Secrets of Successful Infopreneurs

Jim Laube is the founder of RestaurantOwner.com, a subscription-based web site for aspiring and established restaurateurs looking to build a better business.

Jim started out doing a lot of speaking and consulting in the restaurant industry, and found his business was taking him on the road quite a bit. In 1997, the Internet was starting to become more popular and he decided to put some of his material online.

He launched with about 150 pages of free information. Then one day, a restaurant owner in Dallas called him up and told him his material was too valuable to give away. He suggested Jim sell the information, which Jim had never really thought about before.

Recognizing a good idea when he heard one, however, Jim took the helpful caller’s advice, found a programmer to password-protect his site, and the subscription version of RestaurantOwner.com was born in mid-1998.

Today, the site has about 3,000 subscribers and generates around $500,000 in annual revenue. With the profile generated by the site, Jim no longer has to market his speaking services -– people come to him. He’s also been able to bump his speaking fees more than 100%.

Last week, I had a chance to talk to Jim about his success, and collected some of his advice for others who are considering a subscription-based web site.

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Jim, what’s the biggest mistake you made in establishing or running your site?

Not finding a subscription web site software package sooner. I wasn’t even really looking for it, but I found a software package called MemberGate. MemberGate really elevated every aspect of my site overnight. We converted the site [to the new software] on August 16, 2003 and my revenues essentially doubled in 30 days, thanks to the software’s Search Engine Optimization component and the way Membergate allows you to present and structure content on the home page in particular. Not only was I attracting more visitors but my capture rate increased too because the software allows me to feature much more of my content on the home page. I was able to turn the home page into a much more effective sales tool to entice people to join.

The administrative work was a lot heavier on my own. I was doing a lot of the billing manually. When I set up a recurring billing, I had to enter that into my credit card processing system manually. With MemberGate, that’s all automated.

Also, adding new pages and content used to be a chore. I actually had a web person doing that for me. With MemberGate, I can do it myself and I don’t need to know HTML.

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How much time do you spend administering the site now?

I have an employee and between the two of us, we spend 4 to 6 hours a day. That time is spent answering email from members, creating and uploading new content and general housecleaning and administrative tasks. It’s definitely a manageable task for one person, and something that would still give you 50% of your business day to do other things. The key is making sure it’s automated.

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How often do you update your content?

We have an arrangement with Restaurant Start-Up and Growth magazine, which is a new magazine that started in February 2004. The publisher was a member of my web site, he opened up a restaurant in 2001, and after he had opened his restaurant – he had been a successful publisher before that – he said, ‘I’m going to start a magazine for the restaurant industry because I don’t see any magazines on the market telling people how to do what I’ve just done.’

The relationship I have with them is essentially that every member of my web site gets a free subscription to the magazine, which I pay for, and I get all the content from the magazine. So every month, I get 10 to 12 new articles to put on the web site, in addition to the ones that I or my associate might write. We generally write another 1 or 2 new articles per month ourselves.

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How do you find people react to getting the same content in the magazine and on the web site?

People like to get something physical in the mail. It really makes the recurring billing a no-brainer because even if they don’t look at the web site they’re still getting something in the mail that has value to them. So I find the magazine has a very high perceived value even though the same content is on the web site.

Plus, we have a keyword searchable database on the web site so all the archives of all the articles are available. If you joined today, you also get the benefit of being able to access all the previous articles.

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What are the main ways that you market your site? What has been the most successful?

It’s probably equal between search engine optimization and the magazine [Restaurant Start-Up and Growth]. I get a full-page ad in the magazine every month. The search engine optimization is handled by MemberGate. Apart from those two things, I don’t spend a nickel on advertising or marketing -– no Google ads, no print advertising, no trade shows or anything.

I also give away a lot of my articles and that has been a good way of marketing. I give free articles to restaurant associations, other restaurant magazines, other restaurant web sites, distributor magazines and newsletters. I get my name out there.

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What advice would you give to those thinking about starting a subscription-based site?

You have to love you subject matter, really love it. You need to have reasonable writing skills. Notice I didn’t say great. I don’t think I’m a great writer but I’m an adequate writer.

I also think it’s necessary for the potential population of members to be a sufficient size. That’s the beauty of the market segment we’re in –- independent restaurant operators -– because there’s hundreds of thousands of them out there. Even if we capture just a small slice of the market, we can do reasonably well.

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Any final words of wisdom?
Don’t give up your day job! At least not right away. It took me about 5 to 6 years to build the site to the point where I could live off the income, although when I launched the site most people still expected things for free on the Internet. Now people are more used to the idea of subscription-based sites so certainly you can build your revenue faster than I did. I know people who have done it in 6 months and even less.

Again, love your subject matter. You probably don’t need a huge amount of content to start -- maybe 50 articles – but the key is to slowly and steadily build it and find some good software to manage it.