This module looks at the different ways passive income can be generated in sales funnels, so you can identify where and how you will do the same. This is the first step in creating your Passive Income Plan.

You’ve put a lot of effort into getting potential customers into your sales funnel, so don’t waste the opportunity to optimize every part of it for revenue.

People already deep in your sales funnel are much easier to sell to. According to Farris, Bendle, Pfeifer, and Reibstein in their book Marketing Metrics, the probability of selling to a new potential customer is between 5 and 20%, but the probability of selling to an existing customer is between 60 and 70%. So, put your sales funnel to work even more than it is now!

By their very nature, sales funnels are part of your passive income revenue because they automate your sales process, meaning you sell without being present. Your sales funnel should already be automatically gathering and converting leads, overcoming objections, and generating sales for your key products or services. You can make it work even harder for you by adding further passive income opportunities to its key components.

The different parts of your sales funnel, and possible points for passive income, may include:

• Your lead magnet freebie to gather email addresses or other contact information
• An automated series of follow-up emails that nurtures your relationship and then sends customers to a relevant product or service, according to the lead magnet they signed up for
• Your sales page
• Your thank you page
• And any additional download or confirmation pages
• An automated series of follow-up emails post-purchase that helps people use their product or service, and which continues to nurture your relationship

There are various ways you can generate passive income from all the elements of your funnel. We’ll take a look at some of those now.

Easy Places to Add Immediate and Future Income to Your Funnel

• Add a recommended product to your opt-in thank-you page. After someone requests your lead magnet, you can offer something small and related on the thank-you page.
• Add a ‘latest product’ to your email signature on all emails. Adding a link to your eBook or other product or service at the end of your emails is an easy way to add passive income. Keep email signatures to three or four lines and avoid adding too many links – too many choices will result in none being clicked. Email signature generators include: WiseStamp, htmlsig, ZippySig, newoldstamp, and si.gnatu.re.
• Similarly, you can add a recommended product or ‘next level’, higher priced product or service to one of your customer follow-up emails.­
• Add a recommended product to any download or confirmation pages during and after purchase.
• Add a recommended product to automated emails sent to people who did NOT buy during the sales funnel. When people opt-in to your email list and download your lead magnet, they don’t always end up buying something. But these people are already interested in your topic, so don’t forget about them. They might be interested in other products you offer, or they might be interested in offers from people you’re an affiliate for (which we’ll discuss later on).

What Should You Offer? Cross-Sells & Upsells

If you have a very clear idea of who your clients and customers are, and what they need or want that will be of great value to them, it will be easy to decide what to offer in the places we mentioned. Typically, you’ll offer products or services that are related to each other and to the original product or service they purchased.

When you recommend products during your sales process, especially during the checkout steps, they’re referred to as cross-sells and upsells. These are both effective, straightforward ways to add revenue with relatively little effort.

Add Cross-Sells to Your Sales Funnel

Cross-selling is recommending a different, but related or complementary, product or service to somebody who is already buying from you, thus increasing the value of the sale.

Very often this is a product your customer may have gone on to buy anyway, but showing them that product or service at the right time encourages them to buy and increases the chance of a making the additional sale.

It’s also a great way to introduce customers to products or services they may not know you offer.

A common example of cross-selling is the familiar “Would you like fries with that?” Or, the offer of an extended warranty or insurance on products such as computers or kitchen appliances. For retailers, a common cross-selling tactic is the “shop the look” section, where you’re offered items of clothing that will make a complete outfit with the shoes you’re about to order.

If you’re selling online courses, you could offer a complementary mini-course, or even a report or eBook – something that adds value to and expands on something from the course.

You can cross-sell one related product, or bundle two or more, and you could offer these related items at a discount to increase your customer’s perception of the value of your offer. Amazon is renowned for this tactic.

TIP: Only offer related items, and don’t give too many individual choices as this can be confusing and result in the customer not buying anything at all.

Cross-selling something with a lower price tag than the product they’re already purchasing is more effective than trying to cross-sell something that costs a lot more. The general rule is that your cross-sell will be more successful if its cost is below 25% of the original purchase. But if you want to offer a higher-priced product as your cross-sell, a payment plan could be a good option to consider.

Add Upsells to Your Sales Funnel

Upselling is when you encourage your customers to buy a related, but higher-priced, alternative to the one they’re considering purchasing. You show them a product or service that offers them more, and may meet their needs even better than the product they’re purchasing. Your customer gets something that’s of greater value to them, and you increase the value of your sale.

It’s best to offer something that isn’t too much of a leap in price, but something that seems like too much of a good deal to ignore. Be sure to explain clearly the benefits for them of the upgrade.

Perhaps the most common example of upselling that many of us have experienced is when an airline offers passengers the opportunity to upgrade to from coach to first class. Upsells could be anything from a standard pair of jeans to a designer pair, or from a basic laptop to one with all the bells and whistles.

A membership site subscription could upsell from the basic membership with a library of useful content, to a subscription with access to even more content, plus premium features such as small group masterminds and guest speaker interviews.

If customers have purchased an online course, the upsell could be to a membership site subscription that offers them valuable resources and information, and a recurring passive revenue stream for you.

Only a small subset of your customers will be willing to pay the extra for an upsell, but those upsells can make a significant difference to your income.

TIP: Of course, you want to try to upsell products or services that are relevant, but also upsell those with the most positive reviews and testimonials. Your customer will be easier to persuade to buy a more expensive product when they can see evidence of the value and benefits that product offers.

Many shopping cart systems and ecommerce plugins have the facility to add cross-sells and upsells built in. For example:

• Tools for automating the cross-selling/upselling process such as Marketo, Conductrics
• Shopping cart systems such as RomanCart and Magento
• WordPress ecommerce plugins such as WooCommerce
• Ecommerce platforms such as Shopify
• Online platforms for building sales funnels are one of the easiest for cross-sells and upsells. For example, JVZoo, Zaxaa, Click Funnels, and SamCart

Marketing wisdom commonly states that people need to see your product seven times before they buy, but, depending on who you’re listening to, many marketing experts say it’s anywhere between three and twenty times! Regardless, it makes sense that you should give your customers as many chances as possible to be reminded of your products or services. And all of those reminders are part of the passive income methods you add to your sales funnel.