Steve Dotto here.
How the heck are you doing this fine day?
Me?
I would like to wish you a really happy new
year because this is the first vlog that I’m
delivering of 2015 and I want to wish my entire
community a really prosperous, happy and healthy
new year in 2015 as we move ahead.
Today as I was taking a look back at the year
that was, I wanted to pick one thing that
surprised the heck out of me in this journey
of growing my YouTube channel and building
a business out of YouTube for this vlog, for
Growing Your YouTube Channel to 100,000 Subscribers.
When I looked back at the year that was, the
thing that just gob-stopped me and has completely
surprised me is the community’s engagement
in Patreon, the crowd-funding site that is
not generating a fairly substantial amount
of revenue as far as I’m concerned and I
think as the year goes ahead will become my
most significant revenue source.
So we’re going to take a look today, a revisit,
a remix, at Patreon on DottoTech.
I began this whole project, Growing Your YouTube
Channel to 100,000 Subscribers and actually
this whole YouTube project of building a community
on YouTube to see if I could recreate the
success that I had on television, to see if
YouTube could indeed support a content creator
and could be the basis for moving ahead.
I didn’t have any preconceived notions about
where I was going to make money and how I
was going to make revenue.
I knew there were opportunities out there
to do digital products and sell courses, to
get advertising revenue from AdSense and other
things, consulting, other things would come
along as result of creating authority through
a YouTube channel and building a community
through the YouTube channel.
All of those have generated revenue.
Some were more successful than others.
We’ll talk about them as the year goes on.
Certainly, the digital products are doing
quite well and we’ll be talking about the
digital products as they relate to Patreon.
But the thing that shocked the heck out of
me this year was when I launched a Patreon
campaign.
Now Patreon is crowd-funding for content creators.
It’s like Kickstarter for content creators.
What happens is you basically go to a community
and you say help me create content by financially
supporting me and I’ll give you some perks.
There will be some benefits attached to being
a part of this community.
For me, what this became was a place that
people could come and the pitch that I put
out at the beginning was if you help me by
giving me a little bit of money, then I don’t
have to spend all my time looking for advertising
revenue and I can create more and better content
and people responded quite well.
We launched the Patreon campaign a little
over six months ago, maybe seven months ago
and immediately we had some traction.
People were saying yeah, I get that, Steve.
They were giving me $1 a month and $5 a month,
very small amounts of money which basically
said to me that they were supporting my endeavors.
As a content creator, it was awesome.
It was a really affirming feeling to have
people staying and actually paying money.
When my money came in and the first month
ended and I think $350 or so came into my
account, I was like wow, that is so cool!
But I didn’t really even at that point say
this is going to be the main pillar.
This is going to be where I’m going to make
most of my money moving ahead because I didn’t
really have a sense of what the difference
was in what a patronage site, a crowd-funding
site like this could represent.
As the year moved on, it slowly increased
until the point that I looked at it—I don’t
know what caused me to make this change but
as I was looking at it, I thought what I want
to do is—I guess in September when I created
a really nice new little course, my Evernote
Made Easy course, when I created that course
I said I should really make that course available
to the people who are supporting me on Patreon.
So at the $10 level of patronage, the people
who were supporting me at $10/month—this
was starting on October, I think, I out it
out—I said hey, if you’re a patron, thank
you for your support and I’ve got this new
course that I developed.
It’s normally $97 but as a perk of your
patronage, I will give it to you for free.
People responded immediately.
All of a sudden, I had people upgrading their
account, new people were signing up and everybody
that I started at the end of my sales webinar,
I was talking about—now there’s a two-edged
sword here because I was telling people they
could buy it for $97 or they could join me
on Patreon at $10/month and they could access
to the same content.
So people immediately said, what happens if
I just sign up for a month and then I unsubscribe;
do I get the course still?
Of course, you still get the course.
If you’re the sort of person that wants
to do that then I wasn’t going to worry
about plugging all of the loopholes.
I guess it was a pretty big loophole but I
wasn’t going to worry about plugging it
because think the idea of community means
that there’s a certain type of person that’s
going to be attracted to it and if you’re
going to do that, you probably weren’t going
to be a member of my community anyways.
Besides, I also offered a money-back guarantee
on the course so you could always ask for
your money back anyways and you would have
gotten your money back.
So there were ways to get the course for free
if you really wanted to.
Frankly, if somebody wants the course for
free and they were going to do one of those
things, I would rather they would just write
and say Steve, give me the course for free
please or I’ll just do one of these other
things.
Then I’ll just save you the trouble and
send you the course for free.
Having said that, the idea of community is
what was important here.
As I started to see more and more traction,
as people started to jump onto Patreon at
that $10 level, I saw the number increasing
pretty dramatically.
Then we launched another course.
I did another one with Mike Vardy and poor
Mike Vardy, he jumps on and he helps me build
this Task Apps Made Easy course.
I included it in my patronage because I didn’t
think that it was going to be that huge on
Patreon.
I thought that other people were going to
buy it but indeed a lot of people jumped on
that as well.
Even though they could get the bundle for
$149, people still chose to get the course
a lot on Patreon.
Mike includes it in his Patreon site as well.
But regardless as this moved along, a shift
happened in my mind, in the way that I looked
at things.
I recognized that I was basically able with
this Patreon support, with including these
courses in Patreon as a course at the $10
level, I had created a sort of membership
system.
I could have quite easily taken all of my
own content and out of my own website created
a membership site where you pay me $10, $20
or $30 a month and you get access to all of
the content at a membership site and you just
give the money directly to me.
Those work well.
Lots of people use those and they’re very,
very successful.
But there’s a psychological relationship
that happens then and the fact that if you
join the membership site, you are my customer.
You’re purchasing content from me.
Keep that in mind and then think of what happens
at Patreon.
At Patreon, the people come in with an attitude
of I’m supporting you.
I’m not so much paying for what you’re
going to give me as supporting you to create
new content in the future.
That’s the philosophy behind Patreon.
It’s about content creation.
So when they get the stuff in the past, it’s
a perk as opposed to something they’re purchasing
from you.
So people don’t feel like they’re your
customer.
Instead, they feel like they’re your patrons.
They are supporting you.
The feeling for me is the same.
It’s not so much that you’re my customer
but you’re a supporter of my community.
There’s just a slightly different philosophical
feel to it.
Does that make sense?
I think it does if you stop and think about
it.
So I started to recognize this.
It takes a while sometimes but the light started
to dawn in November and all through November
I was thinking how am I going to approach
Patreon, moving ahead into 2015?
It crystallized in my mind what I should be
doing and how perhaps you can be looking at
using Patreon moving ahead.
What I decided to do is I decided to take
Patreon and I decided to push my courses as
much as possible, all of this new content
I was going to create into the Patreon community.
There were already several hundred people
in the community so there were people that
were going to appreciate that content coming
down the pipe to them, A, but it also seemed
to be a very easy sell, to ask people for
$10 or $20 a month to support you on Patreon
as opposed to ask them for $100 to $200 to
$300 or $400 to purchase a course outright.
That was the philosophy that I thought about
moving ahead.
Now there are a couple of caveats to that.
When I launch a brand new course, I don’t
think that it should be available to the patrons
of Patreon immediately.
I think there should be a window, six weeks
maybe, where I could launch it and I can actually
sell it and I can include some extra little
perks to people that are selling and then
make it available to people on Patreon.
That’s still something that I’m working
out in my mind but I think that that’s a
reasonable way to approach it, especially
some of my high-ranked courses that I’m
developing around content publishing, around
YouTube publishing that take a lot of time
and effort to produce the course, there should
be a time that I could sell it as a fixed
product as well.
That’s what I’m doing moving ahead, looking
at Patreon as potentially the best revenue
source for me.
I am basically planning an editorial schedule
now of releasing products into Patreon.
So what I had to do was I had to make some
decisions now.
Patreon has—you can see the numbers here—we’re
now just a little bit over six months into
it and we’re sitting at nearly $2,700 a
month in revenue already off of it.
This is not insignificant as far as I’m
concerned and if this has grown this fast,
if we’re growing by $2,500 in about six
months, if I can do that same growth rate
by the end of 2015, you could see how this
could be a significant part of any independent
producer’s income.
So that’s my plan.
Having looked at that, I had to take a look
at this which is the pledge structure, exactly
what you get for what you give.
I’ve always wanted to reduce the numbers.
I’m actually a little bit stuck with this
idea because I’d like to get rid of this
$5 a month pledge and just have $1 a month
and then let people add maybe anywhere between
$1 and $10 and not actually have a fixed number
like this just so there’s one less thing
for them to look at.
But I don’t know how to do that with the
existing people.
It’s something I’ll have to talk to people
at Patreon about.
But once we hit this $10/month level, that’s
where real money as far as I’m concerned
starts to come into me and that’s where
the really valuable perks should start to
go out to the patrons.
What I’ve decided I’m doing is I’ve
tiered my content because I have two different
audiences.
I have you folks who are the audience that’s
interested in webcasting, podcasting, screencasting,
YouTube publishing and in social media and
internet marketing, which is what this vlog
is really all about.
Then I have my productivity audience.
Now some of you cross over but then I have
my productivity audience that’s interested
in Gmail, in Evernote and in the iPhones and
that sort of stuff.
So what I’ve decided to do is take all of
my productivity-based courses, the Evernote
courses that I’m doing, the task manager
courses, any courses I do in that space and
make that available to the people who are
at the $10/month level because those courses
are all going to be $97 and that’s what
I perceive as good value for those courses.
So I’m going to slot those in as perks at
the $10/month level.
I think people are willing to spend a little
bit more money if they can make money and
the things that I’m teaching in the YouTube
course that I’m creating and the webinar
courses that I’m developing right now, that’s
going to help people create revenue themselves.
So I’m going to set up at the $20/month
level access to those services.
So if you want to take my YouTube course,
if you want to take my webinar course, if
you’re sponsoring me at $20 a month, you’ll
get access to those courses.
Then if people want both, we will have a tier
$25/month which basically gives people access
to all of the courses.
I think that this ultimately is going to really
accelerate the revenue into my channel and
into my enterprise because of the philosophical
feeling of support rather than purchasing
and it’s a nice, reasonable dollar value
that people can handle without breaking the
bank that they get a lot of good value from.
They know that they’re going to be getting
good courses coming down the pipe, plus they
get early access to other videos and other
things.
But primarily, it’s all about the courses.
So this is a little philosophically different
and what this does for me as a content creator
is it takes off a lot of pressure because
here’s one of the challenges with just selling
information products which is the model most
internet marketers are following.
It’s feast or famine.
Either you’re in development or launch all
the time.
By that I mean either you’re building a
new course, figuring out what your audience
wants and then selling that course or building
it up to the point where you can launch it
and then sell it or you’re in that sale
cycle where you’re selling it but in between
the two when you’re not selling or promoting
a course actively, your revenue is going to
dry up pretty significantly.
So creating a consistent passive income stream
is really what Patreon can bring to the table.
That’s exactly what I see starting to happen.
As I say, this was a complete surprise to
me.
I fully expected Patreon to be a nice aside
to kind of generate the same amount of revenue
that maybe AdSense was generating but it has
already passed my AdSense revenue just six
months in.
It also seems to be far more scalable that
I might have believed at the beginning.
So once I’ve launched a product now and
future webinars when I’m promoting it, I’ll
be doing less selling of the products and
more pushing people towards Patreon, getting
them into the community and at that point
there, it takes a lot of the pressure off
because every month we have money coming in.
That’s what’s happening with the business
side of Patreon.
I think it has grown to the point now where
all content creators have to take a good,
long, hard look at it.
YouTube is.
They have their own content creator’s model
with kind of a tip jar that they’ve been
putting forward to compete with Patreon.
At least, I believe it’s going to compete
with Patreon.
Unfortunately for me, they’ve authorized
me for the program, sent me an invitation
to the program.
When I replied, they said oh thanks for your
interest but it’s not available in your
country.
Apparently, Canada doesn’t have it yet so
they will let me know when it’s available.
Some of you might actually have it already.
If you do, please let us know.
If you can comment down below exactly what’s
happening with it, let us know what’s going
on.
I hope you found this interesting today.
I know it seems very narcissistic as I talk
about me, me, me, me and how I’m producing
this content but really we’ve been using
the DottoTech channel as a testing bed and
it’s the only one that I have control over
so I have to basically talk about me, me,
me if I’m going to show you what we’ve
been doing and what we’ve learned.
What I have learned, the biggest lesson from
2014 is crowd-funding is definitely worth
taking a good, long, hard look at and getting
your head around the difference between selling
a product and being basically the mentor of
a community and what the difference is for
your customers from being an audience to customers
now to being patrons, to being supporters
of your community, of your channel.
That’s a pretty profound shift and it’s
one that could indeed carry you forward business-wise
as you move ahead.
This channel here or this video series here
is brought to you by Patreon.
I make it ad-free and it’s supported by
the community.
If you are interested in taking look at my
Patreon page, I encourage you to have a look.
The link is here.
Also, don’t forget to of course subscribe
to this channel and sign up for our newsletter
for all of our upcoming webinars as we’re
going to be concentrating really hard this
year on webinars on webinars, teaching people
how to create webinars which I think is probably
the best way to actively grow your market.
Obviously, YouTube is a big part of the whole
entire growth process but it fits very nicely
with the whole webinar process and creating
an event is such a powerful thing.
I think webinars are the way it’s going
to be going this coming year.
With that, I am done.
Till next time, I’m Steve Dotto.
Have fun storming the castle.
