Episode 81

How to Create Passive Income for Offline Businesses

In today’s LMScast Joshua Millage and Chris Badgett discuss simple yet powerful ideas around how to create passive income for offline businesses through online instruction, tutorials, and even courses.

There are basically two kinds of businesses:

  • Conventional offline brick and mortar businesses that have a website
  • Online website-based businesses

In either case your website informs people about your business. Buyers research even the simplest products and services online. The more people know about you and what you do, the more comfortable they’ll feel about buying from you.

Because you are sharing information, your business can benefit from a learning management system like LifterLMS to help you create and share videos, tutorials, and in-depth training for your products and services.

This is especially true if training or education is your business. You can only do so much in-person instruction in a day, but if you create courses you can reach an unlimited audience of paying customers.

If you understand eLearning technology, you can partner with other businesses to help them expand their presence to the internet and share useful information with their clients. You can be a consultant, an assistant, or an instructional designer who builds custom courses for businesses. You can also choose to specialize in a niche market.

Instructional videos can benefit you in several ways. First, when people see the amount of labor and expertise that go into what you do, they may decide not to do it themselves. Because you’ve shared quality information with them, they will trust you to provide that service. If they decide to do the repair themselves, then they’re likely to buy the necessary parts from you.

If they decide to replace rather than repair, they’ll probably buy from you because video creates a sense of relationship. Those customers feel like they know you now, and good experiences with you going forward will establish brand loyalty.

Whatever your products or services, you can learn how to create passive income for offline businesses in a variety of ways. Using a platform like LifterLMS will make it even easier to provide information and training to your customers. You can try a demo of LifterLMS to see how our course development platform can benefit you.

Post comments and subscribe to our newsletter for updates, developments, and future episodes of LMScast. Thank you for joining us.

And if you’re an already successful expert, teacher or entrepreneur looking to grow, check out the LifterLMS team’s signature service called Boost. It’s a complete done for you set up service where your learning platform goes live in just 5 days.

EPISODE TRANSCRIPT

Joshua: Hello, Everyone. Welcome back to another episode of LMScast. My name is Joshua Millage, and I’m joined today with Christopher Badgett. Today we’re talking about something really exciting, and that is how to create passive income for offline businesses. Chris, how would you define an offline business?

Chris: I guess you could say there’s two types of businesses. There’s ones that have a website but the business is actually offline, and there’s other businesses where the website is the business.

Joshua: That’s right, yeah.

Chris: A lot of brick and mortar stores or retail locations are obviously offline, but in the context of education, I would consider offline like teaching in a normal classroom, teaching at ticketed events, having some kind of workshop that people come to in person. As we like to say at LifterLMS, “We’re big believers in taking your offline training into the cloud.”

Joshua: That’s right, yeah. I think, for me, you hit it right on the nose. Either your website is your business, or your website is telling people what your business does. I think that’s the quickest way to really define what-

Chris: If you don’t have a website, you’re crazy.

Joshua: Yeah, and you probably are not a fine business. Let’s dive into the meat of it because I think that almost every single business has an opportunity to use a learning management system, hopefully a WordPress learning management system in their business model somehow. Whether it’s onboarding customers, educating customers, whether it’s selling something as a upsell, cross-sell, a value add, there’s so many ways to use information. People, this is just something that I see across our culture right now, we don’t give ourselves permission to try things because we need to feel like we’ve educated ourselves to the level, a certain level, before we try something if that makes sense. A good example of this was I was talking to some realtors up in Redding, California last, last weekend and they were running a mastermind. They have a brick and mortar business, an offline business, real estate, but now, they’re adding these online training components, they’re doing blended learning training components but the point is they’re doing a lot of training.

When they tested this, they were actually testing other forms, other masterminds before they invented their own and they realized that people were spending anywhere between $80,000 to $200,000 in information before they made their first commercial investment because they didn’t feel like they had permission to try. That’s is huge. That’s something I want to drill home because I think a lot of brick and mortar businesses need to understand that people, their clientele, often times have some sort of resistance in their mind before they move into the place where they can be either a client or a customer. Education and education-based products are huge.

The other thing that I think is really interesting is that if you run a business where you are actually doing the training, say you’re a yoga instructor or a crossfit gym or you’re a nutritionist or even a psychologist maybe, something in those professional service areas where you can’t really scale yourself, you’re really in that one-to-one “I’m trading time for money” scenario, an online training component is huge. I understand that a lot of people who are listening to our podcast probably are already in the e-learning space which I think opens up a really unique and huge opportunity which is actually going and partnering with these sorts of businesses, helping them create these passive income streams and either doing that for a one-time, one-off fee or creating some sort of royalty package if you really believe in the company. You think that they would sell the information well. Maybe-

Chris: I think I could give a great example of that. A lot of people who use LifterLMS are in the health and fitness or the wellness space and if you think about it, you put yourselves in the shoes of a personal trainer or a yoga instructor, you get to your maximum. Like, “Oh, I can only teach 6 classes or do 6 private client visits a day.”

Joshua: That’s right.

Chris: Or physical therapy that you start to see a cap on what you can make, what you can earn. You might be able to raise your rates a little bit but there’s no exponential growth there. You have all the knowledge and wisdom that you could take into the cloud and teach online but maybe you’re not a technologist. That person could do it themselves as a trainer or yoga instructor or if you, listening to this right now, are a technologist and you get it, you understand the basics of setting up a online course, you can then go reach out to these people, partner with them, provide services to them, build a course for them. You can actually get this down to a point where all they have to do is say, “Yes.” You’ll do everything whether you do some kind of revenue share or just have a flat fee for your services and you walk away, you can build a real business around that.

Joshua: This scales so well too. For the person who wants to design, who wants to be an instructional designer for that sort of business, look at it this way. I think very standard offering would be a 4-month program, we’re going to develop a course together, create the content, I’m going to work with you, it’s a flat fee of $1,000. You should be able to do that with 5 to 10 people. $5,000 to $10,000 a month, that is a healthy, healthy income for an instructional designer. For the business, $1,000 for an asset that they can sell over and over and over in the course of the year, the pitch is super easy, super simple. If you are a business, you’re a business owner who’s listening to this, why aren’t you doing it for yourself. I think that even oil change shops or automotive shops could have full courses where they’re actually not even creating content, they’re just going out and curating YouTube videos for people like, “Here’s how You Do Transmission Fluid Change,” “Here’s How You Do Oil Change.”

The thing that people don’t realize and I just went through this because I bought a new vehicle, is that I had a old 1999 Toyota Avalon. This thing was beat. I started getting online, looking at it and I was like, “Dude, this is so much work.” I’m grateful that these guys showed me how to do it but I’m happy to pay someone now that I see how much work it is.

Chris: That happens in real estate too.

Joshua: Oh yeah.

Chris: Teach people how to For Sale By Owner do it themselves and they’re like, “Whoa, maybe I should hire an agent.” Who are they going to call?

Joshua: The guy who trained them. Exactly. I found that out on YouTube but I was like, “Man, Bobby’s Pit Stop in Santa Cruz, wish you would have the whole training library because I would’ve just automatically called you.” I wouldn’t even price shop because the trust would’ve been built and the relationship would’ve been built. So much opportunity and I know we’re throwing a bunch of random ideas but I just want people to broaden their horizon and open up their minds to this possibility because we’re not really seeing anybody do it.

Chris: You can take a publisher mindset. You still own the platform and then you find these instructors and do royalties and revenue share or you can just offer package services or by the hour and just find that niche that works. There are business coaches just for people who own yoga studios. If you find a niche, “Oh, I want to work with yoga instructors,” or, “I want to work with Crossfit Trainers,” “I want to work with some kind of nutritionist,” go for it.

Joshua: This is a great example. I want to wrap it up with this one. I have a Kenmore washer and dryer, over/under washer and dryer and it broke. I had the thing for 8, 9 years. It doesn’t really owe me anything. It broke. The tumbler, it’s like a belt. I don’t know how to describe it. It’s like a rubber belt. I was like, “Crap, man.” I called up an appliance guy. He’s like, “It’s going to be a couple of $100 to come and do all that.” I got online and I’m searching for how to do it and Kenmore, which is owned by Sears, has a massive LMS training library on how to fix all the stuff yourself. I bought the piece. They made money again off me there. Then I used their training videos to install it, to fix it up. Now, there’s another issue, the motor in the back actually blew so this thing was really done but guess where I’m going to buy my next washer and dryer? I’m not thinking about anybody but a Kenmore because at the end of the day, I know they have this whole training platform where I can then do it myself if I want to. They created an incredible relationship by giving this away for free and now, I’m loyal to that brand because they’ve created that connection.

Look, there’s so many ways to do this. Chris, I think you have lots of ideas for realtors which I think are really missing the boat right now because they feel like they need to do all of it. You created and excellent, was it a blog post?

Chris: We have an LMSCast episode about it. You can go check that out at LifterLMS.com/realestate.

Joshua: You talk about all the ways that realtors can utilize this technique which I think is massive because real estate agents have the same conversations over and over and over again. Well, why wouldn’t you just put them through like a short little mini course so that you don’t have to have that conversation. They feel, “Wow, this guy, he’s not only a real estate agent, he’s trainer. Wow, he’s an expert.” There’s so much benefit that can come from doing this sort of online component for offline businesses. I’m really excited about it. I would encourage people who have ideas or want to talk about it to head over to our YouTube page and post in the comments under this video. It would really mean a lot to us and we’d love to share some ideas and dialogue there and you can always reach me @jmillage on Twitter and Chris? Where can they find you?

Chris: @chrisbadgett.

Joshua: @chrisbadgett. We’re very active. We don’t hide behind our business or behind this podcast. We’re very much out in front and willing to have a chat. Come and hang out. Until next time, we’ll talk to you soon.

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