PPP026: Planning for Next Year’s Profitability

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As we dive deeper into the new year, it is important to take a look back at last year to examine what worked well, what didn’t, and what trends we are seeing around the web that can help us grow and thrive in the new year.

Resources Mentioned

• Google Analytics
• Jetpack
• Quickbooks
• Wave Accounting
• Backlinko
• The Personal Finance Arsenal 

Full Transcription

Eric Rosenberg: Ladies and gentlemen, boys and girls, children of all ages, welcome back to the Personal Profitability Podcast. I am you host, as always, Eric Rosenberg. And today I wanted to talk to you because it’s still January, still the beginning of the year, about how we want to plan out the rest of this year.  And I keep challenging people to earn your first freelance dollar somewhere. And I’m assuming that some of you have not yet, some of you have. For those who have not yet earned that first freelance dollar be sure to check out my ultimate Guide to Getting Started with Freelancing and I have an upcoming post you’ll see probably sometime in the next month or so, that will give you a huge list of ideas to get started.

But today we’re going to talk about people who have already started, already have a website, have already earned that first dollar, how we can really understand how we’re doing so we can improve that revenue in the future and make more money.

So last year, I set myself an online income goal of $40,000 on the side outside of work.  And I did make over $40,000 outside of work but my real goal was to do that through Narrow Bridge Media, which is the parent company that owns Personal Profitability, this podcast you’re listening to, and all by freelance writing and other websites. And with that I made $39,263.67. And I was within $800 which I decided to call a pass for the year, in finance we round a lot so I rounded, I said, ‘I made it but next year, for 2016, actually now, this year, my goal is $50,000.” So I want to raise that by $10,000.

If I want to make an extra $10,000 on the side, on top of the $40,000 that I brought in 2015, I really have to understand what I did that worked and what I did that didn’t work. That’s what we’re gonna focus on today, trying to understand the revenue sources that you have that work and don’t work.

Your Site’s Analytics

The first place you should look when you’re trying to understand what works, let’s assume your revenue is still pretty low, you have a website and web presence, a few episodes back we talked about Key Elements for a Successful Website; so you have your website, you have your good elements, one of the most important things on your website that you should have installed is some kind of analytics testing program. I use Google Analytics, it’s free, it’s the most popular resource that you can use to monitor analytics. It’s the one that most people trust. That’s one that I wanna talk about.

I also use, in addition, a built in stats tool from the WordPress theme. My site runs on WordPress as most fit websites do these days, not most, actually yeah most, over half of the big sites on the web run on WordPress. If you use WordPress, there’s a plugin called Jetpack. Despite what you might read on some reviews that are really old, it does not really slow down your site. It actually can speed up your site by offloading things, it’s pretty complicated how it all works. But one of the tools built into Jetpack is a stats monitoring tool called Jetpack Stats or Site Stats and I use that every day when I log in and look at my site on the dashboard just to see general traffic trends, what posts are popular, what’s not popular, so I know in a quick instant what is working and what’s popular.

When I really want to dig in and understand how users are interacting with the site, what the flow of people is, how they are finding the site, where they’re going when they get there, how long they’re staying, how many pages they go to per visit, I go to Google Analytics.  And again, that’s totally free, you go to analytics.google.com, I believe. Just type Google Analytics into your search bar, it’ll come up.

To install that, they give you a little code snippet that you paste into your, the way I set up themes I paste it on my theme files. You can also use, there’s a good plugin called Yoast; Google Analytics by Yoast, something like that. Yoast is a great tool. They also have an SEO plugin that I use. So there’s a couple of ways you can add the Google Analytics code to your site.

Once you get that set up and let it run for a while, you get all these great data about where users are coming from. If you use Google Search Console, it used to be called Webmaster Tool, you can actually get the keywords that they type into Google that lead them to your site. With Analytics, you can see these are my most popular posts, these are the posts that people are spending the most time reading, you can see actually the number of seconds people spend on each post.

So I know, yeah, some posts people come they might look at for a few seconds and leave, that’s a really bad post. If there’s one people are staying at for two minutes, three minutes, five minutes, ten minutes, I do have a couple like that; those are my best posts. Those are the ones that are telling me, these are what you’re doing right, Eric and what I should keep doing more of.

So look at your own Analytics and go into your dashboards and sort by all the different metrics. You can filter them by and see what keywords are really driving most of your traffic. If you have a certain keyword that you’re dominating, beef up those posts. Write more and more about that topic because that’s clearly is what bringing people into your site. And then use those really popular posts to build a funnel and a path for those users. They don’t want them to land on that page and leave you. You want them to land on that page and join your email list. We talked about that before, how to sign up for email list in the past podcast episode. You wanna really look through and see where people are finding you, how they’re finding you and what content is performing best. And that is the content that you want to keep repeating and replicating again and again.

When I first started my site, it used to be called Narrow Bridge Finance, before it was called Personal Profitability, there was one post that stuck out among all the others that was bringing in, I think it was over 80% of my search traffic, which is actually kind of scary and that was a big part of what led to a big downtrend in my search traffic when Google updated their algorithm.

If you’re too reliant on any one source for your traffic, that’s not a good thing. But at the time I thought, this is where most of my traffic is coming from so this is what I’m going to write more about. And I kept writing more and more about it and those five or ten posts are, up until 2015, were all of my top posts. Every single one of those was my top posts list by number of visitors.

So really find what works and repeat it. That’s a very simple formula for business success. Find what works and repeat it. Find what doesn’t work and don’t do that again. That’s what I’m always trying to do when I’m writing new posts and new podcast episodes. I’m trying to replicate what really works and what you guys really enjoy because I know if I’m doing well there then good things are bound to follow.

Your Site’s Revenue

The next thing you should look at once you’re done reviewing your analytics is look at how your money actually came together. Notice that I said look at money second and top performing content first. And that was very intentionally. You obviously, the end goal is to make money. You wanna make more and more and that’s probably why you’re listening here today, because you want to learn how to better manage your money or earn more money. That’s the end goal but to get to that end goal you really do need to understand all of the things that are happening leading to you making that money.

Once you have the content understood, pull up your financials, which I hope you are using some kind of software, there’s free ones online, like Wave Accounting, which I’ve tried, didn’t really love but it worked.

Other options, the one that I’ve used myself is QuickBooks, which is much more powerful. I actually use the desktop version because it comes out to be cheaper than the online version. I’d rather use the online one but I don’t want to pay like $30 or $50 a month or whatever they charge for their online service when I could pay one flat fee and use it for a couple of years before I have to upgrade. So I use QuickBooks on the desktop and I actually have my QuickBooks open right now so if you hear some clicks, here’s my clicker sound, that is my mouse clicking around.

So I’m looking at my 2015 Full Year performance. That’s where I got that revenue number earlier I shared with you, $39,263.67. And when I look at where that revenue is coming from, there’s a pretty clear trend. About $4,000 of that came from personalprofitability.com and related things. That’s click through revenue; affiliate revenue is the biggest bucket of that, that’s over $2,000 of it. Then direct advertising is when I do sponsored posts or some kind of a direct advertising agreement with the sponsor – that made up the next biggest bucket.

I’ve actually removed click advertising; I made 19 cents from AdSense early in the year and I don’t plan to make a lot more from that. AdSense is Google’s ad network that you can get those little ad blocks on your site that people click on it; you make a nickel, you might make a buck, you might make a little more, it really depends. But I decided I didn’t want people clicking away from my website. I wanted them clicking into my website.  So I removed that and I thought I’ll take less money there if I can build deeper relationships with my readers which might build bigger affiliate revenue later on. I can see that that trend is working. My affiliate revenue is growing, albeit slowly, I’m still making some money there.

My next biggest bucket was from event sponsorships that most people probably can’t pull off the way I do exactly. That was a lot of years of relationships to get some event sponsorships. And that’s all related to my attending the financial conference that takes place every year. It’s called FinCon and I’ve mentioned that before. I get some sponsorship revenue from attending FinCon.

But my real big bread and butter of my income is coming from my freelance work. I wouldn’t have any of that if it weren’t for the websites. It’s not a chicken and an egg thing here; which came first. Definitely it was that I built the website and then the freelance revenue came after because of things I’ve done on the website. Of that revenue, about $25,000 came from freelance writing, so me writing on other people’s websites. And a little under $8,000 came from me building other people’s websites, the website support services that I offer.

Also, there’s a small line for product sales. I made only about $70 this year. I have an eBook called the Personal Finance Arsenal that I sell. You can find that on the website and there’ll be a link on the show notes. Obviously I didn’t sell that many copies this year. I sell them for $3 and on Amazon I just get a small portion of that. Product sales hasn’t been my biggest income source though. I do have some plans to expand that in the future.

So let’s get back to that, the bread and butter. The money is really coming from, almost $33,000 out of the $40,000ish I made last year came from freelance. Knowing that, going into this year, I evaluated my list of clients, everything I worked on, my marketing techniques which at this point I don’t actually do much marketing of my services because I’m kind of full from my work load, of what I can do on the side. If I took on much more, I’d have to leave the day job. Which I’ve explained before, I don’t have any plans on doing any time soon.

If I want to build up that freelance writing income, I have to turn over my clients a bit and get some more higher paying clients and drop the lower paying clients. I actually did that. I dropped my longest client I’ve ever had. I sent them an email and said, ‘here’s the rate you’re paying me today, here’s my new rate going forward’ and they said they did not feel comfortable increasing my rate so I wished them well. I did not burn any bridges, it was very amicable. I said, ‘Thank you for the opportunities. I enjoyed working with you over the last couple of years but I really need to focus on higher paying clients and projects,’ which they were very understanding of. I was totally transparent of my reason. If they had been happy to raise their rate for me, I would still be writing for them. But they were not and I have people who are willing to pay. Actually I was working with a new client today that might be paying me over eight times what they were paying. That is a huge pay raise.

That’s the way I’m really trying to grow my income this year. I’ve cut the lowest paying client and I’m trying to replace them with a couple of much higher paying clients. And that will, I believe, that will build up the income.

Actually I want to take a break for a moment, I forgot the most important parts of the Personal Profitability Podcast. I’m sitting here drinking a delicious beer and I’m sure you’re all really thirsty wondering when I was going to say, ‘this is your moment to pause and join me in a beer.’ So this is it, this is your moment. If you have not already and you are not at work or in the car and you’re somewhere that is safe and able to do so, make sure to grab a moment, hit the pause moment and join me in having a beer or a wine or scotch or whatever you prefer. I’m a beer guy so I have my beer in hand. So here’s your moment, pause.

Welcome back. Alright, I hope you’re drinking something good. So what I’m drinking is actually, I got a special release of a brand new beer from Portland Brewing. I used to have a beer blog. It was originally called Beer Sexy. I got the idea from my friend J. Money over at Budgets are Sexy. And that eventually became a site called Portland Off the Wagon, which I earlier in 2015 decided to shut down. I took my favorite posts and merged them into my personal blog at ericrosenberg.me.

One of the dividends of having had a beer blog and writing about beer on occasion online is I get special release beer to review and rate and sample. So I just opened up a Portland Brewing Raise the Roost Belgian Style Red Ale. That’s a bit of a mouthful. Portland Brewing, they actually pretty cool company. They’re owned by a bigger more corporate entity but they still have their own range of freedom in what they brew. The big batch stuff comes down from their corporate office but their head brewer Ryan, super nice guy, gets to sample, he gets to try around some fun and different things.

And this is one of those, it’s a Belgian Style Red Ale Raise the Roost. I’m not normally a red ale guy but this one I’m really enjoying. I really like the Belgian yeast flavors in any beer. So here’s a cheers if you’re drinking along with me, it’s the raise the roof, L’chaim. So thanks for bearing with me while I clear that parched throat.

Learning from Your Favorite Sites

So we’ve talked about two of the major topics I wanna talk about. We’ve looked at our analytics, we’ve looked at our revenue. Now let’s look outside at other sites and get other ideas of what we can do to make our sites better. If there’s one site in 2015 that totally revolutionized anything that I do or think about, that site is called Backlinko; it’s the word ‘back link’ like getting linked from another website, with an O in the end.

With a site like Backlinko, that is an amazing site, the creator, I think his name is Brian, if I remember right, I don’t have it open right now, but Brian has really put out some amazing content over the last couple of years. His site has become arguably the number one resource for SEO, for people who wanna do things the right way, White Hat SEO. A long time ago and there still be a lot and they’re doing it Black Hat SEO, which is doing kind of the wrong thing to get ranked as high as you can in Google.

But Google changes their algorithms every few years and bad things happen. Like I was talking about earlier I’d lost, one day I lost over half of my traffic, when Google changed their algorithm and they did the, I don’t remember if it was the Panda Update or the Penguin Update. Cute fuzzy animals on the internet are not as happy as they are at the zoo. When I lost all that traffic I was like, ‘crap, that sucks, ‘f this.’

Backlinko is actually putting out case studies about people who are using their techniques that they’ve written about, the real success stories. Not only do they tell you what to do they will show you the results of what’s happened there.

There’s two major posts that they put out at Backlinko that I really want to implement this year, they’re something that I wanted to do new and I’m doing that with one of the posts I mentioned earlier that I’m working on different ideas to get started in freelancing.

And the two major techniques that they talk about that really struck home with me are ones called the Skyscraper Technique and one is called the Guestographic. But the premise is pretty much the same. You try to write the best post or create the best infographic on a topic that has ever been made. You might even include quotes and links back to other top players in that niche.

Let’s say your niche is pet care, that was one of the examples that they have given on the site before, you quote other pet care experts, you give the best pet care tips, you write the very, very best post on pet care that has ever existed in the history of the internet; which is quite a feat. But if you look back, my travel hacking post I wrote last year, The Complete Beginner Guide to Travel Hacking, The Complete Beginner Guide to Freelancing, I’ve written some other complete beginner guide type posts, one about the stock market, one about lending club, they’re really the best posts I’ve ever written. And now, today, Google is rewarding and those are my highest traffic posts by far, right now. They’ve come back and overtaken those posts that I talked about earlier that had been my top topic.

So this stuff working and I haven’t really implemented everything that they suggest on Backlinko. I haven’t really done all the outreach and the stuff to get the backlinks from the other sites. Looking out at my favorite sites, I’m able to see what strategies they’re using to really succeed. And I’m seeing this kind stuff happening all over the web now. The best and most successful bloggers are just doing exactly what they’re telling us to do at Backlinko and the results are just too compelling for me to ignore.

I am going to do that into the next year and I challenge you to look at what other sites in your niche, what other people doing similar, if you’re looking at freelancing or if you’re looking at providing a service or creating a website, look at your favorite sites and see what they’re doing. Don’t rip them off, don’t steal their text, don’t plagiarize, don’t steal their design. That’s not cool.

But their strategies, those are totally a fair game. I look at Smart Passive Income, it’s the site from my buddy, Pat Flynn; he was at an early episode that we recorded at FinCon last year. Pat, his site I’d say my favorite. What he’s doing is my favorite of all the sites and bloggers and podcasters that I listen to and read. He is just killing it. He’s making over $100,000 a month, $200,000 a month sometimes.

Those are the strategies that I try to implement regularly. But then when I looked at Backlinko, it’s so revolutionary that that’s stuff that I want to try too. For me it’s Pat Flynn, he’s my favorite guy and inspiration. I’m lucky enough to be able to email him and hear back and add him on my podcast.

But whoever your favorite is, and maybe some of you, it’s me; that’ll be kind of fun. Whoever your favorite is, find them, see what they’re doing, really try to understand it and don’t hold back reaching out and saying hello. Because bloggers and web entrepreneurs are people just like us. I’ve been lucky enough through conferences to meet a lot of my online blogging idols. They have been tremendously helpful in giving me great feedback.

When I first released my first eBook, The Personal Finance Arsenal, I made a landing page website for it and in my head I was thinking, ‘arsenal, it’s like a military kind of thing, they’re like weapons to help your finance.’ And I made this landing page to sell the book and I sold zero copies. And I talked to Ramit Sethi, the guy from iwillteachyoutoberich.com and he’s like, ‘well look at it, your website has a weirdo with a gun on it.’ And I thought, ‘oh I haven’t thought about it that way before.’ But I totally did have a weirdo with a gun on my website. Which kind of made sense to me but probably would have scared off a lot of other people.

So instead of having it be like weapons to revolutionize your finance, I changed the cover, the landing page, I actually deleted that landing page. I made a whole new one and now its tools to help you improve your personal finances and on the front there’s some socket wrenches and stuff. It’s now about tools not guns. I’m not a big pro-gun guy, so, thinking back, ‘what was I thinking doing that? It’s like making a video game.’ But it was about personal finance.

Really do talk to those people, get that feedback and act on it, listen to it. Because I have sold more copies of my books since I made that change. I believe changing the cover, changing the landing page was a huge part of that. Obviously it still hasn’t made me rich but I will take a few bucks over zero bucks.

That’s really three main points I wanted to hit on today. To recap, first look at your analytics, next look at your revenue and look at your favorite sites. See what’s working really well for yourself and for others and repeat. And see what’s not working well and stop doing it even if it’s something that you really enjoy. If other people aren’t responding, it’s not working. Business is not about doing what we like; that’s what hobbies are about. If you want to make money which admittedly, making money is my favorite hobby, you really want to look at what’s working and look at the data and then act on that data.

That’s all I have for today. I’m going to raise up this Raise the Roost Belgian Style Red and say cheers to all the Personal Profitability listeners out there. Always feel free to shoot me an email. I’m [email protected]. Please head to the website and join the email list.

And if you enjoyed this podcast, please do just take a quick moment, the only thing I ask from you, I don’t ask for you to buy stuff for me or anything else, though I’m always happy if you do, please if you could just take a hot second jump into iTunes and if you liked it leave a good review. And if you didn’t like it, send me blue, let me know why you didn’t like it and I will promise you that I really will listen and improve it because like I said, listen to your audience and act on what they want. Five star review helps me get the word out, helps other people discover the podcast, we can grow our community and change our own worlds if not the world. We have to dream big. So cheers, L’chaim, raise the roost and I’ll talk to you next time. And until then, stay profitable.