Monetizing Knowledge: How Agencies Can Create Passive Income

What if there was a way to turn your agency’s expertise into a source of passive income? Do you wonder how agencies can create passive income in an industry where economic ups and downs are inevitable?

Having a steady stream of revenue from intellectual property can be a game-changer.

Agorapulse’s Chief Storyteller Mike Allton sits down with Gini Dietrich, the author of the Spin Sucks (book, blog, and podcast.) Gini will share her insights on how agencies can leverage their intellectual property to create structured processes that generate passive income. Gini and Mike will explore the steps necessary to transform agency knowledge into monetizable assets and how those strategies can provide financial stability during tough times.

If you’re looking to create new revenue streams and future-proof your agency, this episode is for you.

[Listen to the full episode below, or get the highlights of the Social Pulse: Agency Edition, powered by Agorapulse. Try it for free today.]

How Agencies Can Create Passive Income Using IP

Mike Allton:

Can you start by just telling us first how you kind of came around to this idea of using your own intellectual property to create passive income?

(I mean, I’ll tell you, as a content creator, this is kind of something I’ve been doing for a while, but it’s not so common with agencies.)

Gini Dietrich: It’s not so common with a lot of people.

I think the Great Recession was my first couple of years in business, which is a great time to start a business. Kind of like if you started an agency right now, it’s not ideal. But I think I went into it a little bit naive and not really understanding. Of course, the business was decimated within a year because of the Great Recession.

I had to very quickly learn about the business failures:

1. The mistakes of laying off employees
2. Working with clients because they could no longer honor their contracts
3. Going through all of those things that you go through as a business owner
4. Figuring out how when something like that were to happen again, it doesn’t decimate everything and you don’t lose a hundred percent of your revenue

And that was the genesis of it.

So I started to think, “Okay, well, how could we do this?” I co-wrote Marketing in the Round, and I went on the book tour for that. And I learned a lot, then solo wrote Spin Sucks, went on the book tour, started speaking, doing a lot of that kind of thing.

As part of that and Mike, you speak, and you’re on stage, and you’re traveling, and it’s a lot, and I’m an introvert. So I didn’t have a lot of recharge time, and eventually, it got really exhausting and I thought, “I can’t keep this up because it’s not good for me, my mental health. It’s not good for my physical health. It’s not good for my need-to-recharge health.”

And so I remember, I was sitting at a speaker’s dinner at Content Marketing World, and this had to have been probably 2011, and we were talking about online courses, and I had just launched an online course. We looked at how to take your content and marry it with media relations.

So how do you take the content that you’re creating and get journalists to be interested either in you or the company or the thought leaders, the subject matter experts to include them as sources?

And so we launched this course for $199. We sent it out to our subscribers, and, granted, we had a nice subscriber base at that point. We made like $250,000. I remember sitting at the speaker’s dinner, and everyone turned and looked at me like, “Wait, what?” It was Marcus Sheridan, Ann Handley, and Jay Baer, like people who know what they’re doing.

Every single one of them had a story about how they had launched an online course, and it failed. And so we talked about as a group, like what I had done differently to have such great success and then how I’ve taken that and launched it into other bigger things, where now it’s about 65 percent of our revenue.

So when the pandemic hits and when the world is on fire—like it feels like it is right now, and clients are pulling back on their budgets, or they don’t want to resign retainers, or they only want to do projects, whatever happens—you have this other side of the business that’s for lack of a better term, keeping you afloat.

Mike Allton: Yeah, going through the economic times that we’re going through now, mid-2024. I know agencies have been struggling. So many agencies that I talked to on the show or outside the show. Because their clients are struggling. So the first thing they do is they pull the marketing budgets. Now, the one thing I’m super glad you did was you made a distinction about book writing because book writing is not passive anything.

Specific Examples You Can Follow

Can you give us some specific examples of what kinds of mediums we’re talking about?

Gini Dietrich: A couple of things: So to answer the question about what kinds of things you could sort of productize for lack of better terms, online courses, webinars, ebooks, anything that you can sell on your website.

And, truth be told, I’m in the process right now of writing the second edition of Spin Sucks, and I’m going to follow Joe Polizzi’s footsteps and see if I can sell it on our website versus through Amazon. (I don’t know yet if it’s going to work, but I’m going to try it because I’ve spent the last 10 years, 12 years building a community, building a subscriber base. We have it in schools now where they use it as a textbook. So my hypothesis is to use the fifth grader terms as they’re going through science classes.) My hypothesis is that we have a large enough audience that I might be able to skip Amazon. If it can’t and it doesn’t work, then of course I’ll go over there as my plan B.

Setting that aside—just because I don’t have the results yet and I don’t know what to expect—it is something that I’m going to test. Those are the kinds of things that you can do: thinking about it from the perspective of what is tangible that I can sell through our website. It’s DIY. I have one coaching client that is doing a DIY strategy development program. Another client is doing short snippet videos that someone will buy for small businesses on how to do their own PR.

There’s a lot of different ways that you can package it. And when you think about what you might sell or what your intellectual property is, think about a few things.

Do you have a process that you use at your agency that is unique to your agency? And if so, that can be productized when you’re talking to prospects, and they’re typically too small for you. What are the things that they’re asking for?

I’m a communications professional. So in my business, they’re asking for things like, “Can you write a news release and distribute it for us?” I mean, yes. But you probably can’t afford for us to do it, but I can teach you how to do it. “Can you develop a strategy for us and let us teach us how to implement it?” Absolutely.

So pay attention to the questions or the kinds of needs that prospects have that they may not want to or be able to pay you and your team to execute for them—there’s all this AI that’s doing SEO.

Can you take that and package it into something that is not great yet, but can you take sort of the AI that’s doing SEO and package it into something great?

Think about the kinds of things that you offer, the services that you offer that you can package into something that can just be sold over and over and over again.

Initial Steps to Get Started: How Agencies Can Create Passive Income

Can you walk us through some initial steps?

If I were coming to you and saying, “This is what I want to do with my agency,” what do you think some of my initial steps should be if I’m trying to figure out what knowledge I could share that could be structured and put into that kind of monetizable process? And I loved, by the way, your point about thinking about customers who aren’t a good fit.

First of all, that’s a recurring theme on this show because that’s a challenge for many startup agencies, right? You just want to take the revenue from wherever you can get it. I understand that.

But once you get to a certain point where you can start to be more selective, this is a great avenue to think about, “How can I still help the people that are coming to me without having to sell them my time at a rate they can’t afford?”

So, what would those first steps be for how agencies can create passive income?

Gini Dietrich: So I would answer that by saying first that I think many agency owners are altruistic. And a lot of us go into business and say the small business market—nobody’s helping them.

And then, as you grow your agency, you realize that nobody’s helping them because they can’t afford to pay you or they don’t pay their bills. Or they say, well, “Let’s try this for three months and see what happens.” And you’re like, “Three months isn’t enough time.” So I think as your agency grows, you start to understand that. But at the same time, I think you can still be altruistic and say, “What are the types of things that we can do to help this small business achieve its marketing goals?”

So really think about it. If you came to me and said, “Okay, how do we think about this?” The first thing I would have you do is write down everything that, in the last 18 months, a prospect has asked you to do. And maybe it’s a client too. And maybe it’s a client where it’s not profitable or you’re a little fed up because they’re asking for Tesla on a Ford budget.

I would have you sort of think through those things and think about and write them down: What kinds of things are we doing now? What kinds of things are we good at doing? What kinds of things are we asking, being asked to do that? We don’t necessarily want to do that. For us, it might be social media engagement, like nobody wants to post on social media. So how do you package that into something for a small business to be able to do on their own?

How Do We Know What’s Going to Be Valuable?

Mike Allton: I wonder if you could share some of the specific ideas of how that was different.

I imagine there are some different considerations when we’re thinking about what we should and should not develop for these kinds of passive income opportunities.

How do we know what’s going to be effective and valuable?

I’m thinking maybe there might be some lessons from your experience.

Gini Dietrich: One of the things I learned during that dinner is that most of the speakers, marketing professionals, influencers, and experts who were in that room had done a couple of things.

• First, they had identified a pain point they thought that their audience had. May or may not be true. And then they built the content based on that. So there wasn’t a feedback mechanism.
• There was a “ I think this is a pain point and I think I can sell this so I’m going to build it.” And a lot of them spent a lot of money, like producing high-end products. Jay Baer, I remember telling me he spent a lot of money to produce a high-end online course, and no one bought it. And so he didn’t make back the money even, he didn’t even break even on it.
• And what we did differently—I think this is advice I would give to anybody just starting out. I couldn’t get away with this today because we’re so much further along, but this is how I would do it. If you’re just starting out, we sent an email to our subscribers.
• We asked this question “If you could spend an hour with Gini Dietrich, what would you talk about?” That’s it. You got everything, we got everything. We got silly responses. We got funny responses. We got really serious responses. So what we did was we took in a quick Google survey so we could put it into a spreadsheet. And we took everything that people said. So some people said, “Well, I’d love to just go get a mani-pedi with her and drink some champagne.” And some people said, “Let’s go get some cupcakes.” So we got those silly responses, and we just packaged those over here. And then we got some thoughtful, interesting responses. And so what we did is once the survey, once we closed the survey, we had everything in a spreadsheet and then we took that spreadsheet and we said, “Okay, if somebody—I can’t remember the exact numbers I would have to look—but let’s just say for argument’s sake that if somebody responded with more than a hundred characters, they’re going to go into this bucket. If somebody responds between 101 and 250 characters, they’re going to go into this bucket. And if they responded with more than 250 characters. As in typed characters, then they go into this bucket.”
• Then we took those three buckets, and we went through, and we said, “Okay, are there any trends that we can see?”
• We started to see what the trends were between the people who spent a lot of time answering that question and the people who didn’t spend any time answering that question.
• And we found that there were three areas that people wanted to know about. And this was [in] 2014. So it’s been a decade, but at the time, people couldn’t figure out how to marry what for us has later become the PESO model, but they couldn’t figure out how to marry the four different media types. They couldn’t figure out how to marry paid, earned, shared, and owned media. Their biggest challenge was, “How do we create content? What is content marketing, and how do we marry that with media relations? How do we marry it with link building and SEO?
• And so when we saw that trend—and I knew in the back of my mind that because of the process that we used internally at our agency, which was the PESO model—I knew that that was going to get us strategically closer to where we want it to be.
• So we took that, and we said, “Okay, we’re going to create an online course that shows people how to take content and media relations and put them together.”
• What I did is build the first lesson, and I did it as a webinar. So every Wednesday for four weeks, you showed up at the same time I presented the content for 45 minutes, there was a Q&A afterward, and then you’d go on to your week.

One is because I was building the content as we went, and I was able to take feedback as it came in.

People would say, “I didn’t understand that,” or “That was too fast,” or “I need you to spend more time doing this,” but it also allowed me to continue to run my agency because I only had to create a 45-minute webinar every week—instead of trying to do it all at once and make sure it was professional and make sure it was high end and that I’d spend a bunch of money.

So literally it was a webinar every week. And then I would take the feedback that people gave me in the Q&A, and I would use that to create the following week. So by the end of four weeks, we had something usable. At the end, I asked for feedback. I took a survey, had everybody take a survey, give me the feedback, and then I sent it off to a producer I found on Upwork, and he took all of that, and he broke it into—so the four-week hour webinars, that’s what we sold for $199 and made 250 grand. That was our first thing.

Then I took that and hired this producer off of Upwork, and he made it into bite-sized lessons. So it wasn’t a 45-minute lesson. It was an 8-to-10-minute lesson. And there were 16-20 of them, and he produced it, and it looked nice and all those kinds of things, but that was the second edition of it.

How agencies can create passive income and maximize all the expertise they need: Listen and/or read BRAND NEW episodes of Social Pulse: Agency Edition.

So we had our beta, and then we had our full launch. Then I think we sold for $499. So it allowed us to sort of stair-step into it and build something that we knew people wanted because we were building it as they told us.

That was a long answer, but that’s what we did.

How do you think you might go about identifying which one actually has the most potential for generating actual passive income?

Gini Dietrich: Honestly, I would spend time on the one that you’re most, most passionate about because you are going to be spending time, it is going to be some work. So I would spend time with the topic that you’re most passionate about. Not to say you can’t do the second topic later. But I would prioritize it based on how I’m excited about how AI is going to affect our industry. So I’m going to focus on that versus how to post on social media, right, whatever happens to be.

So that’s what I would do is just do it based on what you’re most passionate about. It’ll make it easier for you.

Mike Allton: I’m wondering if you could share another example. We’ve got this great example of the course that you created. Let’s kind of prove this wasn’t you know a magical kind of one-time thing, right?

These could be examples of your own or other agencies that you’ve seen or any other success stories that you could share.

Gini Dietrich: A couple of things.

One is that this year is the 10-year anniversary of the launch of the PESO model, and so I wanted to provide something new and interesting around the PESO model for the industry every month. And in January, we relaunched the PESO model certification. So that was that in February. I’m not going to remember every month, but as we’ve gone through the months, we’ve done something new, and I was stuck at June, and I was trying to figure out what we should do for June because we had some stuff for the fall and winter, but we didn’t have any things for the summer months.

A girlfriend sent me an email, and she said, “I’m trying to decide if I should go through the PESO model certification or if I should do the Story Brand certification.” And for me, I was kind of like, “Well, the PESO model certification is only $12.50. I think the Story Brand certification is like 30 grand.”

She was like, “What are you trying to decide?” But she said, “If you had a process where you taught agency owners, the PESO model framework, and then how to sell it to their clients, I would buy that.”

I was like, “Really?” She [said], “Yeah.”

So I sent an email to our subscribers and I said, “If we had this kind of program, would you buy it?”

And it was like, boom, boom, boom, boom, boom, boom, boom, boom, boom, boom, boom. So I literally launched it two weeks later, literally.

But what I said is: Anybody who’s in right now gets it for at least 50 percent off because it’s not built yet. Like, we’re going to build it as we go. You would have to spend a year with me, and every month you have to show up for a monthly coaching call. You have to give me feedback as we go because. (Like I said, we’re going to build it as we go.) And then I want you to be able to serve as a testimonial at the end. And everyone was like, “Yes!” So I did it for 10 grand and I probably, in retrospect, should have charged more because we had so many people interested.

But again, it was listening to something that a prospect said and thinking about it from the perspective of, “Huh, I could actually do that. So let’s just do it.” And as entrepreneurs, that’s what we do, right? Like, let’s do it and see what happens. But so that’s what we did.

Overcoming Pitfalls

What are pitfalls that we might have to look forward to particularly when it comes to creating passive income, how do we overcome some of those pitfalls?

Gini Dietrich: I believe so strongly that every agency should have a passive income of some sort. I don’t want to dissuade you from doing it.

That said, it’s a different type of business. We’re accustomed to client service. We’re accustomed to referrals, word of mouth, and usually sitting down with a business owner or CEO and talking through their pain points and then going back and saying, “Okay, here are the things that we can do. Here’s a proposal, and here’s how much it’ll cost.”

This is a different business, and you can’t treat it the same. You have it like it’s an e-commerce business because that’s what it is. Like, you’re selling products, and even though it may not be tangible in the same way that a book might be or a product, a widget might still be a product service or a product business. So you have to learn that.

And with that comes like, “What kind of e-commerce do I put on the website? What kind of shopping cart do I use, and what kind of credit card processing? How do I price it so that I’m incorporating credit card fees into it?”

You have to think about all of those things. It’s like your own agency—you learn things as you go along for sure.

But those are the types of things that I think are probably the most challenging as you do this because there aren’t a lot of businesses out there doing it. If you want to launch a line of T-shirts, you can just do that through Etsy or Amazon. And they have all of that stuff for you, right? But when you’re doing this on your own, you have to learn all of that. You have to incorporate all of that and have to figure out how it all works.

Understand if somebody wants a refund, what that process is, if somebody has gone through your course and decides they didn’t like it, do you give them their money back? Figure out all of those policies too. So it’s not that it’s necessarily a pitfall. It’s just a different business. And so you have to learn how to run a second kind of business.

Mike Allton: That’s exactly what I was going to say. ‘Cause everything that you’re talking about isn’t hard. There are simply things that need to be thought through, and you’ve never done it before. You need to take the time to learn, explore, and talk to people.

Related post: How Early Engagement Can Score Big Results for Agencies

How Agencies Can Create Passive Income Through Distribution

I mean, if you’ve installed WordPress, and you’ve installed WooCommerce on a WordPress site, then setting up e-commerce is not going to be challenging for you, but if you’ve never done it before, then you’ve got to explore the various e-commerce plugins and figure out how do they work. And it’s not expensive either. I mean, like WooCommerce, that’s free. If you’ve got a WordPress site, you might want to pay for one of the other upgrades, but yeah, this isn’t hard. It’s not rocket science. Folks, you can do this.

I also want to know about, though, how you’re distributing it. I mean, first of all, it sounds like you’ve got a great subscriber list, which is fantastic. Kudos to you. I imagine you probably grew that list through normal content marketing kinds of means.

Was that your only channel for distribution? Did you see success using social media or any other channels?

Gini Dietrich: We have not seen success using social media.

In the beginning, because we had such a vibrant blog and so many subscribers to the blog, that was really where most of it was generated from. today. Like I said, at the beginning, we’ve spent a decade doing this. So it’s not like you can just go, “I’m going to try it and make a quarter of a million dollars.”

There are things you have to do. You have to build an audience. You have to build subscribers. You have to do it on something that you own so that you’re not relying on social networks or Medium or Substack to do that for you. So you have to do those things.

Today, you know, I would say if I were starting this all over again, and I didn’t have a subscriber base, I would be solely focused on email, and I would be using social networks to build awareness among target audiences with our thought leadership and then drive them back to subscribe to our email.

That’s what I would focus on, and I would just work on building that subscriber list as much as I can, as fast as I can. You don’t want to do things like buy leads and all that kind of stuff because that tends to get you in trouble with GDPR and other California laws and the like—but if you can do it organically if you’re really thoughtful about your content, you can absolutely use LinkedIn.

• LinkedIn right now is on fire. Use a LinkedIn Newsletter, use your LinkedIn personal page, and start building your own thought leadership, and at the end of every post, drive people back to subscribe to your list so that you’re doing that. Even if you only have 200 subscribers, if 20 percent of them buy something, you’re sitting pretty in a pretty nice spot.
• So, don’t worry about “I’ve got to have a hundred thousand subscribers and I’ve got it.” That’s not the case at all. If you can get 20 people to pay 500 for an online course, you have a nice start to something big.

Mike Allton: I appreciate the disclaimer that we shouldn’t go into this expecting to make a quarter million dollars, particularly not on our first try. You are an extremely successful speaker, writer, and author. And so you developed an audience over time, you’re appearing on stages like the Content Marketing World, right? So you’re in front of hundreds of people on a platform where a well-known conference is espousing you as an expert. So they’re naturally attuned to follow you.

And it’s one of the many ways that you’ve grown an audience for those of you listening.

If you haven’t been focusing on an email list, you have just been focusing on sales and prospects, do everything that Gini just mentioned, have those upsells up content upgrades. You know, so you’ve got people coming to your blog, and you’re using social media to drive what conversation traffic you can.

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I mean, granted social media today is not what it was in 2014. You’re not going to get the traffic that we used to get. No, my GA hates me for that, but instead do what you can, you do what you can. So speaking of Google Analytics, I’m wondering—I just kind of want to touch on this measuring success of how agencies can create passive income.

Measuring Your Success

How are you measuring the impact of these kinds of initiatives? How do you track the success and profitability of IP-based processes?

Gini Dietrich: Well, the nice thing about IP-based processes is it’s all profit, right? You build it once, and I mean you have to sell enough to make up for your time and whatever you put into the production of it.

But if you go back to the example of our very first online course, we’ll read four webinars, four weeks in a row—I mean, it was an hour, it’s probably two hours of my time to create the content and an hour of my time every week to present it. So let’s call it five hours a week for four weeks. So 20 hours of my time. And let’s just say for argument’s sake that I bill $500 an hour. Well, we made a quarter of a million dollars. So extraordinarily profitable, right? It’s not the same level of profit that it is in your agency because it just sells itself.

I remember I was skiing with a girlfriend of mine, probably 12 or 13 years ago, and we were on the lift. She’s on her phone and she goes, “Oh, I just made $500.”

I was like, “What did you do?”

She’s an art therapist, and she had created a package for parents to give to their children in the times that the therapist wasn’t available but when they were having a meltdown or needed some space, whatever happened to be. And she sold it through her website.

Literally, we were on the lift going up. She’s like, “Huh. $500.”

So it’s that when you talk about profitability, that’s what it does and how agencies can create passive income.

That’s why it’s called passive income because you build it once and then it just sells itself.

You can sell it through social media ads. You can sell it through your email. You can sell it on stage wherever it happens to be.

There are lots of different ways that you can sell these products and it just does its thing so it’s a gigantic profit.

Mike Allton: It’s such a great experience. I gotta tell you, if you guys haven’t done anything like this before to just be out shopping or doing your thing, and your phone dings a couple of times with money coming in—it’s a really, really liberating feeling, exactly.

Again, particularly if you’re in a situation like many of us in the economy today, where clients aren’t paying their bills and new clients aren’t coming in to have this kind of revenue coming in on the side is such a fantastic option.

Final Advice for How Agencies Can Create Passive Income

Do you have any final tips or advice that you might give agency leaders who are thinking about starting and monetizing their knowledge and creating passive income streams?

And while you’re thinking about that, I also want to point out one other thing that you said struck me, which was that you only spent a couple of hours, you think in hindsight, creating each one of those webinars.

I appreciate that because I wanted to stress that everything we’re talking about is the knowledge that you already possess as an agency owner. We’re not talking about going out and researching machine language so that you can teach on the level of Chris Penn. No, no, no.

Gini Dietrich: I think it’s really easy to be overwhelmed by all of this. And it’s really easy to sit here and be like, “Oh, okay, that sounds interesting,” and then just get mired back into our day-to-day jobs. So I would say to you: Don’t be overwhelmed by it.

Choose one thing and say, “You know what? By October 1st, by January 2nd, by Valentine’s Day—choose whatever date makes sense to you—I’m going to launch X.” Then back it out and say, “Okay, if I do it easy as Gini did, I’m going to send an email, or I’m going to ask my social media followers. I’m going to put a poll on LinkedIn. I’m whatever it happens to be to get some feedback so that you know what the pain point is and then say, ‘I’m going to do that by, you know, 90 days in advance of my launch date.'”

And then you just start to build it.

And don’t let all of the pretty shiny things overwhelm you.

I think what we did, if I remember correctly, I had to get a Stripe account so that we could process credit cards. And that took a little bit of time because you have to prove who you are and show your incorporation documents and all that kind of stuff—Tax ID, Social Security number, all that kind of stuff.

So that takes probably three or four weeks. And Stripe is pretty much what everybody uses. So figure that piece of it out pretty quickly. And then we just added Sam Cart on so I didn’t have to incorporate it into the website immediately. Sam Cart is a shopping cart and it does it on its own.

So I didn’t have to go through the process of trying to figure out, “Do I need WooCommerce, or do I need Shopify? And how does this all work on my WordPress site?” It just sits on its own and processes the credit cards for you. So do it as easily as you can.

And because it’s so easy to create one 45-minute presentation every week versus four 45-minute presentations before you launch, do it like that and do it as a webinar, invite feedback, tell people that they’re going to pay less because it’s a beta, because you’re testing it out, they’re going to be excited about it.

So don’t let things be overwhelming. I know how hard it is, and I know that you said it. Like I do the same thing ’cause you know, clients come first, but if you say to yourself, “I’m going to do this and I’m going to launch it by this date,” and you start to break down the pieces that you need to do into tiny steps, you’ll get it done.

Thank you for reading about how agencies can create passive income in this latest episode of Social Pulse Podcast: Agency Edition on Apple, powered by Agorapulse, where each and every week we’re talking to marketing agencies like you going through many of the same struggles you’re going through and sharing their stories, subscribe to find in each episode, inspiration, motivation, and the perspiration that go into growing and scaling agencies like yours. Then leave us a review. We’d love to know what you think.

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