I love blogging. I love writing. I love interacting with readers. I
love researching topics I enjoy writing about. But, in order for me to continue the privilege of blogging for a living, I must earn money from my blogs … more than a few bucks a day from ads.
After being a full time blogger for more than 1 year, I’ve tested and tried many ways to monetize my blogs
without harming the user-experience. In fact, my aim with monetizing my
blog is to do so in a way that actually enhances my readers’
experience.
In addition to my love for writing and researching, I was attracted to becoming a full time blogger
by the opportunity of earning passive income. This pursuit was more
elusive than I expected when starting out. However, in time I’ve
discovered a truly powerful and simple method of earning truly passive
income from my blogs.
What is “truly passive” income?
Truly passive income is earning revenue without investing ongoing resources (time and/or money). You no doubt have heard about affiliate marketing, Adsense and selling products.
Recurring Commission Products = Truly Passive Income
One not-so-common, but incredibly effective method for generating
truly passive income from your blog is promoting or selling products
that generate recurring revenue. The product(s) you sell or promote as
an affiliate are products that you must love, you use, and that you know
your readers both need and want. That’s a tall order, but when you find
the right recurring commission product, you can, in time, build up a
truly passive income.
I only promote as an affiliate.
I don’t sell a recurring sales product. Therefore, I had to find just
the right products for my audience. It wasn’t easy and it took several
months testing and trying products until I found the perfect options for
my readers. However, am I ever glad I put in the effort, because in the
end, the products I promote are loved by my readers, convert well and
pay very generous recurring commissions.
3 Types of recurring commission products
1. Subscription Products
More and more software is sold as a subscription model instead of a one-time fee for download. The latest software is hosted on the merchant’s website (called cloud or SAAS
software) and customers log in to their account to use the software.
Not only does this offer a hassle-free solution for customers, but it
generates consistent recurring commissions for the merchants.
The good news is that some cloud
software merchants offer affiliate programs where they’ll pay
affiliates a percentage of ALL the revenue generated from a referral.
This means the affiliate earns a percentage of each month’s subscription
fees.
Another subscription product are membership websites. These are
websites that charge customers each month in order for them to continue
having access to the site. Arguably, cloud software
is a form of this, but in this sense I’m referring to content-based and
social-based membership sites. Generally, these types of membership
sites have a higher churn rate than cloud software.
A key advantage about cloud software is that it generally has a lower
churn rate than the other types of recurring commission products set
out below. What this means is that customers remain customers for a
longer time meaning you earn commissions for a longer time.
2. Lifetime Commission Products
I promote several lifetime commission products. what this means is
that if a referral buys products over and over from a merchant, you
continue earning commissions. This model is a little different than
cloud software because lifetime commissions MAY be earned. In other
words, referrals may or may not buy again and again.
Examples of common lifetime commission products are supplements.
Often people buy a bottle every month, which means as long as the
affiliate program offers lifetime commissions, the affiliate earns
commissions on all future sales.
3. Tier 2 Commission Programs
Tier 2 commission programs is when you refer other affiliates to
promote a product and the referring affiliate earns a percentage of all
sales generated by the referred affiliate.
I don’t pursue this form of recurring commission model, but if you do
this well, you can generate excellent passive income. The big downside
to this model is you don’t have much control because it’s up to the
affiliates you refer to actually sell the product. Most won’t ever make a
sale, so much effort results in no revenue. Another downside is that
you are creating competition for yourself. Tier 2 commissions are lower
than tier 1, so any sale earned by a referred affiliate is a tier 1 sale
you don’t earn.
That said, if you have an audience of affiliate marketers, especially
email readers or loyal blog readers, you can quickly and with little
effort, inspire many affiliates to promote a product from which you’ll
earn commissions from their efforts.
My Focus
The lion’s share of my recurring revenue is from promoting cloud or SAAS software.
The key is promoting the right software to the right audience
who truly need it and will benefit from it. When you do this, you’ll be
able to easily generate sales, recurring income and please your
readers. In time you’ll build up an excellent passive income.
Set It On Autopilot
In order for recurring commissions to be truly passive and grow each
month, you must set up a sale process, also referred to as a sales
funnel, that will generate more new sales each month than the number of
referrals who stop using the product. I do this via my blog and my
blog’s e-newsletter. Basically, I publish a well-regarded blog that
serves a very narrow business industry. I offer a suite of great free
products for anyone who signs up to my e-newsletter. I then mention the
software in my email messages, using examples, content and tips as ways
to explain how the software can work for them.
Now that my blog is very well established and attracts consistent and
targeted traffic each month, I generate more and more sales which
slowly, but surely increases my passive income. I still add posts to
this blog, but sometimes I don’t do so for months, yet sales continue at
roughly the same pace. I only publish new posts when I have something
worth sharing with my readers.
Caution
The greatest caution to be aware of is the potential for merchants to
end recurring commissions. You could invest a lot of time and money in
campaigns only to have the merchant you promote stop recurring
commissions, go out of business or lower commissions. However, this
should not affect past efforts, which is good if you’ve built up a
decent number of referrals generating you recurring commissions.
If this happens to you, chances are there’s a competing product that offers recurring commissions that you can promote.
Be Patient
Building up truly passive income via recurring commission products
takes time. It took me more than 12 months to earn my first 4-figure
check. However over the subsequent 12 months, my monthly earnings
tripled again, resulting in a recurring income that is higher than the
average income in the USA … and that’s from just one product.
You must also be patient in finding the right product. Be sure to use, love and know the product.
Don’t promote garbage. Promote only the best that your audience will
love and actually need. When you do this, you not only build a long-term
business, but you build great relationships with your readers.
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