6 Lessons for #Bloggers from Smart Passive Income

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Last week I was talking with one of my mastermind buddies about online business models, and the name of Pat Flynn and Smart Passive Income came up.

Now I won’t name and shame my mastermind buddy, but Steve he’d never heard of Pat, or the Smart Passive Income blog.  We were near the end of our chat, so I sent Steve him a link and thought no more about it.

Now my mastermind buddy and I are in different time zones and when I woke up the next morning I had an email from him asking if I could get on Skype with him again as soon as he was awake.

So later that day we talked – and he was freaked out.  He’d read Pat’s latest Income Report (June 2011) and couldn’t understand how he was making so much money and asked if I could explain how Pat’s business model worked.

As I’ve been following Pat since April 2010 I said I could, and we spent 30 to 40 minutes on Skype where I did an impromptu reverse engineering of Smart Passive Income and explained how Pat was so successful.

There are some fascinating lessons from Pat’s site and I thought it would make a great post to share those lessons.

( Note – I’m a great believer in courtesy and treating people how YOU would like to be treated, so I emailed Pat on Saturday, explained the situation and asked if he minded if I wrote and published this post.  I half expected Pat to say no – after all, although we’ve emailed a couple of times before, and exchanged some tweets, I would be surprised if I was on his radar.

However, not only did Pat say Yes, but he replied to my email within 15 minutes.  And he even answered a couple of questions too, which was an unexpected bonus!)

So let’s have a closer look at six lessons we can learn from reverse engineering Smart Passive Income.

Lesson 1: Building The Trust Factor

Pat started SPI in October 2008.  If you go trawl his archives you’ll find that from Day 1 he’s been honest and open with just about everything.

I want to highlight two posts in particular that illustrate this.  Firstly, at the end of October he published his first ever Income report, where he posted and broke down his earnings of just less than $8000.

October 2008 Income Report

The second post from October 2008 I want to look at was the 4^th post Pat ever published. Here’s the chronological sequence prior to that post:

• Why I Will Quit My Job For A Passive Income
• Earning A Passive Income While At Work Part 1
• Earning A Passive Income While At Work Part 2
• Nevermind I just Got Laid Off

So within a week of starting the SPI blog (Smart Passive Income), Pat was laid off from his job as an Architect.  And as deflating as that must have been, Pat creates some motivation for himself out of it (and for others).

But he’s also ruthlessly honest about the experience – he talks about thoughts of inferiority like: ‘his employers doesn’t think he’s skilled enough’, or: ‘why me and not the other guy?’

Anyone reading that would emphasize with those feelings.  And that kind of  empathy helps establish The Trust Factor with his audience.

And he’s continued that policy.  He publishes Monthly Income Reports without fail – and talks about both the successes and failures.  If you look at the screenshot below, you’ll see a summary of the majority of these monthly income reports.

Notice how from that first report in 2008 the income rises for a few months, and then in July 2009 it tails off and hovers below the $10,000 mark until it starts rising again in January 2010.

That kind of honest reporting really builds The Trust Factor, and it’s built into literally dozens and dozens of other posts ranging from traffic figures to Pat’s ‘Before And After’ photos of his fitness drives and his tallying of SPI’s expenses too.

Lesson 1 Learnings: Be Yourself.  Be Honest.  Be Open.  Build The Trust Factor.

Lesson 2 – Always Be Learning

If you read how Pat got started with his LEED eBook you’ll realize that he had a lucky start.  The blog that he started – that turned into the LEED eBook – wasn’t started to build an audience to launch his eBook too.

It was started so Pat could take notes and reference those notes wherever he was.  As long as he had an Internet connection he could connect to his blog and learn from his notes.

Thanks to Google, other students started learning from Pat’s notes too.  And Pat eventually created an eBook to sell to the audience he’d inadvertently created.

Again, go to the October 2008 Earnings Report and you’ll find this information:

Now I’ve highlighted two really important facts.  Firstly, on Oct 2^nd Pat released the LEED eBook.  And you’ll see he sold 300 plus copies in October (which is a staggering success).

I remember hearing him in one of the Podcasts say that this pleasantly surprised him – but he wanted to know more.  And understand the process more.

And after launching the eBook he joined the Internet Business Mastery Academy.  (This is a membership website run by Jason Van Order and Jeremy Frandsen aka Jay and Sterling.)

Pat used that experience to enhance his learning about what he was doing online, and make it better.  (For example, almost immediately he created an audio version of the LEED eBook, and sold that separately from the eBook or a higher priced bundle of the PDF and audio version.)

If you follow Pat, you’ll see this approach – learning new things to improve his business – is something that appears with almost monotonous regularity.

Here are some examples of Pat learning and applying new skills:

• Learning how to record, edit and upload Podcasts
• Buying and learning how to use Green Screen technology for videos
• Going to the Warrior Forum to learn about ‘backlinking’ strategy’
• Using Market Samurai to master Keyword Research
• Broadcasting A Webinar
• Learning the importance of scheduling
• Having his website critiqued by Derek Halpern
• Having his website critiqued for SEO mistakes

And much more.

You should dive into the Archives of SPI – there’s some fascinating stuff there – and you’ll see that this is a theme that’s repeated through the period that SPI has been live.  Pat is always learning new things, and then reporting on his experiences with those new learnings – both good and bad (there’s that honesty again).

Lesson 2 Learnings – Always be learning.  And just as importantly – implement that learning and see if it’s successful for your blog or website.

Lesson 3 – the Importance of Pillar Content

I think the phrase ‘Pillar Content’ was coined by Yaro Starak of The Entrepreneur’s Journey.com.  Here’s a definition of Pillar Content from Yaro:

“A pillar article is usually a tutorial style article aimed to teach your audience something. Generally they are longer than 500 words and have lots of very practical tips or advice.”

Here are the primary reasons for creating Pillar Content:

• It creates value for your audience – and thereby gains you the position of expert in their eyes.  (With expertise also comes trust)
• People bookmark it and come back to it – thereby spending more time on your website
• People link to it.  If enough people link to it, Google starts sending traffic.  Some of that traffic will like it and link to it.  You rise up the rankings – a virtuous circle ensues.
• Due to its length it should rank for long tail keywords – again attracting search engine traffic to your blog
• People who use it and see results WILL come back to your website – and are more likely to subscribe/take positive action

Pillar Content should be a no-brainer.  And Pat has a ton of it.  Here are just a few examples:

The Backlinking Strategy That Works

How To Create A Facebook Landing Page

YouTube Marketing (6 posts on using YouTube)

Email List Strategies

The Hole In Most Blogs That Needs To Be Filled

There are over 400 posts at SPI – and there’s a lot of Pillar Content, and really practical ‘To Do’ articles within that content.  Again, it’s worth having a search through the archives and seeing what nuggets you can find.

Lesson 3 Learning – Create Pillar Content

Lesson 4 – Be An Authority Website or Blog

I think Mr Nice himself – aka Chris Garrett or Chris ‘G’ – coined the term Authority Blog.  An Authority Blog is a site that is one of the leading authorities in a market area.

So if you’re interested in Copywriting – Copyblogger is the Authority Blog in that market.  If you’re interested in web traffic, then either Corbett’s Think Traffic.net or Ana Hoffman’s Web Traffic Café are probably the authority sites you should be checking out. (Both great sites by the way).

If you’re interested in blogging in general then probably the top 3 authority sites are Problogger, Pat’s SPI Site and maybe Glenn Allsop’s Viperchill site (where you’ll also find lots of pillar content).

Building an Authority Blog is something that doesn’t happen overnight, and happens as a result of publishing high quality content for a sustained period.

But once you’ve built an Authority Blog, then you become THE thought leader in your market – or one of them – and that translates to a large, receptive audience.  And it’s no coincidence that Pat has got a larger receptive audience as a direct result of building an Authority Blog.

What’s interesting is that not only has Pat built SPI into an authority blog – but he’s also using this strategy to build the Security Guard site that he’s written about at great detail in his Niche Duel.

The Niche Site duel is well worth taking the time to read through and see how Pat has got to where he’s got with that website (making $1000 a month with Adsense)

Here are Pat’s own thoughts on creating an authority site:

Building A Big Personal Brand

Lesson 4 Learnings: Authority = big and receptive audience.

Lesson 5: Avoiding The Traffic Plateaus

This is something I’m suffering from at the moment.  One Spoon At A Time is stalled at around the 125,000 mark (in terms of Alexa Rank).  The July 31^st goal was to be below 100,000….this traffic plateau is something that happened to Pat for a few months too.

Take a look at this traffic graph from Alexa:

When I first started following Pat (via a guest post he did at Kim Roach’s Buzzblogger.com website) my memory is that his Alexa Rank was around 60,000 or so.

It hovered there for a few months – which you can see in the graph above -  and then it started climbing until it got to the level it has today (Alexa Rank under 5000).

What I think really helped him grow that traffic and get off that ‘natural plateau’ was his use of different media and different platforms to reach a wider audience.

Pat talks about it here:

Are YouTube Videos And Podcasting Worth The Effort

As well as creating videos and podcasts, Pat also started a presence at Facebook and he uses Twitter as well.  By combining all these extra platforms he is able to reach a wider audience than if he ‘just’ blogged.

One vital thing to note though – Pat transfers the concept of Pillar Content to the different platforms.  Some of his YouTube videos are detailed tutorial videos that people actually use.  And some of the podcasts have got some golden information in.

Another great tip I just realized  – note that Pat adds a transcript to his podcast pages, so that not only does he get the SEO benefits (long tail keywords etc) of the words, but people like me who’d perhaps prefer to skim the transcript in 10 minutes rather than listen to a 40 minute podcast can still access the content.  Again, this comes down to creating value for your audience.

Lesson 5 Learnings: When you hit a traffic plateau, go wide to YouTube, iTunes, Facebook, Twitter etc.

Lesson 6 – Affiliate Income

I was going to include a screen shot of Pat’s Affiliate earnings from July 2011 – but the freaking column was too long to be able to get on the screenshot without reducing the fonts to a miniscule size!

Suffice to say, Pat made a bucket load of affiliate commissions in July.  There are four reasons he does so well (IMO).

Firstly, he only puts forward products and software that he knows and has used.

Secondly, he never pushes an affiliate sale.  Sure, he makes recommendations.  But they’re never ‘in your face’ – and Pat always tells you if a Product Link is an affiliate link (honesty again!).

I’m on Pat’s email list, and I don’t ever remember getting an email promoting an affiliate product – again, his email list is about building trust and the expertise factor, not trying to make a quick commission.

Thirdly, because Pat has the expertise and trust factor established – from his pillar content, his honesty and his authority blog status – people trust his recommendations.  And often act on them.  (Plus you’ll note on his Earnings Post that he also says if you have any questions on any of the products to email him!  That’s a big, big tip if you’re planning on going down the affiliate route).

Fourth – and here’s the kicker – he doesn’t just recommend something.  If it’s an info product – he’ll interview the creator in a Podcast and create valuable content that you can learn from. (The interviews with Corbett Barr are gold dust by the way – the transcripts of those bad boys should be in your safe folder on your hard drive!)

If it’s a software product, he’ll demonstrate how it works with videos and create a pillar style post (should that be a ‘pillaresque’ post?).  So people can see for themselves if these products will solve a problem for their own online business and make a buying decision based on that.

He even created a post about how he gets Bluehost affiliate sales:

My Affiliate Links and How They Convert

Lesson 6 Learnings – An ethical way to do affiliate marketing.

How Can YOU Implement Some Of Pat’s Strategies?

Modeling someone who has achieved the kind of success you want to achieve is a great way of not having to reinvent the wheel.

However there’s a caveat – when you model someone else, you always have to make sure that what you want to achieve is broadly similar to what the person you’re modeling set out to achieve.

So for example for One Spoon, Pat’s monetization strategies with Affiliate Sales wouldn’t work because I don’t particularly like the affiliate model.   I plan to monetize One Spoon through consulting, training courses and eBooks.

But Pat’s method of getting off the ‘traffic plateau’ would work for me.  And creating more hands on, how to, ‘Pillar’ articles would also work really well for me.

The education principle is something that I already do – I’m currently working through a Copywriting Course at the moment with Sean D’Souza, as well as learning to create eBooks more efficiently in InDesign.

The honesty thing – you’ll have to tell me, but I try to be as open and as honest as possible.  (Which reminds me I have to update my Traffic Report and share my miserable failure to achieve an Alexa ranking of less than 100k!)

The point is you need to work out where you want to go.  And if there are strategies you can borrow from Pat to help you get there, then borrow them.

If you have different goals, then find a blogger who seems to share them, and do this kind of analysis on that blogger.  And then adapt the learning from that blogger to your own website.

Summary Of Learnings

This was an interesting exercise for me – and I bet Pat’s bounce rates have gone down today as I’ve been trawling through his archives for about 6 hours (and they’re dusty Pat – you need to outsource a cleaner!).

Here are the greatest learnings for me:

• Always be learning
• Avoid the traffic plateau – different media types
• Pillar Content
• Combine pillar content with other media
• Be honest.  Be yourself.
• Be an Authority.

Paul’s Edit: Had a couple of emails already (post only live for 90 minutes) about Pillar Content.  So make sure you come back on monday as I’m going to do a ‘guide to pillar content!’

Your Shout

What were your greatest learnings from this post, or from Pat’s example?  Please share them in the comments form below.

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Tagged as: blogging, facebook, income reports, itunes, pat flynn, pillar content, smart passive income, youtube