Updated: September 16, 2016
When you go down the path of trying to make money online you can end up visiting a lot of sites to hopefully gather some tips and tricks. One of the sites you’ll probably come across, if you haven’t already, is Smart Passive Income by Pat Flynn.
This is definitely one of the more popular make money online sites and one of the first that I can recall where someone was sharing their income reports. What’s great about income reports is that they can show you it is possible to build a great lifestyle through blogging and online sites and they add some authority to your brand.
The bad thing about income reports is that they leave out a lot of the picture of what it actually takes to make money online. I see this happen a lot with Smart Passive Income and it isn’t Pat Flynn’s fault. It’s just how people see the world sometimes. They want the easy way without understanding there is no easy way.
So how does Pat Flynn consistently make 6 figures a month from his site? Let’s find out.
The Income Report
For this analysis, we are going to look at the April 2016 Income Report. We aren’t going to go over every line item, just the ones that have a big impact on the bottom line.
April was a very good month for Mr. Flynn. His profit (revenue – expenses) was $117,645.97. That’s more than 99% of what people in the world make in a year! So how was he able to do this? It starts with affiliate marketing.
The majority of Pat’s income comes from affiliate marketing. I don’t know if he’s Bluehost’s top affiliate marketer, but he’s the first one that I saw make big money from them. In April, he made $58,575 from Bluehost.
Let me say that again.
One company paid him $58,575 just to link to their site. I know you like the way that sounds and many other people do to, so what do they do? They go and sign up for Bluehost’s affiliate program, get the links they need, add them to their site, and wait for the money to roll in.
But it doesn’t come and they don’t understand why.
How is Pat able to make so much from Bluehost while you can’t even get one person to sign up? The answer is pretty simple: you aren’t providing value to the right audience.
Pat’s site is geared around people looking to make money online. To make money online you need a website so if you see how successful someone is doing online, wouldn’t you trust their opinion? Pat recommends Bluehost so you go and sign up for Bluehost.
But that in itself isn’t providing value.
Pat first began providing value with his video How to start a blog in less than 4 minutes. That video is ancient in Internet years so I can’t vouch if still pertains to how Bluehost work, but you can see the value he is providing. He is going through the steps of setting up a blog on Bluehost. People that watched the video didn’t have to do any guesswork, ask for help, or search Google for answers. Pat’s video showed them how to do everything quickly and easily.
That’s superior value.
They see how easy everything is and they want to do it themselves so they click his Bluehost affiliate link, sign up, and Pat gets paid.
As Pat continues to provide value with blog posts, his reputation grows and he becomes an authority figure in the field of making money online. Due to his authority figure status he can recommend a product and people will jump on it, but this wouldn’t have happened without all of the value that he provided before.
Long Tail Pro Keyword Research Tool
I want to point this affiliate out not because of the money he made from it (just $2883.57), but why he makes any money from it at all.
Pat used to write a lot about doing keyword research when building a niche site. He would go over his process of searching for keywords that would help boost his site’s rankings. This is extremely valuable to his audience.
In these posts, he would show how he uses Long Tail Pro to help him research his keywords. He didn’t just tell people they should use Long Tail Pro, he showed them how he uses Long Tail Pro to build his niche websites.
People love to be shown how to do something. That’s teaching at its finest and one of the best ways to get affiliate marketing working for you. Too often I see sites using affiliate links on products they never use. This works when you gain authority status, but at the beginning why should people trust your recommendation if you aren’t using it yourself?
In Pat’s case, he shows people how he uses a tool and explains why it benefits him.
If I come up to you and say:
I’m going to show you how I use this tool to make $5,000 a month
…are you going to be interested in that tool? You damn right you are.
This is why I always recommend that you understand the product you are trying to sell through affiliate marketing. Don’t just blindly post affiliate links up on your site with the hope that people will magically buy it.
You have to set up the sale for the site and the only thing left for people to do when they click the affiliate link is to purchase the product.
Pat has two books that you can purchase. I love the idea of writing books and selling them. It’s awesome and I recommend it to everyone. If you have a Tribe, they will buy your book. If you don’t have a Tribe, it might be a while before anyone buys your book.
I learned this lesson the hard way with my first book. It came in both printed and ebook formats and nobody bought it. Nobody. Not even my Mom.
I spent two months writing something brilliant thinking that a crowd would magically appear to scoop it up. When it comes to making money, if you are relying on magic you’re in for a rude awakening.
What I should’ve done is spent those two months writing blog posts as well as writing the book. Even if I was only able to get 100 people to sign up for my email list, it would’ve been 100 people were intrigued by the ideas in the book.
Over the years, Pat has built up a Tribe that wants to know his take on things. When he writes a book sharing his knowledge, you best believe that people are going to scoop it up.
It’s important to keep in mind though that he didn’t write a book in secret and then just launch it like a Beyonce album. He talked about his book for months on every medium possible. He promoted the shit out of it and that’s what you need to do with your products and content.
Promote. The. Shit. Out. Of. Them.
I know it can be tough promoting something initially, but if you don’t promote it, nobody will know about it. Besides, if you are really creating something wonderful, it’s your duty to share it with the world. You are doing the world a huge disservice keeping them from the value you have created.
Books Add to Your Authority Status
Another great thing about publishing a book is that you instantly look like an authority figure on the topic to a lot of people. Without them even reading a book they will think oh, they wrote a book on X so they must know about it. And I’m not talking about New York Times Bestseller type of books. They can be tiny ebooks that people can download for free.
Putting your name on these kinds of things builds up your authority status which in turn helps people trust you even more. Pat writes about testing out new business ideas to see what works so he must know about the topic, right?
Some bloggers wonder how they can seem more professional when they are just starting off. An easy way to do it is by having a giant section of your site say “Download my free book on…”. As long as you come across as someone that knows what they are talking about in the book, then you are set.
This is what Pat made his name on. The idea that anyone can do some research, figure out a niche and build a site around it to make money. Sadly he’s strayed away from that stuff, but he still does decently well with them in a normal person’s world.
I won’t go into details about making money with niche sites because that is a whole different post altogether, but if you do decide to go this route the key is that you want your site to be considered an authority site on whatever the topic is. Once you have established that, then you are good to go.
This one is pretty simple. If you have an audience, companies are willing to pay you to have their message reach that audience. People don’t skip over podcast ads and that is why companies love them. For a podcast to be effective the audience has to be engaged.
You shouldn’t expect to just start a podcast and get sponsors right away. You need to build up a following and to do that you need to be consistent with your podcasts. You can’t record one every couple of months because people won’t pay attention to them.
However, you also don’t need to go John Lee Dumas extreme and post one every single day. Figure out what will work well for you and stick with it. Promote the hell out of it and keep doing good work. It’s really no different than your blog.
If you look at the Smart Passive Income Podcast you will see that Pat has done over 200 episodes. 200! The only thing I’ve done 200 of my life is shots of tequila. This goes to show that if you want to build a brand that generates money for you, you need to be consistent and persistent.
Too many people get into this game because getting started is easy, but get out of it just as quick when they aren’t consistent. You can’t blog or start a podcast one month, disappear for 4 months, come back to it and think things are going to be the same.
People start blogs to get away from their 9-5s, but the funny thing is you need to treat your blog like a 9-5 if you want it to succeed. You need to show up every day (most days) and do the work.
The Honey Trap
I can always tell the difference between people that are in the blogging game and treating it like a business versus those that are learning the ropes. The biggest tell is how they treat their homepage. When you’re first getting started with blogging you will pick a theme that probably has a nice listing of your blog posts on it.
This seems like a reasonable thing to do, but how often is the homepage the first page a person comes to on your site? Most of the time you arrive on a blog’s post page. Someone links to a particular blog post, you click the link, and there you are.
This means that the post page might be your only chance to capture an email or get the visitor to do some other type of action that you want. Maybe you want them to explore the site more. Either way, the design of your post page dictates what they do next.
This is also why the design of your homepage is so important. Your homepage is a gateway where you get to control the experience. If you simply have a homepage with a listing of posts you aren’t really controlling the experience because people could easily browse the titles of the posts, find nothing interesting and leave.
Instead, your homepage needs to be a honey trap that entices them to do a particular action. Here is what you see at the top of Smart Passive Income’s homepage:
Looking at this design there are four things that stand out to me:
- Right away you get to see the man behind the site. This establishes relatability and makes the brand more human.
- Next you read the headline that clearly outlines what the site is about. There is no guesswork going on here.
- At the top you see the nice big number: $166,123.99. Holy crap! That’s a lot of money. That makes me want to find out how he makes that much so already I’m drawn into the site’s concept.
- Finally, there is the green GET STARTED HERE button that leads you into the site. This allows Pat to control the experience and be the tour guide.
Looking at the rest of the homepage I think Pat and his team could do a better job with the design. I’m not talking about the aesthetics of the site, but what the design pushes people to do.
The latest posts section is fine. It pushes people further into the site just like most blog homepages do. The problem with this approach is that it’s too easy to lose a reader. Currently, the post titles that I see are:
- SPI 217: Brik Book and How Brett Miller Quit His 6-Figure Job to Build LEGOs
- Join My Personal Book Club & Enter to Win!
- SPI 216: Your Habits and the Story Behind Pavlok with Mannesh Sethi
- Live Interview with Gary Vee – AskGaryVee Book – SPI TV Ep. 47
To be honest with you, none of these appeal to me because I’m not big on interviews or podcasts and the one blog posts is a contest. From here I could easily just leave the site thinking there isn’t much in it for me, but I know there is due to the hero section above it.
I spent 1,000 words earlier telling you the virtues of providing value to get people to use your affiliate links and here Pat simply list his top 3 resources (all affiliate links) and just links to them.
So what gives?
My guess is that SPI pulls in so much traffic now that Pat can get away with doing something like this and still make $50k+ without blinking an eye. No doubt there are other affiliate links sprinkled throughout the site that provide a bit more value, but it’s kind of surprising to see this approach being taken.
I would use this section to link to more specific posts that showcase how I use the resources so that my readers understand how they can derive value from them as well.
I think with the amount of traffic and how well known Pat’s brand is he can get away with these types of design decisions, but if you’re just starting off I think you will want to optimize things a bit more. For example, on your homepage you might not want to give your visitors so many choices. Give them two:
- Sign up and get this cool gift
- Go check out this page that will guide you to all of the other valuable stuff I have on this site
I’m also guessing that Pat is getting more away from blogging and trying to become more of a media mogul with his TV show and podcast. There is nothing wrong with that at all, but it’s something you have to keep in mind if you try to use his site as an example of what you should be doing.
The Concept of Making Money Is Easy
When you study how Pat Flynn is able to make money the concept is pretty easy. That is why a lot of people get affiliate links up on their site. They go in with the dream that people will click on things randomly and purchase whatever is on the other side.
Same thing with writing a book, building a niche site or starting a podcast. The concept of making money is pretty easy. There are no secrets. All the steps have been written about over and over and over again on a hundred different sites.
The problem people have is creating value on a consistent basis and promoting that value to the world.
The difference between your site and the guru you look up to is that the guru hit some home runs with their content and they made sure people knew about it.
If you truly believe you are hitting home runs, but you aren’t building a Tribe then you need to work harder on promoting. If you get plenty of people, but they aren’t sticking around then you might not be providing the value that you think are.
Money comes when you provide awesome value to your tribe.
Pat Flynn spent years doing this and you can see how it pays off. It didn’t happen overnight. It took time, but he was consistent with everything he did. How many people do all this research about how to start a blog, start one, and then fizzle out a couple months later?
Every successful person never has a tale about not being consistent. They are always consistent at what they do.
As you can see, the concept of it all is pretty simple, but the execution is where people fall apart. As you continue to provide valuable content and promote it heavily, you’ll find that your site starts to exponentially grow over time. It always starts off small, but eventually you hit a tipping point and every new month builds on the success of the previous months.
I give Pat major props for being consistent over the years. He has been able to build a loyal Tribe and from it has reaped the rewards.
What We Can Learn From Smart Passive Income
So you see a random dude making 6 figures a month and you decide you want to do the same thing. So what can we learn from Smart Passive Income? It’s hard to look at the site now and follow the steps that Pat took and try to emulate those, but it’s possible.
If you go through the archives of his blog there are a number of things that pop out to me that you can do as well to build your Tribe.
1. Be Authentic
First and foremost, Pat is one of the more authentic people you can find online. He’s waaaay nicer than me, but as long as that’s how he is in real life then it’s all good. Reading and listening to Pat you always get a feeling that he is willing to help and that draws people in.
Even though a lot of the topics that he talks about can be dry (not his fault), that doesn’t mean he leaves his personality out of the equation. Every piece of content he produces lets you know it is from him.
Find your voice and stick with it.
2. Produce, Produce, Produce
The more content you have the better. Everyone knows this, but some people take this the wrong way. Some of you out there will produce a ton of content that is crap.
Hm, let me rephrase this then.
The more valuable content you have, the better.
If you’re going to post something on your site make it worth a reader’s time to read it. Now this doesn’t mean everything has to be educational. Some of Pat’s posts are more personal and talk about his family and friends and people love that stuff because it builds a connection. However, every single thing he posts has a purpose.
3. Stay on Point
Smart Passive Income has a focus and it sticks with it. You don’t go through the archives and randomly come across posts about movies, sports, or games. When you come to Smart Passive Income, you know exactly what type of content you are going to get.
One helpful way to ensure that you stay on point is to create themed posts. For example, Pat does monthly book reviews and used to have a series called Niche Site Duel. Having themed or series posts allows you to always have some ideas of what to write about and also sets expectations for your audience.
4. Keep Your Audience on Your Site Until You’re Ready for Them to Leave
When looking at Smart Passive Income you’ll notice there are no ads. None. Why?
Well, there are a number of reasons that I can name and Pat might have his own, but if you really want to make money with your blog, ads are not the way to go.
- They are limiting. There are only so many ads you can have on a site and companies will only pay so much. There is a very low ceiling to how much you can make for ads.
- They provide no value.
- You don’t control the experience.
- You lose your audience and get nothing in return. Once someone leaves your site by clicking on an ad what happens? You get $0.10 and probably never see them again. With an affiliate link, the tool is attached to you so odds are the person will be back.
- They can ruin your brand.
Smart Passive Income is a very strong brand and any type of ads could severely ruin it. Why should Pat make $2,000 in ads when he can make $70,000 in affiliate links and probably still keep the reader?
5. Teach, Teach, Teach
The best thing you can do on your blog is teach. If people can read one post on your site and get something from it, they will be hooked. You don’t need to be an expert in a subject, you just have to know enough of whatever topic your post is about to teach it to someone who doesn’t know it as well.
Teach everything you know.
6. At the Beginning, Explain What You’ve Learned
You’ve just started to blog and aren’t quite an expert on the topic that you’ve decided to blog about and you aren’t sure what to do. This is actually a great time to start blogging and the best time to come up with original content. I’m going under the assumption that whatever topic you’ve selected is something that you are actively doing.
Maybe you’re writing a personal finance blog and just started to save money. Explain your experience and what you are going through. Share what you are learning and what is working or not. People love to read this stuff because it usually describes the exact situation that they are in.
Experts read experts, but not as much as novices read everything. Did you get that? People that are just starting to learn about a topic consume a voracious amount of content. Those are the people you want to write for. The experts? Sure they may end up reading your site, but they are usually pre-occupied with their own stuff by then.
At the beginning, Pat was making money, but he was far from an expert on niche sites. So what he did was explain everything that he was trying to get his niche sites to the top. Who wouldn’t want to read something like that?
Embrace your novice status and run with it.
Okay, It’s Not Easy
Before I told you that making money is easy and in a bubble it is, but we don’t live in bubbles. We live in a world where 100s of brands are fighting for our attention. When you start a blog it can be too easy to become robotic and follow the rules that the gurus tell you (including me). What you end up with is a site that nobody cares about and one that is no fun for you to write.
Pat obviously loves what he does and he shows through on his site. The result is that he never has to worry about money again and he has built an awesome brand that he can be proud of.
I’d be lying if I said I didn’t emulate some of Smart Passive Income into Obstacle.co. I’m glad someone like Pat is around to take the first steps to help me see what can be done and what you need to do to achieve it.
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