Many businesses that try to make a profit online seem to be hard pressed to make a decent income even if they have a large email list or social following. Even if you’re driving enough traffic and have an excellent product, you may still be missing a fundamental piece of the puzzle: the marketing funnel.

The first mistake with many online sales is that you have only one product to sell or, conversely, many products that aren’t related to each other. Any product, whether it be a digital or physical product, should have other products which are related to and branded in a similar way to the initial purchase — but we’re getting ahead of ourselves.

What you need to offer first is a free incentive in exchange for an email address. This could be a white paper or ebook or a how-to video but it needs to be useful and something your audience wants. A mistake at this point is to think that just because they opted in means that they’re a customer. Just having an email address from a lead is also not enough, you need to have a product to offer them as soon as they sign up and a plan to continue sending them newsletters.

The next level after capturing their email is to offer a high-value low-barrier product at a decent price. Nothing expensive so keep it between $20 and $30 dollars which is inexpensive enough for your lead to consider purchasing it but expensive enough that they won’t think it’s a cheap useless product. One of the biggest errors is offering an expensive product at this stage because you are new to them. While they may be curious about you and your business, they’ll still be cautious about trusting you.

Whatever you choose your $20-$30 dollar product to be, remember that it must be a quality product. Your customer needs to be satisfied with this product or else you’ve just lost them and they will never purchase anything from you again. Worse, they may warn their friends about you; word of mouth is still the most powerful form of marketing there is.

The next level is to offer a more expensive product that is related to your initial free offer and the $20-$30 dollar product. This product could be priced anywhere from $70-$100 and should retain the same branding as your first product.

Be careful though, make sure your copy reinforces that the previous product the customer purchased was complete and this is an advanced course or product that builds on the previous offer. The previous product will do everything you said it would do and never try to sell an incomplete product — remember what I said about word of mouth.

The next level is an even more expensive product than the last (say $300-$500) and retains the same brand while reinforcing the previous products are complete products. You probably get the idea now, there will be another level under this which will be even more expensive (in the high hundred dollars or low thousands) but continue along the same brand. Keep creating products at each level that are more expensive than the last and cap it off with a product that will charge monthly.

At each level, some customers will opt out of purchasing but what you’re left with a small and devoted group of people who will be your super fans. This group will almost certainly buy anything you produce and will be your biggest advocates, so treat them extremely well.  Don’t forget your other customers as well, they may not have purchased anything after your initial or second (or third) product but they’ve proved that they are willing to buy something from you. Keep them informed of any new products you may sell and they may yet become a super fan via another offer down the road.

Remember, this journey started off with a free incentive and ended with a product that sold for thousands of dollars. You’ll still need to create quality products and write captivating copy, so there’s a lot of hard work. But with a marketing funnel you now have a fundamental idea of how to profit greatly online and build your company.