217: Behind the Revenue: How I Actually Make Money in My Digital Product Business

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Welcome to the Creators MBA Podcast your go to resource for mastering the art and science of digital product entrepreneurship. My name is Dr. Destiny Kopp and I help business owners generate consistent revenue from their digital product business without worrying about the social media algorithms. I hope you enjoy our episode today.

Hi there Destiny here and welcome back to the Creators MBA Podcast, the show where I help you grow consistent digital product revenue using smart systems scalable strategies with a little help from AI. And in today's episode I am pulling back the curtain and giving you a behind the scenes look at how I actually make money online and what you can learn from it as you build or refine your own business model. Now today I'm going to walk you through the most common revenue streams for digital product businesses. Which ones I use in my two brands and which ones I don't do anymore and why I moved away from them. The pros and cons of each model so you can choose what works for you personally. Now I will say there are a lot of shiny business models out there and it's so easy to get distracted by what other people are doing. But what really matters is picking a model that aligns with your audience, your own personal business goals and your lifestyle. So let's get right into it. The first thing I want to talk about are what are your options? And I want to give you a little quick tour of digital product business models. So when we talk about business models for digital product creators like you, what we're essentially talking about is how you generate income from from your expertise, your content or your audience. Now here are the most common ways people like us will monetize. The first is low cost digital products. So think like ebooks templates. The second is courses and mini courses. The next one are what I would define as memberships or or subscription type models. And then we might have some live events in there like summits and you might monetize those with like a VIP pass and a funnel that goes on the back end of that. You might have some one on one coaching or group programs. You might have some done for you or done with you services. Even though we might be creating like digital products too, you can do and make money from affiliate revenue, sponsorships and ad placements especially if you have built up your audience. If you have built up your email list, you can make money like from bundles very similar to the summit type model that I talked about. And you can also make money from more high ticket type offers where you might have a higher ticket type group coaching program that might have some done with you or done for you services in there. Now, you don't need to do all of these in your business. In fact, I would argue that you probably shouldn't. It would be too much to have all of these revenue streams in there. But really understanding all of your options helps you build a more intentional and profitable business. First, let me kind of break down my revenue streams and how I actually make money online. And I'm going to break this down by brand. So you can see how I use different business models in different ways. There's a lot of similarities here, but I want to break these down. The first is my B2C brand, which is hobby school. So hobby school is what I would consider like a creative lifestyle type brand. So it's for crafters and hobbyists and creative entrepreneurs who want to have fun, make things, and maybe even monetize their skills. So here's how we make money in hobby school. The first is we host live virtual summits. I do five of those a year or that's what I'm doing this year. And it has free access to the live virtual summits. And on the back end of that I sell our VIP pass and it has a funnel that goes along with that. But we are also starting to evergreen our summits, meaning we're going to repurpose the content and we'll continue selling these VIP passes even after that live event has ended. So we're going to basically evergreen the summit, treat it like it's live, like run it like a live event like we normally would. Even though it's event that we have ran in the past and we're going to still sell the VIP passes there. And what I love about that model, it really does add that long term value to each summit that we're producing. So if you've ever put together a summit or been involved in it in any sort of manner, you know that that host has put a ton of time and energy into that. We spend probably, you know, at least three to six months before each of our events finding speakers, working with them, answering them, answering their questions, getting their information, following up with them, putting all the promo material together for them to promote. So there's a lot of work there. So being able to kind of repurpose that content is a huge benefit. The other thing we sell in hobby school are our low cost digital products. So we're selling things like printable planners, coloring books, digital journals, and we're doing all of that through our Shopify store. So these are low ticket offers. That people can purchase basically anytime. The other way we monetize in hobby school are memberships. Right now we have two in and we're going to be adding a third one or that's my goal. I'm still working on it. But the first is the craft and Create club. And then we have our part time passion club for people who are interested in kind of monetizing their hobby. The other revenue stream that we have in hobby school are sponsorships and ad revenue. Now I don't do a ton of this, but I do monetize at sometimes through sponsored email placements. I might have some event type partnerships there where I'm getting revenue in and then affiliate revenue. Again, I don't do a ton of this, but I do earn some commissions from a few select tools and platforms that I use and love. To me it's easier to promote if it's something that I generally use and believe in. Okay, now let me move on to my personal brand which is my destinycop.com brand which is part of the Creators MBA podcast. And this brand is focused on helping digital product creators grow and scale their businesses. And here's what I do under this particular brand. First again I have these low cost digital products, these low cost front end type products. So I sell these products through optimized funnels that also help me grow my email list and generate basically daily cash flow. So these might be swipe files, mini trainings, toolkits. Also I have a Shopify store here which is called hello Content where I sell marketing templates, course resources, workshop materials, content bundle and really all of those are designed to help other creators get results faster. Right? It helps them put together their lead magnets, their sales pages, their email sequence and then memberships. So I have two in my personal brand I have my newsletter profit club for creators who are wanting to grow and monetize their newsletters. And then I have my digital product growth lab for business owners who are ready to implement systems that drive consistent digital product revenue from their products. Here too I also have affiliate revenue. So there are some products that I use on a regular basis, like my email marketing software, some other design tools. Obviously I promote ThriveCart. I'm a huge fan of that. The other area that I earn revenue are affiliate revenue. And here I promote platforms and tools that I use specifically in my business that I use on a regular basis and I love and then occasional sponsorships. While it's not a huge revenue stream for me here, I, I do earn money from some email placements and sponsorship, collaborations. So here's what I no longer do or what I have walked away from and said, you know what, this is not going to be part of my business model going forward. The first is done for you services. I used to do that. I have done that in the past. I've also been a Facebook ads consultant. Completely walked away from done for you services. So that's not in my business model. There's nothing wrong with that if that's part of your business. But I have made the decision that that's not going to be a way that I earn revenue. Also more done with you type programs. I don't have any of those right now. Will I do them in the future? I might, I might launch like a done with you type program that's more, more higher ticket where I work with people, you know, like for six weeks to put together like a webinar funnel or a tripwire type funnel. But right now I'm not doing that and I don't have it on the roadmap to do. Not saying I won't do it in the future, but right now it's just not there. Also one on one high ticket coaching. Now I did fail to mention in my personal brand, I do one on one coaching via Voxer. Okay. So I do that for my VIPs in my digital product growth lab. So people can basically upgrade and purchase the one on one coaching through Voxer. I do that on Wednesdays. So if they have any questions whatsoever, I'm there all day. They can ask questions, I'll answer them. What I'm not doing is what I would consider like my one on one high ticket coaching where I'm getting on zoom calls every single week with somebody and you know, basically being extremely, extremely hands on in their business. All of these business models that I have talked about today or ways to earn revenue can be extremely profitable. So it really kind of comes down to what is your vision for your business and how do you want to spend your time? Now, for me, I decided and made that decision to serve a more broader audience at a lower price point rather than a smaller audience at a higher price point. Again, I'm not saying that either one of those decisions are right or wrong, but that's just the decision that I made. So that kind of begs the question, what are the pros and cons of each of these business models? So here's what I have learned over the years because I feel like I have done absolutely anything and everything there is out there to do except maybe for an agency model. I haven't done that and I definitely don't want to do that. But let's talk about these. Okay, so for low cost digital products, I'm going to give you some pros here. I think they're great for list building and kind of getting that daily revenue. I also believe that they're scalable and they're easy to automate. Some cons are is you need traffic, right? You need a lot of volume for that model, either through ads or SEO or collaboration. And I would say that for me it's been mostly collaboration and I'm thinking about hobby school gear mostly. We've done that through collaborations and that has certainly worked with the virtual summit model. We've also done some paid ads and a little bit of SEO and Pinterest there. Also margins can be very thin unless they are kind of paired with the upsells or funnels. And we have definitely have done that and that is help tremendously with the, the profit margin there. So in our funnels we make sure, you know, we have the VIP pass sale, we have order bumps. We most of the funnels will have like three upsells on the back end of that. The next business model are memberships. Now I definitely love memberships. I have four of them right now. We're thinking about adding a fifth one. But here's the reasons why I love memberships. First of all, it gives you that predictable monthly income and it builds customer loyalty. So you're interacting with your clients, with your customers on a regular basis. So they know you, they love you. It also requires, on the con side, it requires regular content and retention effort. So you're almost constantly having to prove yourself right because you want people to stay in your membership. And it can be time consuming without systems. So you have to have those systems in there. And I do think that we have some really, really solid systems in place for our memberships. Next one is courses. So the first would be more higher ticket without ongoing delivery. That's a pro to a course, right? You can charge a little bit more for it and you don't have to deliver like monthly content like you do with memberships. Also, courses work very, very well with evergreen funnels. So you can do your live launch, take that content and evergreen it a con to. This would be lower completion rates unless you have support that is included. Also, courses can require a lot of upfront creation. Now generally what I suggest you do is kind of do it live with a cohort of students, take that content and either kind of Rerecord it or even use that content. So that's kind of my preference for creating courses. Now let's move into like affiliate and sponsorship type revenue. The pros to this would be low effort and it can have a high ROI if it's aligned with your audience. So I'm very, very particular about who I do sponsorship partnerships with, affiliate partnerships with because it really can work very well or you don't see a result if it's not aligned with your audience. A pro here is you don't have to create products, but depending on your audience size and audience trust, you might not make as much money and it can be inconsistent or quite frankly really out of your control. Now moving into the done for you or high ticket coaching, more of the higher priced offers. Some of the pros are you have high margins and you can have a transformational impact with those type of offers. And it can be for some people easy to sell if you have authority in the marketplace. But here you are really trading that time for money and it's very, very hard to scale these without a team. A lot of times with these higher type offers, you know, you might even see people having like a sales team to really sell them. If you're, you know, if they're having to sell like an $8,000 package or a $10,000 package, it's hard to do that without a team, a sales team behind it and you might even have to hire people to help you deliver it. So you're going to, in most cases you're going to have a team behind you for these higher ticket type offers. So now let's move into how to choose what's right for you. And I will say that there are no perfect business models out there. I do think what I have landing on is perfect for me might not be perfect for you. But I absolutely love my personal business models. But here are three questions that I would kind of put out to you to help guide your decision for your own business. The first is how much time do you want to spend delivering your offers? If you want more time freedom, I would say lean towards more passive or semi passive model. That's me. That kind of work I want to be. The next question is what does your audience actually need and how do they like to buy? Think about it, are they more do it yourself type people or do they want more hand holding, more step by step guidance? Do they want you to kind of do it for them and also what's sustainable for you both mentally, emotionally and logistically? Right. Because Just because something is profitable doesn't mean that it's the best fit for your business, for your life. Okay, so here's your action item for this week. What I want you to do is take out a blank piece of paper and list every product or offer you have or want to have. And next to each one I want you to write down how it delivers value, how it generates revenue, and how much time or energy it requires from you. And then ask yourself what's working, what's worth kind of doubling down on, and what's not aligned with you anymore. So just think about that if you are doing like done with you or done for you type offers, is that what you want to continue to do in the future? So just ask yourself this questions. If you want support choosing the right model and kind of building it out with smart systems that generate consistent digital product revenue, I'd love to have you inside the Digital Product Growth Lab. Thank you so much for tuning in to the Creators MBA today. If this episode helped you clarify your next step, please share it with a friend and leave us a review. I would love to help more creators find this show. Until next time, keep building smart scalable systems and I will see you soon.

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