What's the plan ?
Do you intend to quit your current job, become a multi-millionaire and work from an island paradise one day a week ? Or is it just to add a bit of spending money to your current finances by doing a little part time work ?
Both of these can be achieved.
Let’s take a look at the average weekly wage here in the United Kingdom which is £550 (or approximately $725 USD). That works out around £28,600 per year or $37,700 USD.
So, is it achievable to replace the average weekly wage with income from an online business ? The answer is Yes, in fact it’s more than achievable.
Let’s say, for instance that you start a membership website. You record a couple of videos, lets say, teaching beginners how to play guitar. You add these videos to your membership website along with some other text based tutorials and you set your price for membership at £50 per month.
You make a post on your Facebook profile telling your friends and family that you are now a guitar teacher and for just £50 per month you will show them how they too can become a proficient guitar player.
Let’s say in your first month, 10 people sign up. You have ten members each paying you £50 per month. Congratulations, your new online business is now earning you £500 per month.
An extra £500 per month could be life changing. It could be the payment for a new car, a mortgage payment, a holiday, new clothes or anything that you normally would have to save up for. You have an extra £500 per month that just didn’t exist before you started your guitar membership website.
But, it doesn’t end there – if you keep providing quality to your members, there is no reason for them to cancel. You keep teaching them how to play guitar, they keep learning. They keep learning, they keep paying.
That initial £500 you earned, has now become a recurring income. You get £500 this month, £500 next month, in fact £500 every month as long as you keep on teaching.
It's recurring income, oh yes, it is
So things are ticking along nicely, you are banking your hard earned £500 every month, spending now and again on little extravagances here and there and your bank balance keeps on growing every month.
You’re happy. You’ve created your own online business. You are providing good quality content to your paying members and things are good.
What if you then ran a small promotion. Let’s say you placed an ad somewhere. It could be a Facebook ad, a Google ad or even a postcard in a music shop. You get responses, people interested in learning to play guitar get in touch. You gain another 10 members.
Straight away that’s another £500 per month. Add that to what you already had and you now have 20 members and you are making an extra £1000 per month.
What kind of work are you doing to earn £1000 per month ?
If we look again at the average weekly wage of £550 or $725 USD, then for £1000 per month we would need to work for approximately 75 hours per month to earn that money.
In order to keep 20 members happy you wouldn’t need to work anywhere near 75 hours per month to create new content. In fact whether you have 1 member, 10 members or 100 members the amount of work involved is pretty much the same.
So from just 20 members we can make £1000 per month.
What does 20 people look like. There’s more players on a football field than 20. Think about how many people you have a friends on Facebook. Far more than 20 I would expect.
There are 3 billion people on the internet and you only need 20 of them for you to make a great little monthly income of £1000.
Can I do this full time ?
What do you think would happen if you decided to take your guitar teaching a little more seriously ?
You devise a marketing strategy – you write some guitar related articles and you place ads.
Could you get 50 members ? Could you ?
You now have 50 members paying you £50 per month to learn to play guitar.
You’ve just made the average weekly wage.
So what are you waiting for, go to work tomorrow, tell your boss to stick his job, you’ve decided to become a full time guitar teacher. Seriously..why not ?
What would the numbers look like if you did this full time ?
You put all your efforts into gaining new members and creating new content for your existing members.
Once you reach 50 members, strange things start to happen. You get the “snowball effect”. Instead of starting from zero and trying to convince new members to join, you now have 50 members singing your praises. 50 other people spreading the word to other interested people. These members will share their experience of your membership with their friends and family and so on and so on. Its a compound interest effect with your members.
So, this is where it starts to get really interesting.
You are now the boss. You’ve no one to answer to, except your members. So….why not give yourself a pay rise ? What ? How do I do that ?
It’s very simple, you just rinse and repeat. Write good quality content, provide new lessons for your existing members and then promote, promote, promote.
You gain another 10 members. You still only have 60 members, but you’ve just given yourself another £500 per month. When was the last time your boss gave you a £6000 per year pay rise ?
But as you are doing the same process every month – creating content and promoting it, there is no reason why you can’t give yourself a pay rise EVERY month.
The sky is the limit with online business
What if you had 100 members ? That’s £60,000 per year. 200 members £120,000 per year. 500 members £300,000 per year.
And these numbers are not just pie in the sky. They are more than achievable. Okay so £50 per month is probably going to be at the top end of what you can charge members per month. A more realistic figure would be £30 – £40 per month. But in some niches £50 is more than acceptable. Some could even charge higher.
But don’t get me wrong, this is no get rich quick scheme. Its no multi level marketing scam, it’s simply a value exchange. You are exchanging your knowledge for money. In your normal day job you are probably exchanging your time for money. But what we are doing is cutting out the middleman, the overheads, other people’s salary and having a more direct approach to using your time to sell to many instead of one.
We can see a trend of the number of members a website has, easily correlates to the quality of the content, and the amount of promotion the content is given.
Most memberships start off slowly, unless of course you already have a following, or an existing email list you can contact.
You start with one or two members for the first month or two. In the second, third month you add a few more new members, you lose a couple, but the membership numbers are still heading in the right direction – upward.
Six months pass and you now have 50 members and things have levelled out a little and you are struggling to consistently gain new members.
This is where the plateau of 50 usually occurs and when most membership owners think that’s it. They think that they have reached their maximum level and it’s going to be impossible to grow their site any further. But, they are wrong. 50 members can just be the beginning. This is where the magic happens. The tipping point of going from level to level.
Most membership sites have anywhere between 100 – 1000 members. Getting from 50 to 100 members is not an impossible task and once you get past this hurdle your online business will really skyrocket.
100 member is a life changing amount of money. Whether you’re still in your nine to five and doing bits on the side or you’ve made the leap to quit your job and are concentrating solely on your online business you will now be making some real money and your life will change.
You now have the vast scope from 100 to 1000 members – the difference is huge. As you go through this next level of growth, you will have the funds and resources to do so much more.
You may want to employ someone to help you out. With the increased income you will be able to do this.
You will be able to further your use of paid advertising to gain new members.
You often hear about the famed “hockey stick” graph of growth that happens with successful companies and there is no reason why this kind of growth is not possible from your own online business.
Its not just money - its personal freedom
But it’s not always about money. Having a successful online business gives you freedom in many ways.
With a normal job you usually have to travel to and from a single place of work on your daily commute – not so with your own online business. With access to the internet being cheap and easy, you can pretty much run an online business from anywhere in the world.
Whether you have a desktop, a laptop, a tablet or just a smartphone, its very easy to create new content for your membership site and provide it for your members use.
In a normal job, you would usually have to work set hours, nine to five for example. Not so with your own online business. Your the boss. You get to decide when you work. You may be a morning person, get up at 6am, do a few hours work and be done by lunchtime. Or you may prefer to work late into the night. Or even a bit of both and that’s fine, it’s your decision. When you work, is entirely up to you.
Not feeling too good ? No need to call in sick, just take the day off.
Have a family emergency, again not a problem, just drop everything and take whatever time you need.
Take a week off in January, a fortnight in May, in fact if you want to, take the whole of August off to go find the Loch Ness Monster. It’s up to you, and that’s how an online business can give you true, personal freedom.
So, the question was How much money do we need ? And the answer ?
It’s entirely up to you. Work as much or as little as you please. You can earn £50 per month or £50,000 per month. You get out what you put in.
But the most important thing about an online business is gaining freedom. Financial freedom, yes, but better still, personal freedom – to work, when and where you wish.
If you would like to know more about creating your own online business or have already started and would like to grow it then why not join the Online Business Academy, where you will join like minded business owners with access to courses, tutorials, ebooks and articles that give you step-by-step instructions to make your online business a success.