Building Residual Income
Through Internet Marketing

Before we go into the complexities of Internet Marketing, let me first give you a little background on how I went from absolute miserable failure to consistent success in just 2 1/2 years.  In the process I proved that the old adage "It Takes Money To Make Money" is completely false.  In fact, it wasn't until I was absolutely flat broke and in debt up to my eyeballs that I started to succeed.  In addition, I proved that sometimes you do have to hit rock bottom before things can turn around.

Over the past few years I've learned that developing proper cash flow is far more important than your level of Assets.  I used to think of my goals in terms of building net worth, $1 million dollars is a commonly mentioned goal.  But focusing on such a large goal can be discouraging.  I was in debt up to my eyeballs, so I was actually over $140,000 below zero.   I found it discouraging to think about the fact that I needed to claw my way back to zero before I could even begin socking away a million dollars.   That's when I changed my strategy and began to focus on cash flow.

Cash Flow is a much better place to focus, because you can make immediate progress.   We live in an instant gratification world, so immediate progress is very important.  If you see immediate benefits, you are more likely to stay on track.  The biggest culprit to your financial security is persistent negative cash flow.  From 1996 when I began my internet marketing career until mid 2000 I had 52 months of negative cash flow!  Many of these months I bled to the tune of $3,000 or more, so by mid 2000 I was in terrible financial shape.  I finally just stopped everything and went back to the drawing board.

From this point forward I'm going to share with you exactly what I did to turn my life around 180 degrees in 2 1/2 years.  Now I enjoy a positive cash flow each and every month that exceeds my living expenses, all it took was getting on the right path and following the steps I outline below.

#1  -  I had to get my head on straight, aligning my business with my core beliefs.  This doesn't need to be a religious experience as it was for me, but your business needs be aligned with your beliefs.  If not, you will constantly be struggling with feelings of guilt and even if you make money it will be unfulfilling.   That is the reason I have decided to build this course, so I can help people become successful instead of simply marketing a product or service to make money.

I grew up in a Christian home, but I have often strayed far off the path.  For nearly 12 years (1988 to 2000) I had been relying 100% on my own abilities, talents and knowledge thinking that I could make it on my own terms.  This attitude was not serving me well and looking back I think it was a major reason why I was sabotaging myself.  By giving up and asking the Lord to lead the way for me, it took the pressure off.  Since the night I came to terms with God, I have never struggled the way I did the 12 years preceding it.  When I start to feel uneasy or have those negative feelings returning, I stop and re-evaluate.

#2 - My Cash Flow Was Negative, So I Made Immediate Changes.  Regardless of where you are right now, you can make immediate improvements in your cash flow starting today.  Stability is the key to being able to pursue your dreams and the first step to stability is "stopping the bleeding".  

For me this included picking up a part time job at UPS (which included health benefits), canceling monthly subscriptions to things that weren't crucial and cutting back to basic cable.  In addition, I quit stopping for lattes in the morning and quit eating out everyday for lunch.   Just the lattes and lunches were about $200/mo so by cutting back to one lunch per week and 1 latte I cut that expense by 80%.  The spending changes all together released about $220 per month that I began using to pay down one of my credit cards.  In addition, my part time job brought in about $800 per month and paid for my health coverage which had been costing me $150 /mo.  So all together the positive changes were nearly $1200 per month.

I chose to use the extra earnings and savings to pay down my credit card that had the smallest balance.  At the time, that card was at an APR of 24.99% which was absolutely ridiculous.   Much of my negative cash flow was due to all the interest I was paying on my raked up credit cards, but I knew if I could get one paid off they would send me a cheap balance transfer offer.   I had about a $5000 balance on that credit card, so if I stayed on course it would take me about 5 months to pay off the first credit card.  I'm getting off the topic,  so if you want you can read more about how I paid off all my debt.

#3 - I Had To Develop A Positive Cash Flow For My Business On A Shoe String Budget With Zero Downside Risk.  For the previous 12 years I had consistently taken big risks in hopes of making money fast.  I often placed oversized bets on hunches and hired consultants who claimed they could put my business on the fast track.  Near the end of my free fall in 2000 one consultant took me for $14,000 and added $0 to my revenue while adding thousands to my expenses.  It was the straw that broke the camel's back, it was the end of high rolling days.  I had spent thousands and thousands of dollars and had absolutely nothing to show for it.

But Everything Was About To Change!

One day I was looking through my Commission Junction account and noticed that I had made $25.00 on one of my web sites.  Compared to my staggering debt, it shouldn't have been any cause for excitement but I was truly excited.  The reason for my excitement was the fact that this was the first time I made a passive online sale without any human interaction.  I knew that if it was possible to make one sale, I could make hundreds of sales.   If I had decent conversion rates, I could afford to buy advertising and it would pay for itself.   All I had to do is figure out how many visitors it took to make one sale, then I could simply purchase advertising and pocket the difference between my cost of advertising and the commission I was paid.

Pay Per Click Search Engine Advertising is the way to go when testing any new marketing idea.  You can start out with $50 - 200 (depending on the cost of clicks) and by the end of your test you will have a good idea whether or not you have a successful idea.

Critical Knowledge:  How To Test An Idea

First, I use the keyword search tool offered by Google to determine what people are searching for in that particular area.

Second, once I find what people are typing in I click to show the average CPC or what people are paying to advertise for that keyword.

In my case, I found that I could spend about $8.00 in order to make $25 so it was obvious that I should buy as much advertising as possible at that price.  I had tested my concept using Overture which has since been purchased by Yahoo.  I immediately expanded my number of keywords in order to get more traffic and found that I could make about 100 sales per month ( $2500 ) for $800-900 worth of advertising.  Best of all, these were affiliate sales so I didn't have any interaction with my customers.  I could go about my business and have this working for me in the background.  Each morning I would wake up and login to my account to see how much money I had made.  It was very exciting.

You get what you pay for when it comes to search engine advertising.  The only sites I have had good conversions from are Overture and Google.  Overture is the most expensive but I've had the absolute results from them, I believe they have fewer issues with click fraud than Google.  But both are excellent sources for test marketing and getting sales flowing quickly.  

Yahoo! Search Marketing - (Formerly Overture)

Google Adwords

If you are trying to make sales, avoid all the lesser known search engines.  

I began capturing people's names and email addresses and adding them to my database as they came through my websites.   That way when new offers came out, I could email the entire database and let them know about the new offer.  Since email was free, this dramatically increased my profitability.  Since that time I have always tried to incorporate database marketing into whatever I was doing.  It's less effective now due to all the spam filters, but the cost is so low it still provides a very positive return on your investment.  Building prospect and customer lists are a basic staple of all successful marketing businesses whether online or offline.

Since that time the capturing of someone's name and email address prior to delivering relevant content has become the staple of internet marketing.  Even though it's more difficult to reach someone via email than it used to be, it's still the most cost effective promotion tool in existence.  Today, there are more options than ever and more sophisticated database systems that offer more features. 

How Do You Get Started?

Getting started today is much easier than it was 10 years ago when I began trying to market online.  Today all the information you need is available in just a couple online courses.  DON'T BUY the big expensive $300-400 internet marketing courses, they are filled with fluff that is not necessary! 

1. You are simply trying to sell the wrong product or service. 
2. You are using the wrong techniques and are not correctly reaching the Target market.
3. You really aren't putting much effort into it and are looking for short cuts.

Looking back, I now realize that prior to July 2000 I was guilty of all 3 of these!  That's why I found myself on the verge of bankruptcy.  I changed my habits and my finances turned around as well.