By Pratik Dholakiya published August 14, 2014

How Creating Content Could Sabotage Your Revenue

hooded figure with mask-lighting fuseThe basic premise of content marketing is one that we’ve all known since grade school: Give and you shall receive. Between DVRs, ad blockers, and plain-old banner blindness, it’s increasingly up to the consumer whether or not they get marketed to. By offering genuine value to users, content marketing gives consumers a reason to expose themselves to your marketing.

But can we take it too far?

It should go without saying that any marketing strategy has its limits. We face diminishing returns, and at some point any new dollars we invest will fail to produce additional profit. Still, most of us assume that investing more money or resources will almost always boost revenue, even if the profit isn’t there anymore.

This isn’t always true.

Sometimes creating content can actually cannibalize your revenue.

When Neil Patel shot himself in the foot

In October of 2013, Neil Patel launched a massive resource called Quick Sprout University (QSU), a series of videos. As smart and successful as he is, Neil called it a $45,300 mistake. His previous advanced guides could easily pull in hundreds of thousands of visitors and create thousands of email subscriptions. But the QSU videos actually did far worse than his previous resources. In fact, they failed to make up for the difference due to random downward fluctuations in traffic. In 5 days, they only generated about 7,000 views. At a cost of over $40,000, the videos were a huge brick of wasted expenses.

More importantly, however, was that the videos actually caused his revenue to drop. In fact, it dropped by 27 percent. Why did this massive content marketing undertaking actually hurt his revenue?

According to Neil, his audience was becoming so accustomed to accessing high quality free content that they were less willing to pay for content anymore. The QSU videos were undercutting the value of his core products and actually discouraging visitors from making a purchase from him.

Ultimately, Neil decided to monetize QSU by merging it with his core product (even though he had originally said he wouldn’t do this). We can’t fault him for making this decision — he had three options: Let the course continue to cannibalize his sales, eliminate the videos and admit that they were a huge waste of money, or use them as a draw to sign up for his product.

In the end, the attention that Quick Sprout University earned while it was free certainly might have turned a profit after it became a paid product. But that’s more like having a free beta and a paid final product than legitimate content marketing — even if it wasn’t planned that way.

The conflict between reciprocity and scarcity

Neil Patel’s mistake wasn’t producing an awesome resource for his fans, and it wasn’t investing too many resources in creating content. His mistake was sabotaging the scarcity of his product.

Content marketers can actually damage their revenue when they offer free information that reduces the overall value of their product.

Products solve problems. If you’re a good content marketer, your content solves problems as well. Content that doesn’t solve a problem for users is just a distraction or a waste of time. Consumers need a reason to expose themselves to your content.

But if your content solves the specific problem that your product is supposed to solve, consumers no longer need your product.

The principle of reciprocity only goes so far. As humans, it is certainly true that we have a desire to reciprocate generosity when it is offered to us. But it’s important to recognize why we do this. We reciprocate because we expect to become part of a virtuous cycle of give and take. This is a concept in game theory called “reciprocal altruism.”

If people discover that they can easily take from somebody who keeps giving, with no expectations of reciprocity, they will eventually take advantage of the situation, no matter how virtuous their original intentions might have been.

So when it comes to content marketing, I might be drawn to read your blog if it solves problems for me, and that might expose me to your product, which promises to solve additional problems. But if your blog has already solved those problems for me, my instinct to reciprocate probably isn’t going to be enough to convince me to pay for your product. I might recommend you to a friend and speak highly of you, but I probably won’t give you my money.

As a content marketer, when you decide on subject matter, medium, format, tone, and so on, you need to:

  • Think about the problem your product is meant to solve, and the type of person who would have that problem. Think about the other kinds of problems those people will have, and how your content can help them solve those problems, too. You typically want to avoid solving the specific problem your product addresses.
  • Avoid attracting an audience of people who expect everything to be free. Never set the expectation that you will give away the farm. You want to be helpful and generous to your audience, but you should be up front about the fact that you are in business to make money. Approach it any other way and people will resent you for the “bait and switch.”
  • Avoid getting too hung up on subject matter. Yes, you want to establish yourself as an authority, but your primary goal is to become a trusted source of useful information to your core audience. Subject matter doesn’t play as big a part in that as you might think, as long as you’re thinking about your target audience’s needs, on the whole.
  • Realize that it’s sometimes okay to approach the core problem your product addresses with your content, but you need to do it carefully. You can address the problem as long as you don’t undercut your product’s unique selling proposition. In Neil’s case, he talks about online marketing all the time on his blog. This doesn’t undercut his revenue. The QSU videos, on the other hand, compromised the value of its traffic by cannibalizing its core promise. They weren’t one-off blog posts; they were built to serve as a single comprehensive guide — just like his business is designed to do.
  • Consider where medium and format come into play. No amount of blog post content can fully undercut the value of a video series, for example. A disorganized group of blog posts is also less valuable then an organized eBook, even if the information contained in both is the same.
  • Understand if you aren’t selling an info product, the concern that content will cannibalize your revenue is reduced, but not eliminated. For example, if you sell hair products, and then teach your audience how to create their own hair product from home ingredients, you might hurt your revenue. At best, you’ll attract an audience of people who weren’t going to buy your product anyway.

I can’t stress enough how often content marketers get caught up in subject matter. All too often, we come across:

  • Freelance writers who write advice for freelance writers
  • Lawyers who write advice for lawyers
  • Lifestyle entrepreneurs writing about lifestyle business

The reason we see this all the time is because most online marketers write about marketing in order to market themselves. This is a unique case. Digital marketers (like us) write about marketing because everybody in business needs to know about marketing. Our clients need to be somewhat educated in how marketing works in the digital age.

We are solving problems for our target audience. But this doesn’t necessarily reduce the need for our paid products — our colleagues and our clients are always going to need new information — and our insight and experience at guiding them to implement it effectively will still come at a premium, no matter how many free resources we share.

However, when this same practice is used in other industries, it’s actually another way to cannibalize business revenue. A law firm writing advice for lawyers isn’t necessarily attracting any clients when they do it. But they are certainly providing their competitors with useful advice — and giving away information that they could charge clients for.

This is what happens when we put the focus on subject matter, instead of on our audience.

How to keep content from consuming your revenue

If I’ve been giving you the impression that offering too much value with your content is a bad way to expand your reach because it compromises the value of your product, I assure you this was not my intention. Nor have I been trying to say that it’s a bad idea to invest a lot of resources in content marketing.

I’m simply arguing that content marketing needs to add user value without compromising product value.

It is possible to invest a great deal in content and turn a positive result.

Shopify is a great example. These days it’s practically a household name, even expanding into physical retail with its point-of-sale system. But Shopify started from close to nothing, and its success wouldn’t have been possible if it hadn’t caught the attention of a man named Tobias Lutke.

Tobias’ primary investment in content marketing was to build an open-source blogging platform called Typo. The platform earned itself over 10,000 installations, and earned a massive audience for his own blog in the process. This audience would ultimately prove instrumental in launching Shopify.

This just goes to show that target audience is so much more important than subject matter. Blogging and e-commerce are two very different subjects, but they are both very interesting to similar kinds of people: namely, web entrepreneurs.

Shopify continues to make big investments in content marketing. One of the most successful was a contest that arose as an idea from Tim Ferris, who suggested that Tobias put up a $100,000 reward to the Shopify store that could earn the most revenue in six months. The experiment was a massive success that more than paid for itself, and even earned exposure on massive platforms like The New York Times.

Both of these are examples of how big, successful content marketing campaigns often stretch the limits of what we traditionally think of as content. Tobias was a blogger, but he owes much of his success not just to blogging, but also to creating his own blogging platform. Similarly, investing $100,000 in a contest was a way to encourage other influential people to create their own content, broadly defined. is another example of massive success. Aaron Patzer launched the site in 2006, and invested in not just blog posts, but also slide shows, videos, and infographics. The important thing to take away from this is not that you should invest in slide shows, videos, and infographics — it’s to take note that was the first company to heavily invest in these content marketing tactics.

The strategy grew Patzer’s site to 100,000 accounts in a year, and 2 million accounts by 2009. Just three years after it launched, it was sold to Intuit for $170 million.

Again we see that successful content marketing pushes the limits of content:

  • It solves problems, not for similar experts, but for a target audience, often with diverse subject matter.
  • It goes deeper than blog posts, often going so far as to invent brand new media.
  • It doesn’t cannibalize the core promise of the product.
  • It involves other people, including influencers.


We don’t like to hear it, but excessive content marketing can sometimes not just fail to turn a profit, but can actually hurt revenue. Obviously, things don’t have to be this way. Successful content marketers understand why the product is valuable, and craft content that is valuable to the same audience, but in a different way. Furthermore, they push the envelope, continually redefining the meaning of content, and they aren’t afraid to invest in doing something different.

Looking for more insight on creating content that adds value to your brand? Don’t miss Content Marketing World 2014, September 8–11, 2014. Register today!

Author: Pratik Dholakiya

Pratik Dholakiya is the co-founder of E2M, a full service digital marketing agency and PRmention, a digital PR agency. He regularly speaks at various conferences about SEO, content marketing, growth hacking, entrepreneurship, and digital PR. Pratik has spoken at NextBigWhat's Unpluggd, IIT-Bombay, SMX Israel, and other major events across Asia. As a passionate marketer, he shares his thoughts and knowledge on publications like Search Engine Land, Entrepreneur Magazine, Fast Company, The Next Web, and the Huffington Post to name a few. Search Engine Watch, one of the most respected platforms in the search industry, recognized Dholakiya as a "must follow" SEO expert. He has also been named one of the top content marketing influencers by Onalytica three years in a row. Follow him on Twitter @DholakiyaPratik.

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  • Padraig Ó Raghaill

    Well how are you doing Pratik?
    Great article, foundation knowledge is the problem, there is something to be said for coming from a traditional marketing background, I feel many in the online space are missing the core marketing discipline foundation gained from formal learning and industry experience.

    It is very refreshing to see such an article and especially with Neil Patel, great stuff and hope to be visiting and comment more on great marketing insight.

  • Gary Hyman

    This is an excellent article Pratik. You’ve nailed it & I clearly remember Neil’s situation. I too have run into this issue – producing high quality blog content, with low returns on the actual product. When I surveyed the ‘unbuyers’, most responses ‘you’ve already given me what I want’. It’s a fine line to straddle – producing ‘blog’ content that will educate & give just enough to wet the appetite for your products, Your 6 “As content marketers…you need to” ,makes a lot of sense. I also believe you need to set the expectations of your audience up front – e.g. tell them what content is free and what is not. Thanks for sharing.

  • Lewis LaLanne – NoteTakingNerd

    THIS . . .

    “But if your content solves the specific problem that your product is supposed to solve, consumers no longer need your product.”

    I believe a trait that is common amongst all the greatest content marketers is that they offer incredibly useful, but incomplete information. The information is valuable but it only masterfully addresses one component of an overarching, systematized solution – example “Facebook Page Post Advertising Tutorial” which is part of your “Online Traffic Generating University”. When you get this right, you’re creating a demand for your solutions instead of working yourself out of a job.

    Thank you Pratik for reminding me of such an important marketing lesson!

  • Vicki Kunkel

    I typically have offered the “What” information for free, and the “How” information for a fee. EG: “Here are the five things you need to do to accomplish X in your business,” or “Here’s what you need to do to solve the massive problem of Y in your business.” For folks who already know how to do it; great. But for those who don’t, it’s a learning gap that the “for fee” content addreses. So far (fingers crossed) that model has been successful for me.

    And, you’re right: I never could understand why experts would give free advice to other experts who were directly competing with them. That’s not to say I don’t give advice to other experts in my field who as my privately. But I also don’t advertise it, either. 🙂

  • Denise Renee

    Fantastic article Pratik (I actually read it all the way through and didn’t skim!) and all very true points; I’d love to hear what some of the “give-your-best-info-away” evangelists have to say in response. Funny thing is I remember getting onto the QSU mailing list earlier this year. I wanted to buy Neil’s program (and still do) it’s just I’ve got so much else going on (in terms of other learning courses) I simply didn’t have the bandwidth to take it on. I don’t even think I finished watching the whole video series. I think one element that could be added to Vicki’s formula below is scarcity… nothing like the fear of something being taken off the market to make folks buy in a hurry!

  • Blasko

    While helping my clients I recently stumbled on a framework that I think will solve the problem Pratik is talking about. Draw 3 concentric circles where the central one is what you sell and the external one is how you sell it to (your audience) between these two we need to build content assets to attract “who” we want to sell to “what” we sell.

    Content assets are not just blogs or video series, but could be even entire new websites that help your audience solve one of the problem that will take them closer to your offering. Or even offline events and more…

    I found the 3 circles to be a simple and yet powerful representation of what needs to be done and for who.

  • Votrepere

    You used the same old strategy of sensationalising an already known issue. Anything that’s done over the limit is sure to bring disastrous consequences. Your title is misleading too. Stuff and nonsense, in three words.

  • Ryan Biddulph

    Hi Pratik,

    Excellent. I’ve learned that seeing your ideal reader before building a blog, let alone writing a post, helps you target effectively. Also, don’t give stuff away for free unless you charge for some stuff too. Does that make sense?

    I started my new blog and eBook – Blogging from Paradise, in both cases – with a clear vision of my ideal reader in mind. I picked the domain; stunned that it was still out there. Then I designed my blog top down, for readers who wanted to retire to a life of island hopping through smart blogging.

    I simply focused on making sure all elements were completely aligned before I did anything, from the domain, to the title, to the tagline, to the blog posts, to anything in my sidebar. This alignment helped me monetize through my eBook, and my freelance services, because all elements lined up, sending a clear message to both readers and customers.

    I also made sure to charge for my first eBook. No giveaways. I already give away three, 2500-3000 word posts for free each week. Some grossly undervalue their posts, but I don’t. I know you can over deliver through an email list, or through a blog. I own my self-hosted blog – i don’t not own an email lists..aweber or getresponse does…..and hotmail/gmail/etc etc…owns the medium – so that’s why I do all of my creating on my blog.

    I give away max value through my posts and pages but I’ve conditioned my readers from Day 1 of my new blog at least, to pay for premium eBooks and for my services. I never felt bad about charging because I worked for years to develop my craft, so if doctors, lawyers, and other professionals get paid for offering a service, I should get paid for teaching individuals how to blog from paradise.

    Power post here Pratik. I’ll tweet in a bit.

    Enjoy your weekend.

    Signing off from Fiji.


  • Rob TheGenie Toth

    It’s a great article and a topic I definitely preach myself to clients. It’s a direct compete if the information being sold (or is closely related to) more information.

    If it’s a service, then the leeway is much greater. Someone selling dog grooming services won’t lose sales from dishing out dog grooming advice as there will always be a market who wants it done for them.

    But they MIGHT lose sales opportunities if they spend weeks in the “content creation lab” to build up a mountain of content assets and ignore sales gears.

    The topic you brought up though in this great article is one a lot of clients who have an “artist” mindset struggle with… they like to create. So they will spend weeks on end creating, revising, posting and re-arranging content. Many of them sell premium courses though … so they lose sales in many ways…

    Like you illustrated, their users now have less motivation to purchase the premium course since so much is available for free, they also become overwhelmed by the staggering hours worth of content and therefore fear buying a course, they are less likely to share because this same information overwhelm results in them not actually consuming the content (since it’s not bite sized)… meanwhile the merchant themselves ignored the sales gears so they dip in revenues there too.

    Great stuff. Great article.