For many entrepreneurs, a passive, perpetual income stream is the ultimate goal. Who wouldn’t want to spend their days sipping colorful drinks on the beach while their business continually brings in income without them needing to be present?
And although it’s a dream for many, some want to go further than that. At Kajabi, we understand and want to help you build a solid foundation under those lofty goals. That’s why, in this article, we’ll talk about how to use knowledge commerce to build perpetual, passive streams of income.
What is passive income?
Passive income is money you earn without actively working to bring it in. In the traditional business world, owning rental properties is an example of a way to earn passive income.
In the online world, however, passive income is often made by creating digital info products, such as:
- Membership sites
- Paid podcasts
The key to generating passive income online is to turn your knowledge into an in-demand product and sell it entirely online, so there’s no need to coordinate things like packing, shipping, and logistics.
Knowledge commerce presents the perfect opportunity to create a perpetual income stream, because you can create the product once, then sell it over and over again. And growing your business is easy. Your digital product can easily become a springboard for multiple streams of income.
Here’s how to do it, step-by-step.
Five ways to build passive income with knowledge commerce
Knowledge commerce is one of the easiest ways to grow your business and build multiple streams of income. It’s as simple as packaging your knowledge into a sellable format and sharing it with the world.
You can start by building a course or other info product. Then, little by little, add other information products until you’re generating income from a variety of channels and product lines. Here are five ideas for adding streams of income to your knowledge commerce business.
1: Get sponsors for your blog, podcast, or YouTube channel
A sponsor pays you to promote their product or service in a blog post, podcast episode, or video. Their goal is to leverage your audience to boost their sales.
Finding sponsors is easier than you might think. To get prospective sponsors to beat down a path to your door, you need:
- An established brand persona
- A similar target audience to your sponsor
- Great quality content that you publish on a regular basis
And you don’t have to have a huge following or a massive number of subscribers! Sometimes the smaller and more targeted your niche is, the better!
If you decide to go this route, it’s a good idea to take a step back from your chosen promotional channel and ask yourself, “If this content belonged to someone else, would I still like it?”
There’s perhaps nothing worse than a mismatch between a brand and a sponsor. Chances are, we can all think of times where that combination backfired.
Do a solid quality audit on your blog, podcast or channel before you ask about sponsorships, and don’t hesitate to ask your existing audience for their feedback. Current subscribers can be a goldmine of advice and suggestions.
Wondering how much you can earn for a sponsored post? Influencer Marketing Hub reports the going rate for Instagram is typically $100 for every 10,000 followers. On YouTube, it’s $200 for every 10,000 subscribers.
2: Do affiliate marketing
Affiliate marketing involves selling others’ digital or physical products and earning a commission from successful sales. Since there are likely hundreds of affiliates marketing the same product to the same audience, you have to be a bit creative in your approach.
Pre selling is often a successful tactic that marketers use to set themselves up for success in affiliate marketing. Essentially, you’re introducing the product, sharing all its benefits, and generating desire before you direct them to the product page itself.
That way, by the time they get to the product page, they’re primed and ready to purchase. A little pre-selling on your part can lead to a lot of commissions, creating a consistent perpetual stream of income that only takes a little upfront work to reap dividends.
3: Create joint ventures with other knowledge entrepreneurs
Another great way to build multiple streams of income is by working together with other knowledge entrepreneurs. Depending on what you have to share and sell, there may be other individuals in your chosen niche who promote or share information that’s complementary (and not competitive) to yours.
For example, a marketer that teaches others how to get started with email marketing might choose to partner with another marketer that specializes in search engine optimization. Both of these niches have to do with selling online, and both are necessary as part of an online business, but they also don’t directly compete with each other, making it a win-win for both parties.
But a joint venture isn’t always just an agreement to promote each other’s products. It can also go much deeper than that. For example, you may choose to pool your resources, share email lists, train each other in your respective niches, and so on.
There are pros and cons to joint ventures, and it’s worth knowing what they are before you jump in with both feet.
For example, one of the major benefits of a joint venture is getting access to each other’s markets. If you’re looking to “test the waters” by creating a potential course on the other person’s topic, you might want to see if there’s enough of a market to justify it — and a joint venture is a great way to do that.
You also get access to the other party’s skills and resources. Just like you, they’ve amassed a variety of experiences, tools, and strategies. Working together can help you develop in that area with the right guidance, and vice versa for your partner.
In short, not only are you working together, but you’re also benefiting from each others’ knowledge in your respective areas.
There are also a few drawbacks to consider carefully before you take the plunge. For example, you don’t want to be the one sharing all of the knowledge and resources and making the joint venture feel very one-sided. Ensuring that both of you have a pretty even and secure knowledge of your respective niches is the key to making your joint venture a success.
4: Write books
Creating an online course or membership isn’t the only way to create perpetual income in the knowledge commerce world. Writing and publishing a book is another way to consistently build multiple streams of income.
In fact, many knowledge entrepreneurs draw upon marketing strategies from the affiliate world — such as pre-selling, to get potential buyers excited about their book before it ever hits the shelves. And even if you opt to not go the route of traditional publishing, there are still a wide range of print-on-demand, do-it-yourself options, including Amazon Kindle, that give your book professional exposure even on a budget.
5: Sell self-directed courses
Another fantastic option for creating perpetual income streams is selling self-directed courses. If yours is a skill or talent that users can learn on their own with video or written instruction, a self-directed course could be a great way to allow them to learn at their own pace and still get the benefits of one-on-one instruction.
How much could you earn with knowledge commerce?
The great thing about selling digital products is that there’s no need to get tangled up in the specifics of calculating shipping, managing inventory, and dealing with logistics. That means the potential is wide open in terms of how much you could earn.
Here are a few knowledge entrepreneurs who have done just that, and are continuing their wildly successful journeys:
Joseph Michael with Learn Scrivener Fast
Joseph Michael worked an ordinary corporate job and made enough money to make ends meet. But their family was growing and the entrepreneurial bug kept gnawing at him. On a whim, he started a blog that showed people how to do different things incredibly efficiently.
The blog never really earned any income, but in the midst of creating it, one of those more efficient methods was teaching his daughter how to tie her shoes. He found a fun, efficient way of teaching her, and together they made a video that quickly racked up over 800,000 views on YouTube.
That first taste of success got him thinking about even more blog posts, and in writing those posts, he came across Scrivener, a word processing program that’s like Microsoft Word on steroids.
Scrivener is a fantastic writing tool, but it’s also somewhat complicated for beginners. Once people learn how it works, they become die-hard fans, but there was no real course to teach them all the ins and outs of the system.
And that’s how LearnScrivenerFast.com was born.
You can read the rest of his inspirational story on his website. But LearnScrivenerFast quickly surpassed any and all income goals Joseph had for it — bringing in over $40,000 per month and growing.
But this isn’t the only online course perpetual income success story.
Rob Percival, The Millionaire Math Teacher
Rob was a high school math teacher for many years. After building websites on the side, he decided to convert his love of teaching into an online course teaching web development. Today, he offers dozens of courses on topics ranging from Wordpress and copywriting to specific programming languages like Python and Ruby-on-Rails.
He also has nearly two million students. Rob sells his courses for anywhere from $14 to $28 each. You do the math.
By now you might be asking, “But what if my niche isn’t in the marketing or technology world? Can I still create perpetual income streams by creating digital products and online courses?”
And the answer is, absolutely. Because that’s exactly what Swordschool did.
Do you love medieval European martial history? I mean really love it? Because if you do, Swordschool is for you. Courses run the gamut from basic footwork and medieval longswords to complete rapier training courses and more. Prices vary from $7 all the way up to bundle courses for $600.
The site’s owner, Guy Windsor, has been operating Swordschool since 2001. Through this example, you can see how any niche, even the most specialized one, can earn money in the hands of a professional with a passion for the subject.
Passive income meets perpetual income
As you can see from these examples, these individuals and thousands more like them have taken the things they love, and created courses and memberships that include video walkthroughs, blogs, checklists, tutorials, and much more.
Although the creation of the individual lessons takes time and effort up front, from that point on, the course sustains itself. All you need to do from that point on is answer any questions that pop up, and continue to promote it.
In addition, since it’s likely that your chosen topic doesn’t change often, you won’t need to update it much either. (Although we all know those trendy cutting-edge medieval rapier training methods are hard to keep up with because they change so much!)
From there, you can continue to create other courses or simply work on promoting your existing one and growing your membership and student enrollment. Keep in mind, however, the more courses you create, the more streams of income you can potentially create. Just be careful not to spread yourself too thin!
Keep in mind that you can go through these steps with each course you create, so you don’t just have to limit yourself to one course and one method of perpetual income. You can mix and match your streams of income alongside your courses according to what best fits your available time and your short- and long-term business goals.
How do I get started building a perpetual income stream?
Now that you know what a perpetual income stream is and have seen examples of knowledge entrepreneurs who’ve made a name for themselves in their respective niches, your next question is likely:
“How can I get in on that?”
We love your enthusiasm! Here’s how to start building your first perpetual income stream, step-by-step.
Step 1: Find your audience
You can’t sell a course or a membership to an audience that doesn’t exist, so the first thing you’ll need to address is who your audience is.
It can be tempting to simply exclaim, “Everyone!” and call it a day, but the more time you spend refining this and thinking about things like the demographics of your customers, their interests and where you’re likely to find them, the easier it will be to market your digital product to them.
The best way to find your audience is to go where they are, whether that’s forums, YouTube channels, blogs, podcasts, or social media. Do your research and see who your competitors are (if any). Although it may be tempting to start a course in a niche where there’s zero competition, it may also mean that no one’s interested enough to spend money on the topic.
Just as LearnScrivenerFast’s course creator discovered, he couldn’t monetize a blog that showed people how to do things more efficiently. His how-to’s were interesting, but they didn’t generate any income.
It was while researching ideas for that blog that he finally found a topic that had a willing market. Wisely, he pounced on it. It just goes to show you that you never really know where inspiration for a course will strike!
Step 2: Hone in on the problem(s) you solve for your audience
A course can’t exist without an audience that wants to learn it. And it won’t sell if it doesn’t solve a problem for them.
Oftentimes, these courses are created by people who tried to learn a particular skill themselves (like Scrivener) and found the instructional material out there was just too daunting or non-existent.
So the problem you solve for them isn’t just addressing the people in the room who say, “I want to learn that!” but also how, exactly, you’re going to help them reach that goal.
The problem for many prospective buyers is that they’ve either tried it before in the past and failed, or they’re starting from absolute scratch. Either way, you must approach them and convince them that your course is different and better — why they should care.
Step 3: Choose one passive income channel
Chances are, you read all about the different passive income methods above and saw instant dollar signs in your head. If that’s you, you’re probably thinking about doing them all, yesterday.
While that’s certainly tempting (and eventually you may do just that), when you’re starting out, it’s best to choose one passive income channel at a time. The last thing you want to do is put the cart before the course — err, horse.
Step 4: Build and optimize it
Once you’ve chosen the income channel you want to build, focus your time and energy on making it a success. Don’t get distracted by other bright, shiny ideas. Learn the strategies and tactics that work in your chosen channel, and build the automations that will make it profitable.
Your new income stream needs to become easy to manage, and it needs to integrate smoothly into your existing business. But it won’t do that from day 1. So take whatever time you need to get off the ground and running smoothly before building another income stream.
Let’s say you’ve chosen affiliate marketing. Rather than promoting all of the conceivable affiliate products and solutions out there (and there likely will be many), choose just a couple of the best ones and really go in depth on them.
Step 5: Get it running smoothly
Make sure you can keep all the plates spinning, so quality doesn’t suffer in any area of your business. Now is the time to streamline your activities and create checklists for getting everything done.
There’s nothing more embarrassing than setting up a marketing campaign for a passive income stream and then having it fall apart due to a lack of planning. For example, in the case of a joint venture, you’ll want to make sure that you have a contract in place that spells out exactly what the other person is getting, as well as what you’ll be receiving.
This leaves no room for confusion or miscommunication and ensures that everything is up and running smoothly before launch day.
This applies to much more than just joint ventures, too. Selling a course or membership online means that there are often many different moving parts all working together to produce the end result. The fewer steps you have in between you and that result, the better.
Step 6: Add one channel at a time to increase revenue
Once you’ve got one channel perfected and running smoothly, you can then add on another and another, like building blocks. For instance, let’s say you’re looking for sponsors for your blog, podcast, or YouTube channel, and you’ve already written a book on your chosen subject. Now, you may be ready to create a course that teaches people how to do what you talk about in your other channels.
Ready to get started?
Kajabi makes it easy and intuitive to start building a perpetual stream of income by selling your knowledge. Through our intuitive course and membership-creation tools, you can easily set up a blog, start an email list, add video tutorials and more, all on your own beautifully-designed, mobile-responsive website.
But it starts with a plan. Your plan.
Think about the different ways you could start generating a perpetual income stream. Then prioritize your ideas. Start with the low-hanging fruit, the activities that work well with your current income stream. Then build out from there.
It’s time to take your knowledge business to the next level. Join us for live Q&A webinars every day, Monday through Friday.
Register today to learn everything you need to know to succeed as a knowledge entrepreneur, including selling products, Kajabi themes, pipelines, webinars, and the Kajabi Partner Program.
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