How Much Can You Make Producing And Selling Your Own Videos?
(Continuation from previous post on why producing special interest videos can make you serious money.)
How much can you make selling your special interest videos?
One thing you need to know at the beginning, this isn’t a get rich quick scheme. Can you make a lot of money selling special interest videos? Yes. Do people? Unequivocally, yes! But there is more to successfully selling your titles than just the work and time involved in producing them. Let me show you a few scenarios to get you excited about all the possibilities when you have a good selling DVD.
Scenario 1: “Low price, high volume” model
You have one title you are selling for $20 each and your sales are averaging 2 DVDs per day. Keep that up and your monthly gross income** would be $1,200. Over the course of a year, you would make $14,400 and over five year’s a total of $72,000.
** Merchant account fees, duplicating and packaging costs cut deeper into this model, not to mention time costs if you do your own shipping. Of course, if you sell digitally, you do not have the fulfillment and handling costs but you will have web hosting costs.
If you bring 5,000 or more people who are very interested in the topic and your DVD to your website each month, it isn’t unrealistic to expect 50 of them to buy your DVD. That’s only 1% of the total. That list size seems to be the set point many internet marketers use. But if you have a strong, targeted following, you can make money with a smaller list than that. We do it all the time. It is a matter of targeting your offer to a specific interest.
This is the “low price, high volume” model. Your goal is to attract many customers who will buy at a low price.
Selling at this price point has its pros and cons. Many of your customers can afford this price and it increases the chances of selling to them. However the down side is that you have to attract and sell to many more people to make it really profitable for you. Chances are you’ll spend a lot more time and resources getting those higher numbers to your site.
For videos at this price point, I recommend producing more than one title on the topic. That way, if your customers like one, they will likely buy more titles from you. We call that your “back-end.” Imagine selling 8-9 DVDs per day…that’s an income of over $60,000 in a year!
Scenario 2:”High price, low volume” model
However…when selling “Special Interest” or niche titles, the prices are usually higher – often much higher. Joe Clokey of San Luis Video Publishing in Los Osos, California, is one of our associates who has a full-time video publishing business. He sells 2-DVD sets, each DVD containing two 20-minute programs, to schools at $400 per set! The actual cost for him to duplicate them is about $2.00. Now that’s a good profit margin! Yes, he sells to few people but he doesn’t have to sell to as many to make the same income because his audience, agriculture teachers, is very targeted.
Assume you sell a title, or series, at a price of $120 each and aim for 10 sales a month. This is a price point you could get selling to schools and institutions. That’s the same amount you’d get for selling 6 times as many at $20 so imagine what you could make if you sold one copy per day! Your one-month income selling 30 copies at $120 equals $3,600. In 5 years that one DVD could make you $216,000.
This pricing model is the one I am most familiar with when selling to schools. Although that price does seem high, at that level, schools are getting what is called public performance rights. Those are the rights to show a video to a large public audience versus the home use versions we are used to renting at Netflix or your local video rental store. Schools and institutions expect to pay more.
The other thing with that price point is it makes it more profitable to go through distributors. The general practice when working with distributors is you sell your DVDs to them at a discount or wholesale price. You do get less profit per sale but that is made up in having another sales outlet doing the work for you. In fact, this may be the only way you wish to distribute your DVDs, especially if you only have a few titles or don’t want to set up your own eCommerce site and do your own marketing.
Adding products to increase profits
Now bear in mind these two scenarios are only based on selling just DVDs. From there you can add other related “back-end” products such as books, guides, etc., to really increase your income potential.
The formula is simple: the more you produce, the more you can earn. Successful special interest video publishers make it their goal to produce a number of SIV titles and products that will continue selling regularly over time. If you do this as well, your residual income will grow as the number of titles you are selling grows. Your potential greatly relies on your productivity and vision.
So you see how selling special interest videos (or as it’s called in the industry, video publishing) even on a small scale, can create freedoms you could never have before, possibly allow you to quit the job that’s not fulfilling, say good-bye to clients you no longer wish to work with, take holidays with your family, pay off your mortgage, and best of all, get paid well to do something you enjoy.
Next post will answer the question, “How has the internet changed the industry?” Sign up for our RSS feed so you don’t miss the third post in this series!
(The entire article was featured in Punto Magazine, a bilingual photography and video magazine (Spanish and English) in the September-October 2010 and will continue in the November-December 2010 issue. You can view the article (it starts on Page 18 and is in english) along with the whole issue here.