A few weeks ago I received my first ever payment from Google Adsense in my bank account. While it was only $170, it represents a small but significant step to making money in a way that is completely independent of my time.
Making money passively has been something that I’ve
been wanting to do for several years, but have never really made a
start. For the last nine months or so, I’ve been quietly working on a
website that initially started as a small experiment in Search Engine Optimization (SEO), but has grown into my first source of passive income.
This article is the case study that I wish I had read nine months
ago. Let me help you benefit from my hindsight in how to set up a passive income niche website.
The Background
A few years ago, I read a book called the 4 Hour Work Week,
which outlines a plan for untold internet riches. You build a website,
sell a product that people want, get other people to do the work,
make
money and then go sit on a beach. The book has more to it than this, and
I strongly recommend you read it, but that’s the headline.
I work in digital marketing. Which means I know a
lot about how to build a website, how to market that website so that
people visit it, how to assess the competition (the other websites that
have similar information / products / services) and how to determine how
much demand there is in the market.
In my job I work with companies and help them to understand how these
things can help their business, and bring them more customers or sell
more products and ultimately, make more money.
While there have been many times where I’ve done one or more of these
things for a client, and done them successfully, I’ve never taken an
idea from zero to profitable by myself. I always get called in to fix
other people’s problems or help take a business project “to the next
level”.
There are many reasons for this, but a big one was simply that I was afraid.
Afraid that if I tried, and failed, I’d be a fraud. The risk was that
if I couldn’t build something by myself, what credibility did I have to
encourage others to use these methods in their business? It took me a
long time to find a ‘mental loophole’ or a way to trick myself into
giving it a go anyway.
The Loophole
Back in February 2011, Google rolled out a significant change to its search algorithm – the Panda update.
Google frequently makes changes to the way it arranges the world’s
websites but this update had a big impact on the digital marketing
community.
At the time, an extremely popular way to improve the search rank of a website was to use a tactic called article marketing. Panda appeared to devalue this kind of marketing.
Many people reacted to these changes by running around screaming “SEO
has changed forever” and complaining. I attend a lot of industry
networking events in digital marketing and it seemed to be a theme that
came up time and time again over a period of a couple of months.
We don’t know what to do! SEO doesn’t work anymore!
Unfortunately no one seemed to have any hard data to say that article
marketing would no longer work. While it certainly looked like the
tactic might be less effective than it was, I couldn’t see any reason
why it wouldn’t still work in the long run. The assertions that ‘the
game had changed’ annoyed me, especially as they seemed untested.
I decided to test it.
I really enjoy doing experiments. I’ve tested exercise programs,
sleeping patterns, diets and lots of marketing ideas – and by making
this just another experiment, which no one expected to work anyway, and
which could fail without consequence, I was able to skip around that
whole “if I fail I’m a fraud” mental construct. Take that psychology.
The Goal
set two simple goals:
- Make a website, from scratch, and get it rank #1 in Google using article marketing, within three months
- Make $1 in revenue
I haven’t put a price on my time as even if I had only made $1, the learning experience
in of itself has been very valuable. Besides, if I wasn’t building the
site, I probably would have just wasted the time watching cat videos.
If you want to look at a pure ROI, getting $400 back on a $700
“investment” within nine months is outstanding value, and assuming
people keep clicking ads,
The Method
The high-level strategy for this kind of project is simple, and no
doubt many will be familiar with the business model for a niche topic
website, so you may want to skim this. But for those who aren’t here is
the premise:
1. Brain storm a bunch of topics, for me a good topic is one that lends itself to:
- Evergreen content (meaning it says relevant and doesn’t go out of date quickly)
- Strikes a balance between between having a tight focus but plenty of information
- Things people spend money on
2. Determine the demand, as in how many people are looking for information on this topic, using things like Google Keyword Tool or Market Samurai.
3. Assess the competition, how many other websites already exist and how established they are in the market.
4. Build a website, and fill it with content that specifically targets the keywords people are searching for.
5. Market the content, so that the site ranks well in Google, and subsequently gets traffic.
6. Monetize the traffic by placing advertisements, selling products for a commission or developing your own products.
(7. Sit on a beach)
There are numerous guides on how to do each of these things, but I specifically followed a case study on How To Build A Niche Site by Pat Flynn, who
wrote a highly in-depth series of posts about building his own niche
site.
The Challenges
Even though I was following a highly detailed case study, there were a
number of things I found really difficult – more from the amount of
time required than anything else.
Keyword Research
I would estimate that I spent 40 hours alone on keyword research in Market Samurai. Every
topic idea I had seemed to be unsuitable and a dead end. I kept a
tracking spreadsheet and I ended up thoroughly researching 46 different topics before I stumbled across something suitable.
After a few hours keyword research stops being fun, and there were
several times during this where I was tempted to give up or settle for a
topic that didn’t quite meet the criteria for a good keyword.
Domain Names
I screwed this part up – it should have been nettleteahealth.com or
something, but instead I blindly copied Pat’s naming structure. The
lesson from this, is of course that the domain doesn’t really matter if
you do the marketing correctly, and there’s no need to blindly copy
other people. Entrepreneurs-Journey succeeds despite the difficulty I’m
sure many people have even spelling ‘entrepreneur’ correctly.
Content
I hired a writer to create the initial articles for
the site, based on my keyword research. While it was cheap ($10 for 500
words) and written by a native English speaker, on reflection it wasn’t
of sufficient quality. I had it written in 1st person, in a way that
told a story and tried to force engagement with the reader.
It would have been better if I had got the writer to do more research
and focus on producing THE BEST content on the internet, at a
comparable standard to Wikipedia. At the time I made the mistake of having the content written for Google rather than the reader.
Personality
One tactic I have seen used to great effect is where the writer’s personality
comes across in a website. When you can “hear” the voice of the author
and see a photo of them, you naturally become more engaged. So without
really thinking about it I added a personality to the site.
What started as a pen name, quickly grew into a fake character with
personality, photo and back story and ultimately I went too far and
became uncomfortable with how I was presenting the information. This is
one of the reasons I’ve been reluctant to share this story until now –
the site didn’t feel honest.
I’ve since removed the “personality” and have begun working with
another writer to help redevelop the content away from the 1st person
conversational style so that everything is presented in an objective
manner, even if that means people are less engaged.
Marketing The Content
Article marketing, the reason for this whole experiment is in essence very simple. You take 400 words
of good quality writing, perhaps something like “how to grow white
roses indoors”, and post this article on your website. You then re-write
the article, changing it so that it has different words and a different
structure, but ultimately delivers the same message.
Then you put this second article on an external website with a link
back to your website. By linking back to your website, you are
essentially “vouching” for your own content and telling Google that your
site is of high quality, and relevant to the topic of “how to grow
white roses indoors”. Google then ranks your website slightly higher for
the topic “how to grow white roses indoors”.
Easy right?
For this strategy to be effective, i.e. get a #1 ranking, you need to do it a lot. I ended up doing it about 2000 times. Yes I’m serious. The more competitive the topic that you have chosen, the more links you will need.
Luckily there are some pieces of software that can help you automate this: article spinners and article posting services. An
article spinner enables you to create many unique “copies” of an
article, while an article posting service takes these unique copies and
distributes them all over the internet for you, building your links.
Article spinning is a god awful horrible
nightmarishly boring job that takes a long time. And if you want to do
it well you have no option but to either grind it out, or pay
someone. As a guide, it took me on average three hours of concentrated
effort to thoroughly spin a 500 word article. I ended up outsourcing it
and it turned out to be about twice as expensive to spin an article as
it was to have the article written in the first place. Again, Pat made
this look easy.
I broadly followed Pat’s guide on how to distribute these articles
and your success will be largely determined by the quality of the sites
you are able to post to.
Money Making Potential
Finally in terms of money making, nettle tea is not a good niche as it doesn’t have strong commercial intent. How
much does a tea bag cost? But people still come, and some of them click
on the ads or use the affiliate links, so the site makes money!
The Cost
It costs money to do all the above. Something that many people and
businesses outright baulk at. I was talking to a friend this week who
has just spent 12 months and $30k traveling the world, and when I
suggested that she invest about $500 and educate herself in how to build
a website like this she was immediately reluctant.
Even though she works on websites daily, even though she has a
thorough understanding of all things internet, even though she knows
that it’s important to invest in your education, even though she’s a
smart woman.
It was really hard to convince her that it would be $500 well spent.
There’s something that gets triggered in people’s brains when it
comes to opening the wallet for this kind of project. For many I think
it’s the intangible nature of education and the time separation between action and results.
It’s true that you can do many things yourself and save some money if
you want, but for me the trade off was that if I went that route, NOTHING would have actually got done. By spending money I was more committed to seeing the project through, and by allocating cash up front I felt like I had an “operating budget” that was at my disposal.
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