This is a guest post by James Tayo from Entrepreneur Blog’r.

Recently, Paul Cunningham from Blogging Teacher posted on Problogger on how small victories can help you create big products for your blog. He went on to describe two products you can create to offer to your audience, The eBook and a Membership site.

Because let’s face it, just as man cannot live by bread alone, Bloggers cannot live by blogging alone. Both products are on opposite ends of the complexity scale. One being easy to pull off (the eBook) and the other being hard to pull off (the Membership site).

I am here to propose a middle line product, The Software product.

This post is directed to the bloggers that already have eBook products out there and want to move on to the next step but feel a membership site is not yet within reach. This is a concern that many bloggers have and is supported by a comment left by Ms Freeman from Baby Steps of an Entrepreneur.

The Software Product

So what is this software thing I am talking about? It is a product that targets your audience’s pain and helps them to ease that pain. You can build a business around your blog by offering a software products that automates a task your readers are currently doing manually.

Now you don’t have to develop a full-blown product like Microsoft Word or Backpack from 37 Signals. Your product could be a simple wordpress plugin. Here is a list of premium wordpress plugins that are out there today. This business model is also practiced by Brian Clark over at Copyblogger. He has a software product to called Scribe that helps content publishers to leverage SEO while writing their posts in WordPress.

Can you really develop and sell software?

Here are some reasons why you may think software products are out of your league or you do not want to consider going down the route of developing your own software product.

You do not know how to program

You may feel you cannot offer a software product because you have no idea what PHP Smartys are if it bit you in the butt. Well neither does Brian and neither does Pat Flynn but he is making a steady passive income from 7 iPhone apps in the iTunes store. You need to stop thinking of yourself as the worker in your business and more of the visionary. You can partner up with a friend that can code but has no idea on how to market his software or you can outsource the development on Elance. Your job is not to do the grunt work but the brain work of understanding what your audience needs and bring a product that matches the market.

There is a lot of free software out there, no one will buy mine

You may think people will not buy your product because there are so many free versions out there. Well, there are millions of free eBooks out there too but that hasn’t stopped people from selling $31.9 million worth of eBooks in January 2010 alone.

Here is a case study of Dan Grossman, a SitePoint moderator that developed a WordPress plugin and sold $25,000 worth of licenses in one month. People will pay for value added no matter what other free options are out there. All you need to do is find your unique selling proposition (USP) that will convey that message of added-value.

I don’t want to deal with support

Unless you are a scammer looking to sell “hit and run” products, you are going to have to deal with some customer queries. The good news is that since you are not developing software on the same scale as 37 signal/Microsoft, you should be able to manage this. There are tools like GetSatisfaction and ZenDesk that automate the process of customer supoprt, help desk, bug requests etc. for a reasonable price. Of course, these tasks can be outsourced as well.

Again this strategy is not for the newbie blogger, if you do not have the experience of releasing a product, whether it be an eBook, this is not for you. Please go and read Paul’s post on Problogger and create an email course to build your list and then offer an eBook to get your feet wet. If you feel you do not have enough authority to pull off a membership site, a software product is the way to go.

Steps to take to your first software product

1. Survey your readers, ask them what their pains are so you do not develop a product no one wants.
2. Brainstorm how a tool or plugin could ease that pain or automate a task that is done manually
3. Think of a marketing plan, how would you bring that product ot the market, what is your USP
4. Develop or outsource a minimum viable product, don’t go all out by including all the features possible
5. Give influencers in your market a sneak preview. Get them to promote your product for you
6. Unleash your product to the public.

Do you have any ideas of what your audience would really appreciate? Do you think a software product
can help you grow your blog? Please let me know in the comments.

James Tayo runs a blog for entrepreneurs at Entrepreneur Blog’r. He shares tips on how entrepreneurs can build a profitable business online by building an email list of customers and turn them into raving fans.

Tagged as: Business, Monetization, Products