Starting an online business is all the rage nowadays. It’s understandable because who wouldn’t want to work from home and make tons of money. Of course, if it were only so easy, right? Today, I want to dig into not just running a successful e-commerce business but a passive e-commerce business.
I am all about passive income, but creating income streams takes a lot of hard work. E-commerce is not for everyone because you have to do tons of market research and learn various marketing concepts, such as email marketing, social media, affiliate marketing, sales funnels, and inventory management.
Setting goals and expectation management. To run a successful business, you will need to start by setting reasonable goals. I think a goal of $1,000/month from a passive e-commerce business is appropriate. Again, a passive business is just part of our cash flow retirement plan. We also have retirement income, rents, dividends, royalties, and cryptocurrencies contributing to our passive lifestyle.
4 Steps to Become Rich
If you want to earn a large amount of income, say $10,000/month, from your e-commerce business, it wouldn’t be very passive. Of course, you can grow a huge company and have a manager run it for you, but your profits would diminish. But that’s okay; at least you could enjoy residual business income from a beach somewhere.
So, before you jump into the world of e-commerce, understand what you want to extract from your business. There are many sharks in the water that prey on would-be entrepreneurs with “get-rich-quick” schemes. Be careful.
Become an e-commerce entrepreneur. I always say, “Become an Entrepreneur BEFORE You Start a Business.” In this case, read the book “Ecommerce 101.” This book will break down all business regions such as running an online business, profitability, sales funnels, and data analysis. This book is your first step to becoming an influential online entrepreneur. If you don’t like reading, please don’t start a business.
Become CEO of Yourself
Online business, physical goods. In the online world, there are many ways to sell products to customers. These include:
1) Direct sales. With direct sales, you sell directly to the customer with a product that you produce. For example, you create a bath lotion that you sell on your website.
2) White Labeling. For white labeling, you take a pre-existing product and attach your branding and advertising. It takes much less money to start and carries less risk. However, you have less control.
3) Wholesaling. With wholesaling, you get a large bundle of products, usually at a discount, and then resell them at a profit. It’s hard to get significant discounts when you are moving small volumes of products, however.
4) Dropshipping. Dropshipping sees you selling products directly to customers, but the inventory comes from a third-party source—allowing you not to acquire overhead or inventory. The shipping will usually be slower because another vendor is fulfilling the order; you, in essence, are a middle person.
5) Subscription box model. In this model, customers sign up for a subscription to receive a mystery box of products you ship them. I use a subscription service called Loot Crate. I love the idea; however, it is a large amount of production.
Military Success 105: Financial Fitness
For our business today, we are not going to be dealing with any physical goods. We want a passive business; thus, we want to focus on digital goods and items from other retailers. It’s hard to have a passive business when selling physical goods. Don’t worry; I will write a companion article covering running an automated e-commerce business selling physical goods.
The digital world of sales. Focusing on digital goods makes our business model much more passive. However, our percentage per sale will be much smaller since someone else provides the shipping, handling, inventory, etc.
The best way to sell digital goods is to become a content creator. I love the idea of becoming a content creator and driving sales to your online business. However, I can appreciate those who don’t want to put themselves out there.
I’ll focus on content creation in another article. So, today will focus on advertising and affiliate marketing. In the online space, you will need to learn how to drive customers to your landing page. From there, you give them more details, a “call to action (CTA),” and send them to a product page. Don’t worry; I will review these in more detail.
Retirement Planning in Your 30s
A Sales Funnel. Every sale made to a customer starts with a sales funnel. I wrote an article about sales funnels almost ten months ago. The book “Ecommerce 101” goes even further into an online sales funnel.
The author refers to the A-I-D-A sales funnel, which stands for Awareness, Interest, Desire, Action, and maintenance. The idea is to get a random online person to gain brand recognition slowly. Over time they will warm to the idea of buying the product. When they finally see a sale, special promotion, or your call to action, they make a buying decision.
Multiple touches. It takes numerous “touches” before a person makes a buying decision. As a content creator, a person will begin to know, like, and trust you, which slowly reduces the number of touches they need to make before making a buying decision. However, we won’t focus on content creation today.
Affiliate Marketing. Another way to sell products quickly is to sell products that already have a strong track record. Affiliating marketing is a great way to start a passive e-commerce business. In a nutshell, you direct customers to existing products and receive a small commission from the sale.
3 Things I Love About Being a Writer
However, if you can sell large items, like televisions or laptops, this “small” commission can become a large amount of money. It will be difficult to sell high ticket items without creating content, but it may be possible.
Advertising. If you don’t want to create content, you need to work on your sales funnel. The top of the funnel is usually some form of advertising. You will also need to conduct market research. Let’s say you want to sell an organic bar of soap to men.
It would be your job to find the demographics that would use this soap. Maybe it is men with an age range of 18-25. Now, where do they hang out online, and how do you reach them through ads?
You would have to become good at running Google Ads and Facebook Ads. Your focus would have to be on creativity, design, and writing ad copy. The books “Cashvertising” and “The Non-Designers Design Book” are good places to start.
From there, you would need to build a great landing page. A landing page is a place where potential customers arrive before being directed to a final product page. You should optimize your landing page to get the customer to press the call-to-action button.
The call-to-action button says things like “try your 30-day free trial” or “subscribe.” Again, you would need to do all sorts of data analysis, focus testing, and design work to ensure your landing page gets a high percentage of people to the final product page.
Can You Achieve Work-Life Balance?
As I said, there is a lot of work to get these advertising sequences and landing pages running effectively. I never said it would be easy. However, once you understand what works, it will start to become second nature.
Product reviews. Another great way to drive customers to your sales funnel is through product reviews. I don’t consider this becoming a content creator because you aren’t the star of the show. People show up to read the reviews of the products.
An excellent way to start this business is by writing book reviews. I read books and write book reviews weekly, and it does drive traffic to various books on Amazon. The good thing about writing reviews is that it drives free traffic to your site via search engine optimization or SEO.
If you focus on high-end products, such as television, laptops, or online courses, then your commissions would be considerable. Again, I don’t consider becoming a content creator because you wouldn’t create “unique” content.
The Business of RV Life
Passive e-commerce business. Once you are driving traffic to landing pages or product pages, you can focus on maintaining your numbers. That is when the business becomes passive. You’ll just have to focus on a niche where the products have a long lifespan.
Books and video games have a long lifespan. You can write a review about a small Nintendo Switch game, and you’ll probably get traffic to that page for 20 years. You see, people will see this game for all of these years at different used game markets or resale sites. They will want to know more about the game, and you’ll be one of the few reviews around.
Cellphone reviews have probably a 5-6 year lifespan, which isn’t too bad. However, the traffic will be massive going into a new release. The competition is enormous, and you’ll be a small fish in a large ocean.
Find an underserved niche, and you will get a good amount of traffic. Independent books and small video games are an excellent place to start. Maybe reviewing make-up or Loot Crate boxes. There are so many options; you just have to find something that interests you.
You’ll Need $20,000/month in Passive Income
Conclusion. I could keep rambling on, but hopefully, you have a better idea of your options. If I had to choose, I would become a product reviewer and work on my SEO techniques. Advertising is a cutthroat world, but people have found tremendous success.
However, SEO is a truly passive way to get organic (free) traffic. It takes a while to get everything up and running, says three years, but with the right products and niche; you can enjoy your retirement with residual business income. I’ll be back with a lot more business articles coming soon!
Please join my Facebook Group if you want the latest articles and free books delivered to your news feed. Also, you can contact me inside the group and ask questions. I also have a Facebook Page where you can see my latest articles.
- PDF of the Month: Financial Independence through Real Estate 2 (Free 123-Page PDF)
- Free PDF Downloads: Download FREE PDF books here (Twitter Link)
- Financial Mindset: Become CEO of Yourself (book)
- Retirement Planning: Don’t Gamble with Retirement 3+4 (696-Page Free PDF)
- Investing: How We Plan to Retire on Dividends 2 (165-Page Free PDF)
- Cryptocurrencies: The Magic of Cryptocurrencies (Free PDF)
- Real Estate: Real Estate is a Mindset (Intermediate) (Free PDF)
- Business: Retire Rich, Retire Comfortable with a Business 2 (Free 185-Page PDF)
- Everything!: The Biggest Book on Passive Income Ever! (book)(Web Edition)(Art Edition)
- I bought a Kindle Oasis: Check it out Amazon
- Read My Books for Free: Free Kindle Books Schedule
- Sign up to Access our “Hidden” Free Kindle Book Schedule
- Kindle Unlimited: I Why Finally Subscribed Kindle Unlimited (learn more)
- Book Reviews: 54 Takeaways from 54 Books (book)
- Want to Build Passive Income from Books and Affiliate Marketing? (Learn here)
- Writing: Can Grammarly Make You a Better Writer? (direct)
- My Favorite Chromebook: The Ultimate Chromebook (direct)
- Follow us: On our Facebook Page and Join our Facebook Group
- Amazon Author Page: Check out my author page on Amazon
- Monthly Dividend Planner: Check it out on Etsy
Disclosure: I am not a financial advisor or money manager, and any knowledge is given as guidance and not direct actionable investment advice. I am an Amazon Affiliate. Please research any investment vehicles that are being considered. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article. All Right Reserved Military Family Investing
Leave a Reply