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If you are a creator, you have probably heard about the importance of diversifying your income sources. Chances are you’ve already done this successfully, and if not, you might be wondering where to start.
Like any industry, the creative economy is not immune to the pressures of inflation. As dwindling brand sponsorship offers and ad revenue payments cut revenue, creators are increasingly looking for additional ways to monetize their business. But for many then the question arises, how and when?
Not only do I believe that diversification is one of the major trends that will shape the creator economy in 2023, but a recent survey we conducted also found that 70% of respondents consideration of additional sources of income because of this economy. And for good reason: Diversification can help complement and cross-sell existing offerings, leading to greater engagement, retention, and The value of customer life.
But while it can be tempting, creators should approach diversification strategically to ensure it leads to increased revenue and career stability, complementing and enhancing existing content rather than distracting attention.
I don’t just work with creators; I am one of those who gave me the first glimpse of missed diversification pitfalls and powerful potential. There are no easy answers to get it right, but here are a few rules of thumb for any creator looking to diversify their offerings to stay competitive, meet changing audience needs, and survive in this economy.
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Don’t Diversify Without a Purpose
Let’s get this out of the way. Yes, diversification can be a powerful business growth strategy, but you shouldn’t diversify just because everyone is talking about it. And you certainly don’t have to be on every platform trying to exploit every possible source of income. Generally speaking, there are two main scenarios where diversification can be a good option for your business: when something works and when it doesn’t.
Diversification can be an effective strategy for creators who are already successful and want to take their business to the next level. If you have a large audience, generate significant revenue, and have the bandwidth to do more work, it’s time to think about expanding and reaching a wider client base.
By diversifying, you can tap into new revenue streams and lead sources and engage with your audience in innovative ways. According to a recent study, twenty-five percent of full-time writers earn between $50,000 and $150,000 a year. survey from ConvertKit. Most of them do this by combining multiple sources of income, from online courses to paid newsletters, speaking engagements, coaching, merchandise, or other streams. Our research shows that full-time creators rely on an average of 2.7 streams of income, and the number of creators using multiple streams has grown by nearly 50% over the past five years.
On the other hand, if your current strategy is faltering and you’re having a hard time attracting an audience and generating revenue, it might be time to look for click-through content and revenue streams. Used this way, diversification is more of a slow turnaround than true expansion, but exploring new types of content, products, and services can help you energize your community or find new audiences more receptive to your content, bringing long-term stability to your business. Your business. Simply put, if your content doesn’t resonate with your audience or you’re having a hard time generating revenue, it might be time to consider a new approach.
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When to expect
Despite the great potential of diversification offerings, sometimes it is better to wait and focus all your energy on what you already have. If you’re new to the creator economy, still seeing growth and hitting your goals, it might be better to focus on your existing content and channels rather than add additional distractions. Diversification can easily become overwhelming, especially if you are still in the learning process.
Even experienced writers should understand that diversification will require additional attention and effort. I have seen many cases where writers with shiny object syndrome have neglected successful and profitable business channels and failed in both. If your current approach works wellit is better to focus on developing existing channels and hire a team to increase your opportunities in these successful projects than to divide your attention.
I always advise you to quickly check your ROI if your efforts on this new opportunity are likely to generate more returns than simply building on your existing business and doubling down on what works.
This is not a one size fits all approach.
If diversifying is your move, the next logical question for many creators is: how? And the truth is, there is no golden ticket. The right steps to diversify largely depend on your unique audience and business.
One way to diversify is to expand topics using existing channels. For example, if you have an online yoga school, your student community may also be interested in meditation and healthy eating. By expanding related niches, you can diversify topics within that niche to keep your audience interested and attract new subscribers. This approach allows you to grow your brand while keeping your focus on the platforms that work best for you.
Another approach diversification of income sources to complement and cross-sell successful content. A physical product can generate revenue while a course and community can be an engagement engine that keeps people coming back. Synergy creates a virtuous circle – hot topics of conversation in the community can be the basis for a new mini-course or e-book; Courses can be gateways to paywall communities where everyone has common interests and skills.
Creators can build robust and sustainable businesses by combining channels in unique ways. Take John Lee Dumas, host of the Entrepreneur on Fire podcast, who has combined his daily podcast, short courses, and even regular reports on his own entrepreneurial path as part of its varied offerings.
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A well-executed diversification strategy can turn your community into an engagement mechanism that increases customer loyalty as well as providing valuable customer insights. The key is to always be strategic. When considering diversification, map out the workflow for producing your content by syndicating it across channels and reassess the impact on your bandwidth before making further changes.
Diversification can be a game changer for authors looking to build a thriving and sustainable business, but there is no one way to do it or one right answer that will suit every author’s needs.
Random expansion or the constant feeling of needing to be everywhere – not a successful strategy – is a recipe for burnout. But by strategically identifying and managing new content and revenue streams, creators can stay on top of the game.