The Content Business in Kenya

By ‘content’, this post refers to movies/videos, music, computer games and other similar media but NOT “text-based” content.*

Now, the question is: can a ‘content based’ business thrive survive in Kenya? The sad truth may very well be a big NO.

Case in point: Silverbird Kenya. This once vibrant cimena company looks like it is shutting down in Kenya! If you look at the image below, you will see that their website has been suspended adn their Twitter account (@silverbirdkenya) lies dormant. What could have happened? What may have caused this company’s downfall.

Silverbird Kenya Offline

Silverbird Kenya Offline

Well, there is this court case.

Additionally, I believe it is very difficult to run a content-based business successfully in Kenya. Here, piracy is rampant – you can get DVDs of brand new movies at Kshs 40/- in town!! How can you compete with that? Indeed there is a thread over at Skunkworks Kenya that makes this very point. It would seem that “competing” with piracy is one of the reasons of Silverbird’s failure in Kenya. How sad. 🙁

But can any other content based business survive in this market? Music and games are equally well-pirated in Kenya. I would estimate hardly anyone in Kenya ever buys an original game or music album. Although we must note that this is the case not just in Kenya but pretty much everywhere.

However, local music seems to be doing ‘okay’ and I would attribute that ‘success’ to the very strict attitude towards the piracy of local music. It is sad that this same attitude is not extended to cover other forms of content. I believe this shines some light on what needs to be done for ‘content’ businesses to thrive in Kenya. Very strict anti-piracy laws have to be introduced and enforced in this market or the producers and legitimate distributors of the content we consume so voraciously will continue to suffers.

However, even as we talk about anti-piracy measures, we must face the truth: it is much, much easier to get your hands on pirated stuff than to buy it legitimately. This means that the type of content that consumers will get will be the one that is easier to find i.e. the pirated stuff. This is not a “Kenyan thing”. It is the same everywhere. Even so, in the face of overwhelming piracy worldwide some content producers have found ways to survive and maybe even thrive. Surely we can learn from this?

The main idea here is that we’re in a new era – one in which it is easier to get pirated stuff than to get the legitimate content. This means that the old rules of the content business are changing or have changed. It is time for the players to change how they play. You can stand and shout all day waiting for the government to intervene to save your business but there are better ways to spend your energy – you can build your content business in a way that is is as immune to piracy as possible. It requires that you change they way you think about how to run a content business.

For example, a music band in the US realised that their album sales were plummeting because people could just download their music for free. What did they do? They started giving away their music for free online. More often than not, people who download your music actually like you and if you give them a way to access your content as easily as through piracy, they will pick the legitimate way. This particular music band’s strategy let them build a huge online fanbase. But how did they make their money? Well, now that they had so many fans, whenever they performed at concerts they almost always had the tickets sold out. I would call that “thinking outside the box”.

Another example is Netflix. In the USA, piracy also thrives. Netflix is a company that allows very easy access to legitimate (i.e. not pirated) movies. Well, guess what? Now that one can get movies easily and legitimately through Netflix, online movie piracy rates are going down in the USA. Interesting, eh?

While I believe that piracy is wrong, I also believe that it is not going away any time soon. Content producers should realise this. We’re in a new age that requires new ways of doing business.

The only way to decrease piracy is to compete with it and offer products that are superior to their pirated counterparts.

Something to ponder: the introduction of strict anti piracy law in Kenya will definitely lead to the immediate bankruptcy of hundreds of people who make their living by selling pirated content. Is this a good thing?

*In my view, the ‘textual content’ business is very different and deserves to be treated as such.

Strategy & Marketing

In this video, Joe Hayashi covers mobile app product strategy and marketing from a business perspective. The video is a lecture given at Stanford University. Although the video is supposed to be about marketing and strategy as regards mobile applications, it has enough goodness to be generally applicable to any business. Many, many lessons in strategy and marketing. Watch:

How to Increase Your Revenues By Reducing The Number of Customers

“Would you Cut the Number of Customers you have in Half if You Could Increase Your Revenue?”

On the surface, it seems like a strange question. As a business, more clients is always better than less clients (or so you think). But you have to remember where this question is coming from. What if you could successfully create a business in which you make the most money possible with the least amount of effort (and the headaches that go with it)?

The High Maintenance Client
Don’t get me wrong – you always want a lot of clients and it’s a good problem to have. However, you ideally want the best type of client. The high maintenance client is the WORST type of client because they take up all your time with calls, e-mails, fighting over bills, etc. The time you spend working with the client costs you more money than you ever make from that client.

The problem with high-maintenance clients is that they are very hard to identify. But the fact is that the more clients you have, the more high-maintenance clients, and the more headaches you have to deal with.

Double Your Prices and Lose 40% of Your Clients – Awesome!
This is one of the keys to creating a business in which you make the most money possible with the least amount of effort. Maximize the revenues from each client and if that means losing a lot of clients, you are ahead. Take a closer look at that statement.

Let’s say that you were charging your 50 clients Kshs 1,000 per month, so you were making Kshs 50,000 per month.

Now, let’s say that you doubled your price to Kshs 2,000 per month and because of that you lost 40%, or 20, clients. You still have 30 clients, paying Kshs 2,000 per month or Kshs 60,000 per month.

You lost 20 clients, which means less operations, less support, and less administration, etc. but you gained Kshs 10,000 per month! And that’s not just Kshs 10,000 total. With the reduced overhead and operational expenses, you probably gained even more than that in profits.

Even if you lost 60% of your clients and now made just Kshs 40,000 per month, but you reduced expenses by Kshs 10,000, you’re still ahead. You have more time and resources to commit to those activities that will bring you more money.

But before you just send out a letter to all our clients saying that you are doubling their prices, there are some things you should be aware of.

How and When to Raise Prices

  • Don’t Raise Prices in a Commodity Business. This strategy does not work if you have a commodity type business. If someone can go to your neighbor and get the same product for half the price, you will lose most of your customers. This only works if you have a niche product or service that is differentiated from what other companies offer.
  • Don’t Raise Prices on Existing Clients. The way that you can implement this strategy is on new clients. You will piss off a lot of existing clients if you raise their prices all of a sudden and it’s not worth it. But when you start marketing and selling to new clients, raise the prices on them. They do not know the old price so they will not be pissed off and while your conversion rates will be lower, you will see more revenues and less headaches in the long run.
  • Get Clients First. One of the first mistakes that we ran into when we tried to implement this strategy is that we did it on a new product that we were offering. It was a type of marketing website and while it was a good niche product that wasn’t commodity based, we had no idea what the market would bear. Looking back, we should have just started selling it very cheaply and then once we got some momentum, we would have raised the price to what we think the market would bear.

Earning Money From Niche Websites

Niche MarketingDoes the idea of continuous passive income from websites you can set-up and forget about sound good to you? Well that is what niche content websites are all about. Let’s take a look at this online income method.

Before we start, I’d like to let you know that you can purchase a product from the Chapaa Shop to learn all about niche websites: “How to Make Money Online Using Niche Websites“. Okay, moving on…

What is a Niche Website?
A “niche website” is one that is designed with a very specific and narrow target market in mind. The type of information that it contains is carefully produced to draw in viewers who are motivated by their interest in the subject to purchase a product or products related to the topic of the site.

Consider this example. A dog owner with a large piece of property wants to keep his dog from wandering too far from home. However, he doesn’t want to contain his entire property within a fence and likes the idea of his dog having lots of space to roam. He decides to investigate the idea of installing an invisible dog fence by doing an Internet search.

A web developer who wants to target this customer would create a website around the keywords “invisible dog fences”. He would fill it with articles about different types of invisible dog fences, how to install them, the advantages of them over a regular fence, etc.

He would choose an affiliate product or products related to this topic, most likely a specific invisible dog fence. Of course, visitors to the site are already motivated by their desire to purchase this particular item. If visitors find what they read on the site to be informative and trustworthy, they will be likely to purchase the advertised affiliate product. In turn, the website’s owner receives a commission for the sale.

The website owner can also make a profit by signing up to run web ads, such as Google AdSense. The ad program will automatically place ads on the site which are related to the content of the site. Whenever a visitor clicks on one of the links, the site owner makes money.

Identifying Niches
If you want to be sure you will enjoy the process, one of the first steps you should go through is identifying those things in which you have some interest. Create a list by brainstorming and trying to identify everything you like. You are likely to find at the end that this includes broad topics like reading along with very specific things like collecting Makmende jokes (for example). It doesn’t matter how broad or specific things on this list are because this is just the starting point.

Once you’ve compiled this list, you will want to identify which things are very broad and which are already very specific, and then use this to identify niche markets you could tackle. Our example of a specific item above shows a small niche that is the ‘Makmende collectors market. This is a topic for which you should be able to create or find a fair amount of content, making it suitable for this purpose.

Your broad items will need to be narrowed down into one or more niches you might be interested. To continue on with our examples, maybe you really enjoyed reading the Harry Potter books. In this case, since it is a series of books, movies and other merchandise, it could be considered its own niche market, and therefore be suitable. Popular authors or specific genres could also be suitable, but be careful about getting too specific and targeting a single book.

Creating The Site
To maximize the potential you have for profit, you may want to consider getting your own domain name and setting up a site in your own hosting account. However, neither of these is required in order to make some money or to create a website. Several places online allow you to sign up and create your own blog, web page, or even entire web site, for free. Many of these will even allow you to make money from advertising, or allow you to include affiliate links on your pages so you can make some money. You can also just simple hire us, we’re experts.

The most important aspect of your site is going to be the content. As mentioned above, your content should be focused primarily on the specific niche you identified. As far as this content goes, it is best if your content is unique. To get unique content, you will either need to create it yourself, or hire someone to create it for you (you can hire the awesome Crystal). Of course, these aren’t the only options you have for getting content.

Making Money
Once the site is created, you can begin monetizing it in whatever way you have chosen. If you are using a free blog or other free site to host, you may be somewhat restricted, so be sure to consider your options when choosing where to publish your content.

Two of the most popular ways to monetize a niche website include using an advertising network, such as Google’s AdWords, and affiliate marketing. These can be used separately or together. Placing advertising usually involves signing up for the program and then placing their code into your page. Affiliate marketing is similar in that you would sign up for the program and place a special link on your page, but you’ll usually want to be sure you’re linking to specific products or services relevant to your site’s topic.

Making money via niche websites is one of the easiest ways to make money online. However, do not expect to retire off it – a niche website can be considered to be successful if it makes $2 to $3 a day. The real power comes in when you have 5, 10, 50 or even 100 such websites all working for you. Then you can retire!

If you are interested in niche websites, how about purchasing “How to Make Money Online Using Niche Websites“? It is a nice little course that can help you greatly. Good luck!

What do you think of this method of making money online?

Will your business survive if something happens to you?

While we don’t like to think of it, there are always uncertainties in life that can come without warning. When these events occur, it is often very difficult to pay any attention to your business. Either you don’t have the time or it becomes the farthest thing from your mind.

When that does occur, will your business continue to run without you or is it completely dependent on you? If your answer is more of the former than the latter, it is more likely that you have already built or are on your way to building a successful Lazy Business.
Why is it Important?

The main reason is that you never know what’s going to happen to you from day to day.

  • You could have a family emergency that needs your complete attention
  • You could become injured or sick and not be able to work for a period of time
  • There could be some sort of catastrophe where you work or live and you won’t be able to get to work or do any work for several days

All of these things are completely out of your control and more often than, completely unpredictable on when they happen. You need to be prepared so that when they do happen, your business and your livelihood aren’t affected and you can focus on what needs your immediate attention.

An ancillary affect of being so prepared is that you can also be gone for no reason at all. You can take a week off of work at a moment’s notice or just not do any work for several days. Your business will still function without you to support that lifestyle. Now it may not continue to grow without your leadership and vision but that is a balance that you need to be comfortable with.

The important goal to focus on is that your business wouldn’t fall off the edge of a cliff with clients canceling their service or bills don’t get paid, etc.

What if You Freelance or the Main Cog in the Business?
If you are a freelancer, you have other problems. Freelancing is not a real business in the first place and you need to re-engineer what you do and how you work to make sure that you manage the business and are not the sole person responsible for service/product delivery.

What Needs to Be Done?
The short answer is . . . Everything!

Every business is different in what it sells and how it operates. But that doesn’t mean that there aren’t common functions of every business – accounting, service/product delivery, marketing, sales, general management, etc.

The fact is that each of these areas should be broken down and detailed in a manual with all the functions that need to be completed. And all of those activities should be delegated to someone else to do. These are tasks that need to be completed on a regular basis like setting up new clients or paying bills on a weekly basis. You should not be doing anything that you can get someone else to do – outsource it.

But there are a few things you should have procedures in place for so that they can be run without you. This is also a good checklist for those who want to automate their business:

  • Who is going to handle the accounting and handle the reconciliation of all the expenses and income?
  • Who is going to bill the clients, receive the payments, and process the payments?
  • Who is going to pay the bills on time?
  • How are the taxes going to get paid and any forms or legal documents get filed?
  • Who is going to manage the marketing campaigns – set them up, monitor them, and measure them?
  • Who will the prospects call or e-mail if they have any questions or would like to place an order?
  • Who will take the orders and get the information to deliver the product or service?
  • Who will handle product/service delivery and make sure that the client is set-up and receives what they ordered?
  • Who will handle client support? They will probably have questions or concerns and they need someone to talk to.

While they might not all be completely automated so that they can get completed without any assistance or initiation from you, you should be able to easily hand them over to someone else to complete. These are all things that you need to automate today so that you don’t have to worry about them tomorrow. And you’ll notice that once you do have them handed off, you will be able to focus more time and energy on growing a successful business. . . or you can just play some golf instead.

Can You Do It?

It does not even matter what “it” is, I’m confident that you can do it.

Van Gogh famously said, “What would life be if we had no courage to attempt anything?” What if you never attempt to write that novel? What if you never attempt to start that business? What if you never attempt to steer toward your true north? In the end, you might regret some of the failed leaps, but you’ll surely regret all of the times you failed to even try.

Goethe encourages us: “Whatever you can do, or dream you can do, begin it. Boldness has genius, power, and magic in it. Begin it now.”

Rich Man, Poor Man

working less will help your business grow

Over the years, we’ve worked with very many people and many, many small businesses. I it’s always interesting to see how a small business is run and how the owner approaches it. I was thinking about this today, and I realised there are two types of small business owners: hard workers, and smart workers.

Comparing these two is very eye-opening. Take two businesses in the same industry with the same amount of experience and you will get drastically different results depending on the owner’s approach to business. I am going to just say it: – some people work too much, which hurts the growth of their business.

I know a smart guy who only works a few hours a day on his business compared to the 12-15 hour days that other owners work each day (and a few hours each weekend). Based on my real rough estimates, I believe that his business also made about 5x as much as the other owners (in the same industry). Imagine that – you work a quarter of the time and your business makes five times as much money. Or to look at it another way, you are 20 times more productive with the time spent managing the business.

Both types of owners probably make a very comfortable income but even if I made the same amount of money, I would take the business that requires a quarter of my time. I could use that time to do whatever I wanted or I could use it to grow my business or start new businesses.

What is the Difference?
Smart business owners are incredibly gifted at creating a process oriented business. It’s a very educational experience every time we work with them or visit their offices. Everything such an owner does has to be broken down into repeatable systems and processes. If it can’t, he’s not interested in it. He could easily take on new business if he wanted, but the work would be ad hoc, and would not scale well. If it isn’t something that he can scale, he won’t do it. It might cost him 2 or 3 customers a month, but if he is spending his time creating systems to bring in 10 other customers on his terms, which one do you think is a better deal?

The other type of owner is very detail oriented. He believes very strongly in personal service and is involved in every step along the way, from marketing, to sales, to operations. Instead of delegating work to other employees, he does everything himself. Instead of creating a product that he can sell over and over again, he customizes everything for his clients.

Remember, this owner is very successful and he would be correct if he said he’s been successful for a long time doing it in his style, so I don’t want to say that hard work isn’t the right way to grow. But if he had just relinquished some control and created systems and processes so that other people could execute them, I bet his business would be a lot bigger than it is now. If he decided to put in just 1/2 the time each day that he is used to, he would be been forced to create systems that other people can execute.

When Hard Work is Required
When you are starting your own business, you need to spend a lot of time in the business, growing it. If you don’t do it, no one will. But instead of doing everything yourself, you need to start creating systems and processes so that other people can start operating the business. If you sell some sort of product, don’t be the salesperson, customer service, and operations manager.

Start out by creating systems to outsource some of the work and then continue to move away from each part of the business. Otherwise, you will be working too much and you will end up hurting the growth potential of your own business.