Although they’re virtually unlimited ways of making money—both offline and online—all of them can be condensed into two basic models.
The first model is the product-first model. That’s where you start with a particular product or service you want to sell. It can be pretty much anything: mattresses, power tools, toys, tables or chandeliers. It doesn’t matter if you build the product yourself or resell other people’s products. When you’re selling someone else’s product instead of your own, that’s called affiliate marketing because you’re acting as an affiliate (broker) for someone else.
The second model is the brand-first model. First, you build out a brand. Then, once you’ve established the brand and built a sizable audience, you create products/services that solve a particular problem unique to your audience. For instance, you could start a fitness blog targeted at a 40+ crowd or a finance blog targeted to millennials. You create a blog or a youtube channel (a marketing outlet), and, by producing content tied to your brand, build a sizable audience.
There are crucial differences between the two models. In the product-first model, you already know what product/service you want to sell, so marketing and selling that product is relatively straightforward. In the brand-first model, you don’t yet know what products/services you will build, so you develop a brand first and later create various products and services that will appeal to your audience.
The product-first model is more suitable for making money faster. If you’re selling a mattress or a desk lamp, visitors know immediately whether it’s something that they either want or don’t want. Either someone is in the market for a mattress or a desk lamp, or someone isn’t. Obviously, your success will hinge on your ability to target the former, which, given the advanced marketing tools at our disposal, isn’t very challenging.
The brand-first model is more of a long-term strategy. Building a successful brand typically takes years. I spent over five years building my brand (the site you’re on now) before releasing my first book and earning any money from the site. So, it’s definitely not something you can cash in overnight.
This long-term investment has important advantages. When you build a brand, you’re effectively differentiating yourself from a busy market. Products and services can be easily copied—how many fitness programs are there on the Internet?—but each brand is unique. That’s the reason why you could have a ton of fitness gurus each with a successful brand. That’s also the reason you can be successful in pretty much any niche/market if build out your brand properly. A successful brand is able to connect with its target audience in ways that no generic product can.
A brand is a good idea if you’re building a community and don’t yet know what kind of products (if any) you will have. I started this site back in 2009 from a small 1-bedroom apartment in Rio de Janeiro, Brazil because I wanted to share my thoughts about the city and country. I was motivated to start this site because I was very curious to know if there were others doing the same thing as I was. It was an outlet to connect with others. Building and selling products was never the goal. It was only after I was able to build a brand and connect with the audience via the community, that it became perfectly clear what kind of products and services to create.
Things are very different from a user’s perspective. When a user visits a site showcasing a product, he’s in a buying mood. He’s the scouring the Internet for the best product, ready to click ‘Purchase’ with his credit card in his hand. He’s not looking to join any community or read philosophical ramblings on existentialism or the pros and cons of living in Belo Horizonte, Brazil. He needs a product and he needs it now.
When a user visitors a brand, he’s not necessarily in a buying mood. It’s not yet clear what the user wants. Perhaps he’s looking for a solution to a specific problem (“How to pickup Brazilian women”). Or maybe he’s looking for an idea for a vacation. Or maybe he’s looking for ideas and advice on becoming a digital nomad. Typically, the user himself doesn’t even know exactly what he’s looking for, unlike someone who knows the product they want (and has a credit card ready).
The fact that the user isn’t in a buying mood has its own advantages. A brand is able to “capture” the user before he even decided that he even needs a particular problem or service; before he even enters the market. Think of a brand as something wide, something that encompasses various ideas, thoughts or philosophies. It’s a way to educate the audience in an interesting, even opinionated way. It’s a great way to build a community of like-minded individuals. It’s a way to nourish a relationship and even influence a visitor to take a specific action and buy a specific product at a later date.
Building an audience for your brand can be done for almost nothing. Apart from a domain name and cheap hosting fees, you don’t need to spend much money to get customers. If you’re doing it right with your content marketing channels, they will find you all on their own. I’ve spent a grand total of zero on advertising and my site easily gets over 100,000 visits per month.
On the other hand, a standalone product can’t bring in customers all on its own. Since it doesn’t have the strength of a brand behind it, it’s necessary to buy traffic from different sources. The advantage is that you’re able to laser-target users who’re looking for a specific product and are ready to buy it immediately, something that you cannot do with a brand. Marketing strategies and user acquisition work very differently for products and brands.
Brands and products solve different needs. A brand solves the psychological need for a community, acceptance and self-actualization. A product solves a more pressing need with clear goals and benefits.
If my brand is built around location-independence and living in Brazil, then I’ll be able to build a community of like-minded individuals who are interested in doing the same. Each visitor may have completely different motivations. Maybe one guy is sick of America with its politically-correct culture. Another guy is tired of the high cost of living. And, yet, another guy is simply starting to start a new life in a tropical country and learn Portuguese. Regardless of each person’s actual reason for wanting to emigrate, all of them are linked via similar interests and passions, thus forming a community.
Brands are also very versatile, so everyone can easily build one. It doesn’t matter who you are, what you do, your race, sex or background. If you’re living and breathing, you can build a powerful brand that represents you and your values and connects them with your target audience. My mother is the last person who you’d expect to build a brand. But, in fact, she has a pretty interesting job in the medical field, so there’s definitely potential for creating a cool and unique brand which will allow her to build a community of like-minded individuals. She can actually create a pretty cool brand.
The same cannot be said for building a product. Not everyone can (or should) create a product. In fact, many brands are perfectly fine without products. When I started this site, I had no idea what product (if any) to build. My mom, who can easily start a brand today, will probably do it for fun, not as a way to make money, and, thus, would never create any products or services.
My preference is to almost always build a brand. A brand allows you to differentiate yourself from a busy market and create something that’s truly unique, something that’s truly yours. Apart from this website, I run all kinds of different websites, each with their own unique brand. Some of these sites sell products or services, others do not. I’ve learned so much over the past ten years, that I can easily predict which brands will succeed and which brands will fail. I can also easily determine whether it’ll make more sense to build a brand or a product on a case-by-case basis.
Also, unlike a product, a brand is something that you can potentially develop and grow for a very long time. Although I sell several courses that teach you how to live life on your own terms, things that my audience has asked me to create for many years, I would still continue to write simply as a hobby. Being able to connect with like-minded individuals is its own reward. That’s one of the perks of running an interesting lifestyle brand.
Don’t worry about monetizing a brand. It’s actually very easy to monetize any successful brand. Creating products and services after building a successful brand is relatively easy and straightforward. Just the fact that you’re providing lots of value and have build a successful brand will allow you to see how to create incrementally better value that your audience will pay for.
The brand-first strategy gives you another strategic advantage: it allows you to form relationships with your audience, learn their needs and wants, and only then build a product that satisfies those needs and wants. Instead of simply locking yourself up in a. closet and then building a product that no one needs, a mistake I’ve committed on a few occasions.
Having said, I do admit that if you know the kind of product you want to sell, it’s much quicker to just market and sell the product without building a sophisticated brand around it.
The decision of which model to follow also depends on your personality and unique situation. Are you looking to sell something specific for a set price? Follow the product-first model. Are you looking to write a wide array of thoughts and ideas? Follow the brand-first model. Are you looking to build a community of like-minded individuals? Follow the brand-first model. Are you looking to make money relatively quickly? Follow the product-first model. You do not know what you’re doing? Follow the brand-first model.
Chances are, if you’re reading this, you don’t have a specific product that you want to sell. Maybe you don’t know even know if you’ll ever have a product to sell. In that case, you should start a brand. As you develop the brand, you’ll gradually discover what your audience wants and needs. This will give you time to develop a product that your audience will crave.
Besides, I can certainly tell you that there are very few things as rewarding as building a community of interesting like-minded individuals who have similar goals and aspirations as yourself.