Creative Ways to Get Extra Income on Sales
In the last session, we talked about marketing and now we want to get into a new set of sources of income actually a whole bunch of stuff it's about getting really creative about what you can d'oh based on all kinds of aspects of your music business and your relationship with your fans. Now, I think we alluded to this before the break how we were going to talk about methods to basically get an extra cut out of every time you make a sale on something like itunes and it actually goes beyond that, it actually is for all kinds of aspects of your music business, so let's get into is the funny thing is I just wanted to tell you before we dive into it is that we've explained this many times to many different people I think one of the last times we borrowed up was in front of the grammy association when we spoke to them and we had a lot of people saying, well, how come more people aren't doing this? And we I just kept saying I think it's just because they don't know yeah, so we're really happy...
to be able to share this with you I think you're gonna want oh, implement this it's very easy to d'oh it's yet another type of thing where you could just kind of do it in a weekend and get it done so how can you make money based on your fan base and the relationship with your fans, which sounds like a kind of a very tenuous thing and if you're just starting out, you might be thinking I don't have a fan base yet that's okay, we will take you from ground floor all the way up to having a really huge fan base this technique could be used for everybody and we'll explain why in a second the term is called affiliate sales now this is something that people very experienced with the internet with blogging was new media with basically doing podcasting all kinds of mechanisms where they develop a fan base where they find out a way to use this and now that you're musicians and you're sort of looking at this, you're going to realize while I can apply this to their free that's another thing about it most of what we've talked to you about today it's free to participate and so you're going to make money right away as soon as you start using it here's how it works imagine you were an e commerce site you want business, you want people buying stuff and the way that you would normally do this is just advertising right? You would put ads in newspapers or get your message in front of his many people as possible and on the internet though we have ah way to track what happens so what they do is they create a way to make a special link that a person like a blogger yourselves khun make so that they know that you are sending them business and therefore they actually know where it's coming from and they can reward you by giving you a percentage of the sales but the customer buys that's how it works so let me tell you this there's atleast one reason you have to drive sales traffic to their businesses at least one your music right so you might be thinking all that seems kind of cheesy m already selling my music why would they give me an extra cut? Well these programs air really big there for everybody who sends traffic they don't know that they're happy that you are telling your fans to buy your music in their store as opposed to other stores that's how it works and why they let you do it now what you do is instead of making a regular itunes link you make an affiliate link instead and therefore you get a percentage of the sale for each song the fan bias that's on top of the normal cut you get on the back end so you're going to be getting a different check here the back in check is going to be coming from your digital aggregator which we talked about on the very first day this check is going to become from whoever handles the affiliates and of course the money originally comes from in the case of itunes for example comes from apple that's how they generate that and here's the best part if your fan decides to buy anything else any music you get a cut of that sale too so then they go there and they're in itunes is like hey people about this about this like I like that by that oh yeah yeah the avengers you might like that by that movie you get a cut of everything that they buy in fact you get it depending on how the affiliates site works you might get a cut of everything they buy for the next week because you sent them there you actually had a fan show up in their sight now we haven't talked about this too much but talking about getting marketing and getting actions done one of the hardest things that there is is to get somebody to just do something right especially when it comes to physically move moving themselves so showing up a gigs tough you've got a lot of hurdles still overcome together to do it getting him to come to it a commerce site is hard so again putting yourself in their heads how do we get more people show up on my site? I know I will give incentives for people who are out there who have some kind of fan base at all to do this doesn't cost them anything so they're happy to give it to somebody who's unproven and doesn't can't even prove that they have a fan base yet they don't care and because the moment that you do your very first song sale you could just make an affiliate link out of it now you're getting an extra cut out of it see why I was saying earlier people like well why doesn't everybody do this? It just makes sense but it gets better than that why stop it? Just music affiliate sales happen for everything on the internet absolutely anything that's out there so when they give you an example if for example you blogged about the fact that you just bought a new tv and you thought it had a lot of cool features like it had wireless and it was plugged into the internet and you could just do netflix right a hundred or something like that and you provide an affiliate link to the tv that you're just talking about that you just bought and people some fan buys it you get a percentage of that sale actually and anything else that they purchased by the way in that session or maybe they go there and the like oh nice tv I don't really need to need tv right now but maybe they say hey this I need a new computer and then they buy the new computer on something like amazon you get a percentage of that sale, too all starts with that link, and so all you have to do is make an affiliate link instead of a regular link. All you have to do is think of every place that you would normally go and talk about when you're just doing the normal thing that you d'oh and provide this. Now if it will make you more comfortable, you can tell your fans yep, I get an affiliate link out of this or I get an affiliate cut, but you don't have tio it's not necessary because this is common on the internet is very normal. You're just talking about the thing you normally dio we're not telling you not to be genuine, we're not telling you that you should go out and just talk about all the products all the time. It's actually, just about using the normal type of communication you have with your fans, starting with just your music and moving on to other things. In fact, considering that you're trying to be genuine, what we're going to give you is a very natural affiliate idea next one that you could just do that. I think that every musician we've ever told sue says, yeah, that makes a lot of sense. First of all, what you do is you make a page on your website that talks about all the gear that you use let's face it aa lot of fans are really interested in what you d'oh, right? They want to know what kind of instruments you have, what models which software used to put it together. They even want to know how you do it. And you know what? You should share that. That sounds like a great idea, considering that for the new gear that you talk about that you have, you can affiliate through guitar center and musicians, friend and music one, two, three. And instead of just saying, hey, this is the piece of gear that I have, and then you have a link to it, you make an affiliate link instead, they also allow you to legally use the photos on your site so that you can show off what basically you're talking about, and that makes your site much more colorful and interesting in the first place, and then for older gear for anything that say, out of print let's say you have a nineteen, seventy two fender stratocaster, you can do an affiliate with ebay, and what that will do is allow you to create a search link, which brings the latest items that are for sale for that particular model, so that means that everything that you use as a musician is fair game and people can go on the internet find a way to buy it because that's what ebay and other sites allow you to d'oh and you can start making an income or partial part of your income just off of this now any questions about this first of all, this is actually a really key topic and it's just a few slides but it's that easy yeah you're probably going to go into about do you actually get paid to do this? Okay, yeah, well that a second so let me let me hit a few more slides and we'll ask again we'll see how we're doing so the tax I d is important remember we said that there's three parts to every transaction at the very beginning if anybody here remember I don't know for the very first day yeah a middleman and you so the customer the middleman in you the customer the reason why you have to know that the customer is is you need to know what generates the sales so you know where to target your marketing so you can either get them to do mohr of whatever it is that generate you more money or to get them to up sell to get them to do more of it, to actually get them to take the action to do more of it right the next thing is the middle man and the middleman will say what kind of percentages you might get out of this thing? And then the you part is the tax idea that gets paid because throughout this course, we've given you a lot, a lot of websites that when you sign up shortly after signing up, it's going to say what's, your social security number, what your tax I d number, you're going to be answering an e I n or a social security number, and that matters when it comes to your counting. We talked about this in the beginning, I'm not going to go into detail and all kinds of things along these lines, but it also matters for affiliates because there are some states that have restrictive laws that don't really allow anybody to do this. We have a question line. Sebastian ortega wanted to know if this affiliate sales works outside of the u s or if this is us only it's a very good question, it does it's it's all over the world now the rules are different depending on where you are, so what? You should d'oh we're going to go and give you all of the sites to go to in order to do all of these affiliates, including especially itunes, of course, but all the others that we think are really worth doing, they all our legal agreements that you're going to go through when you sign up, you should read the very carefully and see what it says about international yeah, right, yeah question very good question illinois, where we live actually made it more restrictive for us, and we couldn't affiliate with amazon anymore, which hurt us actually hurt what we were doing out there on then they just recently had a supreme illinois supreme court case, which reversed it, and they haven't quite changed all the rules so that we can start filling in again, but I'm looking forward to it. Here's the thing, your legal entity, the tax I d number that you have for that legal entity has a state that it resides in. Basically you, khun, incorporate a business in any state that you want if you're u s resident and all of these state laws actually tend to have an effect now, if you want, just because you live in a state that doesn't let you do it. If you use your regular tax I d number yeah, you'd have trouble. But if you incorporated your music business in a state like delaware, which is very friendly to business, then you won't have this problem anymore. That's that's a cz much as we can say about the legal stuff, unless we get to the end, we have a little bit of time we'd be happy to talk about it. Okay, here's how to set up affiliate sells answering your question depending on what bloggers um, whatever you do, you actually want to a sign up for affiliate programs on each site that sells the related products, right? And then you make the links using the affiliate program for each link that you share the way that you do this depends on the affiliates site that you use, but when you go to make a link, you won't make a regular link. Your your normal inclination will be to go, for example, to amazon, and then just grab what's at the top of your you are all bar and that's, not the one to grab. Amazon makes it just about easier than any other site that I've seen. They have a special affiliate bar that sort of goes over the top that says affiliate, and it gives you like a number which shows you how much money you're actually owed based on this particular periods sales, but then it will have a little thing that says make affiliate lee, and you click on that and you'll get an affiliate link, it will have a little code in the middle of it, that is your unique code that's how they track it from then on. If a fan or anybody clicks on the link, amazon will know hey, this came from this person and associated with you, and then they'll give you a percentage of all the sales that you are able to generate. All of them have different rules enters of how long the link last for how long the cookies last for some of them last for a week, some of them last for day from less for a few hours. It depends you don't really have much of a choice in this. The only thing that kind of makes it changes the affiliate rules of other sites that are similar, because if the rules get better at other sites and that their sight people will start sending the traffic to the other one that's how it works. So where should you sign up? How should you do this? Well, let's, go through this for itunes, you can go to apple, calm such itunes slash affiliates and it's the most common place fans by music. If you do nothing else and you're eligible because of where you live, you should at least do this. One amazon affiliates is the link is here, physical cd sales, amazon music and all that kind of stuff but the next slide has some really deep links remember various times we've talked about it where it's like well, you go on this link and you have a universe c j dot com and link share dot commer universes they are an affiliate middleman really they will work with websites that don't want to handle all of this affiliate stuff they just want to sell stuff and so these guys handle the relationships they have handle making sure that the advertisers which is what you're going to be going to be called an advertiser as a publisher which air the e commerce sites we'll do business with them so you first sign up with c j dot com and link share dot com you're going to put in your tax I d and then inside their sites you're going to apply to all of the various stores or services that match whatever it is that you want a link to once you're approved, you go through their system to make the affiliate links and then you just added now this is a little it sounds a little bit complicated, I swear to you once you do one of them and they're like, oh, I get this now is it worth your time? Absolutely because if you can get five percent of some bigger sales items like you start talking about a grill that you bought that you love you know on the grill is like nine hundred dollars or even better you talk about the amp that you just bought which is twelve hundred dollars in there getting five percent of a sale of one of those things this can add off and it's again completely legitimate completely natural way to interact with your fans and do this this is a great way to do things for merchandise we've talked throughout about cafe press asil spread shirt lulu dot com these are all ones we've mentioned throughout all of them have affiliate programs so what does that mean when we said that you could make a certain cut off the tee shirt and everything else you can use an affiliate link instead and now you're making a cut on the front end as well as the back end and if you're making a cut on the front end is back and it's even better than that because if they go into cafe press and then they buy your stuff and then after that they decide hey, this is cool I'm gonna buy this to you get a cut of that as well so basically all that work that amazon does to save people like this but this is working for you a cz well another key one to affiliate with is ebay ebay has everything on it right there in everything site and they don't just have recent products they go back in time they have everything you could possibly imagine. It is extremely easy once you use there services to make a search based link, which is even better than sending somebody to a single page, because it shows everything that's currently available for that, whether it's a regular cellar, or whether it's somebody auctioning off an old version of something an old amplifier that you can only get his was made the nineteen eighties or something like that. So, there's one number one thing to remember in maximizing your affiliate income. One key thing, and that is always used the affiliate links whenever you send fans to buy your music or your merch to make sure that you're getting that extra cut out of every sale, this is sort of taking everything that we've talked about till now about sending fans to buy things and adding an extra cut to it and making sure that you actually are eligible to even get other things that they might buy. It is worth your time to go through every link that you have on every single social presence you have do this affiliate and update the links with these instead. Otherwise you're actually leaving money on the table, it takes some organization to do that given it's not easy, but it's worth your time. Also you want to double check the iv included the correct link of course, once you do this because once you make this special link you want to click on it yourself and make sure that it's working so we should open it up for questions yeah, this is this is the sequence about affiliates it's such a huge and important way to make money off of music and it's a little bit complicated and confusing but it's well worth participating in we do have something coming in online mad transit asked if can you incorporate in another state like delaware, nevada and still transact business there live shows through live shows I believe mad trends is in texas so he's asking if he can incorporate in other states and still you can still perform live shots and stuff you just you're doing is you're incorporating in a different state that's the state that you'll be paying taxes out of them for your corporation or your legal entity we should make the point that, uh this is this is a creative uh this is one of the creative ways of actually making some income going out of your way to incorporate in another state too just to pull this thing off, maybe you won't want to do that it's just, you know, something end of the world, right um and it's there's a lot of benefits to incorporating in this state that you're in because you have to get uh you know, you might get noticed letters and stuff like that you're there you have an address you're physically located there's some other issues with incorporating and let's say delaware and you're not there so you have to hire an agent and all this kind of stuff that said many businesses do that and since this is a music business course we should bring that up um so yeah, but that's a very good question geography question here from sebastian ortega little bit complex but so he's currently living in mexico about to move to europe in a few months would you recommend that I do this whole process now we're going to do it twice if I'm moving I know people are kind of all over the place if they are moving to a different country different state I think it's little overwhelming where do you decide where to incorporate well dip isn't how long he wants to live in europe um and if he if he's going to start up is he going to start up his business in europe is going to be touring in europe is that the place where he's going to be really pushing his music and he's going to reside there for a long time? He has the right visa you can work there uh and all that kind of stuff then yeah, maybe you would want to set up over there or you're going to live um your life out? Is there ever a situation where you are incorporating in two different two different states to different countries, or is that just too confusing? Oh, you wouldn't do that, you would have. Ah, uh, just for this, like, for a band, you just have your one entity really? Technically, I mean, if you could do it, can I mean, you're paying my national here multinational ban. So you be you too. You choose the national, you're going to be paying taxes and doing filed. Look, we've got a few legal entities ourselves, and we have to do filings every year and filing suck. I mean, they cost money and there pain, and we always have penalties because we never know exactly right, even though he's a lawyer and it's like this is not, it is like inevitably there's something that's missing. And then you have ticketed policies because of a lawyer don't make that very clear. No he's been doing it. I think it just deadlines, just deadlines and like all these things you have, you do have to be up on your game when you incorporate you have your own business. And this is stuff that, like even in the indie van survival guide we touch on, and then there are books but you have to go into experts you should go talk to your accountant, your lawyer and all that kind of stuff to actually pull this off. The main point of this is that this is a creative income stream and it's not one that musicians a lot of musicians realised that they can actually do um it helps with like when we were talking earlier about cafe presser and stuff like that the margins are very thin but if you add this and you're actually getting a little bit more money out of out of them um and it's ah that's the point of this not so much to go down that rabbit hole of well, there was a little confusion in the chat rooms and so I thought I would let you guys clarify for everybody sure when we were discussing the itunes link in the affiliate program within itunes on dh alex had asked, well, are we supposed to direct people directly tow itunes directly as opposed to the that affiliate link the affiliate link will bring them to itunes directly? It'll just have a little code in it that says I sent you there and give me a cut of whatever people buy and to be clear itunes offers that affiliate program it does it does if I can go back if you don't mind right here just go to this length it's at the top the first bullet and go to that affiliate program and they will explain everything this effect it's just a little confusing which is possibly why a lot of people don't do it is it worth your time? Yeah, I think it is because it's worth this is where your time equals some money if you do it the right way to this is the kind of thing where once you set it up you can forget it it's, wherever you put your link just just stays good from then on and you get that extra it's just a sales commission if you think about that's really, really what it is there's no away the internet handles sales commissions. Well, this leads into a question that hannah brought up as what percentage of the post that you put out should have affiliate links? Are you ever inundating people with too many of them? Okay, now the speaks this speaks to is the red life thiss speech to being genuine? Yeah, this speaks to and that that we can't bring that up enough it's like you can go completely sales man here already don't to do that no it's about your music it's about your art and that's why we bring up it's very natural do this for your music so you can get at that extra bonus cut for your music uh that said there are many bands and musicians that we know that blawg about their life and talk about their creative process and all that kind of stuff which led us to the next natural step it's like oh well you can share the instruments that to use in the software you use and talk about the process on again the focus is more on writing something that fans would engage with about oh that's the process that they're going through okay that's how they record this stuff that's very interesting to me but then there's like you could throw in a link that says, well, here is the program and if you want to use it yourself it's this way uh you head that way s so that's a very natural way and then you could go even further because there are musicians that we know that talk about just their life in general and then they say things like that's where the tv idea actually came up um uh but, uh you know, do you have to do that? No. Do you? And this goes again to the point of selling out that type of thing you know you should be is genuine is possible maybe this isn't something you want to do our job is to make it you aware of it and teo make sure that you know it's out there and that it is something that you could possibly do on the flip side, you should also be aware that people are doing this and hyperlinks that you're clicking on probably are generating revenue for security that nearly all of you at once planter another, especially if you follow the link to amazon, probably followed one and inadvertently gave somebody a sales commission. You just didn't even know it that's how natural and part of the internet it is, they're just links right now, it's just it just seems it seems very straightforward. If you're going to send somebody to buy your music, you may as well get a sales commission out yeah, yeah, yes, it's one thing, if there was, is one side in particular, you guys found the most success or revenue in commission because you sent people to that most ok, so we've we know some people who are making their entire businesses around affiliates yeah, I'm making very significant money out it in each site is different, you know? And depending on how we're doing, even the sites that we dio the income mix will change ebay is surprisingly good. I would say that that's one that I wouldn't miss because there's so much out there, and once they wind up on their site, you can actually they could find other things that they made like amazon's good, too, of course, considering that the other thing about ebay's, I believe, and I don't know their terms of the same, but they also used to give you like a certain flat amount, like twenty five dollars, or someone even just signed up for the site in order to bid on something which was for one of our one of the business people we knew that was a significant source of revenue for a while. So this is another world we've opened you up into almost want to apologize because it's so detailed and you're going to be spending on wait a minute, affiliate links and then the next question, how often can I put it out there without killing everything? And it's it's is this new world that opens up and you just want to play with it, experiment with it, find out what will work for you, find out what will be genuine but then again give you what you need. These are the most obvious these two, um out of these two commission junction, I think, has some very good stores that are associated with it, like the type you would normally shot that day today, but like shares plenty to there's, there's, hundreds and hundreds and hundreds of places and these air obvious because you're selling t shirts already, you may as well get in extra cut for all of them. And we've already talked about this so I mean pretty much the ones were sharing here are all we're sharing signing up for and how much do they cost to participate in free? This is yet another thing and I always bring this up when I do this is our favorite price and we just I mean really it should be everybody's favorite unless you're getting paid to do something and it's just something that's available on site there is another one there was another one but you might possibly just answered it in terms of franchise fees mad trends is worried about like when how long he should wait before creating a legal entity he hasn't made any money yet uh and avoiding those that's kind of feet again I think that's where way it is a real thing that we say to each other let the world tell you when to do it there's plenty of musicians that I just sole proprietorship basically on out there just doing it on their own and eventually you graduate to a point where it makes sense again we couldn't tell you exactly going to do it um you would want to talk to an accountant or a lawyer uh lawyers are always good always feed money that you pay teo register that legal entity in the time that you spend doing the extra taxes is definitely a cost it becomes overhead it's and it's it's a pain and so, like, you know, this type of thing, one of the things I'll say is very straightforward if you want just a hard and fast line, how about this? Don't even think of registering any of this stuff unless first, unless you've been doing this a number of times before, you know how it's going to dio you know you're gonna get income, but you're starting out right? You're totally new, I don't know what to do, wait until you get enough income to pay for it. So you're never paying anything out of pocket because one of the things that we're going to tell you in the fourth session is we're going to go back through everything that we talked about, and we're going to tell you how to start a music business for zero dollars so every sale that you make is in the black it's actually making you money, why not let your profits tell you? Okay, now I have the five hundred dollars for the stupid filing fee I can file it, it's, nothing out of pocket that's one way to think about it.