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VPT Solution 27 by Ed Walters 17th September 2009 Info-Product Instant Money Multiplier Effect Hi Friend,
Firstly, I apologise that this
is a day late. I thought that
after hearing from me twice last
week you might want to rest your
weary eyes. Rest assured my
newsletter will return to
Wednesday as usual next week.
This week I’m going to go back
to basics by showing you exactly
how the big-guns make so much
cash by selling online
information. I’m also going to
show you why and how you should
be getting involved in this
highly profitable home business
sector.
Let me start by first giving you
a simple tangible business
example. (By tangible I mean it
involves a product that you can
actually touch as opposed to
downloadable information). Stick
with me with the maths, you’ll
be amazed by what I’m about to
show you.
Take business people Jack, Jim
and Jane…
Jack manufactures car tyres
which he supplies to car
centres. By the time he has paid
all his production and
distribution costs it costs him
twenty five dollars to make each
tyre. He then sells these to car
centre owner Jim who buys them
for thirty dollars each. Jack
makes five dollars profit (or
seventeen per cent) per tyre. In
order to sell the tyres on, Jim
has to pay for his shop,
marketing, wages, etc which
costs him around an extra ten
dollars per tyre so Jim’s total
cost per tyre is forty dollars.
Jim then sells them on to
customer Jane for fifty dollars
each, meaning he makes a profit
of ten dollars (or twenty
percent) per tyre.
Pretty basic stuff hey…
If we were to ramp up the
numbers to one thousand tyres,
Jack (manufacturer and supplier)
and Jim (retailer) would
obviously make more money – Jack
would make five thousand dollars
profit and Jim would make ten
thousand dollars profit. Great.
But just imagine how much more
time, energy, money, blood,
sweat and tears would have been
involved in producing all those
tyres.
Although Jacks profit increases
to five thousand, his costs sore
to twenty five thousand so his
percentage profit stays the same
at seventeen per cent (give or
take a slight saving for bulk
production). The same is true
for Jim whose profit remains at
around twenty percent. The point
is here, it doesn’t matter how
many units are sold, the profit
margin will always stay roughly
the same for most tangible
products.
Now let’s compare this to an
information product sold online.
This can be in any niche market,
golf, fishing, self help, muscle
building, etc. And it can be in
any format, such as an ebook,
audio, video seminar, home study
course, etc. The start up cost
for creating you own information
product can be anything from
zero to say a thousand dollars,
depending on how much you are
prepared to do yourself. But
there are several gigantic
advantages of selling
downloadable information, most
of which come in the form of
profit…
One. High Perceived Value
Information products have a high
‘perceived’ value. For example,
if you went to a book store you
probable wouldn’t
pay more than twenty
dollars for a book on golf. But
if that book was presented to
you online in a modern format,
perhaps with workbooks, audios,
etc, that would motivate and
stimulate you to learn from it,
you would be much more likely to
pay say forty seven, sixty seven
or ninety seven dollars for it.
If it was packaged as a home
study program with videos, etc
you might even pay up to four
hundred and ninety seven
dollars. It could even come with
some information in a locked
members area for which you’d be
willing to pay a monthly fee of
say ninety seven dollars. Now I
haven’t just plucked these
figures from nowhere, they are
proven price points that
actually work with downloadable
info-products.
I know this is getting you as
pumped up as I am about this
industry right now. You can see
the potential and you can do the
maths. You don’t need to be the
next
Anthony Robbins or Mike
Filsaime to make big money
online, just a fraction of their
success and you’ll be laughing
all the way to the bank.
Two. Instant Money - One hundred Per Cent Profits
Now I admit there are certain
advantages of being an affiliate
marketer and selling other
people’s products for a
commission. But there are also
certain drawbacks, such as
trying to find the best products
to promote and having to spend a
lot of money on marketing
despite only being paid a
percentage on each sale you
make.
However, if you have your own
info-product to sell you are in
full control and you keep all
the profits. Going back to my
Jack, Jim, Jill scenario you
effectively promote yourself to
Jack’s position at
the top of the ‘food
chain’. You become manufacturer,
supplier and retailer and you,
therefore, get rewarded one
hundred per cent of the profits,
which would otherwise be
distributed amongst all the
other people involved.
Even if it cost you a thousand
dollars to start, once you’re up
and running, you get to keep all
the profits. The only costs are
some small marketing costs and
many of these are free (such as
getting traffic to your site by
submitting articles to article
directories). Therefore, even if
you reinvest some of your
profits you’ll still get to keep
ninety five to one hundred per
cent of your profits. There’s no
other industry on this planet
where you can make such insanely
high profits – unless perhaps
you happen to find a gold mine
in your back yard!
Three. Info-Product Multiplier Effect
Once you have created your
product and have your web site
up and running you can sell your
product as many times as you
like without costing you a
single extra penny. This is
called the multiplier effect and
this is how your wealth can sky
rocket.
Remember info-products are
downloadable and that’s the
beauty of it all. Unlike if you
were selling tyres where you
would have to invest more money
to make each and every single
additional tyre, with
downloadable products it doesn’t
cost you a dime. There are no
extra costs no matter how
many thousands of products you
sell.
People pay you the money,
download the product at their
convenience and everyone is
happy. Simple! And with this in
mind you’ll recover your start
up costs in no time at all even
if you spent a few hundred
dollars to begin with.
I remember when my first
info-product took off. I’d been
making a couple of sales a day
here and there. Then one morning
I logged on to my computer and
bang, one of my email promotions
had kicked in and I’d made over
a grand in the night – whilst
I’d been snoring in my bed!
Money for sleeping, it doesn’t
get much easier than that. And
you can soon be doing the same.
Four. Skip Out Or Keep In The ‘Middle-Man’ – Either
Way You Win
Skip out the ‘middle-man’. Using
my scenario you can be Jack
(product creator) and sell
directly to Jane (customer),
thereby missing out Jim (the
‘middle-man’). By selling your
product online your ‘shop
window’ is quite literally the
entire world. I’ll leave you to
do the maths on that one but,
put simply, the profit you can
generate by selling information
products online is probably
beyond your imagination at this
stage. And that’s a good thing.
Use a ‘middle-man’. Yep you did
hear me right. It’s a double
sided coin and the ‘middle-man’
scenario can be used to your
advantage both if you don’t
choose to use one (see above) or
if you do. There are two main
ways you can use a middle-man to
your advantage.
Firstly, instead of selling
directly to the customer you can
package you product up and sell
fewer units at a higher price.
These are called private label
products where people by the
resell rights to your product.
Anyone who knows anything about
business will know that
licensing is big business
especially online.
Secondly, you can use a
middle-man in the form of a
broker who you pay to set up
joint venture deals with other
companies. You have to sacrifice
a small (and I mean tiny)
percentage of your profit but a
JV Broker could net you
thousands from just a single
deal.
Five. Fun, Constantly Changing And Always Evolving
I’m referring to the online
info-product business sector if
you haven’t guessed ;-) and
that’s something you definitely
can’t say about most other
industries. Nuff said!
Recession or no recession
there’s no better investment
that you can make, in my
opinion, than to set up your
first online business. Be
patient, be prepared to put in a
little effort and stick at it
even if you don’t succeed first
time. The potential for
financial security is just
around the corner if you’re
motivated enough to get up and
look for it.
Next week I’m going to give you
a blueprint showing you exactly
what to do to get started
online, how to find your niche,
quickly create your product (or
source a ready made product for
peanuts) and how to ramp up your
profits. I’m also going to
reveal some surprising
information on untapped markets
that are ready and waiting for
people like you to enter and
reap massive rewards from.
Next week my newsletter will
return to it’s usual Wednesday
slot.
To your online success
Ed Walters
P.S. Not
making a killing from virtual
property yet? Check out the full
course at:
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