Why You Can’t Monetize Your Knowledge (And Why That Shouldn’t Bother You)

Hello everyone, and welcome to this episode of The Marketing Show. My name is Clay Collins, and if you are a regular viewer, you’ll probably notice that I’m not doing this in a live action studio like I usually do The Marketing Show, right? I’m not in front of the white board drawing things, and that’s because I started creating this presentation last week when I was in California speaking at an event. There’s a picture of me on a stage, and I had an insight that I wanted to share with you.

But before I get into that insight, which is hugely important, and this is one of the most important episodes of The Marketing Show, but before I get into that insight, I just want to talk a little bit about some of the people that I met when I was speaking at the event. When I speak on stages, and you know, share my content, share my message to the world, I often meet some really interesting and great and fantastic people who I would like to recommend to you.

So one of the guys I met was this guy, Robert Evans. You can check him out at TheMessengerNetwork.com. Robert Evans has been behind the success of so many authors and speakers and people who have a message to get out into the world, but primarily authors, primarily people who publish books, and primarily spiritual authors, but he’s doing fantastic work. He’s creating a huge movement, and he’s becoming a really good friend, and he’s a great guy, and he’s also the guy who put on the event that I spoke at. So he’s a really great guy.

Another guy who was on stage with me at that event is this guy, Bo Eason. And Bo has created what the New York Times called the Best Play of the Decade. So he’s a playwright and he has been performing on Broadway for I believe – don’t quote me on this – but I believe the last 12 years, he has a play called Runt of the Litter, and it’s actually about his own history as a professional football player. How many football players do you know who later become award-winning acclaimed playwrights and actors? Not many, but he’s an absolutely amazing person, one of the best speakers I’ve ever heard speak, and just an amazing all-around guy with a lot of great things to share.

Another person I met was this guy, Kyle Cease. Kyle Cease has his own comedy central one-hour special. I believe it came out in 2009. It was voted the best comedy central special of 2009. The guy is amazing. He’s funny, but unlike most comics who are really negative, he has an incredibly inspirational message, and Kyle is out there speaking at colleges and changing the world, an absolutely fantastic guy. So I wanted to introduce you to those guys because they’re pretty incredible.

So I’m going to talk today about the need for absolute alignment in your marketing and really why you need to stop fooling yourself, okay. So this is kind of part 3 in my rant against monetization, but I’m also going to talk about what you can do about it. This is incredibly important. So please, please, please, if you absorb no other content about marketing this week or this month, please absorb this message. This is highly controversial, but I think by the time you’re done with this you’re going to be agreeing with me. If not, leave a comment.

So here’s what most people want. This is what I’ve seen most people want. They want to take what’s in their brain, their existing knowledge and information, what exists now, and then they want to use marketing like it’s this machine, and use marketing to convert what’s in their brain to cash. So they start out with what they’ve got, right, some knowledge, a book, some expertise, and then they want to put that through a machine, and then they want money to come out at the other end. They basically want marketing to convert what exists now in their head into cash, right? So marketing is this conversion mechanism.

And I’m here to tell you that that is absolutely false. This does not work. It is so rare that I have seen this work, and the instances of this working where you have something and you convert it to cash or you monetize your mission, or you monetize somehow, this works so infrequently it’s ridiculous, okay.

Here is what works. What works is when you create a store from the ground up to create income, and that income appears, right? When you create a store or when you create a business, you’re not monetizing. Monetizing is the act of taking something that was never meant to create money and converting it into cash or converting it into money. No one would ever say that they monetized their food cart, right, because a food cart business was created to make money.

Wal-Mart – And I’m not a fan of Wal-Mart, but Wal-Mart would never say that they monetize their stores because their stores were created as businesses from day 1. So what works is creating something from the ground up to generate income and then making income from it, not taking something that was never created to make income, right, and then converting that somehow to cash, but the point here is that there’s no monetization or conversion happening with this food cart whereas when you take something like a garage sale for example and convert it then you’ve got something jerry-rigged.

So here’s what I mean. On the left, you have a garage sale. Now a garage sale is a version of monetization. Someone did not deliberately go out and acquire everything that’s at that garage sale so that it could be resold. People did not deliberately produce all the items that are at that garage sale to create money. A garage sale is an afterthought. A garage sale is saying we have all this stuff – and in a lot of cases it’s junk – we have all this junk, how can we turn this into money? And that’s what a garage sale is. It represents monetization, taking just some stuff that’s lying around and saying, “How do we convert this into cash?” Whereas a real business like the Apple store was engineered from day 1 to create an income, right? Apple never said, “How do I monetize the iPad? How do I take the iPad and make money?” They created the iPad from day 1 to be something that was for sale.

So an analogy from monetization is a garage sale. It’s awkward. It’s not in a traditional storefront. It isn’t really good at creating income whereas a real business, right, let’s say, Apple or Apple Storefront, is created from the ground up to create income. But let me drive this point home a little bit further. The reality is that instead of monetizing your current assets to convert them “into money,” you need to create something that’s designed from the ground up to generate income, i.e, a real business.

For example, like I said before, you’ll never hear Apple say that it monetized the iPad because the iPad was created from the ground up to create income. Wal-Mart doesn’t monetize its stores because they were created from the ground up to create income. You’ll never hear your local gym say it monetized its gym space because making money was kind of the point in the first place, right? None of these people are monetizing. And none of the great successful businesses are monetizing. They were created from the beginning, from the ground up to generate income.

Monetizing is awkward and backwards because it’s taking something that was never created to generate income and just jerry-rigging it to squeeze some cash out. So what we end up monetizing, so often, are things that were never intended to create money in the first place, and the result is kind of awkward and unnatural and amateur, right? We see this all the time. Amateurs occasionally write mediocre e-books that anyone else could have written to squeeze a little money out of their website. They say, “I have all this traffic. How do I monetize it?” But they didn’t generate that traffic in the first place to feed into a business that would create an income so they end up just kind of like throwing up some ads or writing some junkie e-book to try and squeeze a little money out of it, and that never quite works out very well and it’s awkward.

So let’s talk about professionals versus amateurs. Professionals get up everyday, look at themselves in the mirror, rededicate themselves to their mission all over again, execute like madmen and produce excellence week after week. Actually, they produce excellence week after week regardless because that’s the difference between an amateur and a professional. But amateurs monetize, right? They have garage sales. Professionals build businesses. So to bring this to some kind of a conclusion, I want to say this. Monetization in marketing rarely works and rarely works well because it is a form of conversion thinking, and conversion thinking rarely works well in marketing.

So let me give you just some other examples of conversion thinking. People are all the time trying to take traffic that is looking for one thing and convert into traffic that wants to buy something else. So for example, I had a client that ranked extremely well for the term doghouse in Google, and they assumed that if people were searching for doghouses that that same group of people might also be interested in purchasing dog training products because if you’re searching for a doghouse, you probably own a dog, and you might need dog training products. And so, they threw up an advertisement and a sales letter for dog training products, and they sold almost nothing because they were trying to convert doghouse traffic into dog training traffic. The only way, if you’re really going to do well at selling dog training advice is to get people who were searching for dog training, but they were trying to do this conversion, and this conversion almost never works. So it’s very difficult to convert that, and conversion thinking almost never works.

I also see people trying to do things like take a piece of their product and give it away as a bribe in order to get people to buy their overall product, and that’s another example of conversion marketing because they’re trying to take something that was intended to teach and convert it into something that will sell, right? That free piece of their product was intended to teach and they’re trying to give it away in order to generate a sale. And again, giving away a piece of your product in order to sell that product almost never works because you need to give away a free bribe, right, in order to get people to opt in that was generated from the ground up to create desire, not to teach, if you know what I mean.

And there are a lot more examples of this conversion thinking failing time after time. So in the next episode, I’m going to talk about how conversion thinking, right, taking something that was intended to do one thing and trying to get it to do another, I’m going to talk about how conversion thinking is screwing up your ads. If you are like most people online, your ads are not making you money. You’ve bought piece of advertising after advertising after advertising and you place your banner ads in such a way, and you’ve created those banner ads in such a way that you are not making money. Most people who spend money on advertising online fail miserably, and this conversion thinking is really at the root of this whole problem. So in the next episode, I’m going to talk about how conversion thinking is screwing up your ads, and I’m also going to talk about how to create ads that actually make you money.

So sort of the take-home lesson here is that you should create products and businesses that are created from the ground up to create income so that you don’t have to monetize, and monetization is something that’s done as an afterthought where you jerry-rig a website that was not intended to create money, to create money, and it’s awkward.

So that’s the end. I look forward to speaking with you on the next Marketing Show where we’re going to talk about how to create profitable ads by avoiding conversion thinking. My name is Clay Collins, and thank you so much for watching The Marketing Show.

  • Absolutely love this one Clay. There’s SUCH a difference between trying to “make money online” and trying to extend a REAL business to the web.

    Your teaching has helped me see this distinction more clearly, and my whole online presence is slowly changing. 

    • Awesome! I look forward to watching your work and business evolve!

      • Believe me man, I’ve got BIG changes in the works. Blogs are dumb. Businesses rule. 😀

        • Awesome! I’m looking forward to seeing what you come up with.

  • Sue

    You said that it doesn’t work to ‘take part of a product (like a free chapter of your book) and giving it away as a bribe to opt-in doesn’t work.’

    Wouldn’t the pink spoon taste of ice cream flavours at Baskin Robbins be considered ‘part of a product’? Seems to work for them…  If you like the flavour you tried, you buy it.  If you don’t like the flavour, you try or buy another flavour.

    • Hi sue! The majority of folks who step into a Baskin Robbins buy ice cream.  The marketing is done long before someone steps in the door.  I’ve been at a lot of ice-cream shops, and rarely do I see someone not purchase because samples aren’t offered.  If someone wants ice cream, they get ice cream.  It was the marketing that’s done long before someone gets in the ice cream store that generates the customer.

      • Sue

        If giving a piece of product to generate an opt-in doesn’t work and a free bribe to create desire does:

        1.  What is an example of a bribe? 

        2.  Do you make an offer for the product in the ‘bribe’ you created?

        • A free bribe to create desire does work.

        • P.S. If you’re the Sue who I think you are, you’re in the marketing program right?  If you can time, call during this week’s mentorship call and we can work through the specifics in your business.

  • Evan

    People have ‘monetised’ the audience they have through selling merch for many years.  This is a kind of monetisation.  

    I think the point you want to make isn’t about starting with a project or group and later selling stuff.  I think it is about how the product is designed and offered.

    I agree that it is important to find out what people want and design your offer around this.

    The freebies are designed to market (build know, like and trust) rather than sales.  I think they may work for doing this.

    • Yup, people have monitised for many years, and most cases it’s been a flop.  I made the point that I wanted to make.

  • Monetisation is theoretical marketing advice.  Of course it’s theoretically possible to make money throwing up adsense, ads, and selling shitty ebooks (people have done that before).  But the percentage of people who actually pull this off is so low it’s only a slightly better bet than working the lottery.

    You know who does make a crap ton of money on monetisation?  The people who make courses teaching it.

    “Buy the Automatic One-Click Crazy Awesome Life Altering Fortune-Creating Adsense Machine!”

    • Nice!  I’d like to hire you to do freelance title writing, BTW, Joey!

  • Jgschanen

    Thanks Clay.  Very thought provoking, especially the last part about trying to sell dog training products on the back of dog house traffic.  I look forward to seeing the next video.

    • Thanks, James (I think this is James).  See you this weekend!

  • Taki Moore

    I love the distinction between the garage sale and the apple store.

    Clay Collins does it again 🙂

    • Have you heard the story about how Steve Jobs came up with the Apple Store?

  • I couldn’t help but comment on your example of garage sales as monopolization and not a business. You are so right — almost.  Years ago, I had a friend who loved to go “garbage picking” late at night to find thrown out treasures. She was amazing at it and had learned it from her father. She was so good that friends started asking her to take them out in her van as the social activity of the month. We had so much fun. My mother who was British use to call it “tipping”. But I digress.

    Pam turned this whole thing into a business.  She had friends who “rode” with her find stuff, some were skilled at fixing things and she reworked the rest – storing stuff in her barn. Then we would circulate having garage sales each week in the summer from one house to another selling things.  Besides having a blast, Pam actually made money. It was a side business for her to off load the things that weren’t worth keeping or selling in her “real business”. It was fun for us but it was always business for Pam.

    • Awesome story! And one that really drives the point (of this episode) home.

  • You’re right on the money here Clay. 

    I don’t like blog monetisation. I USED TO, but not anymore. Today, it just feels very.. awkward (like you said) and quite frankly, it feels like a waste of my time. It’s not that you couldn’t do it, it’s just so much more rewarding to build something that was meant to create income (to answer a real market need) in the first place. I see myself repeating what you said, but those things are just so damn true!

    If everyone would just quit blogging (at least for 3 months!) and focus their energy on building stuff (products & businesses) that solve some real world problems, none of us would ever have to think about “should i write an ebook, what should i blog about, should I put this banner here or there, jadajadajada..”. 

    I’m glad that there’s someone who sees how this is so silly. Thanks Clay! 

    This was actually the first of your marketing shows that I watched (the title really caught my eye). Now I have to go and consume your previous marketing shows (I have a lot of catching up to do!)Cheers!- Juha

    • Hi Juha! I’m glad you liked your first marketing show.  Welcome to the site!

  • Kapila

    That was awesome Clay, I love how you always seem to have a totally different way of looking at things and my mind goes.. “oh…aha”

    The Marketing Program rocks, I’m so glad to be on board and look forward to picking your brain more…

    • Awesome, Kapila!  I’m glad you’ve joined and I’m really looking forward to the road ahead.  Thanks for all you do.

  • I just watched this; and you’ve effectively stopped me from writing what might have been perceived as a “janky ebook.” Wheels are turning; thank you.

  • Like your presentation. This alone is good marketing.  Would like to present in a video as you do …look forward to listening to the next video.  Best to your success!!

    • Thanks so much, Gloria! I think this is probably good education, but not good marketing (nothing for sale here).  Anyway, a lot of people confusion education and marketing: http://www.marketingshow.com/show/tms_video/marketing-first-then-education/

  • I thought this was really interesting, however doesn’t it fly in the face of your previous webinar suggesting that you create your product along with your customers’ help based on their needs and wants? This video’s tactics suggest you create a product before building an audience, and the webinar seems to suggest you get your audience first and then build a product.

    • Great question.  This episode doesn’t fly in the face of that webinar.  In fact, this show and the webinar only reinforce each other.  In a meeting right now but will answer later to explain.  Again, great question.

      • thanks, feel free to reply to me on twitter too (@Bobbysofamous)

    • OK. So here’s the thing. This episode doesn’t fly in the face of that webinar.  In fact, this show and the webinar only reinforce each other.  This Marketing Show episode is about purpose, intent, and strategy.  Not about order.  Monetization is about taking something that wasn’t created from the ground up to make money . . . and then trying to Jerry Rig it to make money, which is awkward.  Monetization has nothing to do with order.  When you create your business from the ground up to generate income (as opposed to sloppily throwing up an ebook to try and “monetize” and get some money out of your list), then you’re being a strategize business person, not a monetizer.  When you co-create your product from the ground up to be the EXACT thing your market wants, then you’re being a strategic entrepreneur, not a monetizer.

  • Katrina M Harrell

    it’s funny, I never learned monetization in biz school/corp america. I learned business modeling. So imagine my confusion when I started working online encountering countless coaches telling me how to monetize and looking at me weird when I was more interested in created a new biz model. I thought I was the one that was missing something!!!