The bottom line with any business is to make a profit, and we shared how you can make more money with your existing video products. Today I’m talking about another strategy…
Adding Other People’s Products To Increase Profits
As a bit of a recap…our business model consists of building lots of little streams of income, all feeding into a mighty river. This not only consists of producing more products to sell to new niche markets, it also includes giving your current customers new products they want. Your goal is to keep the relationship alive with your customers.
While producing additional videos along the same subject line is a great way to do this, pursuing other methods will give you additional products quickly and at little or no cost to you. So if you don’t yet have another video produced to sell, it’s a good idea to begin thinking about offering other related products they would find beneficial, and the sooner the better.
While it’s more profitable when you own your own products, there are many ways to add products to your inventory immediately without creating them yourself. Adding books from some place like Amazon.com and promoting related affiliate products will also increase your profit potential.
Years ago when I was selling horticulture videos I tried adding a line of horticulture books from Ortho and we sold thousands of them. It made us a better resource to our customers and provided a healthy boost to our profits.
Do some digging into the products you buy and use that are related to your video topic and see if you can become an affiliate with them. That’s how we became affiliates with our favorite camera store, B&H.
Next week it’s all about the internet and how it’s changed business as we know it.
After checking out the two profit making scenarios – the “Low Price, High Volume” and the “High Price, Low Volume” models - I shared in the previous two posts, do you see the financial potential in producing and selling your videos?
Today I’m tell you how to further increase your profit potential in this business.
Expand Your Existing Products
Now bear in mind the two scenarios I shared were based on selling just DVDs. But you don’t want to stop there to make this a stronger business. Why?
Let’s assume that you have finished your special interest video, it’s available for sale and someone buys it. Yay! Good for you. So you just have to find more customers, rinse and repeat and your fortune’s made, right?
Wrong! Obviously, one of the key goals in marketing and being successful in this business is to get a lot of those “someones” buying your video! But even if you get thousands of happy customers, to truly be successful you have to do more.
Unless you have other products to sell your new customer, your relationship is over with that single transaction. You’ll be spending a lot of effort converting them to a customer and getting them to trust you enough to fork over their money. Once they make a purchase decision it’s the best time to hit them with an offer for something else related to what they just bought. That is often called an upsale. If you don’t have anything else to offer, now or in the near future, you’ll probably never hear from that customer again. So what should you do if you just have a single video title?
There are ways to turn a single video into additional products. For example:
- You can strip the audio out and sell it as an MP3 or an audio CD.
- You can transcribe the audio into text and create an eBook. This works especially well with instructional videos. With the booming popularity of ebook readers, this can be a nice source of additional income at almost no cost to you. You can also offer this as an added bonus, an incentive to make a purchase within a limited time frame.
- Break your video into individual modules and sell them separately.
Ideally you want to develop multiple titles on a topic and plan for this before you start video production. Not only can you bundle them together to get a higher price, it’s also better to have six 20 minute videos for sale on a topic than one 120 minute video. Maybe a customer will buy them one at a time over a period of weeks or months. This could be the beginning of a membership program.
But you don’t have to just sell your own products. Next week we’ll cover adding other people’s products to the equation.
Did you run the numbers to see how much money you can make producing and selling your own videos?
Today I’m going to share another money making scenario.
Scenario 2:”High Price, Low Volume” Model
With the ”low price, high volume” model we introduced last week, your goal is to attract many customers who will buy at a low price. Where you can make much larger profits is in producing more than one title on your topic. That way, if your customers like one, they will likely buy more related titles from you if you’re selling them at a lower price, say 8-9 DVDs a day at $20 each, you’d bring in $60,000 over the course of a year.
However…when selling “Special Interest” or niche titles, the prices you sell them at 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 fewer 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 reasonable 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, commonly 40 – 50% off retail. 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.
While you want to make money selling your titles, you don’t have to stop there. Next week we’ll tell you how to further increase your profit potential in this business.