Have you ever thought about creating new revenue streams for your business?
Preferably a revenue channel that repackages what you already know in a new way to a new set of clients?
I bet you have.
And I bet some of you probably already have some setup. But some of you probably want to.
In this article, I’ll share a simple and actionable guide for creating new revenue streams.
Let’s just get one thing out of the way before we start:
To create new types of revenue streams, you need reserve some serious time for business development.
Making something that someone want to buy is hard. But completely doable.
Want to know the best part?
If you’ve been running your business or worked for a while you already have a lot of the discovery process done!
Because creating new revenue, channels is about having assumptions and a way to find out if those assumptions are correct.
The bottom line:
To create new revenue sources you essentially need to offer something that:
- Truly kills a pain your potential clients already have (ie, it reduces a cost)
- Or is a money multiplier for them (ie, it increases revenue)
- Is profitable from start
A common business model that usually completes the above points is productizing a service.
This means that you take a skill you already provide, you make it run systematically and you grow it with or without you directly involved.
I will assume that you want to create a new revenue channel this way and to do this you need to:
- Be able to sell your service repeatedly and on a one-off basis. Or you should be able to sell it consistently on a monthly or quarterly basis via a subscription.
- Create a service that leverages the things you already know and the things you are good at. For example, offer a service which creates automated email drip campaigns, or running a concierge A/B testing service for eCommerce stores. If you’re an illustrator you could create a service where you create five unique styles of illustrations that a company subscribes to. You basically need to sit down and figure out what you’re good at and find a way to sell it repeatably.
- Be able to offer a product with a low price. It could be an eBook or an email course. The idea is that this introductory product serves as a lead generation tool for your more expensive services. The product could even be free.
- Be able to market it exclusively via your website and email list.
So, if your idea passes through these filters it’s probably smart to move forward with your idea.
But be honest with yourself. Do you see difficulties in getting it to be profitable from day one? Maybe your idea is not very good.
Do you think it will be difficult to market and sell exclusively from a single-page website? Maybe rethink the idea.
Remember that your time is a scarce resource. You have to be sure you pursue an idea that you know people want (to pay for).
Do this to generate better business ideas
A lot of people think that coming up with ideas is an art. That’s jut not true.
Coming up with ideas is, like so many other things in life, a question of having a process.
The best way is to find obvious pain points by simply talking to people. Talk to clients. Talk to friends. Talk to coworkers. Find out how you can reduce their costs, or how you can make them more money.
By simply asking questions and listening attentively to the answers you usually discover a lot.
Another very effective way is browsing places like Hacker News, Designer News, Reddit etc.
Simply look for things that people complain about, and see if you could create and sell them a solution.
You have a good idea. An idea that passes all the filters and which you would like to test.
Time to find a cool bootstrap theme and start design right? Actually, it’s not the time for that.
It’s time to open Google Docs and start to write you marketing page. Yes, words, not images. You need to boil down what your service does in words.
You want to, in words, explain to your potential clients:
- Why they need your service
- How they will benefit from it (is it a revenue multiplier or will it reduce costs?).
- How your service works
In short; you need to write down the sales pitch.
“I’ve done this so many times, I will just do it directly in HTML & CSS.” Please don’t.
Starting with just writing down your marketing page will make your sales pitch so much better.
That being said, your marketing page should:
- Be written with a specific reader in mind. If you plan to launch a service that helps eCommerce stores create more revenue/customer, write with the eCommerce owner in mind. If you plan to create a product that helps B2B SaaS startups with design jobs, write with the product manager in mind.
- Always start the page with a subject that you know will resonate with your targeted readers. This opening of the page is the most important. It’s what captures the reader’s attention and what makes them read the rest of the page and eventually hire you.
- As with all sales, buyers will have objections. They all have. To tackle this, you need to list these objections and address them one-by-one in your text. A good exercise is to sit down and write down an objection management document that lists the top 25 objections. Then try to address the most crucial objections in your text. Common objections are:
- I don’t have the time
- In don’t have the money
- We don’t really need this
- The service is too expensive
- Clearly state the scope of your service. Detail what is included in your offering:
- What work you will do for your customers for the money they pay
- When the work will be done
- How will it be done (are there any reporting needed, milestones etc)
- Tell your potential clients what it will cost. But do it at the end of the document. If you had them reading this long, they’re clearly interested! Now is the time to ask for the close. Ask for their business.
Test your idea first and your launch will be more effective
Ok! Now that you have your marketing page up & running it’s time to launch right?
Nope, now it’s time to find someone that’s willing to try out your service for free. You should not have any difficulties with this. You’re providing great value for free. If people say no, something is wrong.
Once you have a couple of test subjects tell them that you expect some things in return:
- Honest feedback. Your friend, colleague or client should feel free to be brutally honest. Tell them that you expect them to rip your offering apart. Ask them what they would improve but also ask them what they liked. Encourage them to give you feedback that you can act upon. Ask lots of questions and listen carefully.
- You want a testimonial. You want a photo and a quote on your marketing page. Why? Because even though you might have worked a long time in the business, this particular service doesn’t have much social proof yet. We wrote an article on how to get great testimonials here.
- You want to learn. You won’t get everything right from the start. Take what you learned with your test clients and integrate it back into your product or service. Do this before you launch.
Use the actual words your test clients used to express their feedback to improve your marketing page
Now, that you’ve made a couple of test runs with actual people you can return to editing your marketing page.
Because you should have learned a lot by now.
The feedback you got from your clients is a gold mine to better the copy of your marketing page. Use your test clients words to sell to future clients.
Put everything in place
Make sure you have your terms of service and contracts in place.
Your marketing page should be so clear that you can use it for creating your terms of service (ie, your future customers shouldn’t be surprised by anything they see in the ToS).
Next, you want to make sure it’s easy for clients to sign up so set up a payment system so you can charge people directly on the page.
Finish it all up and prepare for launch
Now it’s time to schedule a launch date. Prepare a drip email campaign for your mailing list that you built up.
Tell all your friends. Tell your colleagues. Tell your clients. Tell your test subjects (that hopefully loved the results of your service).