Let’s take a page from Pi (no, not The Life Of), and “restate my assumptions.” More accurately, “revise my assumptions to reflect my growing understanding.”
-Ways to make passive income – posting articles on “content farms” (low leverage and no fun), affiliate marketing, niche sites, blogging, eBooks and other informational products, physical products (whoa Nelly), and software, including iPhone and android Aps.
-Actually pretty much everything above (with the exception of physical products, and even sometimes websites for selling those) relates back to affiliate marketing, and here’s how: niche sites, blogging, eBooks, and even free iPhone apps all make money by trading eyeballs for dollars. More exactly, trading eyeballs you’ve carefully screened for interest in a certain thing for money from those advertising that thing. Which brings us to a truism:
-Your currency is your ability to attract people around a single item of interest to a single point in space. The network is not the means to the end, the network is the end.
This has startling implications for music. For starters, music no longer has to be “zero sum.” In a traditional music culture, we’d trade dollars back and forth. I buy your CD, you buy mine, I go to your gig, you go to mine, and if somebody builds more influence, he’s getting more dollars from more people and spending fewer on fewer. It’s the textbook scarcity context, where I succeed only at your expense, and it’s rife with “pyramid”-style relationships, where people trade dollars for the possibility of a “boost” up the ladder, which more often than not doesn’t materialize.
But say you and I both have successful web channels, and we appear on each other’s shows. Say we both attract a substantial enough following to make money from affiliate marketing. Here’s the crux – if I “click through” on your site then you “click through” on mine, we don’t trade the same dollar back and forth. We both earn original money. (This assumes, or course, that we’re actually deriving value from the product from the affiliate and not just buying crap we don’t need in order to support each other.) As such we can have an overlapping fan base, and your success doesn’t hinder mine – indeed by creating a network of like-minded people and cross-promoting each other’s music/sites/products, we can help each other succeed.
I wonder how quick musicians will be to adopt this. Pop musicians are miles ahead of jazz musicians. One of the many things inspiring me is seeing a group last night that was the “total package”: amazing product that sells itself (the show has to be seen to be believed), and whip-smart online marketing dynamo, complete with search-engine-optimized social network pages linked to youtube, and music’s equivalent of “guest posts”: covers of oft-searched pop songs redone cleverly and catchilly. (Remember Pomplamoose?) (Oh, and in the spirit of abundance, find the group I’m talking about here.)
The thing is, it’s still difficult for me to view music as a moneymaker. And in truth, it shouldn’t be one. Music should be the thing you make money so you can do, not the thing you try to make money from. And, strangely, many of the most successful ideas were just that – things people were passionate about and never viewed as vehicles to riches. (Want a little example? How about Steve Jobs.)
Still, I’m living this experiment/writing this blog to test the viability of passive income, so I need something whose primary purpose is money. Enter: iPhone apps. More on that next post.
By the way, anyone who’s read Four Hour Work Week owes it to him/herself to spend a week with Pat Flynn’s Smart Passive Income podcast/blog before delving in. SOOOOO much has changed since FHWW was written. Adwords are too expensive. Content farms were “demoted” in google’s algorithm. All of which means people who were in it to get rich quickly should probably look elsewhere. But the model of leveraging (ugh buzzword) something you’re good at/passionate about to create something of value (truly of value, not just exploiting an information asymmetry), and attracting loyal fans whose lives you enrich, and benefiting financially either directly from them (by selling informational products like my drum DVD – yes I’m backlinking the hell out of it – or a paid iPhone app) or indirectly (via affiliate marketing) is a viable one for people passionate about and dedicated to the meta-skill of organic marketing.
Anyway, my experiences with my first taping session, as well as all things app, next post.
(photo depicts the electronica duo I posted about)
2 thoughts on “Eve of first DVD Taping Session, and Ten-Thousand Foot View of Passive Income”
Okay I sort of get it. But do you want to teach people to at the drums better or to earn passive income (or both)? I think I will I will understand better once I read the book although I glean from this it’s already somewhat passé? (How am I doing?). 🙂 p.s. see muddslinger pots at etsy – would like to know what you think. When do you want your bday present part b? Love, mom
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Idea isn’t passé, though some of the specifics are. Can’t wait till you’ve read it so we can discuss!