My Passive Income So Far This Year

We are half way through 2012 now. It reminds me how quickly time flies so I’ll take a step back and re-evaluate where I’m going.

One of the goals I had at the beginning of the year was for passive income. I had a target of $2000 to make in the first half of this year. Did I make it? Read on.

sleeping cat

Passive income, as defined in books like the Four Hour Work Week (affiliate link), is where you make money in your sleep. There are a number of ways to do this including:

  • Selling your own products
  • Affiliate sales (selling other peoples’ products from your website and receiving a commission)
  • Advertising on websites

I’ve always been a huge fan of Pat Flynn’s monthly income reports and, although it’s important to stress that passive income accounts for a very small part of my business, I really love the transparency in Pat’s blog and I like to be as open and honest about my business as possible.

Sales of my products

There are two main products that I sell:

I use Clickbank to sell these products and I mainly promote them (or some would say “peddle;) ) through my email subscriber list.

Here are the sales from my products for the 6 months to June 30th 2012:

ProductTotal Sales
Running a Web Design Business$976.22
How To Get Clients$174.07
Other$69.87
Total:$1220.16

As you can see, most of the sales came from my new e-book, Running a Web Design Business. I’m currently re-writing How To Get Clients and plan to re-launch it soon. If you’ve already purchased a copy of How To Get Clients, don’t worry, you’ll receive the updated version as soon as it’s published.

running-a-web-design-business

Affiliate commissions I’ve received

Affiliate commissions are received when someone buys a product from another website having arrived there from here. So when I write blog posts about developing websites with Genesis, I’ll usually include an affiliate link to the Studiopress site where you can download the theme framework.

I always promote products I’ve used myself (either I’ve bought myself or used through a client). This article, and especially the table below, has affiliate links to products.

Affiliate commissions are hellishly difficult to calculate. Every product has a different scheme and payment structure. It’s difficult to know which payments to include the the last six month period. Do you add the payment when the sale is made, when it goes through, or when you receive payment?

Anyway, this will give you some idea of my earnings from affiliate commissions.

ProductTotal Sales
Genesis WordPress theme$425.05
WPML WordPress Multi-Lingual plugin$247
VPS.net VPS hosting$340
A2 VPS hosting$170
Liquidweb VPS hosting$100
Bluehost shared hosting$325
GoDaddy domain name registration$80.78
E-Junkie shopping cart system$14.40
Aweber email marketing and delivery$63.30
oDesk outsourcing$66.71
Others$278.67
Total:$2110.91

It’s very hard to quantify affiliate sales reliably, for example, I haven’t included my commissions from Hostgator or Dreamhost which are taken away from my hosting expenses and may account for another few hundred dollars.

A lot of the commissions come from hosting which, in part, is from two articles I did on shared hosting and VPS hosting for WordPress.

Overall, I’m astounded that I made over $2000 in half a year on affiliate commissions!

Advertising

It’s very difficult to make any money from advertising on a blog. As you may or may not have noticed, I have just started running ads in my sidebar from Influads.

I have only just put the bigger size of ad on the sidebar. The smaller size only made $40. Unless there’s a dramatic improvement, I’ll give up on ads for the time being.

What does this all mean?

My product sales plus affiliate commissions equal $3331.07 over the last 6 months. Well over my $2000 target. :)

Although this is only a small part of my business, it’s something that really interests me and I’ve learned a lot from quantifying it.

The most important point is that my affiliate commissions are twice as much as my income from my own products! This is a real eye-opener. Especially when you consider creating your own products is a million times more time consuming that adding in a few affiliate links!

However, passive income for this company is a side experiment and I wish to continue with my own products as much as the affiliate side.

What’s important is that I only ever include an affiliate link to a product when it occurs naturally in my blog. I also try not to “peddle” my own products unnecessarily.

It’s important to keep the passive side of my business ticking over without overdoing it. Remember, most of my business is actively working for my wonderful clients!

What do you think?

What you think of the affiliate links, products (if you’ve noticed them) and advertising on this site? Maybe you think it’s too dodgy and I push the affiliate stuff too much? Or maybe I’m peddling my wares (e-books) too openly? Or, you don’t like the ads?

I’d love to know.

What you can do

Do you mention any commercial product in your website that you really believe in? If so, just go to Google and search for “the product name” plus “affiliate” and see if they have a scheme. I bet they do. It may take only 5 minutes to set up the link but it could make you a bit of money in the long run!

Photo credit

Comments

  1. says

    That’s pretty good going Rob.
    “My product sales plus affiliate commissions equal $3331.07 over the last 6 months. Well over my $2000 target. ”

    I’m an affiliate for Genesis and Copyblogger and I’ve just added Dynamik for Genesis by the Catalyst people.

    I had intended to sign up as an affiliate with my hosting company and reading this has just reminded me.

    This is my first 6 months of affiliate sales and I’ve brought in about $850, which is not bad as a starter.

    Appreciate you publishing actual figures, which help give a feel for what is achievable.

    • says

      Well, I think you’re doing better than me. I’m not sure when I started adding affiliate links but I bet I didn’t do so well in my first 6 months. It’s one of those things that needs time.

      It took me ages to do hosting as well. My first host wasn’t such a good one but I moved to Dreamhost, and moved then again, whilst using others through clients. You get an idea of the best ones after you’ve used a few. God, there’s nothing worse than a bad host!

      Glad you found the figures interesting. I’ll try this again. Maybe do it every quarter. I have a feeling the next 6 months won’t be so good. We’ll see. :)

  2. says

    Hi Rob, great to see you’ve smashed your target. I’ve recently started featuring Adsense ads and affiliate links as a way of helping supplement my hosting costs, and am looking at other possibilities for monetization, though making money isn’t really the focus of my blog.

    Actually I feel a bit dirty by whoring out my sidebar, but if it pays off I might just be able to live with myself!

    • says

      I know exactly what you mean on two counts. Making money from this site has never been my intention. I wanted a site, primarily, to market my design business. However, it has morphed into a resource for other designers, marketers and other people! But, passive income isn’t what it’s all about. A small percentage.

      And, I know what you feel about ads. I don’t like them at all. And, Adsense I dislike the most, probably. I’m going to give Influads a few weeks and take a decision then.

      Best of luck with your forays into passive income!

  3. says

    Cheers Rob, Google aren’t exactly picky about their publishers, which is mainly the reason why I’m using Adsense. I have to block a hell of a lot of crowdsourcing and DIY logo-maker ads manually though, which is frustrating. It’s slightly hypocritical to have a design blog that’s advertising such sites.

    • says

      Well, Adsense would probably pay better as well. However, the really good thing about Influads is that you can block ads really easily and they only ever have about 10 different ones. I’ve only blocked one so far – horrible big blob of pink that stuck out a mile.

      Actually, they advertise Wix which I’d never recommend, but it might be good for some people. But, yes, I think I’d block some cheapo crowdsourcing sites!

  4. says

    Hi Rob, congratulations on the sales from both of your e-books and for surpassing your target income from passive sources. Although they’re not necessarily so passive, as I’m sure you’ve seen for yourself: putting together a quality e-book takes time, as does presenting the information for product or affiliate sales online in a way that’s not jarring.

    I don’t think the layout or content of your site pushes these revenue streams too hard. There are plenty of sites that do. I think your landing pages are great. Also, I’m comfortable with the inclusion of affiliate links in blog posts so long as there is full disclosure from the author. In particular, I get frustrated by some blogs which publish ‘reviews’ of products that turn out to be no more than an empty sales pitch with an undisclosed affiliate link attached.

    Even though it’s not the core purpose of your blog, all the best with your future passive earnings!

    • says

      Oh, you’re absolutely right about the e-books being not so passive. The first book, especially took me ages to write. I had no experience of writing something that was longer than 20,000 words. And then sorting out the selling side of it took time as well.

      But, then, the second e-book didn’t take as long to write, even though it’s a bit longer. And, setting it up as a product was really easy the second time.

      I’m so pleased you don’t think I push the affiliate products too much. I try to write one article a week that I think will be interesting or useful to the visitors here and the affiliate links slot naturally into them – I hope!

      All the best with your future endeavors too, Tracey, I notice your name pointing to a new website about quizes. I’m going to keep an eye on that!

  5. says

    Thanks Rob it’s really generous of you to share this information. I think you get the affiliate stuff, e-book and advertising just right. I say this as someone who is very sensitive to any hint of overselling.

    Incidentally I despaired at seeing Peeatwork’s pathetically naive comments on your last post “Why I Love Running My Own Web Design Business”.

      • says

        Cheers, Paul, yes I’m pleased I didn’t because I have done before and regretted it. It’s good to have dissenting voices. And you’re not a proper blogger if you haven’t had a troll or two! :)

    • says

      Thanks, David, I appreciate the feedback. I try to strike the right balance. And, yes, I agree with you about the comments about me overselling the e-book on “Why I Love Running My Own Web Design Business”. I went through that post again but I definitely hadn’t linked to the book. But, as they say, what-ever!

  6. says

    Hi Rob – thanks for publishing this info. It’s a real breath of fresh air to see some actual facts and figures. It’s good to see you’re earning money from your book. It yet again reminds me to get started on mine, but I hardly have time these days!

    I hope your sales continually increase Rob. I’m learning a lot from your posts…

    • says

      Cheers, Andrew, so you’re writing a book, are you? Cool. You’ve said it now, I’m going to hassle you about it. ;) But seriously, it’s not that difficult. And I can help you with any questions you may have.

      I’m not so sure my sales will increase, though, that was a “lucky” 6 months for a number of reasons. :)

  7. says

    Hi Rob, nice numbers ;)
    Congrats about your passive affiliate income. May I ask you one question (of course if it’s not confidential) – how many subscribers do you have on your email list?
    BR and have a nice day!
    Chris

    • says

      Hello Chris, thank you. It’s not confidential at all as it’s one of the metrics I targeted at the beginning of the year and I’ll shortly be publishing how I did with all those.

      I currently have 4,366 subscribers to my newsletters and I’m getting roughly 50 new subscriptions every week. The list has been going for over two years.

      Have a nice day yourself!

      • says

        Hi Rob – thanks for your answer. And also congrats about 50 new subscribers each week – it looks great :)
        Have a nice day too!

  8. Steve Wyman says

    Hi Rob

    Firstly not to shabby hey and extra $3K on top of your business is not to be sneezed at and more than a lot of affiliate marketers ever make in the career online !

    Youve slowly built a very useful resource. keep going and the rewards will grow (though youve got a gap to Pat’s income !! did you see he did another $20K+ month on affilaite stuff.. Blue host is paying him enough to be in the high tax bracket in the uk alone just that one affiliate!)

    By the way you EBOOK IS PASSIVE INCOME. write it once even if it take a year and then do no more and its pretty darn passive to me.. even the odd email promotion its still hardly working to make money.

    I to remain a huge fan of 4 hour work week. Not because i follow it (im normal at it 60+ BUT because it expands the mind away from limiting work earn live concepts.

    regards

    • says

      Hey, Steve, thanks for the encouraging words. I would actually say Pat’s probably my favorite blogger at the moment.

      I’ve got to focus on running my design business as that is where most of my income comes from. However, the passive income side does interest me and it has done for at least the last two years.

      I really don’t think anyone does a 4 hour work-week – that was just a great title that Tim Ferriss invented. It annoys some people but I always knew it was part of the concept not the reality of what Ferriss was saying.

      It’s been a while since I read the 4 Hour Work-Week but it must have had a bearing on what I’ve done in my business and on my blog recently.

      • says

        Hi rob

        I agree i dont think anybody does it. Nor do i believe that was his idea. Marketting got in the way of a great book title.

        After all its mostly about
        1) create a system
        2) prove it
        3) outsource the mundane
        4) go back and systematicly improve the process.
        5) outsource the rest
        6) monitor the system.

        Given that I could work 4 hours a week and make just as much money. However as i need to grow then I work 6 hours a week. And of course if google would leave the algo alone i would have less variables and grow faster

        • says

          Yes, Steve, but if I could have a dollar for every time I’ve recommended that book to someone and they say “4 hour work-week, that’s stupid!” But, I think great marketing and great title – even if it puts some people off.

          And, thanks for your great 6 pointed synopsis. As I say, ages since I read it now and it’s good to be reminded.

          Here’s to our accelerated growth from now on! :)

  9. says

    Another great source for passive income is Cafe Press. I designed a few clever shirts and every month or so I get a lump sum in PayPal. You can even sell printed versions of your ebooks on CafePress.

    • says

      Hello Brandy, that’s awesome! I would be really great to find out all the passive sources of income that designers can make use of. There’s putting graphics in stock photo agencies and graphics’ sites. You can design and write themes, etc. I never knew about CafePress, that’s great. :) You should have linked to one of your t-shirts!

  10. says

    Thank you for showing your numbers, Rob. I am adding a tech section to my (recently created) Web site, so it was helpful to see how popular hosting and templates are.

    For my Web site, I did just as you suggest above, which is to find out if my favorite products have affiliate programs. I have been researching non-GMO food, water filters and superfoods because I expect far worse economic problems soon, plus food problems. And I do not believe we should be ingesting much of what corporations and cities put into food and water. I was surprised to learn what could be removed from you once it gets in.

    My outlook for the immediate future is a bit bleak, because I think our currency problems will hurt people. But if things go sour on us for a while, we will know what to do better next time. I don’t think we’re all going to lose our computers and go back to the farm. I think we’re going to choose to do some growing, or at least know our local farmers.

    And I think we will do even more skilled work with our computers at home. That works so well both for economics and lifestyle that I expect it’s here to stay.

    We are one another’s information upgrades! Wheeeee! I love the Internet!

      • says

        Hello Theron, glad you liked the numbers. I think a lot more people working from home would help the economy and the environment.

        Brandy’s link to Cafepress was relevant to the subject of the article, interesting to the readers and it wasn’t her website. These are the only sort of links we allow. Your name here clicks through to your website so if people want to go there they can.

        I know from experience that you really don’t want to allow people to post irrelevant links in blog comments. The spammers will come and they take a lot of clearing up after them.

        • says

          Whoops, I have inadvertently wandered into a description of why I created the site. This was careless thinking and writing, so I apologize.

          But I promise I was being conversational, and not spamming. The main reason I have my site is to communicate more widely what I normally tell other people. I’m only just starting to sign up for affiliate programs, and to pursue the one network marketing program I really like.

          I appreciated learning what you earned with tech affiliate programs because now I know it’s financially worth learning to get traffic. Also wanted to share my results at doing as you suggested, to look for affiliate programs for favorite products. If a particular producer does not have an affiliate program, there is probably a reseller that carries their product.

          My site’s affiliate links are along those lines. They all came from reading about what is missing from the soils, what removes radiation or chlorine, etc. I did not investigate these things to make money. But I have learned you can already buy science-based, or at least obviously sensible, solutions for all sorts of problems. This is why I call the Internet “our information upgrade”. The difference between living to 75, or living to 95, or avoiding something unhealthy, can be just a simple bit of information. And then there are the utter calamities they do not tell us about on TV.

          Well, that is why I am a bit preoccupied with the topic. May I humbly recommend to affiliate marketers pure foods, superfoods and health remedies. These are both a very large market, and good investments in time and learning.

          Your site has hardly any advertising on it at all, so I am surprised that you ask if it seems excessive. You have far more original content than outside links. And I think you have showcased your two books intelligently and tastefully.

          One reason I did not take to Internet marketing more quickly is that most of the tutorials focus on how to close sales using various tricks. Many affiliate sites do things like ask, “Do you really want to navigate away from this page?” when you click Close. Rubs me the wrong way.

          Your book advertisements are nothing like that. And they are placed next to your free articles about how to do work you normally perform for your clients. I find good information on the more sales-oriented sites, and I do not mind lots of advertising if the products are good. But visiting your site is more like peering into your shop window.

          • says

            Theron, thanks again for your comment. Please don’t think that I was labelling you as a spammer! I really appreciate the information you gave about your site, I was just being ultra-picky about you linking to it in the body of the comment as the link is already there with your name in the anchor text. I unfortunately had a lot of spam comments here a few years ago and it’s obviously made me ultra-sensitive.

            Your niche looks very interesting and I’m sure you are going about it the right way. You are trying to help people first and then searching out the affiliate opportunities second. I’m 100% sure this is the correct way to do it.

            Yes, Internet Marketing tactics annoy us all, particularly the pop-up that tries to stop us leaving the site. But I have been accused of over-selling my products here so I’m careful not to be tarred with that same brush!

            Thank you for your kind comments about my site and I hope you see more success with yours. I am trying to live in a more sustainable way and more in harmony with my surroundings and I love the topic you write about!

  11. says

    I’m glad to be exonerated of wrong intentions. This was actually my second experiment with posting on a blog. It was very educational! I see that having good intentions does get me off the hook for such things as oafish wanderings.

    Don’t blame you one bit for being on the lookout for spammers. I am going to read your article on HTML contact forms, because the plug-in I’m using gets spammed every day.

    I also happened to find an article where someone accused you of “peddling” your book. I think he or she was just trying to get your goat (by writing, “Peddle, peddle, peddle.”.) Does the grocer “peddle” his food and wares, putting signs in his window, telling people he’s got a sale on? Pretty much everyone who offers services or goods to others is already working for free by setting up, and then making themselves available.

    To make this post affiliate-related, I will mention that Clickbank.com, through which you publish your book, has been around for years and has made people a lot of money. Nearly everyone can think of something they know or know how to do, and now anyone can publish a book on it, and use Clickbank.com’s excellent affiliate system to sell it.

    • says

      Hello Theron, thank you again for your input. Yes, you do have to put up with spammers and trolls – they are part of the rough that you have to take with the smooth when you have your own blog.

      I hope you’ll find stuff here that will be useful for you and your niche. Yes, Clickbank is a very successful company and a great way to offer your product to affiliates.

  12. Yves says

    I put ads from Adsense and affiliate links in three blogs unsuccessfully. Do you know any successful advertising programs and affiliate companies out there?

    • says

      Hello Yves. This is a huge area which I can’t really do justice to here but I will be writing more about this. The short answer is it depends of the sites themselves. If they aren’t attracting large numbers of engaged visitors you won’t make any money with ads or affiliate links.

      Adsense, although I don’t personally like it or use it, is probably the best ad network to use.

      In my opinion, you should be an affiliate for a product that you personally use and know of its benefits.

  13. says

    Hi Rob. Thanks for reminding me on this. It is always in the back of my mind to attempt passive income but I just need to think of an idea first, which is the hard part. I know that affiliate advertising is a possible way, but can you recommend any good books to read to get the brain cells working?

    • says

      Hi there, Mark. A few people are asking me this now and I’m not really sure about books that you can use. There are so many different types of affiliate products and vendors, it’s unlikely that there’ll be one resource to “get the brain cells working” for all of them.

      Since you are in the same niche as me, you could think of linking to your host in your footer – presuming that you’re happy with the server speed and support. And then if you’ve used any premium WordPress plugin or theme in the course of your work you could write an article about how to use it along with an affiliate link.

  14. says

    Rob you’re a good man. I like the transparency path too and am progressing more towards that. I’m always surprised at how my clients open up more once they sense the openness from me. I think its the way to go.

    I don’t come to your site much but I’m always impressed when I do. I feel you could email me more often and I wouldn’t consider it spamming. I guess the key distinction is that every time I get an email from you it has a link to really valuable info in it. So as long as you keep that up I’d be fine with it. Maybe you could consider a short broadcast to your email subscriber list every time you write a new blog post once a week. That way, you’d keep yourself top of mind to me and I’d edge closer to purchasing an ebook. Currently I only hear from you on average once a month it seems. So I kind of forget about you inbetween emails.

    So I guess what I would summarise with is – As long as the information is valuable and not 90% hype up and only 10% valuable info, I don’t think you will ever be accused of spamming. Not by me anyway.

    Keep it up and thanks heaps for all your help so far.

    Andy

    • says

      Hello Andy, you are making very good points about my emailing and at a very pertinent moment. You’re right I have neglected it recently. I have found it difficult to develop a regular habit of emailing out every one or two weeks, for example.

      Why? Well, I try to write a blog post every week. I also have to work and do other things! :) You know how it is! I also get a lot of unsubscribes each time I mail out (maybe as many as 100 each time – although that figure will drop the more I mail out). I also like to wait until I have real quality to talk about. For example, I was happy to mail about this post because it really seemed to resonate with my readers so I knew (or hoped) the email list would like it.

      Point taken, Andy, I will try to reduce the time between each mail out from now on.

  15. Josh says

    Oh, it is good to see affiliate marketing is working. Im affiliate just 4 months but no result :( Where did you learned that things to be successful? How much did you invest to begin with? Where to begin?

    Watching you through RSS ;) Realy thanx for this blog and keep it up.

    • says

      I set up a blog that was helpful first and then only promoted products that I had used myself. I was more focussed on creating a good website with lots of traffic as that was bringing in work. The affiliate income came a few years later. Many people will tell you to do it this way as it builds trust and authority. I never invested any money, just domain registration and hosting. Hope you continue to hook up through the RSS, Josh!

  16. says

    I would say that many people who come to your site are eager to read items such as this as many; to be fair and honest; want to be able to make passive income; but of those; like myself; find it hard to make passive income.

    I think what you did in the mentioned emails was actually a good way to approach it and not just having items in the sidebars. I mean, how many of us actually look at the sidebars and how many of us click links in mails. I know the later I do quite often.

    I think you have given a good example here of how to do it AND that you can make passive income.

  17. says

    Hey Rob,
    Thanks for sharing your personal experience with your own products and affiliate marketing. I also do affiliate marketing and I am thinking about launching my own products soon. I am currently experimenting with an e-book about using facebook as a catalyst for sales but its free to download at my website, Easy Passive Income Ideas, for the moment. (trying to get some feedback and smooth out the rough edges before I launch anything)

    I would really be interested in hearing more about your own experiences with launching your products and the pitfalls you have faced generating sales. Maybe we could swap some stories. :)

    Cheers,
    Jameson G.

    • says

      Hello Jameson, I would definitely spend some time on your free product and building up your list and following first before you go for the paid products. I didn’t do much for the “launches” just sold to my list at a cut price first.

      I’ll try to write about blog post about this soon. Thanks for your comment.