Public Domain DVD Creation Case Study - $2432 net profit for 2 hours up front work

I thought I'd share the activities to create one of our DVDs and the results thus far.

First I want to explain our business model so the case study is understood in context.

My wife and I do a lot of work with public domain materials and package them on CDs and DVDs. We currently have more than 500 titles.

We operate on the standard retail model - meaning that a few of our products will make 50% of our income and the rest will make the other 50% of the income. This is what is known as long tail marketing as explained in the book "The Long Tail: Why the Future of Business is Selling Less of More" by Chris Anderson.

We build all our products from public domain materials and invest very little up front time. We also do all our manufacturing and shipping in our home office to maximize profits. The total human time in this process is about 3 minutes per order shipped. All activities that can be automated by robotic equipment is done that way.

Since we can often create a product in two hours or less, we have a very low sales threshold to break even on the time investment. And since our products can sell for years, there is lots of time to recoup it even when we completely blow the research.

Our overriding goal is to build equity in a business that can be positioned for sale at some future point if we decide to move on to another activity. As such, evergreen products are very important to that potential exit strategy sometime down the road.

That said, lets look at the case study.

The DVD is a collection of NASA films that we sell on eBay, Amazon and our website. The DVD was created a bit over 2 years ago and has sold 271 copies as of today. It is a middle of the road seller for us. Several of our titles sell much better. And many sell much less frequently.

How was it made?

We keep track of public domain materials and are always scouring the web for new and interesting materials we can package up.

A bit over two years ago, I read a press release on the NARA site (National Archives and Records Administration) about a trial partnership between them and google video. It said they released around 100 films to google in a trial for public dissemination of their huge archive. (They have since gone in another direction but that is another story.)

So I checked out the NARA films on the google archive and saw several NASA films I could turn into an interesting video. I already knew that NASA items sell decently well so it was a good choice for making a DVD.

But there was a hurdle... There was no download button to copy a google video to my computer.

Fortunately there was a solution. A few minutes on google resulted in a tool I could install into firefox that would grab google videos that didn't have protections on them. Since these were public domain films, the downloads worked perfectly.

Next problem... the films were in FLV format (flash videos) and I needed something more friendly to use them.

A few more searches on google lead me to a program called "super" that converted video formats. Problem solved. I now had a series of usable NASA files.

I opened up Sony Vegas (my video editor) and added the films with title cards and chapter marks, rendered it and then ran it through DVD Architect to make a nice DVD with chapter marks for each of the films.

Then I designed a cover for the DVD case using AMF CD and DVD Label Maker and a simple title for the DVD itself with the software that came with my DVD label printer (direct printing onto the DVD surface.)

This entire process took approximately one hour of human time - about 4 hours of calendar time (i.e. downloading footage, rendering and creating a master DVD take physical time but not personal time. I can do other things while that is going on.)

The next step was to create some ads for the product; one for eBay, one for Amazon and one for the website.

Well, since I designed the cover, I already had a lot of the verbiage I used in the ads. And while working with the videos in Vegas, I grabbed several screenshots of the video, so creating the ads didn't take much time. All told, it took less than one additional hour to create the three ads and make them live.

Total time investment from conception to completion of the product came to 1 hour 48 minutes.

As a side note here: We will invest more time in creating some products that we know will sell well to some niches but most of our products - even best sellers were created in two hours or less.

Total time to ship the disk 271 times: 13 hours 30 minutes.

Dollars net per hour of work $2432 / 15.5 hours = $156.90

Plus that DVD will keep selling for years to come and adds to the bottom line value of our company.

Now as I said, most of the DVDs and CDs we create do not do this well... but some do much better (and could do even better with a bit more marketing effort.)

In the interest of full disclosure: There is an additional time investment to develop skills with tools you need to author CDs and DVD, learn HTML to create ads, work with eBay and Amazon and all that. In other words, like in any business activity you need an infrastructure - which I think stops a lot of people from making the attempt. But once the infrastructure is in place, it becomes a pretty simple process to keep making new, marketable products.

Oh... and even though this is showing how we create a public domain based DVD, your thinking doesn't have to be restricted to public domain materials.

For instance, you could use a program like Camtasia or its free clone Camstudio to build training CDs or DVDs for popular software applications. Or if you are skilled with a camcorder, you could shoot and edit any of a variety of how to videos. Now these types of projects will take a larger investment of time but with proper research, they can pay off quite well for the up front time investment.

I hope this little looksie into how we create a marketable product with public domain works is useful to all of you wondering just how to go about creating a product.

Feel free to ask questions.

I'll answer what I can.

Steven