They may be relatively new, but chatbots have now become a way for people to make some extra money. If you already know about chatbots and are wondering how to get started making money from them, then you are right where you need to be.
Can chatbots make passive income? Chatbots can make passive income in a variety of ways, from affiliate marketing, ad placement, lead generation to reducing overhead by automating expensive operations such as customer support. Time and effort are required to build a truly passive bot, but with the right flows it can be profitable over time.
Even if this is your first time hearing about chatbots, know that you can still get in on this lucrative passive income opportunity. It’s possible you have already used a chatbot, but have no clue how to make a successful one. Successful chatbots can generate several thousand dollars a month in various ways. This guide covers how to make passive income using chatbots, so read on to learn more!
How to Make Passive Income With Chatbots [Guide]
In case you don’t know, chatbots are conversational computer programs. They are basically automatic messaging systems. Chatbots are very engaging, and people love them for their 24/7 availability and quick replies. The income potential chatbots offer is especially enhanced by the fact that their demand in the business is skyrocketing.
1. Before Getting Started, Decide How You Will Monetize Your Chatbot
Before you get started creating anything – yes, now is the time – it’s best to know how you will monetize your chatbot. Knowing this will orient how your chatbot will work. There are several ways to make money off a chatbot, and you have to decide which option works best for you to know what you will make it talk about.
For instance, you can use it to promote an affiliate product, or even sell advertising space. Some simply sell their chatbots to businesses and make money from them that way. It is worth mentioning that businesses are an ever-growing market for this modern communication technology. Therefore, there are several ways to make money off chatbots, and here are the most common of them.
Sell Your Chatbot
You can sell chatbot services to your clients and make good money. For businesses, chatbots can save costs and even improve the availability of services to clients for businesses. Chatbots can not only help support agents, but also generate leads and sales, assist developers, and reply to accounting issues. You can create a chatbot outline, adapt it to a bunch of different companies then sell it to them. You can make a Dollar amount for the sale, and receive recurring revenue for updates, ongoing support, new features and further adapting the chatbot to each business’s specific needs.
Give the Chatbot Away for Free, Receive Commissions on Sales or for Leads
You can also follow the steps above and give the chatbot away for free. If it helps people, generates leads or sales, you can then request extra commissions on sales. If your chatbot is efficient and you manage to negotiate good margins, your chatbot can generate substantial income!
Use Chatbots for Affiliate Marketing
You can monetize your chatbot through affiliate marketing. When someone interacts with the chatbot and requests where to find certain items, you can refer users to affiliate links, and when they make a purchase, you can get an affiliate commission. Learn even more about affiliate marketing in our Affiliate Marketing Guide on our blog.
Use Chatbots for Conversions Landing Pages
A chatbot can also be used to lead people to a landing page where they can buy products and pay for services. You can conveniently place the landing page in conversational messages as a link, and then users can follow that link to a landing page. However, you have to be careful about the way you integrate these links into the conversation to ensure that customers do not find it spammy. Providing excellent service should always be your main focus. The better the interaction with the bot, the more likely someone will click through. Treat the conversation as if they were talking to a helpful agent.
Use Chatbots to Conduct Surveys
Some bots can even carry out surveys. These bots can collect a lot of information about web users. This information can be very useful to some corporations, and they can readily pay for it, which can obviously bring good income. For instance, if you get data about financial behavior among clients, you can sell it to financial firms for cash. Surveys can be carried out to collect information to be resold to companies, or to collect information for specific companies. In either case, you can receive a commission for each time someone fills in a survey.
Use Chatbots to Generate Leads
Chatbots can also be used to generate leads. If you have a chatbot that answers questions about plumbing for example, and the person doesn’t find the answer they needed form the bot, it can ask the user where they are located and generate a lead for a local plumbing company. The lead can then be resold for an excellent commission. You can even automate the entire process to make it as passive as possible!
Use Chatbots for Advertising
This is a way to supplement your chatbot income. If you embed your chatbot to a landing page, you can place ads around it. These may be PPC (Pay Per Click ads, like Google Ads), affiliate or sponsored ads. You can make revenue from ad views or clicks.
Use Chatbots for eCommerce (FAQ)
Chatbots can answer any questions that a company have in an FAQ section on an eCommerce site. Chatbots can answer questions in relation to order status, order location and shipping costs. You can learn more about Chatbots for eCommerce for beginners in the Ecwid eCommerce Podcast below. Ecwid eCommerce is our favourite eCommerce solution. Learn more about Ecwid here.
Mix These Monetization Strategies
If you create a helpful bot that provides affiliate links on a page with ads and generates leads, you can increase your income. However do not be spammy. Otherwise you will deter your traffic. Make sure the conversation is human-like, and that actually helping the user is your goal before making money from them.
By combining these strategies, with 30,000 monthly page views and 100 bot interactions at a 2% conversion rate, you can generate $1000 for leads and around $1000 from ads. That’s a total of $2000 for one bot.
*If each lead is worth $50. Page view / ad revenue ratio value based on stats from Income School.
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2. Choose the Industry You Would Like to Serve
After reading the paragraph above, you should know how you will monetize your chatbot. Before you get started looking at technology and ways to create your chatbot, decide what sector you would like to serve. If you already know who your target market is, or what company you want to work for, you can skip this section. If you do not know who you would like to create chatbots for, then read on. Here are some ideas of sectors you can serve.
Who needs chatbots? Here are some sectors that are in need of chatbot AI automations:
- Education
- Consultant
- Career Guidance
- Language Schools
- Finance
- Merchant Service
- Insurance Assistant
- Mortgage Surveys
- Health & Beauty
- Yoga
- Doctors
- TeleHealth Service
- Beautician
- Fitness Centre
- Travel & Transport
- Travel Booking
- Hotel Feedback
- Logistics Feedback
- Personal
- Webinar Registration
- Weddings
- Portfolio
- Event Planning
- Wedding Planners
- Event Planner
- IT & Software
- Digital Agency
- Mobile Application
- Game Studio
- Real Estate
- Mortgage
- Survey
- Mortgage Help
- Food & Restaurant
- Booking a Table
- Restaurant Feedback
- Cake Ordering
- Restaurant Orders
- Design & Photography
- Video Production
- Photographer
- Recording Studio
- Art Gallery
- Services
- Education
- Legal Service
- Freelancers
- Digital Marketer
- Photographer
- Recruitment Agency
- Feedback
3. Create a Diagram of Your Chatbot Conversations
You may feel ready to create your first bot! But wait, what will it say? Save yourself some time and map out the conversation. You can use free tools to do this in Google Drive. Draw.io is a cool extension that allows you to make diagrams. Create a diagram of the conversation so that you can draw out the conversation and cover as much ground as possible.
Here are some things you should think about when creating your chatbot conversation:
- What is the bot’s goal? Answer questions? Collect leads? Collect survey answers?
- What is the bot’s tone? Formal? Informal?
- How old is the user who will be interacting with the bot?
- What questions may they ask? How much do they already know about the topic?
- Should you or should you not use emojis or gifs? Would that be appropriate?
Make sure your bot is adapted to your target audience. Do not overdo emojis and gifs (though they can make the conversation more fun and personal). Keep the tone and conversation clean and professional, especially if you are creating a bot for a business. Also, double check your grammar and spelling! You do not want to make a bot that is full of mistakes, it will look unprofessional and will turn your traffic away.
4. Create Your Chatbots Based On Existing Tech
Ok, now is the time to create your bot! These days, creating a chatbot is easier than has ever been the case. Even if you are not an expert programmer, you can easily create a great chatbot and use it to make a living if you can manage to monetize it. Here is a list of companies that allow you to easily create chatbots:
- Collect.chat
- Facebook messenger
- Botsify or Chatfuel for
- Facebook Messenger
- Motion.ai
5. Earn Passive Income From Your Bot
The best way to make a passive income off your chatbots is to ensure that you generate enough interest in your bot. You can cash in on this traffic and you will not have to try so hard to keep your audience engaged as the bot will handle everything without any assistance.
You can learn more about generating traffic in Income School’s Project 24 (learn more here).
If you think this is too much effort, you can always get into a partnership with other firms, which can use the bots to generate money and then give you a share of the profits. That is a pretty passive way to make money through a chatbot, wouldn’t you agree? 🙂 It is a brilliant and effortless way to generate passive income long term.
How Passive is Income Generated by Chatbots?
Chatbots are inherently passive as a computer handles the conversation with the client on your behalf. Therefore, making money through chatbots will not put a lot of ongoing demands on you unless you are working for a client who requests updates to match their new business needs. For instance, when you make a chatbot for a business, they may have new support or sales needs which will require updates. However, you can easily charge ongoing maintenance and support fees for that. You can also make affiliate commissions on each lead or sale your bot generates for them.
Startup Costs
It does not cost much to create chatbots. Once you know who your target market is, you can easily come up with a chatbot you can monetize and you can make an extra income off it. Your biggest expense will probably be the chatbot service you choose. Pricing can vary from free to over 500$ per month depending on the service you choose.
Scalability
Once you have made a chatbot and it helps you create a passive income, you can go ahead and create another chatbot to create a similar outcome. You can do this multiple times to create several passive income streams from your chatbots. Many people are actually doing it and earning good money off their efforts. You can also create on bot for a specific sector and sell it to hundreds of companies in that sector. This is a very scalable business because chatbots can reply to anyone 24/7. Make it even more scalable by translating it to a variety of languages!
Difficulty
As mentioned earlier, creating a chatbot is not that hard since you don’t have to know how to code. Even if you can’t write a line of code to save your life, you can create chatbots. On top of that, as the above analysis indicates, there are several ways to create passive income with the help of chatbots.
Time
You might need a little time to prove that your chatbot is actually a worthy investment to your target market. Therefore, before your chatbot gets enough traffic to attract advertisers and other people, you will need to be a little patient and test it out. Collect data, conversion stats and success rates to make it an easy sale to future customers. Similarly, if you are seeking a partner who will find a way to make money off your bot and share the profits with you, you will need a little patience to build your reputation as well.
Risk
Since you don’t need to invest too much money to test a chatbot, the risk of giving this passive income stream a try is pretty low. However, creating a profitable chatbot requires a lot of time, patience, skill, A/B testing and more. You may not have a profitable chatbot for moths or years depending on how this idea is executed.
Seasonality
Fortunately, seasonality is not something you will have to worry about as you try to use chatbots to create an income stream. These bots tend to be popular all around the year, and seasonal variations need not be a concern for you if you are using a chatbot to make yourself some money on the side. You should only have issues with seasonality if the topics your chatbot deal with are very seasonal.
ROI (Return On Investment)
Considering that you don’t have to invest much money into chatbots in order to give them a try, it can be quite an attractive idea. However, ROI depends in part on the idea chatbots are used for, execution and monetization strategies.
Related Questions
What is a chatbot? A chatbot is a computer program that relies on AI (Artificial Intelligence) to communicate with a person as opposed to a real-life representative. Chatbots reply to questions that are input by a user. They can be used in a variety of settings, notably business (ex. Customer support, lead generation for sales etc).
Can I create a chatbot without any programming knowledge? You can create a chatbot without any programming knowledge. Creating chatbots does not take much effort, and you only need a few skills to get started. There is a short learning curve as well, you simply need to know your end monetization goal.
How do you monetize chatbot? You can monetize a chatbot in a variety of ways including by creating and selling chatbots, affiliate marketing, advertising, or offering the chatbot for free but receiving a commission on generated leads, survey information received, landing page conversions, etc.
How much can you make selling Chatbots? With 30,000 monthly page views and 100 bot interactions at a 2% conversion rate, you can generate $1,000 for leads and around $1,000 from ads if each lead is worth $50 and ad CPM is $33. That’s a total of $2,000/Month for one bot.
Is Siri a chatbot? Apple’s Siri, Amazon’s Alexa, Google’s Google Assistant, Microsoft’s Cortana and other voice-search and virtual assistant AI technologies like such can be considered voice chatbots. They answer common questions and provide virtual assistance like a type-chatbot on a website would.
Is it easy to create a chatbot? Aalthough creating a chatbot is easy, creating a profitable chatbot will take time and effort. It is important to choose the right industry to serve, to create the right flows for their needs and to choose the best software to serve those needs.
How much does it cost to make a chatbot? Creating a chatbot can cost anywhere from $0 to well over $10,000 depending on if it is created from scratch, or using existing software. If you create it using free, existing software, consider your time to create it as an investment. However, a chatbot will cost more if you require custom features and development.
