels of skill in any chosen topic, the market shrinks. There are simply fewer experts than there are beginners. Therefore, focusing on the beginner at first gives you access to the largest base of potential members and the best chances of a larger recurring income.
So, bottom line, build a beginner product and a continually growing outline to expand the product over time.
How do you know people are willing to buy a membership or what kind of club will they pay for?
So, what kind of club do you want to run? A more important question to ask yourself is - what kind of club do you want to run that people will pay money for every month to be a part of? In other words, what market should you focus on to create recurring income?
There are three big markets that have proven time and again to be viable and profitable. They are money, health, and relationships. There are plenty of other niche markets as well, but if you’re stuck for ideas, I’d suggest using one of the big three as your starting point.
The easiest way to find a profitable market and create a product for it is to see what people are already buying and then model one of them. Let me be very clear that modelling is not copying. Modelling uses an existing product as a starting point which you then change and improve on. Copying is plagiarism and plagiarism is a no-no. Don’t even think of doing it.
How exactly do you find that profitable market and develop a product for it? The 2-3 step method I use is very effective:
1. Facebook Pages and Groups. Facebook may already be telling you which kind of club you should focus on. Depending on how much information Facebook is gleaning from your profile and posts, the recommended pages and groups displayed as suggestions to you are likely pretty accurate in identifying interests that you have. With a few clicks you can determine the size of the market for that topic and how much existing competition there is. If one of those suggestions does interest you and you can create a product fulfilling a need expressed in those communities, you are sitting on gold mine. Build and running the club will not only make you money, but you’ll enjoy being a part of it. If there isn’t anything that immediately interests you, you can browse Facebook groups and analyze topics until you find one that does interest you in a sufficiently large enough market.
2. Amazon. After finding a suitable market, I check it’s profitability by looking for patterns in the bestseller lists at Amazon for the potential topic. Actively selling books are an indication of a market willing to buy information. Amazon reviews often also provide recommendations for improvements that you can incorporate into your product. In short, someone willing to buy a book on a subject is also likely willing to join a club that can provide even more value than the book.
3. Clickbank. Not an essential step, but I often check the potential subject on Clickbank to determine if any related products exist that can contribute to backend sales in the future. This marketplace is a listing of affiliate products that sites recommend to their visitors. If products concerning your topic exist (or related topics), and they are also selling, it is another indication that the market is viable. The metrics Clickbank provides allow you to see what is selling including average price per sale and resale. As a future earning tool, these are products you may recommend to your club members that will boost earnings with backend income.
Once you know what to look for at each of these sites, your topic almost chooses itself, and your product almost builds itself. I’m now going to put myself in your shoes and run you through exactly how to do this using 6-Figure Club tools.
Let’s run through an example:
1. First, I download and print the STEP 1 - CHOOSING A PROFITABLE TOPIC CHECKLIST.pdf file from the files section of 6-Figure Clubs. That checklist will keep me on track and focused during this market research effort
.2. Next I will use Microsoft Excel (or other program that opens .xls files) and open the TOPIC AND RESEARCH WORKSHEET.XLS file from the files section of 6-Figure Clubs. I’ll save it somewhere on my hard drive where I can find it with a file name such as TOPIC AND RESEARCH WORKSHEET 19 DEC 13.XLS.
Note: Alternatively, I can download and print the TOPIC AND RESEARCH WORKSHEET.PDF file from the files section of 6-Figure Clubs and do the research offline.
3. I’m now ready to login to my personal Facebook account.
Note: I have multiple accounts as I keep my personal life separate from my business activities. Each club you develop will have its own account which I’ll cover later. I’m sure to use my personal account so that Facebook suggestions closely match my interests.
4. I’ll go to my pages feed page and look down the right hand side until I see Recommended Pages and click on “see all”.
5. The page that loads will be a big list of Facebook pages that I might be interested in. I will scan the page and identify potential topics, creating a new tab for each topic in the Topic and Product Research Worksheet.xls (or separate page if using offline version). For this example, I’ll create one tab for Barefoot Running which is one potential topic suggested to me and put Barefoot Running into the topic column. (see Fig A. Note 1)
6. I determine the potential market size by adding up all the likes on each page for Barefoot Running and record it on the worksheet. It will be an approximation as I will not search through every single related page. That would take too much time. I usually limit myself to first three pages. In this case, I enter 13618 into the # of likes column. (see Fig A. Note 2)
7. Next, I’ll enter my potential topic (Barefoot Running) into the Facebook search bar. The bar autocompletes, so I scroll down to “all suggestions”.
8. On the page that loads, I look at the main navigation bar and click on Groups to give me a listing of Facebook groups (other clubs) that already exist related to Barefoot Running. I’ll identify and record the top 5-10 groups in that topic and record on worksheet including whether it is open or closed. In this case, I’ve only entered the first group. (see Fig A. Note 3)
9. I’ll also record the number of members each of those groups has on the worksheet. This will give me an idea of the competition that exists for clubs related to that topic. I won’t be too concerned about whether there is a lot of competition or not, as my product and club will be an improvement on whatever currently exists. A lot of groups and competition is not necessarily a reason to give up on the potential topic. In this case, 1544 is put into the # of members column. (see Fig A. Note 4)
10. For each group I’ve listed, I will click on it and join if it is a closed group. When I have access to the posts, I will scan them and record in the appropriate column on the worksheet all questions being asked by members in the group and all products being marketed. Rather than write every question word for word, I’ll indicate the number of similar questions that exist. Each product will have a separate entry. (See Fig A. Note 5)
11. Once I’ve completed step 10 for each group I listed in Step 9, I’ll head over to Amazon.com and enter the potential topic into the search bar and using the dropdown on right side of page to order search results by “Relevance”. This will ensure the books listed relate to my topic.
12. Back to the worksheet, I’ll record the titles of the top 3-5 books including price. Usually the most popular books are listed first, but verify rankings to ensure that is the case. (See Fig A. Note 6)
13. I’ll click on each book to get to its details page and scroll down until I see the ranking and record that on the worksheet. I’ll then use that ranking at http://kdpcalculator.com to get an approximation of how many books are selling each day. In the sales column of the worksheet I’ll enter both the quantity of sales as well as value/day (book price x number of sales/day). (See Fig A. Note 7)
14. Next, like I did with Facebook Groups, I’ll scan the Amazon reviews and record any suggestions for improvements, complaints, and other feedback (including positive feedback). My product will incorporate the relevant improvements while ensuring the positive points remain part of the product.
15. Once complete for that topic, I will repeat the entire sequence for the second, third, fourth topics and so on. I recommend analyzing at least two potential topics, but more is obviously better. The work will not be wasted if you don’t choose a topic, it may well be a future club. Once you’ve analyzed a number of topics, you determine the most viable market by choosing the topic that:
a. Has the most interest (as determined from # of likes and # of group members)
b. Has the least competition (as determined by # of groups)
c. Most potential profit (as determined by sales and value/day)
Note: This is not an exact science, but this analysis does give you better odds of choosing a profitable target. Be objective and in the end if you know the topic, trust your intuition.
I didn’t investigate this topic fully, but with the posts/questions/products I did record, a couple patterns were already starting to emerge. There may be others, but the following topics are the beginning of a great product/club on barefoot running:
a. How to start barefoot running
b. How to run barefoot in the winter (can be extended to other climates as well)
c. How to deal with barefoot running injuries
Just to be extra sure, I’ll double check whether people might be willing to spend money on a club on barefoot running, especially if the top selling books on Amazon aren’t selling many copies. When this happens, I do a check to see if anyone is selling barefoot running products as an affiliate:
1. Head over to Clickbank.com, click on Marketplace and type your topic (barefoot running) into the search box. Doing that does not yield me any results, but if I expand to the larger market of running, I get a couple.
2. A quick search on Google for barefoot running affiliate programs only turns up a couple that are promoting their books on Amazon.
Does this mean that barefoot running is not a good topic? Perhaps, or it could mean that nobody has built a product that appeals to them. This is where your knowledge and intuition come into play. If you are researching a topic you know something about, you are going to be able to draw deductions based on your research. It will be more difficult on a topic you are not aware of. But – a warning – the last thing you want to do is rationalize that a topic is going to be profitable because you’ve fallen in love with it. Look objectively at the numbers and be sure it’s something you want to invest time in.
It is clear from my research is that interested persons have formed communities. They have formed groups and because I know something about running, I can tell you that local running support groups are very popular and spend a fortune on running paraphernalia. Barefoot runners in particular are almost cultish which translates to loyal club members. While it might take a while to grow a club around this topic – I would likely take a chance on it.
And that’s all there is to it. Congratulations, you have a profitable topic for your 6-Figure Club.