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The sorry tale of the café owner who went bust…
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This email contains affiliate links. If you click on a link and make a purchase, I may get a commission. Hi Reader, Today I want to tell you a story… It’s the sad and sorry tale of a café owner who went bust... Let’s call her Ruth. It was Ruth’s lifelong dream to open a café. However, from a young age she had always been taught to be careful with money. Her parents had taught her things like:
So when she started her new café she was determined to be careful with her money and spend the bare minimum.
I think you can probably guess how this tale ends... Sadly, Ruth got very few customers, never even got close to making a profit and went out of business after a couple of months! A silly example?You may laugh at my silly example, but I see online business owners doing this all the time… ...and with exactly the same results as my penny-pinching new café owner. Another thing I see all the time is people saying, "I’ll spend money on my blog / business WHEN I start earning money". But I take you back to my penny-pinching new café owner example… If you start with that mentality, you’ll NEVER get to the bit where you are actually earning anything! The problem, of course, is that many of us were brought up with that exact same ‘A penny saved is a penny earned’ mentality. And that’s almost certainly good advice if you’re looking after the household finances on a tight budget. But this is terrible advice if you are trying to build a successful business! One of the biggest mistakes I see bloggers and online business owners make is trying to ‘get by’ with free or poor quality tools. I understand the temptation – especially when your business is not making a whole lot of money yet. But let me be blunt... Trying to grow a successful business with free and poor quality tools is like trying to build your business with matchsticks and duct tape. Instead of saving money, you’ll cost yourself a whole lot of missed opportunities. In other words… When it comes to business, you need to think like an investor, not a 1950s housewife… and definitely not my penny-pinching café owner! The investor mindset…An investor doesn’t look at a ‘cost’ in isolation – they look at the Return On Investment (ROI). To take up our café story again... A café owner with an investor mindset would see that, if they INVESTED in good quality décor, good quality tea/coffee/cakes, good quality crockery, good staff and a dishwasher, their café would attract lots of customers… meaning that the café would actually turn a PROFIT! Yes, they would spend more money up front, but the ROI would be much, much higher. And that’s exactly the mentality you need to apply to your blogging business… Instead of spending the bare minimum and then wondering why you are not making any money, make smart investments and you’ll find you’ll get a much higher ROI… and in the long-run make much more money that if you scrimp and save and try to spend the bare minimum. Or, to put it another way, would you rather... Invest $0 and get $0 back? Or invest a few hundred dollars, or even a few thousand dollars, and get back many times that investment? The good news is that you don’t need to spend anywhere near as much as a new café owner in order to be successful with an online business. But you do need to spend more than nothing! What should you spend money on?So, all this begs the question… What should you spend money on? Because not every blogging tool is going to give you a good ROI! Of course, to some extent this is going to depend on your niche and your monetization strategy. But here are a few of my non-negotiables: 1. Good Hosting You are never going to turn a profit if your site is super slow, keeps going down or getting hacked! I don’t think you need to spend crazy money here, but definitely more than the bare minimum. Here’s the two I use and recommend 2. A Professional Theme I honestly believe that a lot of bloggers don’t realise quite how much an attractive theme makes a difference. The problem, of course, is that the 'effectiveness' of an attractive theme is not something that is very easy to measure. (Unlike core web vitals, for example – which has a very small effect on your success and yet is very measurable – a major reason why people stick with bad themes!) But people really do judge a book by it’s cover. If your site looks, clunky, unprofessional or a clone of every other site in your niche, people are going to make judgements about quality… and just like a café with poor décor, they are going to vote with their feet – no matter how fast it loads! My personal recommendation here is Restored316. For me, they have the perfect balance of speed, functionality and attractiveness. 3. A Keyword Research Tool If you want your blog posts to rank well on Google, a keyword research tool is a must. I am constantly amazed by how people refuse to spend a tiny amount of money on a keyword research tool that could literally pay for itself with one good keyword! Don’t believe me? Here’s a really clear example of the ROI effect at work… KeySearch, the keyword research tool I recommend, costs just $24 a month… Using that tool I found a keyword that brought me 10,000 pageviews in the last 30 days. That particular post gets an RPM of $33… meaning that that ONE blog post earned me $330 in the last 30 days. Even if I only used KeySearch for that one blog post, that would be an ROI of nearly 14X… but of course I use KeySearch for all my blog posts, so the return from my investment in KeySearch is ENORMOUS! READ MORE >>> Is KeySearch worth the cost? 4. A really good ESP It always surprises me that people want to scrimp and save with email marketing… because email marketing has one of the highest ROIs in business. On average, for every $1 you put into email marketing, you should get $36–$45 back! And the most important email-related purchase is of course your ESP (Email Service Provider). For me, a good ESP is a non-negotiable. Get a good one and it will pay for itself many times over. And for me, the best of the ESPs out there, is Kit. Here’s why >>> 26 reasons why Kit is the best email service provider for bloggers 5. A really good sales platform Here’s another example of a tool with a massive ROI. I’ve watched time and time again as bloggers try to make the leap into digital products, but make that one fatal mistake of scrimping and saving on a cheap sales platform – which leads to poor quality sales pages, a lack of features (coupons, integration with ESPs etc.) a poor checkout experience, and ultimately a lack of sales… If you are going to sell digital products, pay for a decent platform and do it properly! My personal pick here is Teachable, but there are other good alternatives out there, like Thinkific and Podia. 6. Courses When it comes to learning a new blogging skill, there are 2 ways to do it. You can: a) figure it out yourself by reading blog posts, watching YouTube videos and trying things out until you succeed. OR b) buy an ebook / course / membership, by someone who knows how to do the thing… Do all the things they recommend, and in the right order, and get to where you want to be MUCH, MUCH faster and without a ton of costly – and stressful – mistakes. It might sound like the ‘cheaper’ way to figure it out yourself, but it almost always isn’t! Sure, you might not spend as much money up front… but you will almost certainly earn less money in the long run. Like say for example, you buy a course that teaches you how to do SEO properly and as a result your blog starts earning twice as much from ad revenue… Here’s what the maths looks like: Figure it out method Cost $0 Yearly ad income $25,000 Total earned: $25,000 Buy an SEO course Cost $197 Yearly ad income $50,000 Total earned: $49,803 And that’s exactly what I mean about thinking like an investor, not a 1950s housewife. A person with a 1950s housewife mentality thinks ‘Yay - by NOT buying this course I SAVE $197!’ An person with an investor mentality thinks, ‘Yay - by BUYING this course I GAIN $24,803. In this example, NOT buying an SEO course has COST this example blogger $24,803 in lost revenue – this is the epitome of a FALSE ECONOMY. Over to you…I’d love to hear your thoughts! Did you buy a blogging-related tool that felt like a lot of money up front… but actually ended up having a huge ROI? I’d love to hear about it – hit REPLY and let me know! Happy blogging! Eb 😊 P.S. To succeed at online business, you need to think like an investor NOT like a 1950s housewife. For more on thinking like an investor, read this blog post >>> The Money Task First Principle |
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