Starting a Knowledge Commerce business is about choice of model and persistence
Starting an ecommerce business for your own unique knowledge and information products is often referred to as Knowledge Commerce. There are principally two elements for business success.
First, it depends on the business model you choose for yourself. Although we’ve outlined two business models here (and both work), at Solohacks Academy we follow the second model and have seen great results. We also notice that most other highly successful experts also echo our choice. So study both models, and make your choice.
After choosing your business model, you then need the performance of a series of six steps. These steps help you set up your system. You have to keep the system rolling for a sustained period so it gathers traction, momentum and buyers. Earnings start cascading in when you have this solid and streamlined system and you keep working at it, without looking over your shoulder for immediate gain.
The two business models in ecommerce – understand them both first
There are two distinct business models in Knowledge Commerce (based on your knowing – or not knowing – what to sell).
- Model #1 is suitable for those who know right at the start what products they want to sell to target audiences.
- Model #2 is suitable for those who don’t know what to sell – but would rather take cues from their target audiences.
For both models, though, you need to know your knowledge specialization area. But you may or may not know the specific products you want to create in your unique knowledge area.
In Model #1, you first build the products and services. Let’s say, you’ve decided on a mix of ebooks, courses, and a “members-only” podcast series. You then do some online advertising if you have the budget for it. If you’re on a slim budget it’s better to do “content marketing”. In content marketing, you write blog posts and social media posts.
The idea is not to write sales-y articles or social posts. Instead, you write informative content to woo people to read the articles. You then whet their appetite to know more about the topic. When they get interested, you lead them to check out your related products.
In Model #2, let’s say, you know your area of unique knowledge expertise – but you have no idea what products to create and sell. You can still get started with audience-building. You can let the audience show you what they may like to buy from you.
In this model, you start writing blog posts and social media posts first. Build a solid reputation as a domain expert in your area. Build a community of loyal readership. The idea here is not to sell anything yet. Wait until you have wooed a “Minimum Viable Audience” (or MVA) – to opt into your mailing list.
What is a Minimum Viable Audience? It’s the least number of subscribers you need who can give you quantity and quality of feedback on how you can serve them better. If you were to survey them, their responses should be reliable and dependable. There’s no set rule on numbers here. You’ll know from the feedback you get whether your audience suggestions are worth following up on. If there is a sizeable demand for certain types of products, your audience surveys can tell you this. Your audience can also tell you what price-points they find viable.
In this model, shown in the figure below, you rely on your regular and vested readers to tell you what products to create. You can spend less time, effort and cost on trial-and-error.
The pros and cons of both Knowledge Commerce models
The big advantage with Model #1 is that you get your product creation over with upfront. You are then free to focus on your content marketing without distraction. But on the flip side, you do take a risk. You decide to create all products without any hint from your audiences on what they like to buy.
Model #1 works when your target audiences are people like yourself – or of your own ilk. Since you know well what products you’d buy, your guesswork on behalf of audiences may work well too.
On the other hand, there is no risk attached to Model #2 because you get your ideas from your own loyal readers of your blog. The problem here is one of finding enough bandwidth later to make your products. You have to continue with content marketing, while also creating your products. That can be tough.
Most knowledge commerce entrepreneurs tend to use the first model. But Brian Clark, Founder of Copyblogger, made his millions by the second model. Clark says he owes much of his success to the power of listening to his audience’s desires. He then built products to satisfy those desires.
So did Joe Pulizzi, the ultimate guru of Content Marketing. Joe is an evangelist of this second type of business model. He writes in his book “Content Inc.”:
Through a lovely accident, I stumbled on a powerful way to build a business in the digital age—and now believe there is no better way to go to market. By focusing on building an audience first and defining products and services second, an entrepreneur can change the rules of the game and significantly increase the odds of financial and personal success.
Let me repeat that: I believe the absolute best way to start a business today is not by launching a product, but by creating a system to attract and build an audience. Once a loyal audience is built, one that loves you and the information you send, you can, most likely, sell your audience anything you want.”
Once you’ve decided your model here are the six steps to take …
Regardless of which model you choose to follow, the six steps to take are detailed below. I’m following Business Model #2 as my blueprint. The steps are created as checklists you can tick as go through them.
Step 1: Increase traffic to your site to get more loyal blog readers
There’s a lot that makes up this step, so follow these instructions carefully, completing each item below in a sequential order.
- Decide your line of business, your area of unique expertise (i.e. your niche).
- Decide on your ideal target audiences and their segments and research what they would like to see in an expert.
- Decide how best to promote your expertise to them as something of high value, authority and brand uniqueness.
- Get a domain that reflects either your niche, or your target audiences or your value position.
- Set up a website to reflect your brand, put in the mandatory pages (About, Contact, Privacy, Disclaimer, Disclosure etc.)
- Most important, start a blog where you can reinforce your expertise with relevant, reader-centric articles, written in spate and consistently.
- Decide on your sources of traffic – and use a clever mix of SEO, social media, and other forms of traffic generation.
Step 2: Get loyal blog readers to subscribe to your mailing list
It’s never enough to get good traffic to your blog with visitors who arrive just once. The objective should be to get people to return again and again to your blog and get into a loyal follower-relationship with you. So follow these steps below:
- Once visitors start streaming into your site make sure you have a “lead magnet” in place to woo them (a free irresistible ebook?).
- Place an optin form on every page of your side – and in the sidebars and site header or footer – where people can give you their email addresses in return for your downloadable lead magnet.
- Make sure you gather all these captured email addresses in an autoresponder mailing list like Mailchimp or aWeber.
- Automate a welcome email so every new subscriber knows what to expect – they should know you will be keeping them in touch with news from your blog and all your new blog posts and updates.
- Once people are on your list, they are gold. Give them regular emails on your blog updates as newsletters. Once a week newsletters are ideal.
- Put into these newsletters, the excerpts of your blog posts – so they return to your site to read the full post. Get them back to your site often.
- Monitor their activity, and see how many people on your mailing list are repeat visitors to your blog. The blog is where your commerce will happen.
- Get people to read emails, click on links to new blog posts, and visit your site often. Make them loyal blog readers.
Step 3: Survey list subscribers to build and price relevant products
Make sure you have at least 100 subscribers (with at least 75%) of them as loyal blog readers, before you do any survey. There are two ways to survey those on your list to get ideas for relevant knowledge commerce products. One is to see covertly which kinds of articles people click on most to return to your blog to read. The other way is to ask them outright overtly by email.
- If you are surveying them outright, first ask them about their preferred topics to read about. Give them a selection to tick, so they know the contours of the areas you are a specialist in.
- As a second step of the questionnaire ask them to name the formats they like best – ebooks, video tutorials, podcasts, cheatsheets or checklists, templates, etc. et them check as many choices as they prefer.
- Don’t make any survey longer than this. Elaborate surveys never get answers. In fact, research shows that the longer your survey is, the fewer results you always get.
- Finally when you get answers send them a thank you email. Make sure you tell them the results of your survey because many people complain that they are asked to opine but never told the results. People are curious to know what others like them think.
Step 4: Get list subscribers to become buyers of your tripwire products
This is the part where your smarts come into play. You can’t straightaway get people to buy high-priced knowledge products from you. You need to get tripwire sales.
What is a “tripwire”? It’s the analogy that comes from the electrical world. A tripwire is “… a wire stretched close to the ground, working a trap, explosion, or alarm when disturbed and serving to detect or prevent people or animals entering an area.”
The military also uses the word tripwire to describe “… a weak military force employed as the first line of defense, engagement with which will trigger the intervention of stronger forces.”
In other words, you, as a solo brand marketer can aim to sell small opening products (low-priced ebooks?) that reset customers’ mental image of you and themselves and your relationship. Like tripwires, small sales help put people into a state of mind ready for the “bigger thing”.
Internet marketing expert, Neil Patel, has described the power of small tripwire sales:
Think of a tripwire like dating. If you ask a girl or a guy, a random stranger to marry you, what do you think the person is going to say? Chances are he or she is going to end up saying no. The reason the person is going to say no is because the person doesn’t even know you.
But if you ask a random stranger, “Hey would you like to go out for coffee?” there’s a much higher chance that you’ll get a yes.
And if the coffee date goes well, then you may ask the person for dinner, and if the dinner date goes well, you may go on a few more dates, do a few things with the chosen one. Then fast forward a few months, you may end up moving in together. And then if you ask the person to marry you, the chances of saying yes are much higher.
It’s “micro-commitments”. By getting people to take small little actions, you’re much more likely to get them to say yes to your big core offer.”
Another important thing. Tripwire sales change the nature of your relationship with your customers. Your “prospective customers” become “actual customers”. It doesn’t matter if they’ve spent just $5 on your site. Their changed status as “customers” makes them feel like part of your privileged set.
As time grows, you can have more and more trust built up. With enough trust accumulated, even very big sales feel satisfying and wonderful to customers.
Step 5: Get buyers of your tripwire products to by up the price ladder
Keeping the idea of tripwire sales in mind as a way to grow people up your product-price-ladder, here are some steps to follow:
- Create several knowledge products with different price-points ranging from $2.99 upwards. When you lead people back from your newsletters to your new blog posts, make sure these blog posts act like conduits for the purchase of small tripwire products that supplement these blog posts. In other words, your tripwire product should look like “content upgrades”. People should read the blog post and feel the tripwire product advertised along with it acts as additional and procurable value to what they have read.
- You can place the tripwire product in the middle of a blog post, say after about 30% of the article is read, or even at the bottom of the post or in a custom sidebar you have created for the article.
- It doesn’t matter that everyone who reads the article will not buy the product. Many people need several such exposures to a range of products before they realize you have other things of worth to sell in additional to the free information on your blog posts. If you repeatedly aim to bring people back to your blog posts from your newsletters, they will end up buying at some point.
- When people buy these tripwire products, make sure your “Thank You For Your Purchase” page has more upsell or cross-sell products they can also buy. Always, though stick to the topic areas and formats they like to buy.
Step 6: Get buyers to increase Lifetime Customer Value and referrals
Lifetime Customer Value (LCV) is the sum total of money a customer spends with you over a long period of time as a loyal re-purchaser. You obviously don’t want your relationship with customers to end with just one purchase, right? So, here is what you should aim for:
- Make existing customers buy more and more by constantly emailing them and keeping the relationship with them warm. Most often relationships get broken by seller neglect of customers than by customers heading for greener pastures.
- Remember that every sale to a new customer costs 6 times more than a sale to an existing customer. Calculate the value of every repurchase as at least 6 times the value of a new purchase by a new customer.
- Get existing customers to become advocates for your products and, more importantly, to refer new customers for purchases. If you merely use existing customers for word-of-mouth propagation of your products they are as good as Influencers. But if they refer customers and you pay them a referral fee, they are as good as Affiliates.
- A final word: Build a marketing system that revolves around these six steps, and keep at it. Persistence is the most important word in marketing success. The system you create and sustain will pay. Don’t ever give up. You could be just one product away from cascading sales.
In summary …
Know that there are two business models you can follow for your Knowledge Commerce business. But Model #2 is the preferred option of many experts who have made it really big. Model #2 works via building an audience for your content marketing first. Once you have loyal readers in good quantity on your mailing list, you can survey them to see what kind of products they prefer – and at what price-points.
Marketing for a Knowledge Commerce business essentially is about six basic steps created into a rolling system. Once the system is set up, you have to keep sustaining it till traction, momentum and earnings build up – they will. So here are the six steps:
- Increase traffic to your site to get more loyal blog readers.
- Get loyal blog readers to subscribe to your mailing list.
- Survey list subscribers to build and price relevant products.
- Get list subscribers to become buyers of your tripwire products.
- Get buyers of your tripwire products to by up the price ladder.
- Get buyers to increase Lifetime Customer Value and referrals.
So what are you waiting for?
Hear the experts on Persisting With A Marketing System …
Kristine Carey in the article “Three Ways Persistence Helps Your Marketing”:
Clients want to feel taken care of, that you’ll be there for them, and that means showing up, day after day. Clients are looking to you for inspiration and guidance, and if they see you persist year-after-year it gives them hope they can, too. There’s a lot to be said for showing up, persistently pursuing your mission.
In what ways are you tenacious, holding tightly to your why and bringing it to the world? Spend some time today looking at the ways you already persist and acknowledge yourself for them; there-in lies the key to future marketing ease.”
Ozoemena Nonso in the article “Persistence; the Best Marketing Strategy You Never Heard”:
A lot of marketing scholars will have different views about strategy. However, they have not been able to arrive at a consensus, as per the definition of strategy. Every day, the leaders of these businesses come to work, hone their existing strategies and see if there should be changes or not.
Amongst all of the exemplary strategies used by various companies, one stands out as the most underrepresented. How many times has anyone told you that his or her best marketing strategy revolves around persistence? Usually none, but then, this particular attribute is among the most important in marketing.”
Ryan Redding in the article “The Key to Marketing Effectiveness: Persistence”:
Clearly, simply throwing more and more money into your marketing budget won’t guarantee success. If we’re being honest, nothing guarantees success. There’s simply no magic bullet. There’s no one-size-fits-all, perfect combination of strategies and tools. Wouldn’t it be great if there were a formula? Something like AdWords CPC + daily Instagram stories + three ebooks + weekly blog posts + 100 Facebook reviews = 50% business growth year over year. That would be amazing. But there’s no such formula. There, is however, one marketing strategy that’s more likely to bring you success than any other: persistence.
To be persistent means to continue “firmly or obstinately in an opinion or course of action in spite of difficulty or opposition.” Far too many small business owners agree to try a new marketing approach “for a little while,” and they expect an undersized budget to produce outsized results—right away. And when those results don’t come? When they encounter obstacles or difficulty? They quit. We get it: It’s tough to watch your money disappear down the digital marketing drain. But with the right (read: persistent) approach, that pain is temporary.”
So what are your thoughts on this topic? Do share!
This post is incomplete without your input. The community of Knowledge Commerce solopreneurs would feel galvanized to hear from you … so do share your thoughts on this topic with us, in the comments field below this post.
Other articles in our series “Branding Your Unique Expertise For Knowledge Commerce”:
- Target Groups? How Knowledge Marketers Can Hit The Bull’s-Eye
- 25 Types of Information Products To Sell Via Knowledge Commerce