Passive Income: How to Productize for a More Consistent Cash Flow

Using digital products, you can create a more consistent cash flow for your business. Learn from business owner Latasha James as she walks through everything you need to know to productize your services.

 

Developing passive income streams is a great way to make the most of your expertise while also helping more clients. As small business owners, we can’t always count on steady revenue, but creating a more consistent cash flow by adding products to your offering can provide greater security. 

Even for service-based business owners, there are plenty of ways you can turn your skills into valuable products. With some initial setup time and maintenance, your product offerings can grow to serve a gap in your audience or provide add-on support for your long-term clients. 

Learn from HoneyBook Educator Latasha James, owner of the James and Park Agency, as she walks us through how to productize your services. Watch our webinar recording above or read on to learn more. 

Developing Passive Income With Digital Products

Imagine you could generate income without always putting in the service-based work you do on a daily basis. Every dollar wouldn’t have to come from meetings and project management. As the name suggests, passive income doesn’t require a ton of effort to maintain. It’s as good as it sounds, as long as you’re willing to put in a bit of work upfront and keep your products up-to-date. 

Typical examples of passive income that we hear about include stocks and affiliate income, but for service-based businesses it looks a little different. For Latasha, one of her biggest revenue sources is an online course that her audience pays to view on demand. 

Whether it’s a digital course or a downloadable resource, everyone can turn their skillset into a valuable product. 

Should I Use Digital Products?

Even though most business owners can find a way to productize their services, it’s still important to determine if it’s a good fit for your business. In general, it’s a great option for those who want to reach new audiences while also helping more of their client base. Of course, it’s also the best way to diversify your revenue streams if you aren’t interested in adding more core services. 

Consider these points to determine if digital products are right for you:

  • You want to serve more people than you can help 1:1
  • You want to offer options for different budgets
  • You want to diversify your revenue
  • Your client base is very DIY, and they’re looking for an expert consultant to learn how to handle services on their own
  • You already have a solid client base
  • You are patient (or can be)

You’re Already Qualified to Get Started

One of the biggest blockers to developing products is thinking you’re not qualified enough to get started. But the truth is, you don’t need to know it all to be able to teach something! Always remember that your strength could be your blind spot. Because your talents come naturally to you, you might not realize how much of a market there is for what you offer.

We get this kind of imposter syndrome… But you don’t need to know it all to be able to teach something! – Latasha James

Your unique business experience is always valuable. Remember that your clients are already coming to you for your services. What are they asking you to solve? Is there something you could easily help them with outside of your services? Consider the most common questions you receive through DMs or the content you see from competitors. Both are great indicators that the market is viable for a product you have in mind.

How to Decide On An Offer

Generating passive income will be less of a lift than your primary services, but that doesn’t mean you can sit back entirely and watch the money roll in. Depending on your offer, there will be a certain time commitment for setup as well as maintenance. 

If you have less time, you’ll be better off developing something like a download or a one-off product. You could also repurpose something you already have, such as turning a blog post into a more valuable eBook. 

If you know you have more time or help to create something, offers like online courses or signature programs could have a lot of value. These may include more content than a single download, and would likely need more time, research and resources. 

Also, consider how much time your clients have. Would they be able to tune in for a weekly course or webinar series? They may respond better to on-demand content they can pay for and use on their own time. Don’t be afraid to ask your clients directly about the time they spend on continuing education as well as the formats they prefer. 

Once you develop your offer, set a monthly revenue goal. You can use competitor and market research as well as your individual business goals. When you’re pricing, be sure to consider your launch and development costs. Will you need to purchase new equipment or ad placements? Create your initial goal and continue to review your content to improve and optimize.

Examples of Repurposed and Add-On Content

If you don’t have a lot of spare time to create digital products, your best path is to repurpose content you already have:

  • Do you have Instagram videos about business topics that performed well?

Turn these into a webinar or video course

  • Do you already have webinars?

Build them into evergreen training courses that you can sell tickets to

  • Do you have high-performing blog content?

Build them into long-form eBooks or guides that you can sell on your website

Also, consider offering add-on products. These would be an upsell to your current clients to bring them more value on top of your services. For photographers, this might mean a preset pack they can use to edit additional photos on their own time. Business coaches might offer a course library to 1:1 clients who want more resources. For service-based clients, you can also offer templates like questionnaires and brochures. 

With any digital products, you want to make sure you aren’t trading in your core services for lower-cost options. Instead, they should be an added value for current or new clients.

Key Elements of Digital Content

Whenever you’re developing a new offer, keep the following key elements in mind. These features are also important for free content, but they’ll be especially vital for keeping your paying clients happy:

  1. Solves a specific problem – What does your target audience struggle with doing, understanding or being?
  2. Clear and concise – Short and sweet is okay. It’s easier to digest and it can be easy to make it highly specific to your audience.
  3. Easy to use – Make sure the user experience is easy and simple. Test, research and get feedback. While researching, search through what others are offering and take note of what you like and don’t like.

Selling Your Content

Just like anything else, you’ll need to market and sell your product. To get the most out of your content, you can promote it through a variety of HoneyBook tools. 

An easy way to tell your clients about your new offering is to add it to your email signature. It can be as quick as dropping it in as a hyperlink or linked text. With HoneyBook, you can also add it to specific email templates. If you have leads that might be better suited for a product instead of your services, be sure to let them know what’s available. This way, you’re working to build relationships rather than just turning down clients who may not be able to afford your services. 

Another great way to promote your content is inside your business brochures. Include it as a service option or even link out to where you sell the product in an offboarding brochure to maintain your relationships with clients even after their project is over. Your product offering could be a perfect next step for their needs.

How to Sell Your Content Inside HoneyBook

Along with promotion, HoneyBook gives you everything you need to sell your content directly inside HoneyBook. Follow these steps to build your content as a project inside your account:

  1. Customize your project types

First, you’ll need to customize your project types to make sure you’re reaching a targeted audience. In HoneyBook Company Settings, you can add up to 17 project types. These should include your primary services as well as your paid products, such as online courses. 

  1. Connect your project type to your contact form

Next, sync your project types to your contact form. You can do this by adding a “project type” question in your contact form. You can change the wording of this question, but it should always tell you what service or product the client is looking for. This way, you’ll easily differentiate between your product vs. service-based clients in HoneyBook. 

You can also create multiple contact forms and associate an entire contact form with your product through Project Types. To do this, you’ll need to make sure the contact form sets the expectation that it will lead clients to your product. This means you’ll likely need to host it on a specific web page for your product. Instead of the “project type” question, you can ask other questions about interests and/or budget for future lead nurturing and assign a given project type to that contact form as a whole instead. 

  1. Build your content in a brochure

Using HoneyBook brochures, you can use the brochure file to store all your content directly inside HoneyBook. Inside a brochure, you’re able to customize a design using images and text, making it a great solution for checklists, eBooks, workbooks and more. 

If you have content housed outside of HoneyBook, such as a video or webinar, you’ll still be able to build a brochure that includes information while linking to your video content. For every brochure you create, you’ll also need to create an email template, which is a great opportunity to thank the client for their purchase and provide instructions for how to use the content in your brochure file.

Simplify the Process

Whether you’re selling in or out of HoneyBook, don’t stress over the technology you’re using. If you’re developing an online course, it doesn’t mean you need to go out and buy a fancy camera or new video hosting platform. Instead, choose the easiest method to start with. 

New products also don’t mean you need to go out and find new audiences. Instead, leverage your existing audiences. Your offering will likely perform better as well if you’re adding on to your additional services or helping to fill gaps. 

Lastly, outsource your efforts when you need to. Though it might not always be possible, don’t be afraid to hand over the reins if you’re able to. Utilizing your employees or freelancers is the best way to save time. You can focus on your primary services and weigh the cost-benefit of having someone help you with the additional products.

What You Need to Get Started

To get started building and marketing your content, you’ll need three key components: an email list, content marketing and a course host or platform for your content. 

With your email list, start building it as a “hand-raiser” to test the waters with your product or topic. One great way to start building the list is by offering free resources related to your topic. Have people give their email information for the free resource so you can start to nurture them and let them know when your paid content is coming. 

To develop your list goals, nail down your typical sales conversion rate to determine how many people you need. If you price your content at $49 and your typical conversion rate is 1%, you can estimate $49 from a list of 100 people, $490 from a list of 1,000 people, and so forth. You can also use market research to understand industry conversion rates and pricing.

With content marketing, you can use the platforms you already have to get your audience talking and invested in your topic. For instance, you can start posting brief IGTV videos or Reels about your topic and start collecting the comments as feedback for your final product. 

When it comes to hosting your content, remember not to worry too much about the tech. You can always use platforms you already use that come easy to you, such as your website, your YouTube account or HoneyBook.

Developing a Launch Timeline

Especially if you’re launching a webinar or course, you’ll want to develop a launch timeline to stay organized. 

About 60 days out, begin nurturing your email list and get them thinking about your content topic. This is the point where you could release a free download to build the list out and create companion social media content as well. 

When you’re 30 days from your launch date, have your product ready to the point where you can release it to beta testers. This could be a group of your current clients that have the time to review your content and offer feedback. With enough time, you’ll be able to use their feedback to improve your product for launch. Furthermore, you can use your testers’ positive feedback as testimonials for your marketing efforts. 

When you’re a month out, it’s also time to prepare other marketing materials, such as social media graphics and scheduled posts. Make sure you also have a customer service plan ready, which will help you deal with technical issues or other assistance. 

On launch day, drive a sense of urgency to your email list and social media followers to create one final push. On this day, you may also want to kick off paid ads to target warm leads or other members of your audience. Throughout your launch, be sure to get as much feedback as possible!

What If It Flops?

Not everything will go as planned, and that’s okay! As with anything new, it takes time to figure out what works for both you and your clients. If you don’t get as much interest or you receive negative feedback, don’t give up. 

First, work on growing your email list. Often, you might not be targeting the right people, or may just have too small of a list to generate enough conversions. Make sure you’re creating your list with the audience that’s most targeted to your product. 

You can also re-work your idea based on the feedback you received from a beta test or from the initial launch. Change or add on to your product and re-launch it afterward. Whether your offering was a flop or win, you’ll need to optimize and re-launch periodically, so it’s okay to launch it as many times as you need.

Setting Up a Product Workflow For Passive Income

Once you’ve put in the initial work, you can create a mostly passive process through HoneyBook thanks to the Workflows tool. If you’ve built your content using HoneyBook files, you can set up a step-by-step process that automatically sends them to your clients once they’ve paid. 

After you’ve created your content, make sure your files are titled appropriately so they’re easy to find. When you create a new workflow, you’re able to set up the cadence and triggers associated with your files and email templates. 

The only step you’ll have to do manually is to send your clients an invoice when they’re ready to pay for your product. Set clear expectations with clients that they’ll receive an invoice when they inquire through your contact form and include all the necessary information they’ll need about your product. 

Using the project types from earlier, and the connected contact form, you can make it so the workflow kicks off as soon as you’ve sent an invoice and received payment. You’ll be able to send your content all in one automated email or establish a cadence for multiple pieces of content over a longer period of time. Be sure to include a thank you email at the end and let your clients know how they can continue to engage with your business. 

While your workflow can bring you passive income with just a few clicks, you’ll still want to continually update and optimize your content and process. With methods of passive income in your toolkit, your business and brand can benefit in the long term. 

To learn more expert tips from other small business owners, visit our Chats With Small Business Owners webinar playlist. Professionals like Latasha walk us through everything from your client experience to your service pricing.

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