Ok, so you have some ideas—but are they online passive income worthy?
The goal here is to create something that you put a lot of work into so that you can eventually put it on auto-pilot and have it earning income for you, all while you either sit on white sandy beaches or work on even more projects. In order to tell if you have an idea that is perfect for this kind of lifestyle, here are a 5 things you can ask yourself about each one. Enter the checklist:
1. Is it Something People are Looking for or Need?
Obviously, this question doesn't have to do with just “passive income ideas,” but if you can determine that an idea isn't something that people are looking for or will use, then you can save yourself a lot of time (and money) and move on to your next idea.
In an earlier post on SPI titled “How to Waste Three Years and Thousands of Dollars,” I wrote about a guy who spent years of his life (and much of his savings) working on an idea that was just not needed by anyone. Needless to say, he failed.
Of course, until you build your webpage and sell your product, you're really never going to know for sure how well your idea will pan out, but there are a few ways you can see if you're giving yourself the best chance to succeed:
- Ask around! Casually talk to people, preferably friends and family, who may be your target audience and see if your idea is something they would use, or wish they had already.
- Do some keyword research! Use tools such as the Free Keyword Suggestion Tool, the SEO Book Keyword Suggestion Tool, or the Keyword Question Tool to see if you're idea is in demand. This is a great exercise to get yourself used to choosing keywords for your website. Play around with related keywords, and don't get discouraged if the keyword for your idea isn't so popular. It may just need to be adjusted. (i.e. Yoga = too general, but what about Yoga Classes, Yoga for Kids, or Yoga Exercise Equipment).
- Are there similar websites already out there? Like I said in my last post, finding out that there are similar ideas to yours already in motion is a GOOD thing! That means there are people out there spending money on it, and you're just going to join in on the fun (and do it better than your competitors). Type related keywords in Google Search and see what you come up with.
- Hold a Poll or Questionaire! You can simply ask an audience simple questions, which don't necessarily give away your idea, and gauge how well your idea will do based on their answers. If you have a blog or website already, then this can be very simple (especially if your blog audience is your target audience), but if not, there are ways and methods to get answers. QuestionPro and FreeOnlineSurveys are decent tools for this. Just create a questionnaire and send it to a target audience, like in a forum or in a Facebook group.
It's tough because we can easily become buried in our own ideas and believe they're the best in the world. We often forget that it's not you and I thinking our own ideas are great that will make us money, but it's really other people who think our ideas are great that will end up paying for our income.
2. Do You Have to Ship Anything Yourself?
If you're planning on living a passive income lifestyle online, then you're not going to want to ship anything yourself. Many eBayers can attest to this. It's cool to sell stuff online, but packaging items, finding time to go to the post office, long lines and shipping costs really does suck the life out of you. If you have an idea that doesn't require you to do all of that—you're on the right track to a passive income.
Some general examples of ideas that would fit this description are:
- Hardcover books that are shipped for you (i.e. LuLu.com)
- Drop-shipping Items or Parts
- Membership Websites
- Training Courses
- Online Videos
- Access to Special Information
- Mp3s and Audio Files
…just to name a few. All of these can be shipped or handled online without having to package or ship anything yourself at the post office. This keeps your overhead costs down, and just makes your life sooooo much easier.
If your idea requires you to ship anything, you're setting yourself up to be a really busy person. Just think—the more you succeed, the busier you'll be….that's not what we want to happen.
3. Is Your Idea Scalable?
In other words, if your idea was online and on sale, do you have to do any more work if you to get more orders? In order to live a passive income lifestyle, you should be able to do basically the same amount of work if 2 people or two-thousand people ordered from you.
The real test is, if you can fulfill one-million orders in one day, you're good to go. If you're designing websites for people, or knitting sweaters, you probably would not be able to fulfill one-million orders—and therefore your idea is not scalable and passive.
Again, you don't want to work harder as you become more successful. I know, it's a weird idea, but you should have already done all of the hard work in the beginning.
4. Do You Have to Handle Payments and Transactions Yourself?
If you say yes, then you probably skipped over question #3.
The beauty of doing business online is that there are plenty of tools and services out there that allow us to not be present when automatic payments and transactions take place. If you have to manually send an invoice or bill people, then you're not going to be passive at all.
5. Is it Something You're Passionate About?
Yes, you can have a successful idea that you're not passionate about. Maybe you did your research and tested the market—that's great.
But, if you're passionate about your idea and you really believe that it will work, then your chances of succeeding increase drastically. You'll put in the extra effort and extra time to make it all work for you if you have the passion behind it. Plus, you're more likely to create a better product, which will in turn make your customers more happy.
So if you have an idea, ask yourself this: are you passionate about it?
So, if you have a list of ideas, go through each one with the following questions:
- Is it something people are looking for or need?
- Do you have to ship anything yourself?
- Is your idea scalable?
- Do you have to handle payments and transactions yourself?
- Is it something you're passionate about?
If your idea(s) can pass this simple test, you're setting yourself up for a great online passive income lifestyle.