AFP 14: Monetizing Free

Justin Cooke

March 16, 2012

In Episode 14 of the AdSense Flippers Podcast, we dig in to what “Free” means when applied to a business model.  We thought it was important that we explain we are NOT against paid information for any moral reasons.  We simply think you receive more long-term value by offering info for free and that it’s a great way to disrupt established industries and shake things up.  We cover a general overview of how to apply “Free” methodologies and strategies to your business, the advantages and disadvantages that come with free offers, effective ways to use free to get paid, and the particular strategies we’re using with AdSense Flippers to monetize free.

How to Monetize Free

(The pictures don’t have much to do with the topic in this week’s episode, but we were able to drag “John the Intern” away from his desk for a day of island hoping and scuba diving and thought we’d share one of the benefits of living here in paradise!)  Want to see more pictures?  Check them out here.

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AdSense Flippers Diving TripEven though this episode has more to do with business strategy than niche site creation, we wanted to make sure we were clear about where we stand on info products and give you some specifics about how you can utilize “free” in your own business. Did you find this episode useful? Don’t be shy…let us know by giving us a review!  Here’s the link to the podcast on iTunes.  Thanks in advance!

Podcast Transcripts (Click Show to view)

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Justin:
Welcome to episode 14 of the AdSense Flippers Podcast. I’m your host Justin Cooke and I’ve got with me my business partner extraordinaire Joe “Hot Money” Magnotti. What’s up, buddy?

Joe:
What’s up, everybody? I’m pumped to be back.

Justin:
And I’ve got John the intern. John, how are you doing, man?

John:
I’m doing good.

Justin:
Good to have you on the program. We’ve got a great episode lined up. Today we’re talking about monetizing free. Now I know that doesn’t sound exactly right but we will get into that a bit later. First, let’s do some news and updates. First thing is we got a new five-star iTunes review, buddy.

Joe:
Tell me about it, man. I love these things.

Justin:
All right. So we’ve got Chad from San Diego. Chad says, “Great podcast. Keep them coming. By following your advice, I’ve started generating a small income via AdSense sites. Thank you so much. The beer is on me whenever we meet.”

Joe:
Thanks Chad. We had a buyer of one of our sites named Chad. I wonder if it’s the same guy.

Justin:
I don’t know. It could have been, buddy, but I will definitely take him up on the free beer offer. San Mig Light man, please. Thank you.

Joe:
Yeah. Talking about buying our sites, I’m really encouraged and excited that we sold our sites on the buyer sites page quickly. It’s amazing to me, Justin, how quickly these sites sell once we get them up.

Justin:
Yeah, I’m fired up. We just put a couple more sites. There are 13 sites. We got 8 sold like within 24 hours or so.

Joe:
Yeah.

Justin:
Pretty cool, man. I just wish we had more sites available. I think we could do a lot better.

Joe:
Yeah, we’re working on it.

Justin:
Yeah, absolutely. Next thing we’ve got is NichesforCharity.com. This is a new project we’re working on in association with Spencer from NichePursuits.com. Basically the idea is we’re going to pool some money together. We’re going to create niche sites individually and we’re going to take the earnings, 100 percent of the earnings we make from those sites, and give them to charities. Specifically we’re looking at charities here in Davao City, Philippines.

In fact, we are going to be the charity. So we’re going to take the money we make, go buy blankets, mats that people can sleep on, shoes and hand those out to people here locally. I’m really excited about this project.

Joe:
Yeah, it’s going to be really interesting to see how we mix together our expertise with the charity aspect.

Justin:
What I like too is the fact that kind of the internet marketing community has a bit of a black eye, right? It’s always marketing this, selling me that and if we can take that and turn it around a bit and actually do some good with the stuff that we’re doing with the marketing tactics we apply, I think that really kind of helps our industry. It really helps us grow up a little bit and I think it helps AdSense Flippers and Niche Pursuits do that a bit as well.

Joe:
So I got a bit of a news on the Try BPO front. We’re teaming up with someone who’s experienced on the sales and marketing end to kind of bring in some more outsourcing deals and we’re perhaps looking at getting an outsourcing podcast out there. I’m not sure what we’re going to call it yet but hopefully we’ll come up with a catchy title.

Justin:
Yeah. I think it will be fun, man. I really like doing the AdSense Flippers Podcast. I think if we did an outsourcing podcast, it would do really well as well. And the thing I’m really excited about is we’re going to be talking about something that we know so well and we work with so passionately, right? I mean this is something we do on a daily basis. So being able to do that in a podcast I think will be fantastic. I’m really excited to get that started.

Last bit of news we’ve got is the AdSense Flippers Guide. We’ve been working on this for a while now. John the intern has put some blood, sweat and tears into it and basically he’s been, he has got – it’s mostly done and we’re editing it now. We’re going through it but he has done a bunch of videos. I knew we’ve got the process from A to Z. If you follow this, you can absolutely do what we do.

So even if you don’t do exactly what we do, there are some tips in there and some tricks I think that will be completely worthwhile. Now we’ve talked about this guide. I mean we could probably sell it for – anywhere from 400 to 700 bucks literally.

Joe:
Yeah. We could have a six-figure release.

Justin:
Six-figure release. Yeah, what we’re talking about is we can make quite a bit of money on this but I think ultimately we get more value by making it free.

Joe:
Yeah, and I hate charging for information. You know that Justin. So I think this fits right up the alley of giving it away and putting more people to AdSense Flippers.

Justin:
Well, let me ask you, buddy. Why do you hate charging for information? Why is that a problem? Isn’t that a viable business model?

Joe:
It is but I think that the information, duplicating information doesn’t cost you any money and therefore anything that you can duplicate for free, you should find a different way to monetize that.

Justin:
Yeah, but you’re not some like hemp-wearing Kumbaya type of guy that says, “Oh, everything should be free,” right?

Joe:
No, no, no. It’s just not an ethical approach or a moral approach. This is more of a business thing.

Justin:
Cool, man. Well let’s get right into this week’s heart of the episode.

****The AdSense Flippers Podcast****

Justin:
So we have five main areas that we were going to approach monetizing free. The first is kind of like an introduction to free, what it means, what it is. Second would be advantages to free. Third would be disadvantages to free. The fourth section is how free can make you money and the fifth point, we’ll go into our strategies and how we’re applying them in our business.

So right into the first section, the theory of free. Now here’s a book we really recommend that you read. It’s Chris Anderson’s book called Free: The Future of a Radical Priceand this is where we got a lot of ideas. It really kind of changed and helped like focus my scope on what we should do for different free models.

Joe:
Yeah. I didn’t actually read the book. I listened to the audio book and I think John is about a third of the way through the book right now but some of it are new and some of it was definitely eye-opening. And I could see how it applies directly to our business especially things like the Jell-O incident or the Jell-O model.

Apparently, when they invented Jell-O, not a lot of people bought it because they didn’t know how to use it. So what the Jell-O company wound up doing was giving away recipe books so that people would learn how to cook and how to use Jell-O.

Justin:
I really like that. Very similar to what we’re doing. We’re creating niche sites. We’re selling them but we’re giving away the information free on how to build them, how to monetize them, how to expand them. Right. And so that’s very similar, I think, and very applicable to our model.

Joe:
Yeah. I mean there’s a bunch of models that Chris Anderson discusses in the book. A number of them is the freemium model, right?

Justin:
Yeah, which is basically you offer a bunch of stuff for free that’s of value that people will use and adopt and then have a higher level of service that’s paid, right?

Joe:
Yeah, that’s probably the most common one on the internet, the easiest one to think about but then there’s the three-party market.

Justin:
Yeah, which is all about like sponsored content. A good way to think about this is cell phones, right? You might get a cell phone for free and it’s because you’re paying a monthly subscription service. So they purchase the cell phone from the manufacturer, give that to you for free because they know they’re going to make their money back on the monthly fee.

Joe:
Right, and then there’s subsidies.

Justin:
Yeah, which is like the buy one, get one type deals and most of us know that’s not actually free.

Joe:
Yeah and then there’s the non-monetary market type stuff.

Justin:
Yeah. I think this is where it gets a little scary. So people are trying to put a monetization method to something that shouldn’t be monetized and that’s where some ethical or moral concerns kick in and we will talk about that a bit later. But yes, those are basically the four different areas.

I think we should take a stand here and say that we don’t have a moral, ethical, philosophical problem with charging for information.

Joe:
Yeah. Kind of what we’re talking about in the intro where we’re not trying to be all Kumbaya and hippie-ish about this approach. We don’t think everything in life should be free.

Justin:
Ultimately it’s a marketing or business decision, right? What brings about the most values? What industries or what areas can we shake things up by offering things for free? I think that is interesting and not the, “Oh, it should be free,” or any kind of issue there.

Joe:
Yeah, I mean look at our business model at AdSense Flippers. We are ruthlessly leveraging free and we’re using that to get people in the door to come to our site, read our stuff and then hopefully buy our sites and return that to us.

Justin:
Yeah. I mean it’s not all about just OK, we want to give the information away for free. It’s a business. We’re in business to make money. We’re businesspeople first, right?

Joe:
Right. And you know what? That could change in the future. I mean if we realize that we have a better model by charging for stuff that we give away for free now, we would adapt and do that.

Justin:
The worst thing you can do though, I think, is to trick people into free, right? Or offer them something that’s free and then have it not be or using fake transparency to get people to believe in you. That’s worse than not being transparent in the first place, so by not giving information away, not – by being fake about it.

Joe:
Give me an example of that.

Justin:
Well, I’m not going to be calling people out on the show, man, but you know what I mean. The people that are like, “Oh, yes, I did this,” or “I made this much money.” You found out they made it working at a factory or something instead of actually online.

Joe:
Agreed, agreed. It’s tough. I know that people want to build reputation quickly but the way to do that is to be truthful and honest especially if you’re going to be transparent.

Justin:
So getting into part two, let’s talk about some of the advantages to free. Now the first advantage I would say is that it’s disruptive to established markets. I love this, right? If you can get into an established market that’s charging a bunch of money that has huge margins and beat the crap out of them by offering something free and cut their margins down, that’s fantastic. You’re going to be a market leader in no time.

Joe:
Yes. I mean Chris says this in his book. You can’t compete with free.

Justin:
Yes. No way. Can’t do it. So if someone is out there charging for bits, they’re charging for things they shouldn’t be charging for, you can knock them down, right? You can tear them up.

Joe:
Yes, and the reason you can do that is because free bits have a very low cost of distribution, almost free. When you’re in the informational world, like we’re talking about before, it doesn’t cost you anything to duplicate that. You can go ahead and do that a thousand times. It would cost you the same amount as the first time.

Justin:
Yes. Most info products have a really clean, easy distribution system. There are all different kinds of places that can help you do that but basically someone goes here, clicks on a button, maybe put in some information and can download. It doesn’t cost you a dime and you’re out of the process completely.

One of the other advantages I think is that you’re trading short term dollars for long term exposure. So basically we’ve used it as a bit of an investment on our business. We could start off from the get-go, right? Charging for information, right? We’ve got the business going. We don’t particularly care. It’s making us money either way. We can continue selling on Flippa and we could have charged for information. Probably we could have done a WSO or something or charge $49 for this ebook download but I think by not charging for that, we’re able to build a much larger audience by giving it all away for free. People dig that, right?

Joe:
Yes, 100 percent agree there and I really like our approach a lot better. I think it has more long term value.

Justin:
One of the other great things about free, I think, is that it’s easy for industry leaders to give low risk recommendation. So you have someone like Pat Flynn who might go, “Hey, check out AdSense Flippers,” right? You can have Crow Blogger allow you to do a guest post because you’re not charging all this information and all this crazy stuff or for this stuff that you’re giving out. It’s all free. So they can go there, check it out and take a look.

I say low risk because there is a bit of a time and investment involved. So if someone is going to give you a recommendation, they know that it’s going to take quite a bit of their readers and their listeners’ time. So you do have to overcome that and you have to provide actual value which we will get into in a minute but there is a bit of time involved and I think most high level people understand that.

Joe:
Yeah. And I think they’re going to take the time to check it out, right? They’re not just going to offer – just because something is free, they’re not going to recommend it but most people, when they hear about free, which brings us to the next point, they don’t expect any support. So if you give any level of support, that’s going to go above and beyond people’s normal expectations, which is great, right?

Justin:
Yeah, which is fantastic. Definitely. Like if I’m using a service and I have questions about it or whatever, I wouldn’t expect them to have customer service on there ready. I wouldn’t expect them to help me walk through it but if they do that, I’m like, “Oh my god, this is amazing. How can they even afford to do that?” or I will see their paid services on the side and I think it’s really cool.

Joe:
Right. I mean we do that with AdSense Flippers. We try to answer people’s questions directly either on the site or via email so we’re offering that support for free.

Justin:
Yeah, I’m on Twitter all the time. People ask me questions. Kind of say, “Hi. What’s up?” Facebook, fantastic way to get a hold of us and ask any questions you have. So I think that’s a great way to kind of connect with people and we don’t have to. We have a business to run, right? But I like to do it. It’s interesting and people like and respect that.

Joe:
The last point we would like to talk about is free is like open source. It invites collaboration. It invites free improvement of the product. Someone could come to AdSense Flippers tomorrow and have a new point in the process which could improve our sites and offer to that for free because we’ve been offering all those information for free.

Justin:
Dude, I love that. So someone will come in and comment and they will say, “Hey, guys. Love what you’re doing but check this out,” right? Or we will get an email from someone that goes, “Hey, I think you can improve your process by doing this, this and this.” And then we can use that on our sites. We can share that information with everyone else. It invites people to share, right? Because they’re going, “God, they’re being so open with everything. Why don’t I be open too?” So it’s more of a collaborative approach and I love that.

There are a lot of advantages to free but there are some serious disadvantages too that I think are important to cover. There’s a psychological value in paying for something, right? Like if you pay for something, you tend to convince yourself that it was worth the money, that it was worthwhile, that your purchase was a good one. This is something we all do psychologically. We try to, after the fact, convince ourselves that it was valuable, whether or not it isn’t or whether or not it is, right?

So when you get something for free, you don’t really have that psychological effect going on. You tend to maybe think that it wasn’t worthwhile.

Joe:
Yeah. I would also say you probably treat things a lot better that you pay for than you get for free, right?

Justin:
There’s a small bit of here though where if it’s really good, that you’re compared to those who aren’t, right? So if you’re offering something of true value, then you’re compared to all that other crap that people looked at for free and they have a good thought in their mind about you.

Joe:
Another point here that’s a disadvantage is you can’t back out of free. I mean this is one thing we got to think about with the guide, right? We offer it for free. It’s tough to go back later and start charging $47 for it.

Justin:
Oh, the guide is done, man. That cat is out of the bag but there is some other stuff lined up in the future that we do need to consider, right? I mean there are some things that we – I don’t know. I mean maybe we should charge for it especially when you start talking about products or tools or things that have fairly high development cost on our end. I mean we do want to recoup those development costs. We want to make sure that we’re getting enough value out of offering it for free or that we get paid for that product or service long term, right?

Joe:
But then the other thing that you can’t back out of free as we mentioned is as a market, you can’t back out of free. Once competitors start offering stuff for free, then everyone who’s charging for it has to go down to free.

Justin:
Yeah. They’re done, man. That’s it. So it’s not just you that you would be concerned about. It’s everybody. But here’s the thing. If there’s a way to take something free in a market, in a specific niche in a market, it’s going to happen. It’s going to be you or it’s going to be someone else but someone is going to take that to free. So it might as well be you and I love the disruptive nature of that where you can really step in and just own something like that, take people down. That’s so cool.

Another thing you can’t do is you can’t give away crap because free crap won’t work, right? I agree with this all the time. Like, we will get people that ask, “Hey, can you review my WSO?” It’s on the WarriorForum. It’s where they sell info products, whatever. Can you review my WSO? And I’ve done a few of these where I looked at them but they were so crappy, it was just a huge waste of my time and I was thinking to myself, “Oh my god, all these people that are going to download pay for this or maybe get it for free or give them an email address or something.” Like, it’s not even the money. It’s the fact that you’re going to waste four hours of my time digging through this and not only will people not really appreciate that or like it, they will hate you for it.

Joe:
Right. I mean there’s just a whole stigma attached to free. Nothing of free has real value. That’s what some people say. Well, it’s a generational thing maybe but that’s what some people think.

Justin:
Yeah.

Joe:
And you have to overcome that.

Justin:
Yeah, you can’t get something for nothing. Isn’t that the rule? I’ve actually heard you mention this before, right? This is before you were reading the book and kind of got a feel for the ideas but I mean you don’t get anything for free. You always got to watch out, right? The tap your nose kind of thing. I know what’s going on here.

Joe:
Yeah.

Justin:
But if you start looking at some of the things that are out there, you realize you can get some value. Google Apps for example, it’s free and we use it a ton. I get a ton of value out of that.

Joe:
And Google gets value back from us for that.

Justin:
Absolutely. Another problem with free or a potential problem with free is that you can’t get affiliate sales, right? And one of the benefits of an affiliate sales team is that they’re out there doing all the sales for you. They’re bringing you the business. They’re bringing you the dollars. If it’s free, no one wants to be an affiliate for you.

Joe:
Yeah. If you have a distribution network that’s loud enough and large enough, I guess it really doesn’t matter but if you do want to increase the viewership of something that you’re giving away for free, you can’t do it with affiliates.

Justin:
Yeah, you can’t do it on your own. It has to be like extremely good, epic shit, right? And see, that’s one of our problems. I like to mess with the affiliate stuff. I mean I would like to get some affiliates selling some products for us. You can’t do that with free though, unfortunately.

Joe:
Yeah. And the last point here that we should bring up is balancing the freemium model. This is very interesting. I mean you have to give away a product that’s good enough to attract users to adopt it and to make it part of their regular things that – regular tools to use but you don’t want to give away too much in that they don’t upgrade to the pro version because there’s no reason to.

Justin:
Yeah. Adoption is key though too. It’s not that they just download it from you but if they have to use it on a regular basis. If they’re not using it on a regular basis, they’re not going to find out about your paid offer. They’re not going to care enough to want to get involved, to take that next step, right? And if your really good stuff is behind a pay wall, then why don’t you just sell it anyway? You’re not really giving it away for free. It’s kind of silly. It’s kind of a trick, right?

So this next section is about how free can actually make you money. Now free models are not new, right? People have been offering free for a long time specifically John. You started a blog about riding a motorcycle to get trip on your motorcycle, right?

John:
Yeah, totally. Like I sort of fell into that whole trap. I mean it was a cool blog, like it turned out to be a neat project and I met some interesting people but I think the tendency is for people to look at this free model and starting a blog or starting a business and giving away content and stuff for free. I’m thinking that over time, if they just put up good content and write good articles and are consistent, that somehow in the future, it will just eventually turn into some sort of money-making endeavor, right? And that never happened to me. I never even had an idea about how I was going to monetize this blog. I just thought, “Well, if 8000 people read it, I will make some money, right?” It doesn’t work that way.

Justin:
Build it and they will come.

John:
Exactly, exactly. So I guess what I would ask you guys now is, “Why is building an audience not enough?” Why is writing good content and putting it out there not enough in it of itself?

Justin:
Well, it’s important to remember which audience you’re building for, right? So if you are building an audience around people that don’t have any money, like backpackers for example, that’s probably not the kind of audience that’s going to be able to be monetized, right? So you want to make sure that the audience you’re starting off with is able to be monetized, that has the money and that will have interest in what you’re doing. So it’s not just build and they will come but you have to build it so that the right people come.

Joe:
Yeah, and then I don’t think you have to go after the money right to start off but you should have some objective in mind about how you’re going to make that money. I mean unless it’s just a for-fun blog or something you’re doing for your own personal use, no problem. But if you really are thinking about making this a career of some sort or making some extra money, you better have some idea how to monetize those eyeballs.

Justin:
Yeah, I will give you an example. So like the lifestyle design community. People build blogs around lifestyle design but a lot of times, they’re targeting kind of the backpacker community, the people that don’t have a lot of money, right? A difference would be targeting like C-level execs that want to get out, right? They want out. They want an opportunity that will give them a chance to make passive income, a chance to do their traveling of the world, kind of the midlife crisis type people.

I mean the difference is you’re targeting people that have money, that have experience. These are people that you probably want to talk to, right? The backpackers, I mean they have a lot of experience. They need to learn on their own about how to start a business, how to get a business up and running whereas you wouldn’t have that with these like mid-level execs or senior executives, right? So that’s a better audience for you to target.

John:
Yes. So you’re basically saying that people need to think about who’s going to be reading their stuff and who’s going to be buying their products and enjoying their blog before they just start cranking up content, right?

Justin:
Yeah. I mean if you start writing about knitting for example, right? Make sure that you’re talking about wealthier wives that stay at home and knit and maybe not grandma who’s living on social security. I mean that’s a silly example but you know what I mean. Someone that has some money to buy something.

Joe:
Yeah. Well, I mean I think another great example to look after are any of the older established type industries that are charging for their products, right? Where you can kind of throw the services on their head by offering for free.

Justin:
Yeah, exactly.

Joe:
Bootie Mashup is a great example of that, right? I mean they can’t charge for the songs because then they would have to pay royalty fees. So under the fair use policy, they’re using these songs and creating new songs out of them but they encourage you to come to the concerts which they charge for.

Justin:
Yeah. Bootie Mashup for anyone who doesn’t know, it’s basically where they take established songs, mix them together and get around the fair use issue where they can put those songs together but yeah, it’s a good example. I mean anywhere we can take something that is large, has high margins and can now be done electronically, you can destroy that, buddy. I love that.

I think it’s important to think about free bits and not free items, right? Now you can do free with products that would actually be manufactured or created but there’s always going to be some level of cost. You can get it down, man. Overseas manufacturing but it’s not free.

Joe:
Right. The example that I was thinking of when we talked about this was free baseballs. Like I don’t know how you would make a company that could make free baseballs. Wouldn’t there be a way to do it? I’m sure there is but I can’t think of one.

Justin:
Well, advertise on the baseballs. I mean there are ways to go around it. Get the baseballs paid for elsewhere and get them for free but it’s not as easy. When you’re talking about electronic stuff, now that is pretty easy.  We were talking about this before the podcast. We’re thinking of examples of like I think areas where you could be disruptive. Think about like the AWeberMailChimp arena, right? I mean AWeber is charging for something that really can’t cost a lot of money.

Joe:
No. Yeah. Any of those kind of online services where you set up a website and you do the same thing over and over and over again, I don’t think that that costs a lot of money once it has been developed. So why not find a way to offer that for free? If somebody did that, if somebody replicated their business but offered it for free through advertising or some other sort of list building opportunity, it would be amazing.

Justin:
But the thing is, it can’t be crappy, right? Deliver something good. Deliver something AWeber quality that’s free through advertising. I would be all over it, man. It sounds like a really good idea.

So this last section is about our strategies and how we implement free into our business to help make us more money. The first thing I think I would mention is that we’ve mentioned this a bit on like how we sell our sites on Flippa. The idea is to start at a dollar. No reserve, right? Get as many eyeballs on the auction as possible and you will get best price.

It’s the same thing with AdSense Flippers. We know that if we’re offering sites on our site, right, for sale, if we get enough eyeballs coming to AdSense Flippers, some of those people are going to be building sites. Some of them are not going to want to pay us a dime but some of them are going to have some money and some are going to want to skip the process of having to start a niche site and maybe not make it work from the start.

They want something that’s earning that they can expand and they’re able to buy from us. So get the eyeballs and we will get the buyer.

Joe:
It was the auctions that convinced me that this whole model was worth it, so absolutely. If you can build the brand that can attract the eyeballs, you can sell them something that’s worth it.

Justin:
Don’t you feel a little silly now when we look back? I mean we didn’t do this with our outsourcing company, right? We were really kind of reserved. We said, “Well, it would just be a small piece of the pie, the outsourcing pie,” and kind of like held back. I don’t know if that was a smart move looking back.

Joe:
Yeah. Well, I mean you read the book free but you said you really didn’t think you believed it, right?

Justin:
Yeah. I wasn’t sure. It’s like one of those things. Oh, that sounds cool but I don’t know if it would work in practice.

Joe:
Yeah. I mean implementing strategies you read out of a book is always a lot tougher than just getting an A in the course, right? So now practice makes perfect and maybe we will move this into Try BPO as well.

Justin:
Yeah. We’ll be starting about that. I mean I think getting into a podcast going for the outsourcing is really interesting. Picking up a sales guy that can really kind of like push the brand forward there and really get us talking to the right people will help our business out a lot, I think.

John:
So question though. What transpired that allowed you guys to feel that you can really start taking advantage of this model, right? So like how did you get to the point where you felt like the risk wasn’t so high and you were willing to try out kind of the freemium model as opposed to what you did with the Try BPO?

Justin:
Well, AdSense Flippers wasn’t our main gig, right? That wasn’t our main business. We were getting paid elsewhere. So it was really kind of a no-risk situation, right? So I would say for anyone out there that has a job, they’re getting paid, they’ve got a nice steady income, you can be risky here, right? I mean you can really put yourself out there and just try something different and I think that’s what we do with AdSense Flippers. We said, “What the hell?” We want to try this out. We think it would work. Let’s give it a shot.

Joe:
Yeah. I have to say that that’s a big part of the free strategy is I wouldn’t go out there, quit your job and try to start a free blog tomorrow where you are going to eventually monetize it. That may be a recipe for disaster. Try to do that in your free time and build it up so you can kind of take it over after that money goes away.

Justin:
That’s one of the cool things, I think, with our strategy is we’ve had so many doors open, right? Like some people, it’s because oh, you’ve got a blog that’s really popular. You get a lot of people that are reading your site, right? So you guys must be interesting and doing something good. So they kind of view it like, “Oh, well you’ve got traffic so now I will talk to you.” You got other people that are like, “Wow, you’re writing really interesting content.” Like we were saying, it’s helping my business.

So you get lots of different reasons people find it interesting but what’s really cool is that you’re open and like very transparent. People are more willing to reach out to you, right? And when you do reach out to others, if they get a chance to check out your stuff, they’re like, “Wow, these guys seem all right.”

So by putting ourselves out there, we’re getting all kinds of opportunities. Being emailed, meeting people in person, right? I love that about our business now. I love it.

Joe:
Yeah. If we had hid everything behind a pay wall, we never would have been able to do that.

Justin:
Yeah, right? So yes, if we got a membership site where we had to charge people, we might have 100 members, maybe a few, maybe several hundred members but we wouldn’t have met nearly as many people as we have and made nearly as many connections that we have by putting it out there for free.

I would say with our strategy, it becomes a bit more difficult. The more traffic we get, the more people that are reading or listening to our podcast, right? Because you start to think about this and it’s rough. It’s one of those tough things to mention but you start to get a little greedy, right? You started thinking, “Oh wow, we’ve got a lot of subscribers. We got a lot of readers. We could just start charging here or charging there.” Really started thinking a bit short term, right? You also start worrying about like losing your authority, right? So maybe I need to do this or that to make sure that I stay on top of our game.

It’s a really slippery slope. You have to be really careful there because at first, you have nothing to lose, right? You’re all about it. You put out all kinds of information and then the more you have to lose, the more reserve you want to become and I think that’s something we struggle with and we always push to keep the information out there, keep giving quality information. I think that’s really helping us.

Joe:
Yeah. I mean we could sell the guide for around 400 bucks probably and if we got 200 sales inside of 30, 60 days, I mean that’s $80,000 in value. That’s no joke, right?

Justin:
It’s tough, dude. I mean yes, like 80,000 bucks, man. I love 80 grand if we could get that on a launch.

Joe:
But I mean by offering for free, well obviously we’re going to have affiliate links in there. We’re going to have some side sales and then the connections and the business opportunities that we’re going to bring in because of this guide being out there. I mean people are going to look at it and go, “Wow, these guys really figured it out A to Z.”

Justin:
Done, right? Done. What did we do that brought in these guys this last month at – one group of the guys were talking about spending $100,000 with us. What did we do for free that brought in the other guy that was looking to invest like $50,000 in our business, right? I guarantee you the reason that a door was open was because of something we put out there for free, right? That we didn’t charge for.

So I don’t know how much money we would have made charging for that but I mean it’s $150,000 of potential right there. Will they go through? I don’t know but I guarantee you will make more than $150,000 this year.

John:
Yeah, this is like a – it’s a tough one for me, right? Because I’ve been putting this thing together during a couple of weeks and I remember asking you and Joe about it and you guys saying, “Yeah, this thing could probably sell for a couple of hundred bucks if we wanted to do that.” And on my end, it’s kind of like, “Well, why wouldn’t we do that, right?” We’re going to make a bunch of money. I created this thing. Like that sounds really cool but then you guys were like, “Well, we kind of come at this from a different angle,” right?

Justin:
Yeah. I mean here’s the thing. We could sell. We could get a bunch of money for it upfront but that’s – I mean if we would have done that earlier, we would have only gotten $5000 with the sales, right? We probably would have sold out earlier as would you, right? So the idea is to take this all the way. Keep it going, right?

Give free information. Give good information and valuable information and don’t charge for it and keep building your business.

Joe:
Look, there are a lot of people out there that build niche sites, that build micro niche empire. I mean they’re building a lot of sites but nobody talks about it like we do and that brings a lot of opportunity for us to go to the next level whereas those guys who are just private, behind the scenes and don’t market themselves at all, will never get that opportunity.

Justin:
That’s what we do with the outsourcing business, right? I mean that’s one of our things there is that we were the private, behind the scenes guys. It’s good but that will never blow up and never even has the opportunity to because of the lack of connections, the lack of traffic, the lack of eyeballs basically. So never say never, right?

But our plan is to not launching the paid info products by themselves, to not do that route and we will continue doing what we’re doing now although we don’t have any ethical or moral issues with it or anything. So there are a lot of people out there selling info products. That’s great. I hope they don’t take our free stuff and try to wrap that into a sold product. That’s pretty crappy but as long as we keep information out there, the people who are charging for crappy information, hopefully we can put those guys out of business.

Joe:
Yeah, I think we can. I’m very interested to see how popular this guide will be.

Justin:
All right, man. So that’s it for the heart of this week’s episode. Let’s get right into the ninja marketing tips, tricks and our plans for the future.

****The AdSense Flippers Podcast continues.****

Justin:
So Joe, you are up man, for our first ninja marketing tip. Hit me. What’s up, buddy?

Joe:
You know, I love this one, FreeConferenceCall.com. I had this call with these bigwigs the other day. They want to spend a lot of money with us and we had a whole conference call with them for free.

Justin:
Yeah. I love the fact that it’s disruptive, right? I mean it’s like the other paid conference things, go to …

Joe:
Meeting.

Justin:
Yeah, those things, GoToMeeting, GoToWebinar. Those are all paid but these guys are coming in and trying to take them out by being free.

Joe:
Yeah, you get up to 6 hours and 96 callers which is a pretty long conference call and a lot of people to be on it for free. They offer recording for free. All these little services and features for free where if somebody does upgrade to the pro version for certain aspects of it, that’s how they make their money. So it is the freemium model.

Justin:
So the second ninja marketing tip comes from John the intern. John, what have you got, man?

John:
We have FaceTime. So this is like the Skype version or like the Skype kind of program for like iPhones and iPod touch devices. Probably not going to be revolutionary for people who already have an iPhone. But if you don’t, like what I’ve done is I have an iPod touch, right? And we have wireless internet here at the house and I can essentially use this thing exactly like a phone. It calls home for free and the connection is way better than Skype. Like I’ve had some like business calls and some calls of clients on Skype that were – like you miss every third word, right?

Justin:
Yeah.

John:
This is way more stable and it’s free so there you go.

Justin:
FaceTime, buddy. Free. I like free. We will have to check that out. I don’t know. I’m a big Skype user. It normally works well for me but our internet can be a bit sketchy here so definitely something to check out.

John:
Yeah. This is more for like calling family and friends, right? Because like not every client you’re going to want to talk to or potential customer is going to have the service.

Justin:
Yeah. Last thing I want to mention is our plan for the future. One of the things we’re working on that we put in our yearly planning was webinars. So we plan on getting a webinar going here in the not too distant future. We will go over keyword research. We will go over content. One of the things I love about webinars is that it’s actually interactive, right? People are going to ask us questions and get us like directly so I’m really excited about that. We’ve done one internally inside the Dynamite Circle and it went really well. People were really happy with it. I’m excited to offer this to our readers and listeners.

Joe:
Yeah. I would like to hear how many people are interested in that. So if you are interested in a webinar done by Justin and Joe of the AdSense Flippers, leave your information in the comments.

Justin:
Yeah. We would love to hear what you guys think. Again, no pitch fest. We’re not selling anything. We just kind of want to go over the stuff so you can get a really clear idea working with us on exactly what it is that we do and how we do it.

Joe:
Yeah. Maybe we will do the webinar and the guide release at the same time.

Justin:
Maybe we will. Well, that is it for episode 14 of the AdSense Flippers Podcast. Really enjoyed having you. I thought it was a great episode. Make sure to hit us up on [email protected]. I’m on there on a regular basis. We can chitchat and you can check out some of the stuff we’re talking about looking at and doing. So until next time guys, thank you.

Joe:
See everyone next week.

John:
Adios.

 

Topics Discussed This Week Include:

  • Our new charity project, a new approach with our outsourcing company, and the AdSense Flippers Guide
  • Introduction to free: Reviewing Chris Anderson’s book and looking at real-world applications of concepts
  • Advantages to free: Disrupting established markets and trading short-term payoff for long-term exposure
  • Disadvantages to free: Psychological values attached to payments, and irreversible market shifts
  • Making money with free: Niche should start with end-user in mind and attacking older, established industries
  • Our free strategies: Resisting temptation for short-term gains to promote long-term value in our organization
Mentions:

Interested in attending a webinar with us?  Anything you’d like to add?  Please let us know in the comments below!

Note: A few days after posting this podcast, my friend Brendan Tully (a SUPER sharp guy) turned me on to this awesome comparison chart that looks at and compares various mailing list services.  I thought this was relevant after discussing Aweber.


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  1. […] any slick, over-hyped ebooks to sell you. In fact, we’ve built our business and brand on the value of free information. That’s not to say we don’t make money online (we do) it’s just that we value […]

  2. […] without compensation, anyway.  Let them open the pricing conversation and, if possible, do your first work for them for free.  (I know this may be a bit controversial…but if the value of the connection and the […]

  3. […] model in such a way that Flippa can’t (or couldn’t afford to) compete.  As you know, we like Free but I don’t think that would work here.  Charging sellers listing fees keeps the really bad […]

  4. […] big fans of free, but definitely not against charging for it either, especially if it’s condensed, […]

  5. […] a price-tag of $499/month we thought AnyMeeting’s offer was significantly better. Plus…we love freemium models!  Please click here to register to reserve your […]

  6. Dan Norris says:

    Hey guys this was a great episode and very timely for me.

    I am working on a few apps that I want to provide a generous free plan for however my main concern is for projects that are aimed at the internet marketing niche I’m not sure if a free product is going to get the traction that a paid one will get. Surely to get in front of the biggest audience you need to get the big name marketers promoting your product and are they going to do that without a generous affiliate offer?

    I don’t really know what the answer is. I guess I’ll try it for free to start and see where it goes but I suspect at some stage having something that people will pay for (i.e. a higher level plan) will bring in more opportunities for getting the word out.

    • JustinWCooke says:

      Hey Dan!

      You’re bringing up my biggest issue with free in the IM community…the lack of affiliate sales. I’d really like to learn how to build/grow an affiliate sales team and feel like we’re missing out on that a bit. I think it’s definitely worth considering whether you’d get deeper distribution through “free” or through hungry affiliates…and make your choice based on that.

  7. Dave Starr says:

    Bang up job again, guys. There’s some real “meat” in this one … particularly for a lot of people out there who are totally clueless about the balance needed between making money and providing value for that money. Everyone reads about the “making money online” idea and then immediately starts putting up sites and greedily expecting the money to roll in. Providing anything of value? Hmmmm, not so much.

    Several years ago when I still lived in the US and was involved in the data network business (dirt-based), I partnered briefly with a company that had a great business model. They offered to provide wide area Wi-Fi service for an entire city (Colorado Springs) 100% for free. A lot of hardware and engineering investment. Huge, actually. But they had a foolproof (and honest) back end to the business that would provide then a great ROI.

    The only thing they lacked was a franchise certificate from the city government to provide a “public utility”. Eventually, the city refused to let them serve the people of the city, for free, no strings attached. Why?

    During a series of public hearings a number of citizens complained that the service would not provide 24-7 tech support, or expressed concern that the company would hire “non-English-speaking foreigners” in “some damn overseas call center” for tech support. Since the company wouldn’t/couldn’t sign up to provide free, US based 24/7 call centers with specified ‘wait times”, the city council voted NOT to let them provide free service.

    Dumb? I sure thought so, since I was one of the “back-end” businesses that would have profited greatly while at the same time making a profit for them.

    Bottom line? As you mentioned, there is often a significant cost to ‘free’.

    On a different note, please put me on the list for the call center/BPO webinar(s) ASAP. I have long been of the opinion that this is an opportunity for earning overseas that a ton of foreigners looking to make an honest dollar have been overlooking. I don’t think companies have to be the size of a Convergys to provide a great service/potential income.

    • JustinWCooke says:

      Hey Dave!

      Yes…providing something of value is key. Shit with a bow on it is still shit…whether you charge for it or not! :-)

  8. Random question: Have you guys ever received an email with a UDRP Complaint? If so, how did you proceed?

    • We have received about 15 requests. We normally find it’s best to ask for proof of their trademark and then a nominal amount to cover the cost of the domain and setting up the site. $500 is a good starting point. If they force the issue or threaten legal action, it would be wise to comply because you will lose in court. Move on and don’t dedicate to many resources to it.

      • Joe,

        They filed a WIPO complaint which cost them $1,500. Would you ask for a nominal amount to cover the domain and setup cost after they have threatened with this type of legal action? I got scared when I got the emails from the lawyer and just said I would transfer the domain. It’s only a $50 loss for me.

        • Tread carefully. It’s not worth putting your whole hosting account at risk for one site. That said these large corporations tend to have a process. If you prep every email to them with something like “I intend to comply with requests, there is no need for further action” in big bold letters, but still ask a question or two they will probably have to raise it up the chain of command before dropping the hammer. This increases your chances of getting lost in the shuffle or simply getting a payout because it’s cheaper than following through.

          In the end though, it sounds like you are going to lose this site. Your efforts would be better focused elsewhere.

  9. Shinu says:

    I’m guessing you guys know by now of the major deindexing of BMR’s sites? I was wondering if the rankings for your sites had been effected?

    • JustinWCooke says:

      Hey Shinu,

      Yes, we’d heard the rumors about BMR, but when I checked as recently as 4 days ago, it seemed all of our posts on the BMR (for the most part) were still in place, still indexed, etc.

      Someone alerted us that this was no longer the case. I logged into our BMR account to check and 9 out of 10 of the links that BMR had previously indicated were indexed were no longer indexed. It also appears that they’ve changed their policy to no longer include new blog posts on the homepage…they’re simply buried in the content on the site on PR0 or PR N/A pages.

      I’ve sent word out via Twitter/Facebook and have updated our Linkbuilding post and our Resources page explaining what we’ve found. It will be interesting to see how BMR responds to this…so far they don’t seem to have done an effective job at managing the fallout.

      BMR may be able to adjust and fix their issues…that remains to be seen. At this point, I don’t believe it’s an effective linbuilding strategy…let’s see what they do to change that!

  10. Another great episode guys! I do like the free idea but everyone should have a paid product too I think as raises the bar in both your image and the amount of value to deliver.

    Your podcast gets better each time. Can I be the first to dub you the knights of Adsense? :)

    Keep up the great work!

    • JustinWCooke says:

      Thanks, Gordon!

      I totally agree that you have to make your money SOMEWHERE (We’re definitely not hippies here!) but I’m not sure that you necessarily have to offer paid content. I think it might be possible to be completely out there and up-front with your content and information provided and then sell whatever it is that’s making you money.

      Knights of AdSense? Bleh…more like Pages? Definitely aspiring, though! :-)

  11. Steve Wyman says:

    HI Guys

    Another really enjoayble podcast. What I really like is the way they, give a great insight into how you guy think about things.

    Im a fan of the Free model for non physical things. Im really glad your going to get this specific info out there for free as it totally disrupts the guys that rip off others info and put it behind a pay wall. Of course Guys like spencer have also put out loads of great free content.

    I just wish all newbies could be exposed to the guide so they dont waste money on snake oil! It will be down to us all to try to make it go Viral :-) better think about the download capabaility of your servers :-0

    Great to hear from Jon the intern.

    • JustinWCooke says:

      Hey Steve!

      Glad you liked this podcast episode…we had a great time putting it together and really liked it as well. It’s something we feel pretty passionate about and can speak well to it, I think.

      I definitely like the free model for non-physical things, but I’m AMAZED when I see it being used for physical things as well, lol. the author of the book puts together some great arguments for making airline tickets free and charging around them. (I’m not sure that’s a physical thing…but you get my point)

      We think Spencer’s onboard with our ideas here in talking to him. As with us though, he’s in business first…so it all comes down to where we think we can provide and receive the most value. We’re all happy to be disruptive when it comes to free information. It provides us long-term value and authority and leaves those that charge for it scrambling. Hopefully, it will force those charging for similar information to make theirs BETTER if they’re going to charge for it. We’ll try to keep them on their toes! :-) That’s better for everyone, we think!

      Thanks for the mention. We like having John on the podcast. The funny thing is that he was listening to us plan out our content for one of the episodes and had some questions. We thought, “Why not just have him ask those questions on the show?” If he’s wondering about those topics…we’re sure others are as well.

      Thanks again, Steve!

    • I don’t think download capability will be an issue especially since we just moved AdSenseFlippers.com to our own VPS. We might use libsyn to distribute it should volume become a problem.

  12. […] Read this article: Episode 14 AdSense Flippers Podcast: Monetizing Free | AdSense … […]

  13. TomJripley says:

    Hi Guys

    When’s the guide due out?

    regards

    • JustinWCooke says:

      Hey Tom,

      The first draft is DONE. I’ve already gone through it and added some content, edited a few things, etc. Joe’s going through it now and should be done in the next couple of days. “John the Intern” has some more stuff to add and will probably be finalizing it next week. We’re thinking about releasing it at the same time we do our webinar…maybe two weeks?

  14. Wow! Another great episode.

    The Webinar announcement is great news and I’m looking forward to it. My suggestions: keep it professional like the podcast, announce your topics (in advance, if possible), and record the session for future review.

    The charitable initiative is especially laudable: by keeping it a “retail” operation, you ensure that the benefit goes to deserving recipients and you put a personal face on the operation. Keep us posted!

    Thanks again,
    George

    • JustinWCooke says:

      Will do, George! We’ll probably do something like 30-40 minutes digging into the topic and reserve the rest of the time to answer questions…we really enjoyed that part in the last one we did.

      Yeah…”retail” charity is so much more enjoyable, too. Not only do you KNOW the money you’re giving is going right to the people who need it…but you get to see their smiles as well!

  15. Jose Barrios says:

    Another great podcast guys. I am interested in joining your webinar. Please send an email when it becomes available. Thanks

    • JustinWCooke says:

      Awesome, Jose…great to have you onboard! We will send that email when we’re about to get started!

      I’ve been on a couple of webinars over the last few months and one thing they all seem to have in common is a sales hook or push. We’re thinking a non-salesy webinar will be refreshing and appreciated!

  16. Guys another great podcast, I get the impression that you are starting to redefine the the whole IM business model.. I’m board! It should be an interesting ride :)

    • JustinWCooke says:

      I’d like that, Mark! We’re still pretty low-level an don’t have the reach to make a huge impact, but we’re definitely growing! :-)

  17. The charity idea is a great idea. I like that you are controlling the charity and will be handing out stuff to local people in need. I’d love to see some videos and pictures of you guys doing that. It will be a really good step to legitimize Internet Marketing as not being a sleazy business.

    An outsourcing podcast is fantastic idea. I’ve been struggling myself in finding good outsourcers to do work for me. I’d appreciate your expertise.

    The fact that you guys are giving away this really legitimizes the information because it’s in front of anyone’s eyes who want to read it and not behind a pay wall. Love it.

    Personally, I’d rather get the information for free, but then buy through an affiliate link if there are supplemental products. I don’t mind giving a person a commission in exchange for free information. I see it as a “thank you” for the information and it’s at no-cost for me.

    You’re right about how if someone pays for something then they convince themselves that it’s worth it, and if it’s free then it must not be valuable. This is unfortunate because there’s a lot of free info out there that is more valuable then any $1997 info products.

    Love the podcast…looking forward to the webinar.

    • JustinWCooke says:

      Glad you like the charity idea, Mike. Ultimately, we’d like it to be well received, get some attention, and ultimately, get others to join in. Worse case, though, we donate a bit of money and get the pleasure/enjoyment of doing some cool stuff for some people here locally that are in need, heh…not too shabby!

      I’d love to do the outsourcing podcast. We’ve struggled a bit as it’s not in-line with some of our core goals/projects here with AdSenseFlippers, but since we brought on someone to help with the sales side of TryBPO, I think there will be some benefit there in terms of new clients for the outsourcing company.

      Agreed on the affiliate links. We’ve had plenty of people ask us for an affiliate link, thank us by purchasing through our links, etc…it’s one of the reasons we decided not to remove them from the site. It would be silly to NOT allow people to do that through us, right?

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