Many of us are seeking to grow what we often call “a passive income” businesses– in large part thanks to Pat Flynn popularizing the term for online marketers. Internally, we’ve been using all sorts of terms in the same ballpark as “passive income”: location independent, leveraged, automated, online, recurring, scalable, residual, info-income, etc.
The problem with all these terms is that they haven’t precisely captured the type of income I care about most. “Location independent” income can be earned by a consultant (I’d prefer not to primarily be a consultant), and passive income implies you are no longer working within your business.
It’s a great name for Pat’s site, but it can be an awkward way to describe the sort of income we are working to generate from our current online projects.
So I’m kicking around all these random terms and then one day I said something like, “what I love about this product is that it’s creating us Cambodia cash.” And I’m sure many of you can guess what I meant.
“Cambodia cash” – n. – any profits generated from a business that have all of the following attributes:
- does not require synchronous customer support.
- 99% of customer issues can be resolved via email.
- has no critical business processes that requires a high amount of internet bandwidth or stability.
- all products and services are ‘bits’ not ‘atoms,’ e.g. software, online support services, information, etc.
- services, products, and experiences are very similar from client to client (only minor modifications to product or protocol required).
- highly skilled labor is not required for the weekly maintenance of the business.
- has no physical location or time zone requirements.
- does not require phone support.
Want to spend a few weeks strolling by the river in Kampot, Cambodia eating fresh peppercorns and riding your XLR 200 through the hills? No problem. Your business won’t suffer for it. As long as you can find 4-5 hours a day to rock out emails, write, create code, and provide customer support, your business will continue to move along.
Sure… we could all go for a little more Cambodia cash. :)
Of course many of us who are obsessed this online dream can hurt our chances at growing a sustainable business. Long term travel costs time and energy, and generally hamstrings a start-up.
But ya know what? I sure as hell is easier than it’s ever been. Here’s some steps I’d take (plus a business idea to try it out on!):
1) Make sure you’ve found a real problem.
It sucks for expats in Asia to make travel arrangements. Local carrier sites are temperamental. It can take 1-2 hours to make a simple booking between searching for the best price and fudging around with their interfaces. Booking long-haul flights isn’t much better, especially when you have to coordinate your rewards programs.
I don’t want to have this problem anymore. Imagine a virtual travel agency, focused on saving you time and money, securing it’s clients the best deals in Asia and in long haul flights to the West.
2) Make sure you get a URL that isn’t confusing and that is easy to spell and easy to tell others.
I found this one in 30 seconds. Spend a few more minutes on it. Keep it simple, easy to pronounce, and focused.
A lot of people just getting started in online marketing circles will say stuff like “Dan what happens if you want to expand this to places outside of Asia?… that URL won’t work. What if your customers aren’t expats? Why don’t you get a domain like easytravel.ly??”
Having a narrow domain scope is exactly the kind of problem you want to have. If you are ballin’, by all means! Target anyone. Go broad. If you are just getting started, niche until you feel uncomfortable. If you have 350 paying customers, you can present your proof of contempt to an investor, or change your name. No biggie.
3) Solve the market problem in a unique way.
Instead of dealing with preferred suppliers like most travel agents and relying on kickbacks, you provide a concierge type experience for a monthly fee. When I sign up for your service, you take a detailed survey from me. My preferences, credit card #’s, favorite airports, and whether or not I prefer aisle or row. Make it clear that I can update my personal preferences by emailing your team anytime. I can train your team to my preferences– you add my requests to my customer profile so that every agent I work with in the future understands my tastes. Instead of signing me up for your airlines, you sign me up for the best for me. Awesome!
4) Identify the simplest workflow and technology solution possible. Use something 100% out of the box.
Software developers have long been chasing the Cambodia cash– it’s only recently that marketers had such robust tools at their disposal that require little or no developer support.
Define a workflow that can utilize 100% out of the box tools like WordPress or Ning (if you haven’t signed up for a free Ning account just to play around with it, check it out!) Say I send you an email that says “I want to go to the Philippines next Saturday. I want to go in the morning if possible.” Your team sends me itineraries until I approve something.
With the expert protocol that you develop, you can get me good deals faster than I could have gotten on my own. I’d no longer procrastinate on my travel bookings so I’m saving tons of money by getting your team involved the moment when I know I want to make a trip. When I approve something, you team purchases the tickets and emails them to me. They might even remind me that I need an outbound ticket!
5) Don’t automate your idea.
Listen to this podcast and try not to blush. I loved the story of Rob taking over a business with many established customers and running the all customer service himself. That’s how it gets done. How many times has somebody fiddled around with developers and various plugins for months trying to automate a process that could be solved with a few emails and Boomerang for Gmail?
6) Sketch out a quick business plan and product articulation.
Full plane ticket concierge service (members + 1 guest per flight) for $27 a month? How many benefits do you need to offer to get that price? Is it too low? Bounce it off a few friends. How many price levels? Can you keep it less than three? What about full hotel and AirBnB booking service for $47 a month?
If your average customer value is $35 bucks a month, and your average customer is taking up 3 hours a month(<– a key figure to determine with the first small group of customers, probably with this business customers will use the service more in the first month than in the second and third, since they’ll likely purchase it when they need it if you aren’t offering out of the gate immediate benefits). At 100 members you are brining in $3500 a month. Do the economics work for you? Fire up the Google docs!
7) Sell (or figure out an articulation that does).
I’m serious when I say you could be selling something here in 12 hours. Why not give me my first 3 months on your service for free? What about a small group of charter customers that pay a reduced rate? Get some cash greesing the wheels and then see where it takes you. Could this idea get funding in a year? Sure. Could you develop custom software? An automated website? Group discounts? Travel hacking seminars? Of course. This is how it starts.
If somebody provided you with personalized concerierge travel services, would you pay them a monthly fee? I know I would.