Monetizing a business book: The product development strategy
By the time your book is published, you and your publishing team will have spent countless hours nailing the structure, refining the messaging, and packing it all up to appeal and speak to your ideal reader. Whether you intended it or not, what you’ve got now is much more than a book. You’ve also built a master content asset — valuable intellectual property that can be reconstituted in a great many ways. The product-development strategy is a core monetization strategy that entrepreneurs use to earn a return on their investment in writing and publishing their book. So let’s dig into the important topic of product development for authors, first by getting clear about what the strategy is.
The product-development strategy uses your book as the foundation for an ecosystem of related products. Some use this strategy to launch a business, particularly subject-matter experts leaving the corporate world. But it can also be an effective strategy for those who already have an established business but want to re-orient it to match more closely with the branded methodology laid out in their book.
Why develop products?
“But mine is a service business. Why would I need to think about developing products?” you might be asking. When you turn your services into products, a few things happen:
· The perceived value of your offering improves. Converting your services into products makes it easier for prospects to understand the value of the outcomes you provide.
· You’re better able to scale up with demand. Productizing your services forces the discipline needed to systematize what you do in a way that makes it easier to scale up sustainably.
· You discover more income-generating opportunities. A product focus to your service business expands the ways you can package what you do for your customers, which increases your options for generating revenue.
But the goal here is more than simply developing a product; it’s to develop an entire product ecosystem based on your book IP. Having said that, this ecosystem will be made up of specific products and services. So, let’s look at the various kinds of products you might create from your book IP, and then we’ll go over what you need to do to execute this strategy effectively.
10 types of products for your product ecosystem
There are many products and services that can make up your product ecosystem. These include coaching, expert services, trainings, physical products, software, licensing and certification, subscriptions and memberships, and experiences.
Coaching
Coaching improves your client’s performance through a combination of teaching, assessment, feedback, and training. It can be done one to one or in a group setting and can be delivered in person, online, or through a combination of these.
Coaching is relevant in a variety of fields, from sports and fitness to marketing to financial planning and beyond. In fact, any area where there are people who want to improve their performance is a candidate for a coaching product.
Expert services
People hire experts to provide them with a variety of expert services, ranging from advice to analysis to the delivery of a specific outcome or activity. Expert services are most often sought when the client lacks internal knowledge in an area or lacks enough capacity to perform an activity in-house. This all feels rather general because it’s such a broad area, so let’s break it down a bit further.
Advisory services
Advisory services typically involve either a retainer model, where the client pays for guaranteed access to an expert when needed (within certain parameters), or a case model, where the expert is hired to provide analysis, conclusions, and recommendations on a specific topic.
This model is common in professions like accounting, management consulting, and law. Modern variants of this model exist where clients pay monthly for online access to an expert as needed — for example, telehealth or legal support.
Done-for-you services
This category of service involves an expert providing a specific outcome to the client for a fee. The distinctive feature here is the focus on an outcome versus an activity. Examples of done-for-you services include outcomes as simple as a haircut or snow removal, or as complex as wedding planning or managing a construction project.
Metered services
Metered services are services that are billed based not on outcome, but instead on some metered metric — usually time. This is the model that many service-based businesses start with, billing clients hourly for time spent, regardless of what outcomes are achieved.
Other examples using metrics other than time include writing (on a per-word basis), transportation (on a per-kilometre basis), or provision of electricity (on a per-kilowatt-hour basis).
Trainings
While mentioned earlier as a subset of coaching, training can also be a standalone offering. If coaching involves improving the client’s development of knowledge or skill, training is often more narrowly focused on transfer of knowledge.
Trainings may be delivered in person or online (live or pre-recorded), or through some combination of these, and can be delivered in a workshop, seminar or webinar, video, audio, or some sort of interactive format.
Physical products
Physical products are tangible products that customers either consume or reuse. Consumer goods are either durable, with a lifespan of three or more years — like homes, furniture, and vehicles — or non-durable, like food, clothes, and supplies.
Some service businesses deliver a physical end-product as its core business, like home-building, for example, while others introduce physical products alongside a service, such as a home-security company providing security cameras and smart locks as part of its solutions for homeowners.
How might your book IP translate to a physical product? Companion workbooks are common additions to a publishing program, but it’s possible to get much more creative as well. A vegan chef might release a line of ingredients or kitchen equipment that makes it super simple for readers to execute the recipes contained in her hardcover book, for example.
Software
Many businesses build software as their core product, but others have developed simple tools that play a specific role within a broader product ecosystem.
A good example is Ryan Levesque, author of Ask: The Counterintuitive Online Method to Discover Exactly What Your Customers Want to Buy. Ask focuses on Ryan’s Ask Method of surveying customers on their needs and bucketing them into segments to better tailor communications. In addition to other products in the ecosystem, Levesque launched Bucket.io, a subscription software product that helps business owners set up and automate the Ask Method in their business.
Licensing and certification
A type of product that few entrepreneurs think of is licensing — that is, selling or leasing the right to use your methodology, brand, and/or technology to other businesses. This is often paired with certification, where training is provided to the licensee to ensure a certain level of delivery quality.
An example is Mike Michalowicz. Mike is the author of Profit First, in which he shares the rationale and method for designing your business to create and take profit from Day One. With seven entrepreneurship-focused books to his name, book sales clearly play an important role in his monetization strategy. But digging deeper, we notice another important aspect of his strategy: the Profit First Professionals (PFP) certification program. PFP is a membership program for bookkeepers and accountants who undergo certification training and become licensed to call themselves Profit First Professionals, use the Profit First methodology and tools, and sell Profit First products and services.
Subscriptions and memberships
Subscriptions are recurring revenue products that deliver a product or service at a regular frequency (typically monthly) in exchange for a recurring fee. Memberships take subscriptions a step further, providing a basket of benefits rather than a single product, which gives you more levers to pull in structuring a differentiated and valuable offering.
David Allen, author of Getting Things Done: The Art of Stress-Free Productivity, introduced GTD Connect, a $29/month membership program that includes a Getting Started and Refresher training series; an extensive library of audio, video, articles, and setup guides; and case studies, as well as access to discussion forums and regular webinars with David and GTD coaches on a variety of productivity-related topics.
Experiences
Events and experiences are a unique type of offering that can be either the primary focus of a business, such as for a restaurant or theatre troop, or just one component of its offering, like an annual industry conference or retreat organized by an industry thought leader.
Live experiences may be delivered in person or virtually, but the distinction, as compared to live trainings and webinars, is that the value here comes from being live and the focus is on the experience, first and foremost.
Hospitality, travel, and entertainment all excel here, but many other businesses can deliver their value through this type of offering. (Exclusive, seven-day writing retreat on a remote, Caribbean island, anyone?)
2 success factors for the product-development strategy
To execute the Product-Development Strategy, there are two things you need to have in place to be successful: productization and product ecosystem.
Productization is important because it turns your services into something that feels more tangible to customers, even if they can’t physically touch them. And product ecosystem is important because it holds together a set of related products in a strategic balance that allows you to bring prospects in, turn them into clients, and then grow your relationship with them.
Productization
Even if your business is service based, it’s important to productize your service. Productization involves four key elements: branding, features, value pricing, and scalability.
Branding
Your product needs a name. A name makes your service tangible. It allows your prospects and customers to talk about it in real terms and makes it more ownable for you and your business. Can you imagine if, instead of the iPhone 13, Apple simply advertised, “We’re thrilled to announce the new version of our smartphone. It’s great, we think you’ll love it!” Naming your offering is critical.
Features and benefits
Explicitly design what your customers get when they sign up for your product, but then talk about the benefits these features deliver. Write the copy that would go in a brochure, have the brochure professionally designed, and get it printed. Not only will this force you to get crisp about your offer, but the collateral also turns even an intangible service like ‘advice’ into something that customers can feel, touch, and show to others.
Value-based pricing
Don’t price your product based on the time you and your team spend delivering it. Your customers don’t care about your costs; they care about the value it delivers to them.
Price your product based on what its benefits are worth to your customers. If your product isn’t profitable enough at that price, find ways to add profitable value to it or accept the fact that it isn’t viable and design a different product.
Scalability
Design your product so that it can scale. A scalable product is one that you design once, and then deliver at increasing volumes without scaling up your time and input costs at the same rate. Digital products are ideal for this, but products that can be systematized and delivered using lower-cost resources are also scalable. An example of this might be a management consultant who modularizes her proprietary approach to procurement cost savings so that it can be implemented by an analyst under her supervision, rather than having to do all of the work herself.
Product ecosystems and why you need one
Products aren’t profitable on their own, at least not over the long term. Think about high-ticket purchases you’ve made in the past. You pay a lot for a phone and end up paying just as much for cellular service, accessories, and apps. When you buy a car, financing and ongoing maintenance both contribute significantly to the dealership’s profits too, not to mention the upgrades they sell on top of the base model.
Whatever your business, it literally pays to think not only about your core product, but also about products that bring prospects in and those that will allow you to continue the client relationship well beyond delivery of the core product.
There are five types of products that make up your product architecture, each of which should relate to and can build off the IP from your book.
Attention products
Attention products get the attention of your target customer, provide value to them, and position you as a valuable expert who can help them.
Attention products are offered freely, sometimes with no obligation, like in the case of blog articles, YouTube videos, podcasts, and so on, or in exchange for something small and non-monetary like contact information, such as guides, interactive tools, self-guided tutorials, and the like.
Once created, attention products should be low cost or no cost to deliver, so that you can offer them freely to anyone who’s interested.
Entry products
Entry products serve three purposes. First, they offer a low-risk way to become your customer compared to buying your more expensive, core product. Second, they qualify someone as a suitable prospect for your core product. Finally, they deliver a valuable outcome for the customer that gets them ready to move on to your core product.
Core products
Your core product is the product you’re known for and that delivers the bulk of your revenue. Your core product is a high-ticket, profitable product that delivers a fulsome solution to your target customer in a competitively distinct and superior way. It implements the methodology laid out in your book to fully deliver the outcome your customer needs most.
Add-on products
Add-on products are options that can be added on top of your core product to address a need that a sub-segment of your customers have. And it’s delivered alongside your core product.
Add-on products can either be positioned as such and sold for an additional fee on top of the price of the core product. Or they can be structured as alternate packages that effectively become a tiered offering of your core product.
Add-on products tend to be high margin because there are no direct costs associated with customer acquisition.
Sell-on products
In contrast to add-on products, sell-on products are ones that become relevant for your customers only after you’ve delivered the outcome of your core product.
If your core product is effective, it results in a new, better normal for your customer. This new normal, however, comes with additional needs that you can help them with too, especially if you’ve exceeded expectations with your core product. Like add-on products, sell-on products are typically high margin — again, because you already have a relationship with the customer.
Can you see how by converting your book IP into branded products, organized into a robust product ecosystem, you offer clients a logical pathway to working with you in increasingly deeper ways? That’s key to building lasting, profitable, mutually beneficial client relationships. And that, in turn, is key to using the product development strategy to build a long-term sustainable business fuelled by the IP in your book.
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SCOTT A. MACMILLAN is a publishing strategist, speaker, entrepreneur, and the author of the international best-selling book Entrepreneur to Author. He’s also President and Chief Strategist at Grammar Factory Publishing, a Toronto-based professional service publisher that has helped hundreds of entrepreneurs write and publish books that build authority and grow their businesses.
