Loyalty card schemes may be costing you cash.

There are two grocery stores I shop at regularly: Albertsons and Ralphs.

Albertsons is a SuperValu store, which those of you in other parts of the United States may know as a Lucky, Bigg’s, Cub Foods, or Jewel-Osco. Ralphs is a Kroger brand. (And both of them seem to have abandoned their apostrophes for branding purposes, but I digress.)

Ralphs is a 7.1-mile round trip from my house. Albertsons is 0.8mi and easily walkable. Yet I almost always go to Ralphs.

I finally figured out why the other day, and promptly became supremely irritated with myself. I was in Albertsons, about to buy $30 worth of groceries. Then my brain screamed, “You could be getting cash back for these if you had gone to Ralphs!”

You see, Ralphs has a loyalty card. (Those of you who shop at Kroger know it as the Kroger Plus Card.) Once you spend $500, they mail you a $5 gift certificate. Then, every time you spend another $100, they mail you another $1. They calculate these discounts four times a year. I have seen people in the store redeeming certificates worth as much as $16. That’s $1600 in groceries in 3 months! So, clearly, the card works.

Are Loyalty Cards Really a “Deal”?

Let’s do the math. Is Ralphs loyalty card actually a deal for me?

My car gets just under 30mpg — let’s say 28mpg for easy math. So I’m burning a quarter of a gallon of fuel every time I choose Ralphs. I burn only 7% of 1 gallon to drive to Albertsons.

Assuming a gallon costs $3, it costs me 21.4 cents to drive to Albertsons (and I could easily walk, saving even that.) It costs me 75 cents to drive to Ralphs. I’m saving 53.6 cents every time I go to Albertsons.

Assuming (for the sake of argument) that their prices are the same, I’d need to spend at least $50 every time I go to Ralph’s…just to break even on the gas money I spent to get there!

Does Ralphs have lower prices? I don’t think so. In my comparison, the prices between the two stores are nearly identical, and are only offset by specials. Ralphs loyalty card only makes it appear that Ralphs has lower prices.

It’s the mental mindf*** that makes me so upset; that irrational nag I get in my brain every time I shop at a store other than Ralphs. The one that says, “You could be saving money, and you’re not!” That same nag ignores hidden costs like gas money.

What Can We Learn From This?

The point of this post isn’t to show you how you, too, could save 53.6 cents. The point is to understand that we are often driven by emotional impulses that we truly believe are rational decisions.

“I save money by shopping at Ralphs” would be a statement that, on its surface, appears to be correct. Doing the math and unearthing the hidden costs proves it false. (I didn’t even calculate extra car wear and tear, and extra time on my part spent driving there and back!)

Loyalty card schemes are designed for people who want to feel good about saving money. In most cases, however, I doubt they actually save us much money.

Loyalty card schemes reward you for buying a full-price item at one store instead of finding the cheaper one somewhere else. They reward you for shopping at the same place every week instead of looking at the specials and deciding where is best to shop that particular week. And they do this by inserting an insidious nag into our heads; one that says, “If only I had shopped there instead…”

As Henry Hazlitt wrote in Economics in One Lesson, “The bad economist sees only what immediately strikes the eye; the good economist also looks beyond.” Looking beyond and calculating the real cost may show you that what you thought were some of your most rational decisions were really just rationalizations.

Next time you shop at a particular store or buy a particular item, think about why you are doing it. Are the prices really lower, or do you just think they are? Have you taken the time to seriously compare? Are you driving out of your way to save a few pennies when you could shop closer to home…or maybe even leave the car in the garage?

Are your choices rational, or rationalizations?

Recommended Reading:

• Economics in One Lesson by Henry Hazlitt. I strongly believe that if everyone in the U.S. read and understood this book, we wouldn’t be in the economic crisis we are now. It’s absolutely worth reading, and it’s also an easy read.
• What Can You Do to Help Solve the Credit Crisis? Spending money isn’t the right way to help our country. What is? I give specific details.
• Why You Don’t Save for Retirement. Does saving for retirement seem pointless to you? I felt that way, too, until I figured this out…

Loyalty card schemes photo credit: joelogon

Million-dollar innovative business ideas
may be lurking in your nearest newspaper…

Most people tend to make snap judgments about breaking business news. One of the most famous examples of this in the tech industry was Slashdot’s coverage of the original iPod release in 2001. The snap judgment? “No wireless. Less space than a nomad. Lame.”

While it can be entertaining to make these snap judgments, it’s not really effective in helping you grow your business exponentially.

How One Article Can Show You Many New Business Ideas

Wired recently posted an article about a new type of content company. By reading with an eye toward creating or growing your own business, you can glean all sorts of insights…

In the article, we are introduced to Demand Media. Demand is paying video producers a few dollars to create short videos on thousands of subjects, ranging from “What is the best vodka?” to “How to pack for a trip to Spain.” The subject of each video is determined by an algorithm that figures out not only what people are searching for on Google, but also the highest amount that advertisers are willing to pay for Google ads next to the video.

Demand Media’s goal is to get their videos to the top of the Google search results and place pay-per-click ads next to them. The idea is that someone will watch the video, and a fraction of those people will click on the ads. The algorithm shows that some ads pay up to $20 per click (!), so it’s in Demand Media’s interest to pay, say, $20 one time for a video producer to produce that video.

Demand Media has a goal of producing up to 1 million of these videos a month. And its most recent round of capital values the company at a cool $1 billion.

Instead of judging Demand’s business model, let’s take a look at what trends it could represent. Here are some angles I gleaned from reading this story:

1. The old way of editors choosing the content to write about is dying. Google and its database are the new editors.
2. Short and cheap is better than longer and higher-quality…at least if your goal is to make money fast.
3. Being the expert is free, being the producer pays decently well…but being the aggregator of the content is the billion-dollar idea.

One $1B Company Means One Million $1M Opportunities

Whenever I read about a billion-dollar company, I know that there are a million opportunities for million-dollar companies in the same industry. Here are some million-dollar innovative business ideas that you could start in this industry:

1. Build your own algorithm so others can compete with Demand, and license it to other content companies.
2. Create your own videos on the subjects Demand does, except have them be longer, more in-depth and higher-quality…and charge a fee for access to each of them. (This is the Wal-Mart vs. specialty store approach.)
3. Become your own content aggregator in a specific niche and hire people to do videos based on similar algorithms, with the intent of selling your company to Demand or someone who wants to compete with them.
4. Create specific videos in a niche where information products abound, and instead of gaining a couple cents a click for Google ads, sell those information products as an affiliate and rake in larger sales per video.

Notice that some of these ideas compete with Demand, and some of them go so far as to have you seeking to be acquired by Demand in a year or two. But all of them have one thing in common: you’re picking a small piece of what Demand does and creating a business out of it, instead of trying to go after the whole enchilada. That’s the key to competing with a billion-dollar company if you don’t have millions of dollars to blow.

Use the News To Help You Determine Your Next Steps

As an entrepreneur, anything you read about current trends, especially if it involves a hot and fast-growing company, could be profitable for you. When you read articles like this, focus on what that article is telling you about the future.

Regardless of what you think of cheaply-produced, short videos in the results of certain Google search terms, the fact is that they make a lot of money. How can you use this to help your business, or to start a new business?

I welcome your own innovative business ideas in the comments.

Recommended Reading:

• Why Entrepreneurs Fail (Will You Avoid These Three Traps?) Once you have an idea, avoiding these three traps will help you succeed with it.
• How I Turned My Mediocre Website Into A Million-Dollar Business. My company had one of the worst websites ever (we even won a contest for one of the worst hosting company websites!), but I still managed to create a million-dollar business. How did I do it?
• You Are Worth More Than You Think: Overcoming The Key Reason Entrepreneurs Fail. If you have ever said, “I just don’t have enough time to do [an activity I love]“, this advice is for you.

Review: Ramit Sethi’s I Will Teach You To Be Rich
Boot Camp.

I’m excited to help my friend Ramit Sethi in his quest to help you take back control of your financial future.

This video explains everything, but the story is also below for you…

My Story

In 2007, I nearly bankrupted my business because I didn’t keep track of my finances. I didn’t hire an accountant or financial planner because I “couldn’t afford it”. Little did I know that my business had far more money going out than coming in.

I always thought the numbers would work themselves out. I was smart; I read a ton of business books every month, and my business was growing like gangbusters. What was there to worry about?

It took our landlord locking us out of the building and me having to lay off most of my 6-person staff for me to hit bottom and realize what a terrible mistake I had made.

My lack of financial planning devastated not only my life, but the lives of others whose families depended on me for their well-being. That day, I made a critical decision: I set in motion a plan to take action and get my business and personal finances straightened out.

I didn’t like what I found. Between my business and personal debt, I owed over $160,000.00 to various creditors. I was sick to my stomach when I finally added it all up.

From $160,000 in Debt to Debt-Free

I am pleased to say I came out of it. Today, I am debt-free and proud of it; I save 55% of my monthly income, and I know exactly what I spend money on every month. I am free to make wise choices because I know what’s important and what matters to me.

In 2008, I ran a personal finance conference in San Francisco. My goal was to show the attendees what had happened to me and to give them the tools they needed to move forward and be successful.

My keynote speaker was Ramit Sethi, owner of the popular I Will Teach You To Be Rich blog. Ramit blew the audience away with tactical tips on how to “negotiate like an Indian”, save money, spend wisely, and invest for retirement.

Ramit is a friend of mine, and he has personally helped me with much of my financial life. Thanks to Ramit, I have a better credit card that pays me more rewards, I am in control of my spending, and I have automated many of my monthly bills so I no longer have to worry about money.

Now, Ramit is taking a select few of you by the hand and guiding you through his personal system to get your financial life on track. In just six short weeks, you will learn how to save for retirement (and start funding a retirement plan), how to earn more (whether you are an entrepreneur or you have a job), and how to save and invest your money wisely so you are in complete control.

Ramit’s 6-week bootcamp will get you out of the joy-fear-guilt cycle…where you spend money and buy something nice (joy!), only to fear the credit card bill, and feel guilty when it arrives.

Is It Worth the Investment?

From the bottom of my heart, I believe it is worth it for you to invest in Ramit’s program and get your financial life back on track. Not only does Ramit guarantee that you will save more than your investment in the program, but it’s a unique opportunity to set your life on the right path.

Your age and income don’t matter. Young or old; struggling to get by or with a ton of money…you’re not alone. If you don’t know what’s going in and coming out of your wallet every month…if you haven’t signed up for a Roth IRA or 401(k) yet…if you have big goals (like buying a house or retiring early) but you’re not sure if you’re on track to meet them…this is your chance to interact personally with one of the gurus of personal finance.

Who Would NOT Benefit from Ramit’s Boot Camp?

My policy is to be totally honest, so: this isn’t for everyone. If you’re already sporting a fully-funded Roth IRA and 401(k), kickin’ it with multiple ING Direct subaccounts for your savings goals, and you’re totally debt-free and on your way with flying colors to early retirement…well, this probably wouldn’t be of much benefit to you.

If, on the other hand, you just read that and said “Yeah, right! Who even does that?” well, then may I humbly suggest — Ramit’s program just might be right for you.

Have the Courage to Invest in Yourself

“But, Erica,” I can hear you saying. “The holidays are coming up. I’m cash-strapped as it is. And this boot camp costs money. There’s just no way I can do this.”

My response: Have the courage to say “Yes.” This is an investment in yourself and your education. (Compared to a college education, it’s a huge bargain!)

Close your eyes and imagine for a minute that, this time next year, you have:

1. A fully-funded retirement account.
2. A savings account set aside just for holiday gifts to others, so you can afford to give them gifts without the worry in the back of your head of the mounting bills.
3. An account set up (with money in it!) for a goal you have in the future — whether that goal is buying a house, taking that vacation you’ve always dreamed of, or starting a new business.

Now compare that to your current reality. Kind of hurts, doesn’t it?

If you desire all of this, but don’t know how to get there…Ramit’s boot camp is for you. No matter how many books you read, it won’t matter. The hundreds of business books I read didn’t save me from having to go into that conference room and lay off most of my staff.

Stop Doing the Same Thing and Expecting a Change…

Don’t wait. If you wait, your situation won’t change, and next year at this time, you’ll be no better off financially than where you are today. (And, as I can attest, it doesn’t matter how much income you make…if you spend more than you make, you’re still going to be in the same situation.)

An average college extension course runs $400-$500, and doesn’t even help you save any money. (You also typically have to take 2-3 of them to even accomplish anything!) On the other hand, Ramit’s program is tactical, strategic, and designed to help you take action now. Think about it: if you save just $25/month, you will pay back your investment in his program in just a few months!

Sign up for Ramit’s 6-week boot camp today. It’s a rare chance to interact personally with someone who really knows his stuff when it comes to personal finance. Your investment of $199 is an investment in yourself and your future. Have the courage to say yes to your goals.

For more information or to sign up, click here:

Breakdown of Exactly What’s In Ramit’s Boot Camp

Week 1 – Unearth secret credit card hacks. Find better credit cards and negotiate with your credit card companies. Get perks from free airline flights to free hotel stays with “secret” credit card hacks you aren’t currently using. Get a plan in place to pay off your credit card debt once and for all!

Week 2 – Stick it to the big banks. Negotiate fees and get rid of them with step-by-step scripts. Use the support of Ramit’s community to switch banks if necessary.

Week 3 – Retire early and happy. Why your friends haven’t invested; how to become rich on $100/month; how to legally evade taxes!

Week 4 – Spend guilt-free on the things you love. How to get out of the joy-fear-guilt cycle of debt spending. How to spend money on what you love and cut back on everything else.

Week 5 – Automate your way to freedom. Spend just a few hours a month managing your money, and stop letting it manage you. Special techniques for those who are freelancing, self-employed, or who have irregular income!

Week 6 – Invest like a pro without taking the risks. How to automate your investing so your money works for you. The top ten mistakes people make when investing — are you making one of these? Running the numbers on investment strategies (with Ramit’s help!)

Plus — Guest speakers will be demonstrating personal finance tactics, entrepreneurship, and career paths.

You will also gain exclusive access to a community of like-minded folks who can help you if you’re struggling or support you when you need it. If you have people in your life who aren’t fully supportive of your goals, you’ll find Ramit’s community to be invaluable!

How Others Have Used Ramit’s Tips to Make and Save Money

Jason Demant saved $50,000 in 2 years and is now taking a 1-year vacation…

“The reason I’m writing is to thank you for your help in automating my money, getting my 401K properly allocated, and pushing me to sell my crap to make some cash. Using your step-by-step instructions and advice, my girlfriend and I have been able to save over $50,000 the past couple of years and now, in a couple weeks, we will be quitting our Silicon Valley jobs and traveling around Asia on an extremely extended vacation (1-year minimum)! I’ve been reading your site for a few years now and I’ve never properly thanked you for the help, so I decided it was time. Thank you!”

Josh G has saved $14,000 in a few months…

“I have saved 14k so far since I started May 2008 and I’m on track for 20k by the end of the year!

Fear kept me from automating my savings previously. I had bills and it seems that was all I thought about every month.

Ramit mentioned using ING Direct to create sub accounts. I decided to try the full automated savings because I could do sub accounts for future purposes.”

For more information, or to sign up, click here…

Special — Just for My Readers!

If you sign up through any of the links on my blog (you have to sign up through me to get your exclusive invitation), forward me your receipt to erica@erica.biz and I will invite you to a free 1-hour group conference call where I will answer all of your questions regarding personal finance and entrepreneurship.

Here are some questions you should ask me:

• What are some great business ideas that I can start right away?
• Should I start a blog?
• What’s the best way to make money on the Internet?
• How should I market my business online?
• How can I utilize Twitter and Facebook to grow my business?
• What are the top strategies to get more customers for my business right now?
• How can I make some extra money if I only have a couple hours of free time a day?
• How do I make my income more “passive” and stop trading hours for dollars?

Pretty much anything related to personal finance or business is fair game.

This is only when you buy Ramit’s product through my link.

For more information or to sign up, click here.

If you have any questions that aren’t answered by this link, feel free to contact me and I will reply.

I believe in you and want you to achieve your goals. However, I know from experience that you can’t achieve your goals unless you have your finances in order. Give yourself permission and have the courage to invest in yourself, and watch your life change as a result. Sign up for Ramit’s boot camp today!

Note: This program is time-sensitive, so you must sign up by Friday, November 6. If you miss your chance this time, Ramit will offer it again, BUT the price will double…so don’t miss your chance!

Ramit is offering a 100% money-back guarantee for 30 days, so if this program somehow isn’t effective for you, you can request a full refund. You really have nothing to lose (and everything to gain, including meeting your financial goals!) by joining.

I do get some money for referring you to Ramit’s program. Ramit is a friend of mine and I have full faith and confidence in his ability to deliver. I look forward to hearing your success story!

How to make a mind map.

I felt that way when I first started writing my Blog Success Manifesto. I started with a blank document and quickly got lost. I had so many ideas, and it just seemed impossible that I could address all of them. The document gathered dust on my hard drive for a few months…until I figured out how to make a mind map.

I brainstormed out at least 20 topics I wanted to talk about, then realized I could sort them into five sections. Once I did that, I easily completed the entire 10,000-word ebook in just a few weeks!

This, too, may seem like a pipe dream to you…so I created a video to walk you through the process of making a mind map. In it, I show you how to map out a project to break it down into manageable pieces, so you can finally finish whatever that big project is that’s been languishing in your head for months or years. I also show you the exact mind map I used to create my Blog Success Manifesto:

Highlights

[0:10] I start off by answering the obvious question: Why should you care about making a mind map?
[0:45] I use a free tool called MindMeister (link opens in new window) to create my mindmaps. Why do I use it instead of other tools?
[2:00] The first thing that you see when you create your mind map…
[2:25] There are a ton of keyboard shortcuts in MindMeister. I show you the two that will save you a lot of time.
[4:12] How MindMeister helps you override your perfectionist instinct.
[4:40] How to easily create a layout for an entire book or product just by dragging and dropping.
[5:29] My favorite part of MindMeister!
[6:20] I wasn’t able to finish my ebook until I mind mapped the entire thing.
[7:15] The exact mind map I used to fly through and finish an over-10,000-word ebook in just a few weeks.
[8:20] After my mind map was done, I set a simple goal…
[9:20] This should help you get your next project done much more quickly!

How Making A Mind Map Can Help You

Think about a project you would really like to start. Maybe it’s a book, an ebook, or a new product. Maybe it’s a conference you would like to run (I used a mind map to run a conference in 2008!) Any big project you undertake should have a mind map as its basis.

Mind maps help you understand the scope of your project, break it down into manageable chunks, and complete it faster. They reduce overwhelm and help you overcome your perfectionist instinct.

But quite possibly the best part is that great feeling you get when every piece of your mind map has a little checkbox next to it, and you suddenly realize…you’re done! For a project that may have seemed impossible just a few weeks ago, that’s quite a feat!

MindMeister FAQ

Your free MindMeister account won’t expire, and you can have up to 3 mind maps. If you want more features, like unlimited mind maps, the ability to use MindMeister offline, or to search your mind maps, the Premium version is $49/year.

Check out MindMeister for free right now.

(Note: I recommend starting out with the free version and upgrading as you see fit. The link above makes me money if you choose to upgrade to the Premium version. )

Recommended Reading:

• Creating a New Product. The first post in this series; discusses market research.
• How to Start A Business with No Money. It doesn’t take a lot of money to start a business…
• How to Get More Profitable Clients. A quick brainstorming method I dreamed up (literally!) to help you make your business more profitable.

Creating a new product by interviewing others
and selling it online.

Instead of posting affiliate links and hoping to gain a few dollars, I instead asked you for your feedback. And feedback poured in — from the 48 comments on the post, to email after email and Tweet after Tweet.

I wanted to know which of the 20 ways you wanted to hear more about. You told me.

Now, you get to find out why I asked!

Creating A New Product, Step 1: Market Research

Delivering pure content and then asking for feedback is a great way to do market research. The people who respond are engaged, and they are actively looking for more information on a particular subject. Given a reasonable price, many of them turn into buyers.

I have wanted to create a product for budding Internet business owners for a while. I am currently actively developing and beta testing a product about how to create a profitable blog, but it’s not ready for release yet.

In reading your comments and exchanging emails with you, I realized that many of you are interested in quickly creating and selling an online product to solve a problem that others have. Yet, you aren’t quite familiar with how to choose a niche, create a product, and sell it online.

I looked around for quite a while for a product that I could promote that would teach you how to quickly create a product and sell it online, but I couldn’t find one. Then I started looking back at my own experience.

About a year ago, I recorded several interviews and sold them online. I did this mainly as an experiment. I didn’t sell them on this blog; instead, I promoted them on another site.

The first interview I sold on that site generated over $800 in sales in two days.

It was then that I knew I was on to something…and the entire process is exactly what I’d like to teach you.

Creating A New Product, Step 2: Decide What Your Product Will Be

You can create an ebook, a physical product, or hundreds of other permutations, but I chose to simply sell the audio interview with a transcript and a quick how-to guide.

Why interviews? Simple: they are the easiest and quickest way to create a product. Interviews can also be used as the basis of many products, from a monthly membership site to an ebook to a physically-delivered audio CD.

Any question you can think of that you would pay to answer would make a great interview product. How to fix your own home appliances — interview those who fix them professionally. How to start your own business at home — interview those who have done it. Which vitamins and supplements actually work — interview those who have written books in that industry. All of those examples, along with millions more, are waiting for someone to create a product around.

If you can save someone money (huge right now), make them money, or make them happier, you likely have an interesting product on your hands.

The great thing is, not only are these interview products easy to create, but they’re easy to sell. Most of them will sell in the $7-8 range. If you can save someone $20 a month with the information gleaned from an interview, would they pay you $8? Sure! What about if you can make them money? Or help them make their life better? Heck, I know from personal experience I’d pay $8 to listen to a few interviews on what to do when you first get diagnosed with Celiac disease.

Creating A New Product, Step 3: Actually Create the Product!

In my upcoming product, I will show you exactly how to go through each step of creating your product, from figuring out what problem you want to solve to finding people to interview to the right questions to ask. I will show you the email I send out that gets 80% or more of the people I ask for an interview to say “Yes”, and how you can tweak it for your own benefit. I’ll give you some webpage templates to get started and show you how to get your website up and running and what to say. And finally, I will recommend several ways you can promote your product to get immediate sales.

Does it work? Well, I made $800 in two days using these exact methods. But that’s not really the best part. The best part is that you have a product that you can sell over and over again. You can make money while you sleep and not have to worry about fulfillment (yes, I will show you how to automate this!) And you will be able to help other people solve an issue they have.

Since this is an online business blog, I decided to do something really special and unique. I will be showing you, week by week, exactly how I create my new product. I’ll start with the mind map and spend time walking you through my new product with videos. As I create the product, you will gain a better understanding of how to create and sell your own information product.

Creating A New Product, Step 4: Sell Your Product

I plan to give you an opportunity to try out my new product, with a DVD shipped to your door plus online access, for under $10. Sound cool?

I haven’t told you the best part yet, though. I’m holding what is possibly the coolest contest I’ve ever held on my website. I am giving you an opportunity to name my product! If I select your product name, I will send you a free copy of the product and give you credit for the name (with a link back to your website.)

More on all of that soon…

Starting next week, I will be posting at least once a week on how the product creation is coming along. I’ll also ask you to participate — from naming the product to helping me flesh out ideas.

An Example of An Interview Product I Created

The first “inside” piece of the product I want to show you is an interview I did with branding expert Ben Mack. If you’re interested in creating your own product, you don’t want to skip this interview.

I sold this interview online and made several hundred dollars within a week. This is a great example of a product that solves two problems many bloggers and online entrepreneurs have — how to make money and stand out from the crowd. Ben Mack sold an ebook — a simple PDF — for $197, and made over $40,000 with it, and in this interview, I grill him on exactly how he did it!

Don’t miss your chance — download this complete interview and how-to guide for free!

Stay tuned for more free videos and behind-the-scenes looks over the next few weeks as I unveil my complete guide to creating your own product and posting it online for sale!

Recommended Reading:

• Download my complete interview with Ben Mack for free! If you are tired of writing hundreds of articles and/or blog posts just to scrape together pennies, this is a must-have interview.

My journey toward my diagnosis with Celiac disease.

The doctors I went to told me to get more sleep.

Things got worse as I got older. By the time I was 25, I was sleeping for a few hours every day after lunch, and not feeling any better after I woke up. Doctors told me to “take it easy” and “work less” (I worked 60-hour weeks or more, typically.)

I began to develop a hatred of the medical community.

I went on the Internet. Using websites, I diagnosed myself with hypoglycemia (and blogged about it.) This was when I was still running my hosting company. I was pretty used to doing everything myself, and I didn’t think much of any doctor I’d ever had up to that point, so diagnosing myself on the Internet seemed the logical thing to do. I quit sugar cold turkey and dealt with the cravings.

Quitting sugar certainly helped my mood, but the exhaustion continued to get worse. In addition, I developed two other symptoms: recurring bladder and yeast infections.

“Isn’t there anything I can do?” I begged multiple gynecologists.

“No, not really,” they replied. “It’s common in women who are on the Pill.”

It got to the point where I could just call and they would have a pill ready for me to fight off that month’s infection. Eventually, disgusted with having to wait until business hours, I ordered my own fluconazole on the Internet, and stockpiled it in the bathroom for the next infection that was bound to happen.

I came down with a bizarre bacterial infection on my skin. Went to the doctor. “Why do I have this?” I demanded. As they cut me open (with minimal painkillers) to clean it out, they simply shrugged. “It happens,” the woman who was stitching me back together said. “We don’t know why people get this.”

In the meantime, I was having chronic back pain. I went to a chiropractor (who became the only doctor I trusted.) He helped me find a good massage therapist. I started getting chiropractic work and massage every week.

Convinced there was still something wrong with my diet, I went pescetarian for 30 days (which continued for months afterward) and also did a liver flush. The liver flush helped for a few days. Pescetarian (though I was unwilling to admit it, as I really enjoyed the diet) didn’t really help at all.

My World Comes Crashing Down

It was May 23, 2009. I spoke at Pat O’Bryan’s UnSeminar6. For the first time, I made an offer from the stage…and 10 people signed up! I was overjoyed. I would finally begin a new business. I promised to teach them how to build blogs.

I was sleeping 10 hours a day even at UnSeminar, and still feeling exhaustion after meals, but I had myself convinced that this was mental. That if I had customers motivating me and pulling me along, I’d be able to get back into the game.

This was exactly the wrong decision.

When I got home, I could barely stay awake. I was sleeping 15 hours a day or more. My sex life was completely gone (not that it had been that great for months, what with my energy levels being so low.) I felt awful. I could barely drag myself out of bed to blog. Now I knew there was something seriously wrong.

My boyfriend insisted I find someone who could help me out. There was no way I was going back to the idiot doctors, so I asked for recommendations from people I trusted (at that point, my chiropractor and massage therapist.) My massage therapist recommended a nutritionist.

I went to her on June 19. I nearly fell asleep in her office. She was concerned. She thought it might be gluten intolerance. She immediately got me a blood test.

The results were in a few weeks later. I had mono. But the gluten intolerance test returned negative. “See?” I told her proudly. “I knew I didn’t have any food allergies.”

In the meantime, we moved to San Diego. Thank God we hired a full-service moving company; I would never have had the energy to help pack our stuff. I had recently quit my Pilates class because I couldn’t work out for more than 15-20 minutes without finding myself in an exhausted fog.

My chiropractor in San Jose recommended a chiropractor he trusted in San Diego. I saw her in July. My new chiropractor gave me a mouth spray that was supposed to help get rid of the Epstein-Barr virus (that caused mono.) I used it and felt better within a few days. “I am cured!” I thought happily.

Instead of sleeping so much at night, however, I was collapsing for 4 hours after I ate any meal. I’d eat, and about 40 minutes later, I’d sleep and wake up 4 hours later, groggy and disoriented. Something was still wrong.

More Tests Reveal The Real Problem

In August, I did a stool test. The test shows what your body can’t digest properly, and also shows parasites, which commonly cause fatigue. The test results came back and, on September 9, I had a chance to speak to my nutritionist.

The stool test showed fat malabsorption. Even though I was eating, my body wasn’t digesting all of the nutrients from the food. No wonder I was feeling exhausted!

But the “jackpot”, as my nutritionist called it, was a line on the test called “Anti-Gliadin sIg A.” Mine was labeled “High.”

“You have gluten sensitivity,” she said. Then: “You need to try going on a gluten-free diet…the sooner the better.”

“But…” I protested, remembering the words a friend had said to me a week earlier. “Gluten is in everything.”

And indeed, it is. Gluten is found in wheat, barley, rye, and some oats. A gluten-free diet means complete elimination of all of those things. No bread, pitas, cookies, cakes, pies…oh, and weird things like soy sauce, which is brewed with wheat. And many sauces, which use flour to thicken them. Which means I couldn’t eat at many restaurants.

I knew I didn’t have any real choice. I would have to try this insane diet.

I went out to eat with Richard. Like a condemned person, I decided I would have one last really good meal. We went to an Italian restaurant and I got some hand-rolled pasta. It was delicious. I ate as much as I could.

Then I came home and slept for 4 hours. That sealed it for me. I was going to attempt the insanity.

The next day, I went shopping basically the entire day. We did a “kitchen purge”, spending nearly $300 and replacing all our flour, bread, pasta, etc. with gluten-free equivalents. (Did I mention that gluten-free ingredients are expensive?) I realized I was going to have to learn how to cook.

The Final Test Results

In the meantime, I told my new chiropractor what was going on, and she advised me to get a genetic screening test for Celiac disease. I ordered the test.

On October 1, as I was standing in line to check in at my hotel for Steve Pavlina’s Conscious Growth Workshop, I decided to check my email on my cell phone. One jumped out at me immediately: the test results from the genetic screening test. I opened the email. It said “HLA-DQ 2,3 (Subtype 2,7).”

The email explained what the heck that meant. Each of us has genes from both our parents. One of my parents had given me the gene for Celiac disease. The other one had given me a gene for gluten sensitivity.

I had just about the worst possible combination of genes. I would never be able to eat gluten again. And, for the first time, I had to come to grips with what it meant to have a disease for which there was no cure. A disease which, until just a few weeks ago, had been destroying my body. A disease I had had my entire life, which had gone undiagnosed for 28 years.

A disease I was guaranteed to pass on to my kids, should I choose to have them.

Interestingly, the universe had sent me people to help. My chiropractor here in San Diego is also gluten-intolerant. My nutritionist’s husband has Celiac disease. And San Diego itself is full of supportive businesses, including local pizza places, an Italian restaurant, and a gluten-free bakery.

What Is Celiac Disease?

Celiac disease is one of the most common diseases, affecting mostly women. It is genetic, and tests for it have been recently developed. It is quite common in anyone with Northern European heritage (as I like to say with a smile, it affects mostly white women!) It is unknown why it affects women more than men.

It is an autoimmune disease, meaning your body attacks itself when you eat gluten. Common symptoms include upset stomach, fatigue, malabsorption, and bloating. It is often misdiagnosed as chronic fatigue syndrome or irritable bowel syndrome.

Since your immune system is busy fighting off gliadin by mistake, you may come down with other infections…yeast infections; bacterial infections…and yep, even mono.

It is estimated that 1% of the U.S. population has Celiac disease and up to 15% of the U.S. population has some form of gluten sensitivity. However, only 5% of those with Celiac disease in the U.S. are currently diagnosed. That means that there are literally millions of people running around wondering, like me, why they are so exhausted all the time.

Why You Haven’t Heard of Celiac Disease

If this disease is so common, how come you’ve never heard of it? The pharmaceutical companies don’t touch it because there is no drug to cure it. Since it can be managed by diet alone, there is no profit in it for them. Since tests have only very recently become available, most doctors (who went to medical school before it was known that Celiac is so common) don’t think to diagnose it. There is a huge knowledge gap with Celiac, which means people suffer needlessly.

Since going low-carb (a few months ago, before I was diagnosed) and now gluten-free, I have lost 13 pounds. I feel better and am now sleeping ~7-8 hours a night instead of 10-12. I no longer feel exhausted after I eat. My stomach is healing, and I am taking supplements to help it along. I have not had any more infections, and I have enough energy to exercise regularly. Plus, I managed to salvage many of my blogging clients and am now helping them build authority blogs.

The best part is that, after many months of delays getting my new business off the ground, I am finally ready to announce it publicly! And wait till you see what I have in store for you…including an amazing contest. I’m going to open my entire business model to you. That starts later this week!

Getting Tested

If you think you might have Celiac disease or another food intolerance, please find a nutritionist or doctor you trust, and have them order the tests. The tests I took to diagnose it were a gene panel from EnteroLab and a stool test from Metametrix.

Finding people you trust is an important step in this. Talk to your doctor or ask for advice from someone you trust. (If you live in the San Francisco Bay Area, I can refer you to my nutritionist in Los Gatos; contact me and I will send you her details.) The most important takeaway from this is that it’s not normal to feel exhausted after you eat or to put up with other symptoms. Many people self-medicate with caffeine, antacids, or other drugs, but it’s best to get diagnosed and find out what the real issue is. If my symptoms sound familiar, don’t wait to get tested and seek support!

Recommended Reading:

• Wikipedia: Celiac disease. Everything you would ever want to know.
• Celiac.com. An excellent independent resource about Celiac disease.
• Trader Joe’s gluten free list (PDF). A complete list of every food at Trader Joe’s that is gluten-free. Very useful, and another reason why Trader Joe’s continues to get my business and support!

What’s the difference between you and that “idiot”?

Why Many “Idiots” Are So Successful

Idiots Successful entrepreneurs truly believe in their products/services, and aren’t afraid to show it.

When I was young, my dad told me, “Erica, no one wants to hear about your success.” What he meant was, “Don’t brag about all your stuff.” (For many of his cohorts, “stuff” equaled success; he’s an attorney.) Unfortunately, I took his comment literally. I almost never talked about my business.

I finally opened up at a conference several years ago. I talked about hiring my first employee, about how my business had hit 6 figures in annual revenue, and how we were growing like gangbusters. People’s jaws dropped. “How old are you?” they said over and over again. (I was 24 at the time.)

“But it’s no big deal, right?” I said. “Anyone can do this.” I truly believed that at the time.

Now, I know that’s not true. Very few people have what it takes to start and grow a successful business. Most of the people I met at that conference are still tinkering away, not really getting anywhere. Some of them gave up and got jobs. Only a few are true standouts.

Step 1: Be Confident in Yourself and Your Product

Not long after that, I was at another conference for up-and-coming entrepreneurs. The guy putting on the conference brought up an entrepreneur a year younger than me on stage and started talking about how great this guy’s product was.

I was infuriated! I had just started to believe in myself and stop believing that anyone could do what I do, and here was this “kid” on stage talking about how awesome he was. His company didn’t even sound that great! Unhappy about the situation, I resolved to corner the guy who ran the conference and talk to him about my business. I figured the problem was that he just didn’t know me, and I intended to resolve that.

I plopped down next to him at lunch, but he was swamped with conference logistics. He didn’t even give me the time of day, despite me waiting patiently for nearly an hour for him to finish lunch. In the meantime, other people kept coming up to him, and frankly, he looked exhausted. At the end of the hour, he walked away in conversation with someone else who was helping him run the conference.

I was so mad that I went straight to the elevator, intending to go up to my room and have a good cry! Instead, another conference attendee stopped the elevator door just as it was closing and noticed the tears running down my face. “What’s wrong?” he asked.

I blurted out the whole story, about how I had waited an hour for this guy and he completely ignored me the whole time. I was so angry that he hadn’t recognized me or my business. I mean, I was supposed to be this awesome young kid, right? So why was that dolt on stage while I was having to struggle to get this guy to even remember my name?

I was so angry I don’t remember the exact words he said to me, but later, in my room, as I cooled off, I got the gist of it. No one knew me because I wasn’t confident in my own abilities. I wasn’t showing this guy, or anyone else, for that matter, why my company was different and awesome. I was playing my cards like I was running just another web hosting company, instead of having a groundbreaking, Earth-changing idea.

I had brought this on myself. I was not happy.

I resolved then and there that I was going to be confident. I was going to have to act it, even if I didn’t believe it inside just yet.

Over the next year, I started to articulate why my business was better than every other web hosting company. I had to take on that role. I had to believe it myself. We weren’t just another web hosting company, we were changing the whole shitty web hosting industry by offering better service, a real office where our customers could hang out, top-of-the-line bandwidth, and real, personal relationships with our customers.

The company took off and soared. We were doubling in size every year.

Step 2: Stop Thinking of Sales as Manipulative

A side effect of this was that I no longer thought of sales as manipulative. Manipulation was when you had crap that you were trying to package as gold. Nope, we had the best stuff, and you either wanted the best or you didn’t. If price was your main objective when buying web hosting, we no longer wanted you as a customer. Go somewhere else and put up with their crap. We were for the people who wanted to run businesses and not have to deal with outsourced support, “What’s your customer ID?” as the first words out of a tech’s mouth when they called, and a staff who didn’t have a clue about your business. In short, we were the opposite of most cost-cutting, bureaucratic, run-by-robots hosting companies.

I closed 90% of the people who walked in the door. I gave each of them at least half an hour to just talk about their businesses without me interrupting them at all. Then I explained how we would be their partner, a part of their team, and there to support them as they grew. Their faces lit up. Most of them signed contracts and handed me the first month’s payment on the spot.

When I internalized that we were the best web hosting company out there in terms of dedicated servers and colocation, my business went from 6 figures to 7 figures.

Unsuccessful people either don’t have the best product, or they don’t believe they have the best. You have to have both to be really successful. The great news is that your best product can be for a tiny niche at the beginning. You can always grow it later.

Were there other great web hosting companies out there? Could my customers have gone with another one and have been just as happy? In some cases, sure. Was there another hosting company as good as mine in the San Jose metro area? To this day, I don’t believe there was. We had cornered the market on true personal service.

Make the best-in-class product, then believe it. Go out there and show people what you have. With confidence on the front end and a great product behind it, you won’t need to manipulate anyone into buying it. Instead, you will bring in happy customers for life.

“No fear or doubt; there’s one way out — you’ve got to believe.” DB Boulevard, “Believe”

Recommended Reading:

• Sharing My Journey to $1 Million. I wrote this just after selling my company, but I was still under embargo from the sale, so I had to write it as if I still owned it. I was coming to terms with what had just happened.
• Web Site Copywriting Secrets. What’s the difference between web sites where visitors buy products consistently — and web sites where visitors don’t buy at all?
• It’s Time To Completely Change Your Marketing Strategy. Our customers are speaking a different language than they were last year. The sales tactics that worked then won’t work now without major tweaking.

They’re laughing at you.

I mean, you’re practically doomed from the start. 90% of all businesses don’t make it five years. Even if you have successfully run a business before, you’re probably rusty at that whole “starting” thing.

You probably won’t make it.

Your customers are going to ask for refunds. They’re going to take their lack of success out on you. They’re going to tell you you didn’t perform (regardless of whether you did or not.)

They won’t pay you. Their checks will bounce. Their credit cards will get declined. They’ll promise to pay…every week, for the next month…and never pay. Suddenly, their phone number will get disconnected.

They’ll call you up and attack you personally, spewing venom you never thought you’d hear outside of an R-rated gangsta movie. They will laugh at your feeble attempts to make it right. They’ll threaten to sue you. They will get their local police department to call you.

They will leave anonymous comments on the Internet about how awful your company is, and, by extension, how awful you must be as a person.

They’ll complain that you charge them too much. They will threaten to cancel. They will cancel, and then when your broken billing system decides to bill them again, you won’t be able to refund it quickly enough to spare the hate mail, hate calls, and hate letters.

In short, they’re all going to laugh at you. In fact, they’re probably already laughing at you. I bet you can hear it right now in your head: “You’re so stupid. You’ll never be able to figure this Internet thing out. You don’t have time for this. You’re not young any more. You have mouths to feed! How could you possibly consider quitting your job?”

If you’re thinking I’m about to make it all better, I’m not. What I just listed above (including the part where the police department called me) is all real. It all happened to me in the course of running my business. I once let a customer rant on the phone for just over an hour (I timed it) while I transferred the call to my cell phone, put on my headset, and drove home. I listened to him ranting in my ear about how awful our service was the entire time.

As you’re reading this, some emotions are probably coming to the surface. At least one of them is likely to be a memory of when something like this has happened to you in the past. And maybe it’s scaring the crap out of you. You don’t want to run a business like that, you’re thinking. Who in their right mind would sign up for that?

But some of you…some of you are different. Sure, there are probably fears and doubts in there, and you may even question your own sanity. But somewhere, deep down inside, something is fighting to rise up. Something is saying, not, “It won’t happen to me,” but “I will find some way to handle this.” Because it will happen to you. Don’t kid yourself. You can run a great company, and you’re going to get shit flung at you every single day. It’s just how business works.

This post is for the fighters out there. It’s a reminder that you can do this. It’s a reminder that we all get the crap beat out of us, if not physically, then emotionally. Life isn’t always a cake walk. No matter how big or small a business you run, no matter how much money you have…this world is full of people who will want nothing more than to tear you down and see you fail. Online or in person; customer, employee, best friend or family member…they’re going to want you to fail, for reasons beyond your control.

To be okay with this, you have to first acknowledge it. Only by acknowledging that the hate is out there will you be able to get past the fear that is inside you and take the next step.

I don’t know about you, but I’d rather wake up each morning knowing that I’m bringing my absolute best to the table than wake up looking over my shoulder and asking “What if?”

The haters will be there no matter what you choose. Choose something that will make you happy.

Now go out there and change the world!

Recommended Reading:

• Download my free Blog Success Manifesto. Want to start a blog–or do you already run one? This is a must-download; I showcase how I created a successful blog without killing myself in the process. 63 pages; 30 tactical tips…and oh yeah, it’s completely free!

Internet fax review (VIDEO) — how can you
save hundreds of dollars on your fax service?

1. You’re stuck using an old-school fax machine to communicate with others via fax. If you’re in this category, watching the video below and taking action will save you hundreds of dollars per year. Definitely watch it!
2. You’re using an online fax service (or Vonage). Watching the video below will help you use your online fax service more effectively and may save you money at the same time–especially if you’re paying more than $10/month. Also, Vonage is terrible for faxes; I have a better solution. Watch the video.
3. You never fax anything or receive faxes and never plan to. Unless you’re just curious, skip this video–I’ll have a different blog post later this week that you won’t want to miss!

My Story

I hate land lines and phone companies. The phone company is yet another bill and the price is ridiculous — over $20/month for a land line, plus outrageous charges per minute for calls that aren’t “local”. Forget it. I scrapped my land line for Vonage years ago.

The problem I kept running into was faxing. As a business owner, I still had to deal with companies that wanted things faxed to them–everything from order forms to signup sheets to copies of my bank statements so I could establish credit. It seemed like every week or two, I had to fax something else.

Did I mention that Vonage’s fax service is completely broken and terrible? If you’ve ever tried their fax service, you know what I mean. It can be one of the most frustrating experiences ever. It randomly hangs up, won’t send, or only sends the first page. It wouldn’t even be worth it if it were free, and of course, Vonage charges for it. Any other Voice over IP provider is going to have the same issue–Voice over IP isn’t designed for faxing.

At that time, I had an ancient HP printer with a scanner that only scanned one page at a time, so Internet fax services didn’t seem reasonable to me. “Your last two months of bank statements” total 6-8 pages. No way was I going to sit there and scan one page, go back to the scanner, scan another page…forget it! My time is more valuable than that.

Finally, I happened on a solution that fixed all of those problems…

The Solution

Epson was kind enough to send me an Epson Workforce 600 printer for free as a review copy. I confirmed with them that I wouldn’t necessarily have to post a positive review. After all, I have a problem with inkjet printers. I’m an old, heavy, laser-printer-that-weighs-50-pounds-because-that’s-quality kind of girl. I buy printers at garage sales and keep them for years. (In fact, one of my old home printers was an HP Color Laserjet 4500 that weighed more than I did! Remember those?)

Well, lo and behold, this Epson printer turned out to be pretty awesome. Despite a few flaws (the main one being that the printer is an inkjet!), I use it all the time. In fact, it’s become the only printer in our home office. But the main thing that saved me was the auto document feeder. Yep, insert up to 30 pages and the printer magically sucks them in and spits them out as one computer file that you can then archive or…FAX!

So, in a roundabout way, Epson solved my fax problems. I use my printer, plus RingCentral’s inexpensive fax service, to fax all the time.

How It Works

From reading the comments on my blog, I can tell you really enjoy my videos. This video shows exactly how I use my Epson printer and RingCentral to send a fax. (By the way, RingCentral lets you receive faxes via email too, with your own fax number. Awesome!)

This 9-minute video walks you through every step of sending a fax. You can do this with any printer that has an auto document feeder. If you don’t have a printer that has an auto document feeder, and you’re using an oldschool fax machine and a land line, it’s time to upgrade. The good news is that your savings in the first year alone should pay for your printer, and from then on, you will bank hundreds of dollars in savings. Say “Adios!” to the annoying phone company!

Without further ado, here’s how you can save money on your fax service:

Internet Fax Review: Save Hundreds of Dollars (9 minutes)

Highlights

[0:49] I hold up a stack of at least 10 pages of documents the state of California has recently sent my business. One guess as to what they want…!
[1:50] Here’s how the auto document feeder works…
[3:05] My last printer was THIS big!
[3:29] The printer has wireless! This is a really cool feature. (Note: The Epson Workforce 600 doesn’t support WPA2, but the new Epson Workforce 610 does.)
[4:30] Finally, you can throw all your phone cables away! We cleaned out our closet recently and trashed tons of these. It felt good.
[5:28] I say “Epson Workforce 600″ for the sixth time…I had no idea I was doing this until I played back the video and listened to it! Richard watched it and totally laughed at me.
[5:58] I learn how to use “Fade to Black” in my video editing software! I’m such a pro.
[7:08] Actual scanner noise! No fancy effects here…
[7:54] Cool side note: Click that big “Add” button to send the same fax to multiple people. Incredibly useful.
[8:50] You can send as may files as you want. No more waiting to make sure the fax machine doesn’t jam if you need to fax several pages.

Next Steps

You’ll need two things to start saving hundreds of dollars on your fax service:

1. A printer with an auto document feeder. You can buy the Epson Workforce 610 (it’s under $200, and may be on sale for even less!), or do your own research. For a general home office or small office printer, I don’t think you can go wrong with the Workforce 610.
2. An Internet fax service. I use RingCentral; they have a 30-day free trial, so give them a shot. They are far cheaper than other services such as eFax, so if you’re using a more expensive service, you might consider switching. Their monthly fee includes your own fax number that you can use to receive faxes to your email address as well as send them. (Imagine never having to go into the office again to grab a fax!)

FAQ

Can I port my existing fax number to RingCentral?
Yes; sign up for their free trial and then contact them for porting information.

Can I send faxes overseas?
Yes, you can send faxes anywhere in the U.S. or internationally.

Can I block junk faxes?
Yes. This is another great feature of RingCentral. Wen you receive a junk fax, just block the number and you won’t be bothered again. This is difficult with a traditional fax system.

I use one number for everything…what about receiving calls on my fax number?
Upgrade to RingCentral Online (this is actually what I use, since I have a toll-free number with RingCentral as well) and you can easily receive calls on your RingCentral number as well. I have RingCentral forward all calls to my regular phone so people can call me on my toll-free RingCentral number, for instance.

Don’t wait — start your free trial of RingCentral today!

Buy the Epson Workforce 610 on Amazon.com.

Canadians: Start your free trial of RingCentral.ca.

Best of luck saving hundreds of dollars a year on your fax service!

Note: Per my advertising policy, I have not been paid to write this post, and I have personally reviewed and use both the Epson Workforce 600 and RingCentral.

Should you offer your next product for free?

There are good arguments on both sides of the debate about whether to offer your next product for free; here, I will walk you through them. By the time you finish reading this post, you should easily be able to decide whether your next product should be a free one.

Let’s start with an example: I was listening recently to the Personal Finance Hour with J.D. Roth, owner of the popular blog Get Rich Slowly. He mentioned that he planned to do a series of blog posts and then turn them into an ebook. Almost as an afterthought, he added, “I think I’m going to offer [the ebook] for free.”

Offering a product to the world that you’ve put a significant amount of effort into will return one of two things back to you: reputation or money. What you’re interested in receiving at this time should determine whether you decide to offer your next product for free or as a paid product.

The Case for Free/Reputation

If you are new to an industry, offering a high-quality product for free will immediately establish you as a force to be reckoned with. Reciprocity will kick in, and others will promote it (and you!) via social media and linking. Hundreds or thousands of people will visit and download your product. Some of these people will be influencers; they will write about your product on their blogs, Tweet about it, or email it to all of their friends.

Offering a targeted product for free (such as my Blog Success Manifesto, which is targeted toward bloggers) will help you grow a devoted following of people in your niche. Surveying those on your email list will help you quickly create paid products in your niche; you will have a ready-built audience to sell those products to. If you’re a consultant, for instance, offering a high-quality, free product helping your target audience will enable you to quickly reach people who will pay money for your consulting work.

Whether you choose to write a blog, develop an information product, or develop a standalone product such as a piece of software or a mobile phone application, free will help you build loyalty, trust, and a following.

The Case for Paid/Money

Paid products won’t spread the word about you very quickly. In fact, most people who will promote your paid product will want a cut of the sales–they will want to become affiliates. However, if you have already established yourself as an authority in your industry, I would recommend releasing a line of paid products.

Let’s use J.D. as an example. His blog, Get Rich Slowly, currently has over 69,000 subscribers. It’s safe to assume 1-3% of your audience will buy a paid product you produce. (That number may be higher if you promote it well and it’s a lower-priced product.) Let’s use 3% as the number for J.D., and $17 as the price point for his ebook. 3% of his subscribers means 2,070 sales. At $17 each, that’s over $35,000 in gross revenue. That’s not including additional revenue from new subscribers who buy his product in the future, or a percentage of the revenue from affiliates who promote his product on their own sites.

Of course, having a paid product means you will have to deal with the occasional refund or “Help, I can’t download the file” email–or hire someone to do so. But I’d argue that when the numbers look like they do above, that’s a worthwhile expense. You can outsource this cheaply; spend your time on product creation instead.

Which Should You Choose?

If you are struggling with how price your product, answer this question: Do you need to build a reputation in your industry, or do you want to cash in your earned reputation points?

With my Blog Success Manifesto, I decided I’d rather give up $2,040 in gross revenue (3% of 4000 subscribers at $17 each) and instead build my reputation by providing a quality product at no charge. That was worth it for me; already, over 400 new subscribers have downloaded my Blog Success Manifesto. Since I plan to market products in the future to bloggers, I don’t regret my decision.

But when you’ve already built a huge reputation for delivering quality products, and you’re well-known in your niche, don’t hesitate to cash in your chips. Were I in J.D.’s situation, I would sell the ebook. I would then set a goal of developing a new, related product in my niche every 2-3 months and selling that, as well. Doing that would not only exponentially increase my income (thus affording me new opportunities), but it would allow me to hire someone and feel amazing that I was able to help feed an individual or family due to my creative products.

You Know You’re In the Wrong Place When…

If you’re too far into the “reputation” side of things, you’ll feel it. You’ll be burned out about money and frustrated that no one seems to value your time. In reality, you’re the one not valuing your time by offering products that your audience could benefit from.

In fact, your audience may be begging you to offer paid products. Many times, you will get emails from people you don’t even know, asking “Your ___ is fantastic! How can I help you?” This is a good sign; it means it’s time to take that leap and start turning in your reputation chips for cash.

If you’re too far into the “cash money” side of things, you will also feel it. You’ll be demoralized by the fact that everyone seems to “want a piece of you.” You won’t be able to find many people to promote your product without wanting some of the action.

Try offering some of your best work for free…not the castoffs, but your most original products. Use blogs and social media to build your reputation and your list. Once you’ve built a reputation for offering amazing products at no charge, try selling another product. You will be surprised at the different reaction you get!

A Word of Warning

Building a reputation takes time. Don’t expect to write a document in half an hour, offer it for free, and then immediately cash in your reputation points. If you need quick cash, promote others’ products as an affiliate while continuing to offer excellent work for free. Listening to your audience will help you gauge when the time is right to offer your first paid product.

Treat your reputation like gold. Offer products with integrity and confidence, and enjoy the fruits of building your reputation!

Recommended Reading:

• Is Your Tribe Holding You Down? Sonia Simone at Copyblogger examines who has it better: the broke “cool kids” or the money-driven Internet marketers. The two tribes parallel this post. A must-read.
• Blog Success Manifesto. If you’re a blogger, or want to become one, this is imperative. My 62-page guide that shows you step by step how to use a blog to build your reputation.
• 5 Mid-Year, Game-Changing Questions by Pam Slim. Pam and several others are exploring new ways of doing business online by building your reputation; her article goes along well with this one.