Welcome back! It’s been a little while!
If you haven’t read part 1 of this series you might want to go ahead and do that. Else, if you’re the impatient sort, the summary is that I’ve got a wedding place card website that made $100 in revenue this past October.
In this post I’m going to talk about my plans to grow it from $100/month to $1,000/month.
Honestly, because anything higher than $1000 seems totally impossible at the moment.
But also, if I want to get to $5,000/month — or whatever the amount is that I’d need to earn to live comfortably off of it — I’m going to have to get through $1,000 first. I find it to be quite a bit more manageable to think of the next target in front of me than to think about the one that’s a bit farther off.
As I quoted in the last post:
“The journey of a thousand miles begins with a single step.“ — Lao Tzu
Like last time, while a lot of what follows is specific to my own product and product roadmap, I hope that anyone who aspires to launch — or has launched — a passive revenue-generating project can get value (and maybe some inspiration) from seeing my plans. Seeing others work public is one of my favorite ways to learn, and so I try to pay that forward as much as I can.
So without further ado, here they are in all their glory! My grand plans to get from $100 to $1000/month:
Not too groundbreaking, is it? Nevertheless, that’s all I’m hoping it will take. If you’d like to know more details, keep reading.
I originally had a section here talking about how I thought I wouldn’t have to do too much besides ride momentum and that would eventually double my revenue to $200/month.
Here’s a quote from that never-published draft:
I really hope I don’t jinx myself here, but I think I’ll be able to get to $200/month pretty easily and without making any significant changes to the site or my strategy.
Of course, me being the unreliable, procrastinating person that I can sometimes be — especially when it comes to writing — I didn’t actually manage to publish that and now it’s already December.
So what happened last month? Let’s see:
Place Card Me’s first four months of revenue.
If you can’t read the graph, revenue for November was just under $300 ($298.55, to be exact). And I didn’t change much at all on the site besides adding a bunch of seasonal designs. We’ll file this little publishing discrepancy under “good problems to have”.
Anyways — while I’m thrilled about the month-on-month growth in this graph — I’m also trying to remain skeptical about the ceiling of my current approach which is why I haven’t made this milestone more than $300.
The main reason for that skepticism is the fact that U.S. Thanksgiving (and to some extent Christmas) is bizarrely the busiest time of the year for place card searches. And, since Google remains — to an almost overwhelming degree — my biggest source of traffic, I expect to see a fairly significant drop off after the holidays. I believe I can recoup some of that traffic by continuing to improve the site’s SEO and word-of-mouth traffic, so am hoping to just sustain traffic at the current elevated search levels.
New users by channel for Place Card Me, November 7–14, 2017. That big bar on top is the Googs
The other source of my skepticism around organic search-based growth is that there are diminishing returns on the horizon.
Once I rank #1 for “place cards” and just about every related term (which amazingly is not that far off) I expect the growth from search to basically flatline. At that point I’ll have to find my next lever.
Still, for as long as I continue to provide an awesome product — which my users consistently say I am — my search rankings for relevant terms should continue to be strong, and so I hope to be able to sustain this result.
Okay so let’s say I’ve exhausted the amount of organic traffic I’m able to get and — ignoring the fact that I could pursue other traction channels — I need to figure out a way to get more revenue out of my existing customer base.
The lowest effort / highest opportunity lever I see here is to continue optimizing my prices. Place Card Me is currently well below market price for the value it is providing. Equivalent templates sell for $5–10 on Etsy and don’t have a fraction of the convenience of my site.
A random assortment of Etsy listings for “place cards template”. Note the average prices.
When I first launched the site I originally priced my templates in the $5–10 range and then slashed prices to try and prove that I was capable of getting any sales at all. Now that sales are starting to come in steadily I have the opportunity to start raising prices again and seeing how the numbers work out.
In October and November I got my average sale price up from $1 to $2, and just this week I raised prices to where I expect the average sale to go up to $3+.
Now — I don’t have a math degree but I’m pretty sure about this — if I can get the average sale price from $2 to $4 without reducing the number of sales, that should grow my monthly revenue from $300 to $600/month. If I can get the average sale price higher than $4 I can make fewer sales and still double my revenue.
Again, given that $5 is still — in my very biased opinion, of course — a great deal compared to what else is available in the market, I believe this should be readily achievable.
I plan to keep a close eye on the relationship between price and conversion rates over time and find the optimal prices — which are hopefully quite a bit higher than they are now.
Example revenue maximizing chart assuming a linear relationship between price and number of sales. In this example the revenue-maximizing price would be $10. Supply and demand math gets a lot easier when your marginal cost is $0!
Place Card Me is currently completely free to use if you don’t select a design, and the free tier has 100% of the same functionality and features as the paid tier.
For every paid session on Place Card Me there are more than fifteen people that use the product for free.
Providing a high-quality free tier has been an intentional strategy from day one.
In these early days, I knew I wanted to create something as awesome as possible that anyone could use without paying, so that it would be more likely to gain traction and popularity. Among other reasons — the success of people using the site sends an important signal to Google that the product is solving their problem, and as a result causes it to rank well in search, which — as you’ve seen above — is critical to my current traction strategy.
All that said, at some point when I’m confident in the site’s quality and rankings I can start playing with figuring out how to monetize the free tier.
I’ve got a few possible ideas I’d like to play with in this space. These include, in no particular order:
I’m not sure yet which of these I’ll end up trying — and it’s a bit challenging striking a balance between enabling monetization and keeping the free tier valuable so I want to roll this out carefully.
However, if I can convince 10% of the current free users to pay the cost of a template that should be sufficient to double revenue again.
Okay, if I’m being perfectly honest I still have absolutely no idea how I’m going to get to $5,000 a month.
The above plan seems daunting enough and despite my communicated confidence, I really have no idea whether I’ll even be able to get to $300 repeatedly.
To financial independence… and beyond!
That said, if the above pans out, and if I’m able to get to, say $1000/month from the above channels and changes then hopefully, hopefully, the path to $5000 will be much more clear by then.
There’s a huge number of ideas I have for growing things past $1k, some of which I think are decent, and most of which are probably terrible. At the moment I just think of these as “possible long term big things” — largely to be ignored until the changes in front of me are rolled out.
Still, for completeness, here are some of those ideas, grouped into a few high-level buckets:
Anyways, like I said already, these ideas are all far enough out that they’re mostly just pipe dreams at this stage. Who knows what the future holds in store!
Still, I can’t help thinking — if I can successfully double revenue 8 times, surely I’ll be able to do it two or three more, no?
Originally published at www.coryzue.com.
If you’d like to find out whether this all works out or I fall flat on my face, you can subscribe below to get updated every time I write something new — including part 3 of this series, when it’s ready.
Edit: Part 3 is now out! You can find it here. You can still subscribe if you want though. :)
And if you’ve got any feedback or ideas on my plans I’d love to hear from you in the comments!