What Those 'Make $10K This Month!' Ads Don't Tell You
If you’re an entrepreneur, you may have seen ads with the variation on the headline “Make $10K Online This Month!”.
Accompanied with this headline is usually someone detailing that they’ve figured out the formula to make $10K online every month and that they can teach you how to do it too.
Whether it’s through coaching, selling a product, or building a new business, the form through which you can execute this comes in all shapes and sizes, but the message is all the same.
It all seems too good to be true, which is why the pitch is so enticing.
I am all about helping people build a business that they love, that’s how and why I started my business. I have nothing but respect and gratitude for the businesses out there that are helping people break out of the jobs that they hate so that they can create a life and work that they love.
What I’m not ok with is selling people on the fast-track to financial success without adequately educating them on the large investment and risk involved. There is a ton involved in building a business from absolutely nothing and skyrocketing to $10K/month with no foundation or experience (you’ve definitely seen ads promoting this feature too).
If you’ve ever been lured, or are currently being lured by one of these ads that teach you how to build a lucrative business immediately, here are some minimum investments that are required for any startup to see the results that these businesses advertise.
If you’re knowledgeable of these minimum requirements or are ready to commit to them, fantastic, move forward as planned. However, if these minimum requirements are quite surprising to you, or you weren’t aware of them, weigh these options seriously. All of these minimums will hold true regardless of how great the formula or strategy being advertised is.
Significant Financial or Social Capital
Can you invest more than $10K so that you can hit $10K per month?
Because that’s the truth behind the numbers of speed-building a startup’s marketing and sales funnels to the point that it’s consistently and predictably able to generate $10K in revenue every month.
If you possess the financial capital to put in $40K, $80K, or even $300K towards your business (this number varies according to your industry and existing leg-ups) then hitting $10K per month after only spending a month or two building your brand is totally feasible.
Another way you can quickly hit $10K months is if you’re an influencer or celebrity who has significant social capital to prompt immediate purchases from a sizable audience of followers.
Without these types of upfront investments, speeding up your timeline is pretty unrealistic. More on that below.
Let’s reverse engineer how a business is able to hit $10K in revenue online within the span of a month.
First, the business will have to leverage financial or social capital to speed up the acquisition of leads within a short period of time. Once this audience is established, engaged leads will have to be cultivated into a potential sale through a medium such as email marketing. During this phase, the audience will separate into a couple of buckets — leads who are not interested in purchasing at all, leads who are interested but still in the decision making phase, and leads who are ready to buy. The majority of leads will fall into the not interested or interested but still deciding buckets, and about 1–5% will fall into the ready to buy bucket.
If only 1–5% of your audience is ready to buy, that means that depending on your product price, you’d have to have about 10,000+ email list subscribers in order to hit $10K in revenue.
In order to even get 10,000+ email list subscribers, you’ll have to find 1,000,000 people that engage and click on your brand’s ads to begin with. In order to find these people, let’s say that you choose to use Facebook ads to acquire leads, where the average cost per click (CPC) across all industries is $1.72. I’m going to assume that you’re going to optimize your ads so that you drive down that CPC to $0.30, in which case it’ll cost you $300K to run ads that’ll get 1,000,000 people to click on it.
This is a super simple way to look at a funnel with a lot of underlying assumptions, but this is just to share a simple use case to provide perspective — hitting the audience numbers you need in the beginning to result with $10K in revenue at the end of your marketing and sales funnel requires a significant financial or social capital boost that’s way more than $10K.
All of these numbers above don’t even account for real-word time lags. Time lags include, but are not limited to:
Waiting for a lead to be readyto buy from you (whether by waiting for leads to gather the proof they need to be confident in their purchase with you, or catching them when they finally realize that they need your product).
Taking the time to learn your audience’s preferences so that you can refine your startup’s content, copy, timing, and more to sell to them more effectively.
Adjusting every aspect of your startup’s pitch and presentation to meet your audience’s preferences and getting the timing right for when customers are ready to buy from you takes time. I’ve seen experienced Ad Managers test 100 variations of one ad (Just 1! Imagine the time it takes to do this multiple times for additional ads) in pursuit of finding the lowest CPC and most effective ad for an audience — these are all time intensive, but important tasks that contribute to real-world time lags.
I totally understand that there will be plenty of customers out there who are ready to buy and will purchase immediately, but how many of those will you find consistently every month? With a consistent ad budget of $300K for several months, sure. Without that type of budget, probably not.
Can you pay a team every month to help you hit your numbers?
All this solid execution requires an experienced team to help you hit your numbers. Let’s say that you decide to focus on a Facebook ad strategy to help drive new leads to your business. In order to get the best use out of your money, there’s absolutely no way that you’ll do that by running those ads yourself.
You’ll have to hire an experienced Ad Manager who knows how to A/B test your ads so that they figure out the sweet spot that drives down the CPC of your ads to $0.30. This Ad Manager will cost you North of $1,000 per month after setup costs. On top of this, you’ll also have to hire a Social Media Manager, Email Marketing Manager, and Graphic Designer to attend to all of the other needs in your funnel.
Hitting $10K/month off of a digital-only marketing strategy requires a lot of expertise that you can’t and will not be able to master yourself, so hiring a team will be critical to your success.
The Caveat: There Are No Guarantees When It Comes To A Startup’s Success
Even if you check off all of these boxes and are capable of making all of these minimum investments, the truth is that you can still fail.
There are no guarantees when it comes to a startup’s success and the minimum investments you make have to be ones you’re also willing to completely lose.
Regardless of whether the investments involved sound worthy to build a business at this speed, be responsible. The minimum investments listed above use the word minimum because you will always run into them in your pursuit. They are more or less, unavoidable. Fully grasp what the numbers look like for you under these minimum investment categories and move forward thoughtfully.