Welcome to the first installment of the Authority Internet Business Traffic and Income Report.
In these series of posts, I’ll show what it’s like to build an authority business from scratch. Each update will describe the actions I take to grow DevelopGoodHabits.com and the lessons I learn along the way.
Specifically, we’ll cover six major sections:
- Traffic Results
- Income Results
- Total Expenditures
- Future Strategies
Like most folks, I love when bloggers show specific numbers from their business. With the Traffic and Income Report, I hope to show what works with an Internet business. Rather than talk about different strategies, I’ll let you know if it actually helps grow my business.
This post is a long one, so let’s get to it.
Before we jump into the meat-and-potatoes of this post, I think a brief introduction is in order.
Since 2005, I’ve earned a full-time income from an authority business that specialized in affiliate marketing. While I didn’t mind talking about the techniques I implemented, I wasn’t comfortable with being fully transparent about my websites. This I feel, was a disservice to my readers because it’s easier to apply information when you see how it’s used in a real-world setting.
So to become more transparent, I decided to start this case study in January 2013. My goal here is to show what it’s like to build a long-term asset from scratch. Unlike the “niche site model” that’s popular with many marketers, I wanted to show readers what can happen when you’re willing to spend years working on something great.
Honestly, the project took awhile to get going. I started working on DevelopGoodHabits.com (DGH) around April 2013, but it has been a slow-going process, including a three-month break during the summertime. Now I’ve made the decision to work on it full-time, with the hopes of turning it into a legitimate business.
It has been six months since this project was started.
How is it doing?
Let’s find out…
#1: Kindle Books
As you probably know, I’m a huge fan of Kindle publishing. With this platform, bloggers now have an easy way to monetize their website. In the past, you had to spend months building an audience before you could make money. Now, it’s possible to publish a book in conjunction with a blog and use both to grow your site. And yes, this is the strategy I used to launch my blog.
So far, the Kindle books are doing well. I’ve published four in the habits market and hope to complete three more by the end of 2013.
Not only are these books responsible for most of my revenue, they also generate traffic back to DGH. I’m already seeing book readers turn into blog readers and email subscribers. Both are important because my primary goal is to cross-pollinate followers/readers on multiple platforms:
Overall, I’m happy that there is traction with the Kindle books. This shows there is an audience in this market. All I have to do now is get better at finding out what type of information people want.
#2: Amazon Associates Program
As you’ll see in the “failures” section, I’m mad at myself for not doing a good job during the niche research phase of this case study. Specifically, I didn’t identify a quality affiliate offer before getting started. This has now become a problem because I don’t have a legitimate second source of income.
With that said, I think there might be some potential with the Amazon Associates program. While the commission rates aren’t great, I like this platform because you can promote offers that you actually use. In the long-term, I picture creating a series of physical product recommendations that help people with habit development.
(To learn more about what I’m doing with Associates program, check out this article.)
#3: Web Traffic
In September DGH generated 1,660 visitors. I’ll admit this isn’t a huge amount of traffic, but I feel it’s a decent start considering I haven’t actively promoted the site.
Primarily I get traffic from these sources:
- Kindle eBooks
- Search Engines
- Direct linking
You can’t build a business from 1,660 visitors. However, it’s a good starting point for where I hope to take DGH.
I’ll admit it… I have been very lazy with DGH. I started it in April and then promptly took a two week vacation to Puerto Rico. After that, I did some work, which included publishing two Kindle books and 20 blog posts. However, this momentum was lost when I took a bunch of vacations in the summertime:
- Greece (1 month)
- Cape Cod, MA (10 days)
- Biloxi, MS (3 weeks)
It’s impossible to build momentum if you keep starting and stopping work on a project. While I did a “little” work between vacations, I didn’t make any significant progress for about three months.
From this experience, I learned one important lesson:
“ To build an authority business, you need to work like an authority. (Click to ReTweet!)
An authority site isn’t a niche site. You can’t outsource the process and live the “4-Hour Workweek.” Instead, you need to spend time developing great content, creating useful products and networking with bloggers in your niche. All of these things require a whole lot of dedication.
I’m mad at myself because I know DGH has potential—yet I haven’t done the work to make things happen.
That’s why I made a recent decision:
For the rest of 2013 and the first part of 2014, I’ll only work on projects related to the authority business case study.
Basically this means doing a few core activities:
- Writing blog posts (on SteveScottSite.com) related to this case study
- Writing blog posts on DGH
- Creating Kindle books for the habits market
- Networking with bloggers and other thought leaders
- Building additional traffic channels
What this also means is I’m taking time off from publishing IM/KDP related eBooks. I feel this is the right choice because I’ll learn a lot of practical techniques that can be used to make stronger books in the latter part of 2014.
Okay, I went on a bit of tangent there…
My point is simple—if you want to build a successful authority business, then be prepared to focus on it exclusively.
#2: Niche Research
One of the first articles in this case study detailed seven steps for finding a profitable niche. Here, I described my step-by-step plan for choosing “habits” as my niche. Unfortunately, I made a huge mistake with step #3 (“Locate Affiliate Products.”) Instead of finding a good affiliate product, I assumed I’d come across something eventually. The problem? I haven’t found a single offer that meshes well with this niche.
Honestly, this was a huge mistake on my part. I was sooooo convinced that the habits market was perfect that I didn’t take the time do good niche research. And now all I can find are offers that I refuse to promote:
- Law of attraction
- How to be more happy
- Secret “success formulas”
- Binaural audio and subliminal messages
In the long-term, this won’t be a big deal because I’ll create my own offers. However, this mistake is costly in the short-term because I’m relying solely on Amazon for income. Potentially, this could be disastrous if the “Big A” changes a policy or rule.
The lesson here?
When researching a niche, make absolutely sure you find at least three different income opportunities. That way, you’ll have a backup plan if something happens to one source of revenue.
#3: App Development
One of my worst qualities is impatience. When I start something, I want things to happen right away. This causes problems because I’ll often start projects before they’re ready. In regards to the DGH case study, this impatience cost me $1,682.21.
Let me explain…
When I described my initial monetization strategy, I mentioned how app development would be focal part of my business strategy. While I’ve made a bit of money with apps in the past ($11.415.53 so far), I didn’t take time to research the mobile market for habits. Instead, I broke the cardinal rule of business:
“ Create products that people WANT! (Click to ReTweet!)
You see, when I started DGH, I learned about the importance of “triggers” and how they relate to bad habits. In the iTunes app store, I couldn’t find an app that tracked triggers, so I decided to build one myself—for a total cost of $1,682.21. The end result is an app called Trigger Tracker.
While I believe Trigger Tracker is useful, my mistake was to build it before talking to my audience. What I should have done instead was build up a following and then talk to people about what they want. From there, I could have built an app that users would love.
I still feel Trigger Tracker has potential. It generates a few email subscribers a day and some people regularly use it. In the future, I might talk to my audience and then create an update with more advanced features.
Before we move on, I want talk about the nature of mistakes. As you’ve seen, I’ve made three huge ones with this case study so far. Does mean DGH is a failed project? Absolutely not!
Expect mistakes to happen. If you’re not pushing boundaries or trying new things then your business won’t go anywhere. Sure, I screwed up a few times and lost money, but that doesn’t mean the authority concept is flawed.
To quote Thomas Edison:
“ I have not failed. I’ve just found 10,000 ways that won’t work. (Click to ReTweet!)
Sure, the affiliate and app strategies haven’t panned out. But maybe these failures will open the door to a whole new opportunity.
Alright, that’s it for the rah-rah section of the report.
Let’s talk numbers…
As you’ll see, DGH hasn’t generated much web traffic. That’s a direct result from my current area of focus. Instead of promoting the site, I’ve been concerned with:
- Creating good content
- Publishing Kindle books
- Networking with others
While these activities won’t bring immediate traffic, they will have a positive long-term impact on the success of DGH.
Here is a screenshot from the past six months:
These are the stats for the six-month span (April through September):
- 6,177 Visitors
- 4,086 Unique Visitors
- 02:49 Average Visitor Duration
- 43.14% Bounce Rate
Now, let’s break down traffic into specific sources:
- 3,700 Direct
- 1,271 Search Engine
- 1,091 Other
- 115 Twitter
The “Direct Traffic” stat is hard to decipher because it comes from a variety of places: SteveScottSite.com, Kindle books and autoresponder emails. Unfortunately, it’s hard to know exactly where these visitors come from. But, in the future, I might set up individual tracking codes to get a more accurate measurement.
Also, I’m using these traffic numbers as a baseline for future promotions. Down the road, I’d like to compare stats on a month-to-month basis. So let’s look at the numbers from the past month (September):
- 1,660 Visitors
- 1,218 Unique Visitors
- 02:22 Average Visitor Duration
- 28.19% Bounce Rate
And here are the individual traffic sources:
- 742 Direct
- 630 Search Engine
- 234 Other
- 54 Twitter
One stat that stands out is the search engine traffic. DGH has generated 1,271 search engine visitors since its inception, but over half of it happened in the past month. That means my minimal backlinking efforts are starting to pay off. (More on this in a future post.)
Now, a metric that’s equally important is the number of email subscribers. As I mentioned in the post about monetization, the Most Wanted Response (MWR) for DGH is to build an email list.
How many subscribers did I generate in this six-month span?
Here they are (broken down by their subscription path):
- Kindle books: 487 subscribers
- Mobile apps: 172 subscribers
- Splash page: 181 subscribers
- Sidebar widget: 95 subscribers
- Other (no tracking link): 5 subscribers
- Total: 940 subscribers
Overall, I’m happy with the traffic and subscriber numbers. I’m most excited about the 440 email subscribers and 1,660 visitors in September. Both show that the business is gaining momentum. Now all I have to do is work hard and really start to promote the website.
Okay, here is where the rubber meets the road. While it’s nice to talk about successes, failures and traffic; most people want to know one thing—how much money have you made?
Well, right now my income comes from three places:
- Habit Kindle Books: 70 Healthy Habits, Wake Up Successful, and Writing Habit Mastery
- Amazon Associates: Physical product and book recommendations on DGH.
- RevMob: An advertisement platform for the app Trigger Tracker.
To give you an idea of what it’s like to build an authority business, here is the five-month progression of DGH:
- Amazon Kindle: $9.08
- Amazon Kindle: $757.13
- Amazon Associates: $0.24
- RevMob $0.36
- Amazon Kindle: $354.04
- Amazon Associates: $6.70
- RevMob: $13.99
- Amazon Kindle: $256.02
- Amazon Associates: $8.33
- RevMob: $9.11
- Amazon Kindle: $2,190.59
- Amazon Associates: $127.26
- RevMob: $9.57
Total Income Generated: $3,741.92
When looking at these numbers, two things stand out.
First off, my “three month hiatus” killed the momentum of the Kindle books. June was a strong month where I generated $757.13. If I was smart, I should have followed up with a book in July and another in early August. Instead, I waited until the end of August to publish the third book (Writing Habits Mastery). Only then did my income go back up.
Second, I rely way too much on Kindle publishing. This shouldn’t be a big deal in the short-term; but a lack of income diversity is dangerous place to be in. At the very least, I should increase the Amazon Associates income. Beyond that, I think it’s important to focus on affiliate marketing (if possible) and creating information products.
Full Disclosure: Before we move on, I want to mention something…
When I launched Writing Habit Mastery I received a few message from a few “Steve Scott readers” who were annoyed that I didn’t post an update on this blog. They said it wasn’t fair that they had to track down this book and potentially pay $2.99 since I didn’t let subscribers know about the discounted priced. So I made the judgment call to run a $.99 promotion and send one email to my IM/Kindle business list.
I feel this promotion did generate revenue and help with the rankings of Writing Habit Mastery. Consequently, the results from September are somewhat skewed. The purpose of this case study is to provide a realistic look at building a business from scratch. And most people won’t start out with an email list like I used to promote the $.99 discount.
With that said…
Yes, the email promotion absolutely helped with short-term visibility. However, its long-term “stickiness” is determined by reader demand. Right now, people are buying this book because they want to “develop the writing habit,” not because it had a lot of visibility six weeks ago.
Moving forward, I’m not going to promote habit-related books on this blog or on my IM/Kindle email list. If you want to grab free or discounted copies, then you’ll have to check out the DGH blog. Really, that’s the only way I can make sure this is a 100% legitimate case study.
Every online business requires a financial investment. The trick is to know what’s worth buying and what can be skipped. So another point of this case study is to provide a financial breakdown of what I spend on DGH.
There are five categories of expenditures for Develop Good Habits:
- Web Development: Domain registration, hosting (with Host Gator), WordPress theme (Canvas theme) and web design tweaks.
- Content: Blog posts, editing, web articles, lead magnet creation and a few eBook sections.
- Graphics: Stock photography, logo design and eBook covers.
- Mobile Apps: Graphic design, wireframing, programming and app store submission.
- Marketing: Press releases, Fiverr gigs, paid advertising and various experiments.
Here is the financial breakdown during the six-month span:
- Web Development: $405.32
- Content: $1,325.00
- Graphics: $894.60
- Mobile Apps: $1,682.21
- Marketing: $209.00
Now, compare expenditures to my gross income and you’ll get the net income for Develop Good Habits: Gross Income: $3,741.92 – Total Expenditures: $4,515.53 =
Net Income: – $773.61
Obviously, the first thing that jumps out is the fact that my authority business is operating at a loss. To be honest I’m not that worried about this. Some of the expenditures come from content-creation tasks I wanted to test. Plus, 1/3rd comes from the failed “mobile app experiment.” I think most people starting out would only spend money on web development, graphics and marketing. So if you only looked at those numbers, DGH would already be a profitable site.
Also, remember how I stressed the importance of taking a long-term approach to building an authority business? In fact, in a post that I wrote six-months back, I wrote the following:
“ Realistically I won’t see any profits till the six-month mark. That should be enough time to create a few offers and build a baseline of traffic. From there, I’ll explore different options for how to scale this business.
After looking at my current Kindle book sales (for October), I’m pretty confident I’ll earn enough to make DGH a profitable venture. Sure, I didn’t hit the six month goal, but seven months is pretty damn close. And to paraphrase that Edison quote, “I spent a few thousand dollars to find ways that won’t work for my authority business.”
Overall, I’m excited because I feel that the “authority model” is working. While it’s not as profitable as I’d hope it would be at this point, the business is gaining momentum. Really, all I have to do now is tweak what’s working and implement a few additional strategies.
Which brings us to…
There are three strategies I’m implementing for the final quarter of 2013 (October through December):
#1: More Kindle Books
It’s the old 80/20 rule in action—if one strategy is responsible for the bulk of your income, focus on that strategy.
By January 1st, I plan on having seven published Kindle books in the habits market. On Monday I uploaded the fourth (10,000 Steps Blueprint.) That gives me 10 weeks to get three more books on Amazon. Difficult, but definitely doable.
Establishing relationships with related bloggers is a great way to spread the word about your site. There are many benefits of networking that I’ll get cover in a future post. For now, I’m focused on a few things:
- Find blogs where I like their content
- Share their post through Twitter
- Comment on intriguing blog posts
- Send outreach emails to start a conversation
- Look for a way to help the blogger
The key point here is I’m not asking for anything upfront. Instead, I’m focused on getting to know the person. Remember, building an authority business is a long-term strategy. So it’s important to connect with people now and start establishing those relationships.
Throughout this case study, you’ve seen me talk about the importance of traffic and income diversity. While DGH is gaining traction from Kindle and Google, these sources could easily disappear overnight. That’s why I’m using the fourth quarter to try video marketing.
As of now, I’m following a simple three-step process:
Step 1: Get comfortable with video. Presenting information through video has never been my strength. So I’m going work on this skill by creating a number of short (1 to 2 minute) videos that each cover a specific habit change. These will be posted to a new YouTube channel.
Step 2: Free Course on Udemy. After building up a catalog of videos (at least 20), I’ll turn them into a free course on the Udemy platform. I love the potential of Udemy, but I’m not sure how it works. I figure the best way to learn is to give away content and start connecting with Udemy users.
Step 3: Paid Course on Udemy. Finally, I’ll launch my first paid information product on Udemy. Perhaps I’ll turn one of my Kindle books into a step-by-step course or maybe I’ll create something brand new. The important step is to get something on this platform that has the potential to generate income.
To be honest, I’ve had “start YouTube/Udemy marketing” on my to-do list for way too long. Now is the time to take action on this idea and grow my authority presence.
Well, that’s it for the inaugural traffic and income report!
It’s been over six months since this case study has started. I’ve had some successes and some failures. Moving forward, these lessons will help take DGH to the next level.
I feel an authority business takes time to build. This means it’ll often be months before I see the results from the different strategies I’ve implemented. That means I’ll only publish a “Traffic and Income Report” every 2 to 3 months.
I feel it’s more helpful to you to create content that covers specific strategies I’m testing instead of publishing a T&I report each month. By spacing them out a few months apart, I’ll have more information to add to each update.
Okay, it’s your turn.
While this case study focuses on my experiences with growing an authority business, I’d love your feedback.
Post your comments in the section below.
Have a question about the case study? Want to see a specific type of content? Have feedback about what’s happened so far? Got a great idea for me?
If so, let me know your thoughts…Take Action. Get Results.
P.S. Struggling with your Kindle books? Don't know how to get started on Amazon? Looking to generate an additional stream of income?
If so, click here to grab my free report "44 Answers to YOUR Kindle Publishing Questions"