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#+title: S01|02 - my ai print on demand business strategy
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* Transcript
#+begin_ex00:00
Hey, everyone, and welcome back to another video in this

00:02
course. In this video, I am gonna be explaining

00:05
what exactly my AI print on demand business is, how

00:09
it makes money, and how it utilizes AI tools from

00:12
start to finish. I'm going to explain how I use

00:15
AI to make the products I sell and how I

00:17
use AI to drive free traffic to them. Because these

00:20
days, because of the new AI era we're living in,

00:23
you don't actually need to pay for advertisements

00:25
if you don't want to. Plus, in addition, I'll also

00:28
explain how I'm using AI tools to run this as

00:30
a solo 1 person business

00:33
requiring

00:34
0 employees.

00:35
And my hope is that by explaining my business in

00:37
a nutshell, that it will make other video lessons in

00:40
this course make more sense. So let's get started. And

00:44
basically, in a nutshell, what I do is I use

00:47
AI tools to generate art for me and I also

00:49
use AI tools to turn it into high definition digital

00:53
art files that can then be printed onto clothes in

00:56
high definition,

00:57
which is actually kind of crazy for me if I

00:59
think about it. Because before AI, I used to have

01:02
to hire graphic designers and artists to draw specific pictures

01:05
for me if I couldn't find any clip art myself

01:08
to use for it. But now I can literally get

01:11
exactly the image I wanted within seconds. But of course,

01:15
having these digital files isn't enough. To actually sell them

01:17
onto clothes, I come to print on demand tools. And

01:20
of them all, Printify is the biggest and most popular.

01:23
And by the way, if you aren't quite sure what

01:26
print on demand is, it's basically a product fulfillment method.

01:29
So you take t shirts for example, the most popular

01:32
print on demand product with customers by far. Well, there

01:35
are 2 ways you could make and sell t shirts.

01:37
1 way is you could literally get a bunch of

01:39
t shirts printed in advance by a printing company from,

01:43
say, China and store them in, say, your garage and

01:46
then list them for sale online. And if somebody went

01:49
and bought a t shirt from you, then you in

01:51
your house would package it up and then ship it

01:54
out with the postal service manually.

01:56
So that is 1 way. The other way, of course,

01:58
is that you could use a print on demand service

02:01
like Printify. What these services do is they let you

02:04
upload your t shirt prints to the website. They'll then

02:06
give you a product mock up photo of what the

02:08
t shirt will look like printed. You can then advertise

02:11
online your t shirt for sale and if somebody buys

02:13
it, Printify's print shop will see the order. They'll then

02:16
print the design onto the t shirt, package it up,

02:19
and ship it out to the customer for you. So

02:21
for me, since I'm running a 1 person business, print

02:24
on demand is a great way to do it because

02:27
to scale, I don't have to hire any employees to

02:29
be running a print shop for me or managing a

02:32
warehouse for me. The print on demand app is the

02:34
1 managing that. And the way that you profit with

02:36
this is that you have a markup price on your

02:39
products. So you take t shirts. Right now on Printify

02:42
with a premium account, they cost about 6 to 10

02:44
dollars to buy and sell. And then most sellers, myself

02:48
included, will charge the customer the shipping price as a

02:51
separate charge. Well, most t shirts online sell for about

02:54
17 to 23 dollars with a medium price being around

02:57
20 dollars So that's how print on demand stores like

03:00
mine make money. We add a markup to our products.

03:03
And most print on demand stores these days that I

03:05
know are usually after transaction fees and printing fees left

03:09
with a profit margin of, on average, around 20 to

03:13
50 percent. And for me, my profit margin these days

03:16
is generally sitting around 30 percent on average. And for

03:20
me, as I show in step 3 of this course,

03:22
I've chosen to sell my products on 2 platforms.

03:24
Firstly, I set up Shopify stores and I list my

03:27
products for sale myself online. If you've never heard of

03:30
Shopify, it's basically an AI powered online store builder. You

03:33
can build your own online store that you host on

03:36
your own domain name that you own and it has

03:39
a great integration with Printify.

03:41
And then secondly, I list and sell my products on

03:43
Etsy. Now, Etsy, if you've never heard about it before,

03:46
is 1 of the biggest online marketplaces in the world.

03:49
The only ones that are bigger as far as I'm

03:51
aware are Amazon and eBay. And honestly, if you want

03:54
to sell your products on those marketplaces too, you can

03:57
as all 3 of the big marketplaces

04:00
have integrations with Printify. For me though, I've picked Etsy

04:03
to focus on over those 2 because I prefer the

04:06
customer base. Because unlike Amazon and eBay, Etsy doesn't allow

04:10
most mass produced products on the platform.

04:12
All products require some form of human creativity,

04:15
and print on demand products, including designs made with AI,

04:19
fall under the design section of their allowed product categories,

04:23
which is why, of course, Etsy has a direct integration

04:26
and close relationship with Printify.

04:28
But basically, by not allowing most mass produced products on

04:32
your platform, it means that the customer base that Etsy

04:34
attracts is usually happier to pay higher prices

04:37
because they know the products they're buying are individually made

04:40
to order, which also means that Etsy has become popular

04:43
as a place to buy gifts on. People like the

04:45
fact that the items you find on there are unique

04:47
and not mass produced in China. So every month, Etsy

04:51
attracts hundreds of millions of visitors, and every year, Etsy

04:54
brings in billions of dollars in sales and products sold

04:57
through their marketplace. For example, in 20 24,

05:00
Etsy sellers like me sold over 12600000000.0

05:03
dollars of products on there combined.

05:06
But because mass produced products are not allowed, it means

05:09
then that there is a lot less competition

05:12
for these sales, which is a big reason why a

05:15
lot of print on demand sellers such as myself, like

05:18
to use Etsy. But, of course, the question a lot

05:20
of people often have at this point is this. Okay,

05:23
Sarah. I see what you're doing. You're using AI to

05:27
create InDesign products that you then list for sale online

05:31
in your own stores.

05:32
That's great and all. But having products, whether they're AI

05:36
generated products or not, is not a guarantee for success.

05:40
For example, if I set up a lemonade stand, that's

05:43
great. But if no 1 buys my lemonade, I won't

05:46
make money. Right? You actually need to convince people to

05:50
buy your lemonade.

05:52
Now most people assume that to sell lemonade, you would

05:55
need to spend a lot of money to advertise it.

05:57
But let me ask you a question. What if you

05:59
opened your lemonade stand on the side of a busy

06:01
street on a hot day with lots of people walking

06:04
past it already?

06:06
And even better, what if those people couldn't get access

06:09
to water so their only good easy option that they

06:11
could see to quench their thirst was to buy your

06:14
lemonade?

06:15
Chances are people would just buy it from you. No

06:18
advertising required. That is my approach. You see, many people

06:22
don't take this approach. They open their lemonade stand on

06:25
a cold, empty street and they try to brute force

06:27
their way to success with advertisements.

06:30
For me, I call this the advertisement first strategy whereas

06:34
I instead, of course, try to open my lemonade stand

06:36
on a hot, busy street so that it can sell

06:39
itself.

06:40
And I like to call this the product first strategy.

06:44
And the way that I do this, the way that

06:46
I open on a hot busy street is I focus

06:48
on finding this, a gap in the market. A gap

06:51
in the market is a phrase in the business world

06:53
that means that you identify a product or service that

06:56
people would like to buy that doesn't yet exist or

06:59
that it does exist, but that people would like more

07:02
of or better options for. For example, in 1 video

07:05
tutorial I made, I identified that a popular style of

07:08
t shirt was 1 where you have a retro style

07:11
anime painting of, say, cats eating ramen and that this

07:14
was very popular. So what I did was I created

07:17
the same style of t shirt that is popular on

07:19
Etsy and Amazon. But this time, I had it feature

07:22
a cocky dog eating the ramen and I used AI

07:24
tools to create this. And so this is an example

07:27
of how I look for gaps in the market that

07:29
I can fill. I call this the cross niche formula.

07:32
By doing this, I had taken a proven popular design

07:34
concept of cat seeding ramen but now made it available

07:38
to an entirely new customer base, corgi owners. And so

07:42
this is what I do. I spend most of my

07:44
time looking for these gaps in the market and then

07:46
trying to create a good product to fill that gap

07:49
rather than spending my time creating ads and testing ads.

07:52
Because from my experience,

07:53
creating great products is a traffic strategy in of itself

07:57
thanks to AI. You see, this is a slide from

08:00
1 of Etsy's investor meetings and this slide is very

08:03
interesting. It shows how previously Etsy's recommendation

08:06
algorithm,

08:07
which would recommend products to customers,

08:09
used to heavily favor products that were already popular. And

08:13
this is how most people seem to assume,

08:15
in my experience,

08:17
how these algorithms work. They assume that these algorithms are

08:20
designed to keep popular things, well, popular,

08:24
and so they often actually get quite defeatist.

08:27
They say, if I open up a new store, Sarah,

08:30
no 1 will know who I am, so I will

08:33
have no sales and I will have no reviews.

08:35
Because I am a nobody, surely the algorithm is just

08:39
going to ignore me. And that used to be largely

08:42
true, to be fair, but there was a big problem.

08:45
When algorithms only favor things that are already popular, people

08:49
get bored, And for Etsy, this was bad. People saw

08:52
the same items over and over again and they got

08:55
bored and they stopped buying new things. And so what

08:58
the slide was showing was that Etsy was announcing a

09:00
change in direction.

09:02
Rather than favoring items that were already popular, they were

09:05
now going to be shifting gears to try and identify

09:08
new products that, while were not widely popular, were potentially

09:13
more specific

09:14
to an individual's own wants. And this all happened around

09:17
the same time as the TikTok algorithm revolution.

09:20
This pretty much changed the game for the Internet. The

09:23
TikTok algorithm was the first to do this concept. TikTok

09:26
is famous for the fact that random people with no

09:28
followers

09:29
can become viral hit sensations overnight, and it's because TikTok

09:32
figured out that rather than just showing the most popular

09:35
videos over and over again, it's much better to take

09:38
all videos that get posted to the platform and give

09:41
them all a small amount of views as a test.

09:44
And if that test goes well, the algorithm will keep

09:47
showing the video to more and more people. Well, this

09:50
is exactly what Etsy's algorithm is designed to do too.

09:53
It now gives all new products what is often called

09:56
test impressions.

09:58
So for example, do you see this homepage here? You

10:00
can see that Etsy has showcased a bunch of products

10:02
to me as part of its recommendations.

10:05
Well, Etsy can now pop new products in its recommendation

10:07
slots like these to test if anyone will click on

10:10
a new product or even better, if they'll actually go

10:13
and click and buy it. And so if people do

10:15
click on your new product that they test with these

10:17
test impressions,

10:18
the algorithm will keep showing it to more and more

10:21
potential customers. And here's the thing. The AI is getting

10:24
better and better at choosing who to recommend your products

10:28
to as part of its test. Etsy has announced that

10:31
they have integrated AI machine learning into the algorithm, and

10:34
it is now even better at anticipating

10:36
what unique, interesting product

10:38
might be best suited to specific individuals

10:41
to recommend and promote on their Etsy home feed and

10:45
their search results.

10:47
Basically, AI is incredibly good at figuring out just by

10:50
looking at your product listing which customers in its database

10:54
based on their data that they should match it to.

10:57
They figure out basically who they should show your products

11:00
to. Not only this, but increasingly, more and more people

11:03
are finding products to buy through AI chatbots themselves such

11:06
as ChatchePT

11:07
by asking it to recommend products to them too. So

11:11
with all this in mind, this is why I believe

11:13
that in our new AI era that a product first

11:16
strategy is a fantastic way to get traffic because with

11:19
AI algorithms,

11:20
the goal isn't for them to find the most popular

11:23
product. Instead, their goal is to find and identify the

11:26
most specific product that can meet their users' individual needs.

11:30
It is hyper personalization.

11:33
So when I was talking earlier about opening your lemonade

11:36
stand on a hot busy street, this is what I

11:38
mean by taking a product first approach and designing niche

11:41
products that fill gaps. I'm creating exactly

11:44
what the AI recommendation

11:46
algorithms want and what they're looking for. So the AI

11:49
recommendation

11:49
algorithms,

11:50
they are the busy street with hundreds of millions of

11:53
users who are utilizing them, looking for unique gifts to

11:57
buy, and my niche products are the lemonade.

12:01
And if you think about it, right, before AI generation

12:04
tools, making all of these products would have been very

12:08
expensive.

12:09
Because you think about that Caughey Ramen t shirt, to

12:12
make it previously, it could have cost you hundreds of

12:15
dollars because someone would have had to have drawn it

12:18
by scratch.

12:19
And, well, that is slow, and you would have had

12:21
to have potentially waited a week for them to draw

12:23
it and then to send it to you. But now

12:25
I can literally come up with a product idea, make

12:28
it, and then list it for sale in less than

12:30
10 minutes because the AI generates the art and it

12:32
upscales it for print and then it even generates the

12:35
listing text for me. And by using AI, I've been

12:38
able to grow a large selection of niche products that

12:41
I've been able to use to grow and scale my

12:44
sales. And of course, because I'm choosing to use print

12:47
on demand apps to print and ship my products, it

12:50
also means that adding new products to my store is

12:53
very quick too because I can skip the traditional slow

12:56
process of having to produce t shirts in bulk and

12:59
then ship them all the way over from China. It

13:02
is this incredible combination

13:03
of AI combined with autonomous

13:06
print on demand stores, which has just been absolutely game

13:10
changing for

13:11
me. However, where people go wrong, in my personal opinion,

13:15
is that when they see an AI powered business, they

13:17
go, ah, it should just be run entirely

13:20
with AI and with no human ideas,

13:23
no human creativity,

13:25
nothing like that. But I tell you what, at least

13:27
for now, I am not approaching my AI powered business

13:32
like that at all. Nope. And that's because there's actually

13:35
a very important human part to a successful business, and

13:39
it's this part here, finding a gap in the market.

13:42
Right now, the truth is is that AI is not

13:45
very good at identifying these. If you ask Chat GPT

13:48
to find gaps in the market for you, it is

13:51
unlikely to do a good job. And that's because

13:54
identifying a gap is all about spotting what is missing,

13:58
whereas AI is all about looking at information that exists

14:02
and noting patterns within existing data. But us humans, well,

14:06
we're actually pretty good at spotting gaps because our brains

14:09
don't just analyze data. Our brains let us experience things

14:14
like wants and desires.

14:17
And so honestly, the easiest way for me to spot

14:20
gaps in the market is to create and sell products

14:23
in a niche in which I am a customer in.

14:26
Because that way, I can identify product gaps by looking

14:29
at what is for sale already in the niche and

14:32
thinking,

14:33
what product would I like to buy that doesn't yet

14:35
already exist? And then I can use AI to help

14:38
me create that product. I tap into my own wants

14:42
and my own desires.

14:43
And so because I think that this is really important,

14:46
I've decided to make step 1 all about how I

14:49
choose a new niche for a store. Because by choosing

14:53
a store niche, it lets me do 2 things. 1

14:55
of those, of course, being the opportunity

14:58
to build a store around something of which I'm passionate

15:01
about, which then, of course, makes it easier for me

15:03
to come up with product ideas because I can think

15:05
to myself, okay,

15:07
well, what product or design would I like to buy?

15:10
But that I can't because it doesn't currently exist. But

15:13
secondly, as I'll explain in another video in this module,

15:16
by starting a new store focused on a niche customer

15:19
base, it makes it easier for algorithms to figure out

15:22
who to recommend my products to. So yes, that is

15:25
my AI powered print on demand business in a nutshell.

15:29
And remember,

15:30
this is just an overall look at how my business

15:33
works. All of these ideas that I've talked about, picking

15:36
a niche, coming up with product ideas, optimizing them for

15:40
AI recommendations,

15:41
These are all topics which I talk about more inside

15:45
of the course. So don't worry if there is an

15:47
idea that you thought to yourself that sounds really interesting,

15:49
but I don't fully understand it yet because

15:52
I will be going more in-depth into these ideas in

15:56
dedicated videos.

15:57
And speaking of other videos, now that this video is

16:00
over, it is time to go and watch the next

16:03
video. So go ahead, open up my next video, and

16:06
I will see you in the next lesson.ample
#+end_example