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February 2024 Income Report

March 27 2024 – 06:55pm

To listen to an audio version of this report, join the Patreon »

February’s revenue was $6,120, down from January’s $6,561. Profits were $1,975, down from January’s $2,815.

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Even lower profits

This was a low-profit month amongst a trend of low-profit months. I dropped below the $2,000 mark, which I haven’t done since May of 2023, when I only profited $1,588. This low profit brings my 12-month running profits below $50,000 for the first time since August of 2021.

What was the proximate cause of these low profits? It wasn’t book income, as I had the highest book income since August. You could, however, blame high ad spend, as I spent more on ads since, well, May of 2023. I spent $4,753 that month, and this month I spent $3,012.

You could also blame low affiliate income. My income from ActiveCampaign referrals makes up most of my affiliate income, but is stochastic. This was a month in which I made only $328 from such referrals. According to my projections, I’ll make nearly $3,000 in April.

Some other factors – new ones – were that I spent $522 on printing and shipping books, and that I spent $1,396 on Meta ads.

Ad spend, not all of it effective

The proximate cause of my low revenue in May of 2023 was that I spent over $3,400 on Amazon ads, while grossing less than $6,000 on books. That was enough of a scare to cause me to reduce my Amazon ad spend over following months, until I spent essentially nothing in September and October (okay, $5 in September).

In recent months, I’ve been gradually ramping back up my Amazon ad spend. Last month, I spent $654. This month, I spent $1,481. In March, I’m on pace to spend more than that.

As usual, it’s hard to tell just how effective this Amazon ad spend is. About $1,300 of my spend actually happened in February, and through KDP alone, I made more than $2,800 revenue. That sounds convincing, but consider that this month started off with a BookBub Featured Deal, which I paid for in January, and which, along with supplemental BookBub ads, cost more than $850.

Consider also that I’ve been spending a lot on Meta ads in recent months. More than $1,000 in January, and nearly $1,400 this month. Some of that has been spent advertising HWH with nearly break-even success, some has been spent advertising MMT pretty ineffectively, and some of it hasn’t been directly connected to any book sales at all. I spent more than $300 on Meta ads this month simply on growing the email list.

While I haven’t cracked the code on using Meta ads to make a profit on my Shopify store, surely some of that ad spend is resulting in sales on Amazon. I probably have it to thank for the order of 70 copies of HWH that came through IngramSpark this month (the confounding factor being that this was the first month HWH had a 55% wholesale discount).

Books in a warehouse

I’ve shipped my very first books from a warehouse! The three-week turnaround time for BookVault is apparently okay for some of my most loyal readers, but trying to sell books to cold traffic through Meta ads with a “Ships in 2–3 weeks” message on the sales page drives me nuts. (Though it still drive me nuts anyone has to wait three weeks to receive one of my books.)

I had been exploring fulfillment options in recent months, and was struggling with a suspended Amazon FBA account (which fortunately is no longer suspended). I found a warehouse space that some friends have used for their businesses, and that because of this fact was willing to store my paltry supply of books for my foray into warehouse fulfillment.

When I say paltry, here is a photo of my books in the warehouse, after five orders had already gone out.

Instead of waiting three weeks, now U.S. customers will only wait 2–8 business days (most often it’s about 4), for their book(s) to arrive via USPS Media Mail.

Warehouse is faster, but profits are lower

This does cut into my margins quite a bit. Shipping is a little cheaper. Most shipments have cost about $4.16, and shipping from BookVault in the UK cost $7.60. But much of that $3.44 shipping savings is eaten up just by getting the book to the warehouse. My first batch of 39 books cost me $1.58 per book to get to the warehouse, which reduced my shipping savings to $1.86. However, I’ve been charging a flat rate of $5 for shipping to keep things simple, so I can add another 83¢ to that and my shipping savings is $2.69.

But then there’s handling, packing materials, and storage of the books, for which I get a flat rate of $4 per single-item order, with $1 for each additional item added to the order.

So for a U.S. order of a copy of HWH, I’m making about $1.31 less per order than if I were fulfilling through BookVault.

As you can see, the math can get pretty complicated.

What about printing books offset?

So far, I’m still printing all books at BookVault. I haven’t even checked whether IngramSpark would be a more affordable POD option, as their print quality isn’t as good as BookVault’s, especially for the one book that is performing decently on Meta ads – 100-Word Writing Habit.

Each copy of HWH costs $2.87 to print. To start beating that price through offset printing, say PrintNinja, I’d have to print at least 1,000 copies. At 750 copies, my cost would be $2.90, so actually more. At 1,250 copies, my cost would be $1.98 per book. I’m not sure how well I could sell that many paperbacks, and that would probably change my terms with my warehouse where I’m currently not paying for storage.

As I’ve mentioned in recent reports, selling books directs makes evaluating performance a bit more complicated, as there are expenses associated with printing and shipping that distort top-line revenue and are difficult to tie directly to book sales in the given month. As you can see, if I’m shipping from a warehouse, that gets even more complicated.

100-Word Writing Habit journal prompts workbook!

Since sharing a preliminary interior mockup in last month’s report, I’ve made a lot of progress on a 100-Word Writing Habit journal-prompts workbook. I’ve developed a bunch of journal prompts based upon my own journaling habits, built a layout template, and worked out the details of how to generate the interior layout once I have enough journal prompts.

The idea is to have 100 journal prompts, a “word-count calculator” that helps you determine how many lines of each prompt page you need to fill to arrive at 100 words, and a habit-tracking grid. Here are some sample pages.

An important detail of the layout that has taken a lot of time is making the pages small enough for it to still be a convenient journal, but with enough space that people with a variety of handwriting sizes will have enough room to write at least 100 words on one page.

I still need to develop more journal prompts, design a cover, and get my hands on a proof copy, so stay tuned. I think I may do a Kickstarter for this, which would be a good way to reacquaint myself with the platform in preparation for the next major book.

100-Word Writing Habit Wristbands!

I’ve produced 100-Word Writing Habit wristbands! In fact, they’re special habit-tracking wristbands, but I haven’t yet found a graceful way to call them 100-Word Writing Habit Habit-Tracking Bands. Kinda weird, “Habit,” two words in a row.

Here’s a picture of them from my warehouse.

On the inside they say “0 WORDS”, with an empty circle next to it. On the outside they say “100 WORDS” with a checkmarked circle next to it. So you start your day with 0 words, and when you’ve written your 100, you turn the wristband right-side out as a reminder that you’ve done your habit for the day.

I’m still waiting for some bands to be forwarded to me so I can make sure they turned out right, and so I can photograph them for sale. Though I may just make them a part of a Kickstarter for the journal-prompts workbook.

Warehousing and direct-sales skills unlocked!

The 100-Word Writing Habit Habit Bands will be my first physical product that isn’t a book. It’s a cool feeling to be able to sell something like this now that I have the skills of both running a Shopify store, and fulfilling goods from a warehouse.

Of course, I could have easily fulfilled my own goods when I was living in the U.S., but never thought to. I would have said it wasn’t automated or scalable enough. I’d definitely try it on my own now, but since I don’t live in the U.S., I’m forced to find a more hands-off solution.

I really feel like I’ve up-skilled this first quarter. Much like how last year I up-skilled in photography and video editing. I always find it fun when I get a new skill and suddenly a new world of options opens up.

Austin networking trip

I’ll finally get my hands on a 100-Word Writing Habit Habit Band when I go to Austin – or at least I’ll get the band on my wrist. I’m going to Austin March 30th–April 4th, for no reason other than to meet or catch up with other writers and creators.

I haven’t been in Austin since I did a mini-life there in November of 2014 – ten years ago. Since then, the “next Austin” has surprisingly turned out to be…Austin. Judging by my Twitter feed, it’s like Austin is the Hollywood of online writers.

Want to go hiking with me?

I opted to skip SXSW and instead sorta create my own conference. I’m planning dinners and coffee chats, but leaving some of my schedule flexible. Want to go hiking with me? Join me for a hike on March 31st.

Or come to my meetup!

I’m also organizing a meetup with lots of help from my friend, Nick Gray, author of The 2-Hour Cocktail Party. Nick is the master of meetups, so you can bet there will be name tags and icebreakers to make it comfortable and fun for everyone.

Our meetup will be on the evening of Tuesday, April 2nd. If you will be in Austin, please learn more and RSVP here.

If you can’t meet me in Austin, I’ll try to remember to take some selfies to share in the next income report. I never think to take selfies but I’m working on it.

Can I interview you?

I’m still interviewing readers about finishing creative projects, to research my next book, Finish What Matters. I’ve already interviewed everyone who signed up from the first cohort of 1,000 subscribers I emailed, and I’ve started emailing the second cohort. I’ve talked with more than two-dozen readers so far.

If you have 40 minutes to chat with me about finishing creative projects, sign up here. I’d love to hear your finishing philosophy, and/or help you finish more projects.

RSS-based Love Mondays / web archive

The first couple RSS-triggered Love Mondays emails have gone out! This seemingly-simple project was actually a lot of work. It took a lot of exploration and butting up against obstacles, but it feels great to have the first emails go out without a hitch.

The gist is that the body copy of my emails gets published in an as-of-yet-hidden area of my WordPress blog. That publishes an RSS feed, which then triggers the email.

With this setup there’s a web archive of the email and I don’t have to compose emails within ActiveCampaign and instead can do so through WordPress, which also streamlines my newsletter creation system. In my next batch of emails, my AirTable base will publish a Markdown file accessible by Ulysses, from which I will publish to WordPress.

A possibly-important feature of this setup is I can monitor web traffic to the web archive of the email, which may help me better assess how often the email was shared.

It all sounds kind of trivial when I describe it, but I’m very excited about it. It’s something I had wanted to do for a long time, but could never figure out.

I’m working on this feature in phases, seeing how it goes along the way. At some point there could be an archive of all past emails, and more prominent sign-up forms on those archive pages. Kinda like my own personal self-hosted Substack.

More ConvertKit testing

In the first phase of my RSS-based newsletter rollout, I’m testing ConvertKit. Thanks to RSS, I can send the same content on two different email marketing platforms, with no extra effort.

I talked last month about how I’m already not impressed enough by ConvertKit to justify switching from ActiveCampaign. In fact, while ActiveCampaign’s RSS support was frustrating, I was still able to accomplish what I wanted. With ConvertKit it’s turned out it’s simply not possible.

But I am sending out my best compromise as an email through ConvertKit in this month’s batch of four emails, to a test group of about 250 randomly-selected subscribers.

I wrote in a past report about how ActiveCampaign’s open rate for a test email was slightly higher than ConvertKit’s, but not enough to draw any conclusions. In the two emails since then, the results are similar. This week’s email is a dead heat with a 34.7% open rate so far for both. Last week’s email, ConvertKit’s open rate was higher, 41% versus 39.96%. But given the sample size, a Bayesian calculator gives ConvertKit only a 63.8% chance to beat ActiveCampaign.

Especially given that I’m very good at using ActiveCampaign to build just about anything I want, and ConvertKit’s RSS support straight-up can’t do what I want, I would need to see dramatically- and convincingly-better open rates to justify switching to ConvertKit – like a twenty- or thirty-percent increase.

There’s a couple more emails to go in this experiment, but I find that outcome highly unlikely.

New ActiveCampaign review?

Given my recent underwhelming experience with the one email marketing platform that gave me some FOMO, it may be a good time to create an updated ActiveCampaign review.

I know I’ve made a lot of money from my last one, but it’s so hard to make it a priority given all the other projects! However, I feel like I’ve already done much of the work with my recent experimentation.

BOOX Poke5

I’m really enjoying my BOOX Poke5. So much so, I’ve written a BOOX Poke5 review. (I’ve signed up for the BOOX affiliate program, though the payout is crazy low – 1%! And despite generating 167 clicks, no purchases.)

The thing I love about the Poke5 is, since it’s an e-ink Android device, now I can read ePubs on Readwise Reader, on e-ink. Therefore, I can sync my highlights to Readwise as if I were reading a book on my Kindle.

I think this will be a boon for authors like myself, who sell ebooks direct.

My Sudowrite plugins!

You’ll see a $300 payment for “consulting” this month. That’s weird because I typically don’t do consulting. It’s for the plugins I built for Sudowrite. Go check out Anecdote Engine, Hot Take Oven, and the Podcast Media Trainer!

Deleted 3,300 D4H subscribers

After carefully marketing to anyone on my Design for Hackers list who isn’t already on the Love Mondays list, I’ve deleted (well, unsubscribed) 3,300 subscribers.

This is anyone who has already been through the free email course, and isn’t on one of my other lists, which is actually a surprisingly small number, since I had about 22,000 total subscribers, and was motivated to do this to make room before I reach the 25,000-subscriber limit on my plan.

The free email course is still up, but anyone who goes through the course gets some emails about the 100-Word Writing Habit email course, Love Mondays, and is then removed from the list.

I’m no longer promoting my Design for Hackers courses. I guess you could say I’m “sunsetting” them.

Direct-sales update

Direct sales of books were $684 this month, which was 13.5% of the total book revenue of $5,120. My gross margins on those books was $566.

Patreon: Shopify and Meta Ads tour, new lead quarantining sequence

I’ve shared a couple bonus videos for Patreon supporters, showing behind-the-scenes how I run my author business. One is a tour of the back-end of my Shopify store and Meta Ads. Another is all about how I quarantine and warm-up new email subscribers I’ve gained through Meta Ads.

If those sound interesting to you, join the Patreon to get instant access.

Thank you for having me on your podcasts!

Thank you to Kyle Campbell of Da Vinci’s Discourse.

Income

Book Sales

Digital Products

Affiliates / Advertising

Reader Support

Services

Expenses

General

Advertising

Hosting

This post is filed under Income Reports.