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PNP.com Archive |
E-Ezine - Free marketing resources,articles,website promotion tips
Explode Your Online Business With
Membership Sites
By Jim Edwards
A cardinal rule of business, whether online or offline, goes
something like this: It is ALWAYS easier to resell an
existing customer than it is to find a new customer in the
first place.
Almost every business spends the greatest amount of money
and time attracting new customers (advertising and
marketing), while viewing retention of existing customers
and meeting their needs (customer service) only as a
"necessary evil."
One of the fastest and easiest ways to exploit this business
principle of reselling existing customers online involves
setting up a membership site where customers pay you monthly
for a service, updated information, or something else they
want on an ongoing basis.
Let's look at the numbers to see just how fast the revenue
can pile up when you add a membership site to your online
business.
Let's assume you target a yearly revenue goal of $100,000
selling an ebook about how to buy seized cars at government
auctions.
If you sell your ebook for $29, you must sell approximately
$8,500 (290 copies) every single month to reach your income
goal.
Assuming you spend $15 in pay-per-click, ezine, or text link
advertising to obtain each sale, you will net approximately
$4,250 each month.
Not bad - not great - but much better than flipping burgers
because you would net around $50,000 per year with your
ebook.
Now, let's assume instead of a one-time sale of a $29 ebook,
you create a membership site that not only shows people how
to buy cars at auction, but keeps them up-to-date on the
latest sources to find cars, finance them, "flip" them for
cash, and more things your customers really want.
Let's assume you charge $29 per month for this membership
site. Let's also assume it costs twice as much in
advertising to sell each membership ($29 in advertising).
So, following the previous example, let's assume you sell
290 members your first month. Since your advertising
expenses doubled, you'll net zero dollars in profit the
first month.
But, in months 2-12 you rake in about $8,500 per month
profit because you carried zero advertising expense!
So instead of netting 45K the first year with a $29 ebook,
you net over 90K with a membership site.
By the way, the previous example assumes you don't sell ANY
more members after the first month.
Do a little extra math and see the profits you could
generate if you brought in just an extra 30 new members each
month in your first year.
One of the primary advantages of adding recurring revenue to
your online business is that you can predict your income.
Most savvy marketers understand this enables you to service
your customers better since you focus on producing quality
content for them each month rather than strictly chasing new
sales.
And, with the car auction example above, you could even
budget in the help of a first-class, part-time research
assistant for 15-20K per year to do much of the work for you
and still net much more than the one-off ebook model.
Various types of membership sites popular online include:
adoption, school classmates, hobbies, employment, dating,
search engine optimization, social and business networking,
and even clipart.
The choices rate as endless as the many and varied interests
of the human brain.
If you want to start an online business, or expand an
existing one, before you start marketing any product or
service, think long and hard about how you can add a
membership site, or some sort of recurring revenue to your
business mix.
Jim Edwards is a syndicated newspaper columnist and the
creator of an amazing new membership site that will teach
you the latest tips, tricks, tactics, and techniques for
growing a REAL online business!
Free Info
http://www.thenetreporter.com/subscribers-only.html
By Jim Edwards
A cardinal rule of business, whether online or offline, goes
something like this: It is ALWAYS easier to resell an
existing customer than it is to find a new customer in the
first place.
Almost every business spends the greatest amount of money
and time attracting new customers (advertising and
marketing), while viewing retention of existing customers
and meeting their needs (customer service) only as a
"necessary evil."
One of the fastest and easiest ways to exploit this business
principle of reselling existing customers online involves
setting up a membership site where customers pay you monthly
for a service, updated information, or something else they
want on an ongoing basis.
Let's look at the numbers to see just how fast the revenue
can pile up when you add a membership site to your online
business.
Let's assume you target a yearly revenue goal of $100,000
selling an ebook about how to buy seized cars at government
auctions.
If you sell your ebook for $29, you must sell approximately
$8,500 (290 copies) every single month to reach your income
goal.
Assuming you spend $15 in pay-per-click, ezine, or text link
advertising to obtain each sale, you will net approximately
$4,250 each month.
Not bad - not great - but much better than flipping burgers
because you would net around $50,000 per year with your
ebook.
Now, let's assume instead of a one-time sale of a $29 ebook,
you create a membership site that not only shows people how
to buy cars at auction, but keeps them up-to-date on the
latest sources to find cars, finance them, "flip" them for
cash, and more things your customers really want.
Let's assume you charge $29 per month for this membership
site. Let's also assume it costs twice as much in
advertising to sell each membership ($29 in advertising).
So, following the previous example, let's assume you sell
290 members your first month. Since your advertising
expenses doubled, you'll net zero dollars in profit the
first month.
But, in months 2-12 you rake in about $8,500 per month
profit because you carried zero advertising expense!
So instead of netting 45K the first year with a $29 ebook,
you net over 90K with a membership site.
By the way, the previous example assumes you don't sell ANY
more members after the first month.
Do a little extra math and see the profits you could
generate if you brought in just an extra 30 new members each
month in your first year.
One of the primary advantages of adding recurring revenue to
your online business is that you can predict your income.
Most savvy marketers understand this enables you to service
your customers better since you focus on producing quality
content for them each month rather than strictly chasing new
sales.
And, with the car auction example above, you could even
budget in the help of a first-class, part-time research
assistant for 15-20K per year to do much of the work for you
and still net much more than the one-off ebook model.
Various types of membership sites popular online include:
adoption, school classmates, hobbies, employment, dating,
search engine optimization, social and business networking,
and even clipart.
The choices rate as endless as the many and varied interests
of the human brain.
If you want to start an online business, or expand an
existing one, before you start marketing any product or
service, think long and hard about how you can add a
membership site, or some sort of recurring revenue to your
business mix.
Jim Edwards is a syndicated newspaper columnist and the
creator of an amazing new membership site that will teach
you the latest tips, tricks, tactics, and techniques for
growing a REAL online business!
Free Info
http://www.thenetreporter.com/subscribers-only.html
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