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The Truth About Setting Up A Wealth-Pump Business: The Passive Income Myth Exposed

The Truth About Setting Up A Wealth-Pump Business: The Passive Income Myth Exposed

In theory the idea of generating additional (and passive) business revenue from books, CD programmes and eBooks couldn't be simpler. Find a market. Create a product. Watch the money roll in while you play golf, pamper yourself, shop for shoes, go fishing or enjoy a little R&R.

The reality though is a little (I'm under-exaggerating here) different.

To make income from products genuinely passive there are steps in the process that you can't afford to miss out. In fact the first phase of setting up your passive stream of cash requires hard work, persistence and intelligence. You'll have spent a lot of time, effort and money before you can truly say the money coming in is truly coming in of its own accord.

So here's the myth:

Passive Income Is Easy Income

This dangerous myth has been shamelessly propagated by (almost) all the people selling "Passive Revenue How To Products" out there. What's worse is that they promote this myth in their own interests. You see, if they told you the truth. If they actually said that implementing their fool-proof programme means working your nuts off and taking a financial risk then they wouldn't sell so many of their programmes.

The truth is - us humans love the word EASY. "Easy" sells. But nothing really worth having (as life often proves) comes without a price. So in this case, unless you're extremely lucky, you're going to have to push that passive income vehicle up, an often, very steep hill before you're going to enjoy coasting along watching the money roll in.

It's Not Really All That Passive Anyway...

In the diagram below you'll see that there's a lot of effort involved to get your product off the ground. During this time you (or your publisher) will be spending time and money. But even after you reach the top of the hill (the tipping point) you still need to be active to a certain degree in order to profit. When you're coasting along at full speed you need to steer clear of obstacles. If you forget about looking after customers or collecting the cash then your income vehicle will crash. And you can forget about making any money!

The Active Steps

Gain Real Experience

Despite what people may say - if you're planning on producing a "how to" information product you'd better know what you're talking about. This does not mean attending courses or reading books (which means you'll just be regurgitating) but actually knowing (from hard experience) what it is you're talking about. If you're ethical, authentic and genuine, then you wouldn't even dare to claim you know something when you don't. But plenty of people still do it!

How many people do you see selling "Get-Rich-Quick" programmes who are flat broke? How many tell you how to make a fortune on the Internet when they can't even do it themselves? Too many!

If we can see through their lies then it goes without saying that if you bluff it you'll get caught out eventually too.

So rule number one. If you don't know about it (from real experience) then don't write about it!

Identify An Opportunity

It amazes me, but some people even forget (or skip) this vital step and wonder why they never make any money. You've got to find a community or group of people who will share the problem your product can solve.

It's your job then to identify a genuine NEED and market for your product. What pain relief can you bring with your knowledge? What expert information can you share on a popular hobby or pastime? What challenges, problems or dreams do people have that you can genuinely help them with?

Create A Valuable Product

This is the point where you leverage your experience, expertise and knowledge by turning it into a system which can then be recorded and delivered without you needing to be there. You can convert this system into a book, eBook, audio programme, video etc.

A valuable product must be able to deliver on a promise. It must be well put together and it must be unique. What's your unique spin on the subject? What results can people genuinely expect from applying your knowledge?

It's also a false economy to create audio (thinking that it's easier) for a "how to" product, with steps to follow, when a more appropriate media would be a book or eBook. Audio is great for motivation or self-help. But not so good for step-by-step stuff like DIY, Car Maintenance or How To Draw. So don't think in terms of what's the easiest thing for you - think in terms of what's the most effective way to communicate what you know.

Also, forget the "Interview An Expert" model. It's just a cheap (and blatantly easy) way to make a quick buck without coming up with a single unique thought yourself.

Promote It Like Mad

Even if you've been published by someone else - it's still your responsibility to get the word out there. For instance, if you have a mailing list then tell them about it. Your publisher is unable to do that for you. If you're communicating using blogs, chat rooms or forums (where your knowledge is being openly displayed) then mention your book. If you're still trying to sell higher-value products and services then use this as your lower-cost way in. For lots of idea on promoting things like mad on a budget buy The Gorillas Want Bananas or Lean Marketing Toolbox.

Don't sit on your bum when it comes to promotion whether you're doing it yourself or being published. If you're not making any money and you're doing very little about it then you only have yourself to blame; your publisher can only do so much on your behalf and is likely supporting another 100 people just like you. What's your excuse - you only have yourself to look after.

The So-Called Passive Steps...

Collect and Account for Money

It doesn't matter how great the product is, how hot the market it or how much promotion you do. If you don't have a system for collecting money then you're not making any income (passive or not). Be sure to have systems in place from the outset and account for everything. You don't want to lose all your profits to the tax man.

Deliver Excellent Customer Service

Again, your job is not over until you have a happy customer. What extras and bonuses can you give? Have you got the basics right? Is your delivery process as slick and efficient as it can be? Unhappy customers will want their money back and will tell their friends to steer clear so don't crash, due to a sloppy business model, when it should be plain sailing.

It's Never Passive Forever

Eventually, after all your hard work is done, sales will decline. So make it a habit to keep on promoting. It never stops. To mistake "passive income" with "passivity" is to see all your hard work come to nothing. Take responsibility and make it pay.

'Dangerous' Debbie Jenkins
debs@debbiejenkins.com

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The Truth About Setting Up A Wealth-Pump Business: The Passive Income Myth Exposed

Wealth Building