Kyle has a business in the ebike niche: He makes custom parts and his own ebikes as well. Business is okay, but it's plateaued a little. Kyle wants to double his revenue without doubling his workload, especially since his business is a side hustle. How can he create passive income streams for his ecommerce-based business? Kyle's site is BoltonEbikes.com.
Kyle starts off the call by recapping where his business is at. He recently created a free online course, and that's helped him to garner some traffic and leads. He wants to increase the sale of products that he doesn't have to personally work on or that are fulfilled for him, as well as his affiliate income. I give him tips and strategies for increasing affiliate revenue through his YouTube channel, leveraging relationships with manufacturers, and creating YouTube videos for recommended tools. Kyle wraps up the show with some promising plans of action. I hope we can catch up with him in the future!
What You'll Learn:
Learn how to create passive income streams for an ecommerce-based business.
AskPat 1051 Episode Transcript
Pat Flynn: What's up everybody? Pat Flynn here and welcome to Episode 1051 of AskPat 2.0. This is a podcast where you listen in on a real coaching call between myself and an entrepreneur just like you.
Today we're talking with Kyle who owns an interesting ecommerce business in the ebike space—electronic bikes. He creates parts for existing bikes that are out there on the market; he also custom builds his own electronic bikes. We spend a lot of time in this episode; it's a little bit longer than normal because it takes a little bit of time to figure out what his next steps are.
We dive into a lot of ecommerce related things and also how to best maximize his time, his efforts, the ability to, with an edommerce site, still be able to make some passive income on top of that. We're not just talking about hiring a team either.
Make sure you stick around and listen in, this is a very, very great episode. Kyle, I'm really thankful that you came on to share a lot of this. It's definitely going to open a lot of people's eyes to what's possible based on the things that we're likely already doing—just a few more optimization tactics added on top of that to start to make money off of those things. Make sure you stick around, hit subscribe if you haven't already.
Really quick before we get into the coaching call with Kyle, I do want to thank today's sponsor, which is FreshBooks. They have been supporting this show since the beginning. I love them so much, not just because of that, but because they also have a great product; I wouldn't have them on as a sponsor if they weren't a great product.
If you've been looking for something to better organize the finances in your business, from the income to the expenses, to also the invoicing—that's the best part, in my opinion. We use it for invoicing as well, to be able to get paid for the services that you offer or the things that you sell.
You can literally, with FreshBooks, create a professional looking invoice in less than thirty seconds. You can keep track of who has yet to pay you, you can even see who has yet to even open the invoices you send through the system. Not to mention just the organization of all of the finances in your business, especially come tax season.
Start off the year right, get FreshBooks. If you want to check it out for free for thirty days, all you have to do is get a free trial at FreshBooks.com/askpat. Just make sure you hit up, where it says, “Hey, where did you hear about us?” Make sure you enter “Ask Pat” so they know where you came from, and they can hook you up.
Thanks so much, and here is the coaching call today with Kyle from BoltonEbikes.com.
Hey Kyle, what's up? Thank you so much for coming on AskPat 2.0, welcome.
Kyle Chittock: Hi, thanks for having me. I'm excited to be here.
Pat Flynn: I'm excited for this, this will be a lot of fun. Why don't you just quickly introduce yourself and what you do to everybody who's listening?
Kyle Chittock: Okay. About three years ago now, a little over three years ago, I started a company selling bike parts and upgrades. My small little niche were electric bikes. The company was called Velomobile Shop, which is a little hard to pronounce and hard for people to remember. I've just recently in this past month changed the name to Bolton Ebikes, that's easier for people to spell and pronounce. That's what it is online and everything now.
Basically I started out making controller upgrades, motor upgrades, battery upgrades; things to make people's ebikes go further, faster, more comfortable to ride. Basically all of the above, and then very slowly trying to transition and make my own brand of electric bikes for those that just want something already done. That's the gist of it.
Pat Flynn: That's awesome. Ebikes I know are becoming very popular. We're starting to see them on the streets now, from Uber-like services like Bird and a few others now, on the streets of San Diego at least. It's a hot industry, so I think that's really cool that you're in it.
I'm curious, what's on your mind related to what you have going on now?
Kyle Chittock: Basically it is an industry that's growing really quickly. It's pretty exciting to see all the new people that are jumping into it; you see a lot of the big name brand manufacturers starting to jump on board. It just confirms that I'm in a good spot.
When I very first started, my goal was to not put any of my own money into this business. I still work a full time job and this is something I do on the side. I put in about $200 to get this started. When I went and opened a business bank account, the teller, they asked, “How much is your business going to make in revenue per year?”
Pat Flynn: I know, they always ask that.
Kyle Chittock: I was like, “I don't know.” “Just give me a number.” I was like, “Okay, might as well set a goal right now. How about $100,000?” She was like, “Okay, go for it.” Believe it or not, I was able to do that. I hit $100,000 in gross revenue.
Pat Flynn: Congrats man, that's huge.
Kyle Chittock: Since they're online products, and trying to be competitive, my percentages aren't that great, so I'm obviously not making anywhere near that from that business. I was like, “Wow, this is great. That took off really fast, I'm going to do $200,000 next year.”
I'm sure you're well aware, that's usually not how it works. I hit that number, the next year, basically $100,000 in revenue. Here in my third year, on track to do basically the same thing again. I'm basically at this plateau where I'm stuck, where I know that the market's growing, I know I can take a bigger chunk of it to me, which is a little drop in the bucket compared to everybody else.
To do that the way I'm doing it now is going to require more of my time, which is not what I'm willing to give up, I guess. I have some plans, I have some things I'm working on, but what I'm really trying to pin down is how am I going to add some more passive income streams in the ebike business that I have, and basically increase my sales without adding to my workload? That's where I'm at.
Pat Flynn: What have you done so far to attempt to do that, if anything?
Kyle Chittock: After listening of course to all of your podcasts and different things going on, I was like, “Maybe I should do a course on something related to ebikes.” I went ahead and I filmed an entire course on how to build an ebike from start to finish, every single piece.
I thought, “Well, I can put that online.” That gives me two possibilities. One is obviously if they buy the course I make a little bit. Then they could also buy some of the parts and pieces from me. I recorded it, put it all together, then I was working on the pricing.
It's like, “You know what? I feel weird about charging for it because my customers are used to the physical products.” I also just thought, “You know what? I think I'm going to get more people watching this and more people knowing who I am if I just give this away for free and just put it out there.”
That's what I decided to do. There's probably going to be about eleven episodes of that bike building course all together. I've got ten of them out, and the next one will probably be out by the time this podcast goes out. It's already recorded and I've just been uploading on a regular basis.
That actually has worked quite well, that's really grown my YouTube channel. Now I'm having people that are calling me, not necessarily about the bike builds but they're saying, “Oh, you're a guy that knows about ebikes. What do you think I should do about this? What ebike do you recommend?”
Those are the leads I'm starting to get now, that are a little bit different from what I had before.
Pat Flynn: That's really cool. First of all, when you were talking about this course I was a little bit, “I don't know if your audience would respond to a course.” I was going to actually suggest a, “What if you actually published that for free and used that to get traffic and gain some authority in the space?”
You've already done that, so that's awesome. I think that's a really smart move. Now you're starting to get new questions, you are obviously becoming an authority in the space, or else people wouldn't be reaching back out to you, which does allow for some other potentially passive and active income opportunities; especially when it comes to partnerships with other companies who you can either become an affiliate for or direct leads to, for example.
Have you created more videos just answering those questions that keep coming in? Instead of having to answer them individually, you can just say, “We have a video on that”, which are likely questions that people are already typing into YouTube, for example.
Kyle Chittock: Yes, that's what I've been basically been jumping back and forth between: “Here's another episode on how to build your own ebike”, the next step. Then the next week might be, “Here's how to program this controller, this ebike screen.” My customers and other people have responded to those very well.
Those have been going really well, and I've got a whole big long list of questions that people are asking that are video topics I'm going to cover, more YouTube topics than I can possibly do.
Pat Flynn: That's great. It seems like the content and the authority-building is not the real challenge here. What in your eyes is the real challenge that you're struggling with here?
Kyle Chittock: I think there's a couple of things going on. One is, let's say I create a new upgrade for a different brand of ebike. There's enough customers with that bike, there's enough market for it. I can do that, and I am working on some. In theory, that should increase my revenue and give me a new group of customers to sell to.
That's going to require more time to put those products together, and ship them, and all of those things, in the one-on-one questions about little specific things they get into. Basically, if I look at it, in the past, I'm thinking about the 1,000 true fans. I'm like, “Who are my thousand true fans?”
When I first learned about that, I looked at my email list and I had just over 1,000 on my email list. Then I looked at my website and I looked at my average order size. My average order was right around $100. It was like, “Okay, I've got my 1,000 true fans. 1,000 people ordering $100 worth of stuff, but I want to make more.”
Pat Flynn: It's funny, when Kevin Kelly wrote that article, “1,000 True Fans”, he literally gives you the example of 1,000 fans paying you $100 a year.
Kyle Chittock: Right, I was like, “Wow.” It really resonated because I was like, “I have that, it's just not getting me to where I want to be. I need to change something.”
Pat Flynn: Right. There's a few ways to do that. Obviously there's many ways to increase income. If you are at a base already, you can increase income by number one, increasing traffic so now you have, for example 2,000 true fans who are each paying you $100. You could double your income that way for example, to stay with easy math.
You can increase conversions, or increase the price, or how much they're spending with you. I don't know if you've done anything to follow up with your existing customers, your existing true fans, to have them continually buy from you. It's great, once a person buys from you, they're likely to buy from you again if there are more things coming out.
Is the stop-holder, not just the people, but the time that you have to create what they might need so that they could buy more things?
Kyle Chittock: It's the time. Right now, if I doubled my orders the way they are, that's a bit of a concern. I said there was two things I was working on, the second thing is selling ebikes instead of ebike parts. Then the average order is probably going to be in the $1,000-$2,000 range. Then I only need 100 true fans to get to where I'm already at now.
That's much more manageable. If I can sell two ebikes a week it could potentially double the revenue, but it's nowhere near doubling the amount of work. That's where I'm trying to get to. It's been a little bit of a tough transition, just because people are used to me doing the upgrades and things and not buying complete bikes.
Trying to fit into that space, it's a work in progress. I just feel like there's something still missing to make that happen, and I don't know what that is.
Pat Flynn: On the current inventory that you sell, and the work and the time that that takes, is that something you and only you have to do?
Kyle Chittock: Yes.
Pat Flynn: Why?
Kyle Chittock: I don't have to do it, I guess. I had a steep learning curve. My first bike sales that I did, I built the bikes from the ground up. That was not sustainable because it took way too much time.
Now I really am focused on—and I even announced this to my customers last month in an email blast, I basically said, “Sorry, but I'm not going to do any custom built bikes. It's great if you want one from me and I have the ability to do it, but I just don't have the time to do it.”
All of the bikes that I'm selling now, they show up to me in boxes ready to go. Basically all I need to do is put a label on it, or tell someone to put a label on it and ship it. I've cut down on that amount of work drastically. That way it can scale up and it doesn't suck all my time away.
Pat Flynn: Right. Those are coming from another bike manufacturer?
Kyle Chittock: Yes, I have my own line of bikes that I have made overseas. It's my own custom thing, it's not a generic bike you can buy anywhere else. They're made overseas, brought over in shipping containers. That requires some extra time and care, but it's kind of like my baby.
Then I've got some other new bikes that I'm adding online right now that I don't have to oversee the manufacturing. Somebody else imports them, they warehouse them. I can have them shipped to me if I want for a local customer or something, or I can just say, “Hey, can you ship it to this customer?” They'll ship it off for me; I don't even have to see it.
Pat Flynn: You can have them fulfill it for you.
Kyle Chittock: I'm looking forward to getting those sales going.
Pat Flynn: Okay. Let's keep digging in here because I want to help you. We're getting a good sense of what your business is like now, which is really great. This is a legit operation here that you are doing.
You said it's not even your full-time thing, so I can definitely see how time would be a really important factor. If you had more time, likely you'd be able to build more, or do more, or sell more. In your eyes, what would you say is the best way that I can help you at this point?
Kyle Chittock: That's an excellent question. I wish I had a specific answer, as far as what is it going to be. I guess here's the one thing I jump back to a little bit, is when I put some of my first videos out on YouTube for the course, I thought, “Okay, I'm going to push the passive side of the sales on these videos. Set up an Amazon affiliate account, I linked to some of the tools or things that I used in the video, but I don't sell.” That way people can be like, “Oh, I need that tool,” or “I need that part.”
One of the first videos I put out that did pretty well for my small YouTube channel, I had maybe a dollar something in sales from Amazon. On the flip side, my website, I have several hundred dollars in profit that day from that video. I was like, “Okay, that was good. That was a successful video, but it added work. The part of it I was trying to build that wasn't adding work didn't really do anything significant.”
I thought, “Man, all these people who are making passive income, if they just sold physical products, they might have so much more earning potential.” There's so much work involved too, that I see the trade-offs for it.
I feel like there's a secret sauce or an art to the referral of selling something that I don't have, that I'm missing. I feel like there's a key ingredient there that I just haven't quite grasped yet. How do I increase the sales of those things that I don't have to work on personally?
Pat Flynn: Okay, great question. This ties back into what is it that you want. You want increased income without an additional ton of work or creating new products and stuff. Affiliate marketing in this way, referral marketing, is a great way to do that. Just because that one video didn't work doesn't mean other videos won't.
I think that by continually posting on YouTube like you're doing already, and by continually making sure that when you are recommending a product, or a tool, or something you're using that's not yours, just to continually go into that practice and building the habit of always linking to, always mentioning and referring to the description where they can click through to get that tool—you're going to find that over time, your database of videos, it just builds. Passive income does not happen over night, that's for sure. It's planting seeds, essentially. You've planted a few seeds; what you need to do is sow the field and plant a whole bunch of seeds. Those things do add up over time.
What's really cool is that as you continually come out with these videos, and this content in your authority, as you've already started to see, it will continue to build exponentially. That affiliate income will begin to grow because more people are finding you, more people are trusting you, and more people will take your recommendations, even if they didn't take it the first time.
By continually perhaps using the same tools over and over again, sometimes people need three, or four, to ten touch points, or just knowing that that thing exists to then realize, “Wow, Kyle uses this all the time. I need this now, I can see this after the multiple times I've seen him use this thing.”
Kyle Chittock: That's a good point. I have some videos where I mention a certain tool and I made sure to put a link to it. Then I have another video where to be honest, I didn't because I thought, “Oh, I mentioned that in my other videos.” Really I could go back and I could put a certain tool in a whole bunch of them, because it's used in almost every instructional video there is.
Pat Flynn: Right. If you wanted to take it one step further, you could literally do a video about that tool, which is the secret sauce in my world of creating demo videos for certain things that people either A, want to know more information about because they're thinking of buying it and they just want to know a little bit more about the thing they're going to pay for before they get it. Or B, just seeing how it's used.
What I mean is, you have this tool, there's no reason you shouldn't create a video just about that tool. You can even pull from existing videos in places where you've already used that tool, because you already have that content as B roll, which would be very interesting and very visual.
Then you can just talk about, “Hey, here's the link below. Here's how I might use this tool. Here's how not to use this tool so you don't break it.” I'm sure in the ebike world there's some tools and especially interfaces that are quite fragile, that have specific ways that you want to make sure you take care of them for longevity.
Perhaps even having a tool kit. There's a website called Kit.co where you can create your own kit. You can go, “Hey guys, check out my kit on Kit.co, the link's in the description.” It's literally they go there and they see all the tools that you have in one spot. There's a button to just buy all of them.
Kyle Chittock: Right. I have heard you mention that, but I have not thought of that or gone there.
Pat Flynn: It's cool.
Kyle Chittock: Creating a specific video just about a tool, because then I can really target it towards that tool keywords and everything else. You're right, I've got awesome B roll of it actually in action.
Pat Flynn: Yes. What you do is you go back to your older videos and while you're using that tool you create a little card that links to, “Hey, if you want to know more about this tool that I'm using right now, click on the little card up above”, which pops up at that certain moment.
If you say, “Okay, here guys. Here's the flange number 5”, I don't know, I'm making it up. At that moment, then there's a video that pops up with how to use the flange number 5 or something. Again, it's just now as a part of your library.
You would practice moving forward that any time you use this, you might say, “All right guys, here's the flange number 5. You've seen me do a video about this tool before and how awesome it is. If you haven't seen that yet, click on the link above that just popped up right now.” Then you just keep going in your video.
You just have that practice of always mentioning it and having it be a part of, essentially your language. It just becomes something that when people start to dive into your videos, they consume multiple, “I have to have what Kyle has now. I have to get that.”
That would be a nice way to, not overnight see a drastic increase in passive income, but over time.
Kyle Chittock: Yes, I'm not looking for anything instant. I know it's going to take time. I've got a bunch of videos I can go backwards and do that to; I can optimize them basically to more affiliate sales.
Pat Flynn: It's like gardening. If you were a gardener, you'd have these certain tools that you tend to use all the time and you mentioned them every time you created a new video about a plant or something. People want to be like you and they want to have the flowers that look like your flowers. I must use the same tools, because you use them. You build your library of tools in addition to the amazing content and how-tos.
Kyle Chittock: Okay.
Pat Flynn: Hopefully that doesn't sound difficult.
Kyle Chittock: No, it doesn't sound difficult. It sounds like one of those things: I just need to do it.
Pat Flynn: Right. What's really cool about this too is step two of this is after you start to see a little bit of volume coming from these tools that aren't yours, you can actually reach out to these companies and start building relationships with them, so that maybe you can include the tool in your own bike packages for a really cheap rate. That's just a really cool add-on or value add to the products that you already sell.
This is very common with students in my affiliate courses; they start selling these products through Amazon or these companies. Then these companies actually reach out and go, “Who are you? How did you sell so much for us? Can we do something together? We'll give you a higher commission than Amazon does if you promise to do these things for us.”
Some people have even gotten access to the factories to film videos at the factories where those things are created because of the relationships they're building. Any smart company would go, “Wow, this person's helping. Let's help them sell more of our stuff.”
That's what you can look forward to down the road. Who knows, some of those companies might go, “Hey, we have this tool. Check out these bikes.” They have their own lists of sometimes hundreds of thousands that you could potentially get access to through those relationships too.
Kyle Chittock: Okay. I'm going to have to make some notes on what all these different things. I have a feeling if I go backwards, after I put up my YouTube videos and set it all up—to be honest, I don't go back and watch my own videos.
Pat Flynn: Nobody likes to do that.
Kyle Chittock: I'm sure as I do that I'm going to be like, “I just missed all these opportunities to put these in there and mention these again and again.” Hopefully those subscribers that are watching every week or however often I'm putting a video up—now that I think about that, you're right.
Whether it's five times, or ten times, or seven, however many touch points it takes, some of these people haven't even had that many because I haven't really been pushing my YouTube channel that long. It really just may not even be seeing that tiny little flat curve that hopefully is there.
Pat Flynn: Right. I think that will be a cool opportunity for you that's not going to require a ton of extra time. It's just, you're optimizing what you're already doing, you're optimizing what you've already published.
When you think about it, very similar to a blog. Your YouTube channel, it's almost like, that's your first draft of a book; over time you start to fine tune things. With YouTube, yes, you can't re-upload a video and have the same stats and have it be the same link, but you can go back and optimize the cards, and the description, and the thumbnails, and all that stuff too.
You're just basically on the second draft now of your book, if you want to go with that analogy.
Kyle Chittock: Okay. If I take and make a video specifically about a tool like you suggested, it can be really short. Right now I put videos out every Tuesday; maybe I have a different day where I put a featured tool every week really.
Pat Flynn: You could.
Kyle Chittock: There's enough tools that are used, that would be easy to do and only a couple minutes long apiece. I could put those together, a whole bunch of them, all at once.
Pat Flynn: Then make sure that on those tool videos, which a lot of people are going to find you for the first time because of those videos, that you have that B roll, like you said, for your other videos they see you using it.
Then also in the description, and even in the call to action just go, “Hey, if you want to see me use this tool as I build this bike or as I reprogram this bike to be faster, click on the link. You'll see the video there.” Now you have another entry point for people, which is the tool; now they're coming into your brand.
Kyle Chittock: Yes. I hadn't thought of that angle before we got on this call at all. If somebody could be looking up a bottom bracket tool or a pedal wrench, something that I think is silly and obvious. If they're looking up how to use that specific tool, I was hoping they'd come to my longer videos, but if I have one more targeted, I can really pull them into my channel and then my website and everything else.
Pat Flynn: Yes, there you go. It's like the tool is a quick win. You're answering their immediate question. Now they're like, “Okay, let me see what else Kyle has to offer.” I think that would be cool, I think that would be really cool.
Kyle Chittock: That's been going well the past few weeks. I got a guy coming into the shop later today for example—I'm really positive and always looking at the ups instead of the downs—who called me earlier this week and was like, “Hey, I found you on YouTube. I've been looking to buy an electric bike, I want to buy one. It's so confusing out there, all the information's different. I found your video and I was like, ‘That's the guy who knows what bike I need to buy.'”
Pat Flynn: That's so huge.
Kyle Chittock: He's driving from three hours away to come to me to buy a bike from me instead of someone in his town.
Pat Flynn: Are you going to film that? That might be kind of cool. Be like, “Hey, this is this guy. He saw the YouTube channel, and I just wanted to invite him over to help him out. Sit back and watch how we can talk through this together.”
Kyle Chittock: I thought about that. We'll see when he shows up.
Pat Flynn: He might not be comfortable with it.
Kyle Chittock: He may not, or he may be like, “Wow, I just saw you on YouTube. Now I'm going to buy a bike and now you're going to let me be on your channel.” He may be super excited about it.
Pat Flynn: He'll become a super fan if that's the case, for sure.
Kyle Chittock: Right. If he does, then he'll of course hopefully recommend all his friends to buy some. I had actually considered that, haven't really done anything else with that. Since that's just coming up in a couple hours here, I'll see what I can make happen.
Pat Flynn: Awesome, man. I like where we ended up. It doesn't seem like it's going to be anything hugely in addition to your time. It's just going to be optimizing the things you're already doing.
If you don't mind, I'd love to check in with you later in the year and see how things are going. Hopefully you can report back that things are increasing and things are going well. If you don't mind, I'd love to have you back on later in the year.
Kyle Chittock: Absolutely.
Pat Flynn: Cool man. Kyle, keep up the good work. Thank you so much for coming on and sharing. One more time for everybody listening, where can they go to actually check you out; what's your YouTube channel and the link to go to your website?
Kyle Chittock: My website is BoltonEbikes.com and my YouTube channel is that same, Bolton Ebikes. I've got links to the videos on my website, and links to my website from the videos. Find either one, hopefully you can get to the right spot.
Pat Flynn: Awesome. We'll put all the links in the show notes for you listening.
Kyle Chittock: There's some history behind the name; they can find out about that online.
Pat Flynn: I like that teaser. Cool Kyle, thank you so much for coming on. I appreciate you and good luck.
Kyle Chittock: Thank you very much.
Pat Flynn: All right, I hope you enjoyed that episode with Kyle. Again, you can find him at BoltonEbikes.com. Kyle, thank you so much. I'm looking forward to seeing how you implement a lot of these strategies with the things that you're already doing.
I think it's really low hanging fruit for you and you'll be able to create a very, very nice bank and a library of offers for people inside and outside of your business, for your own income.
Congratulations, I'm really looking forward to seeing how you do with this. We're going to have you back on the show at some point in the future I hope, so that we can see how things go and see how this perhaps made a dent or perhaps exploded what you've already built.
You've done a great job reaching down and getting into the space and creating something really amazing for people who are really into ebikes. I know because I see a lot of people in my neighborhood riding around on ebikes and escooters and those kind of things. Really awesome.
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