Most people spend the majority of their time on minor things. They worry about stuff that will never happen and put huge amounts of energy into activities, and minor issues that will have a very minimal impact on their business and their life.
It’s often easy to determine if you’re doing this, because you’ll feel like you’re working really hard, but not really getting any forward momentum. If that’s you… understanding and applying this very simple concept can really improve your outcome.
We’re going to apply this directly to business, but as you will discover, with slight modification this can be applied to any area of your life.
Success equals the “number of opportunities”, multiplied by the “price point” of those opportunities, multiplied by your “conversion rate”… then divided by the “length of sale”…
Success = (# Opportunities) * ($ Price Point) * (Conversion Rate) / (Length of Sale)
Number of Opportunities
This is lead generation. How many people are you getting your offer in front of. Increasing your lead flow is extremely easy to do. We teach many super-effective strategies that you can literally implement today and see an increase tomorrow.
This is your value of a customer, or customer Lifetime Value (LTV). Understanding your lifetime customer value is something that eludes most, but can make a huge impact on your business. In fact, when you analyze what most people are doing in the affiliate marketing/network marketing space… the numbers show that there is very little chance of real profitability in their current business model.
This is the rate at which you convert leads to customers. There are many ways to improve this metric, but the first and foremost is to focus on building “know, like and trust” with your leads. Understanding that leads are real people with real wants, needs and desires. Understanding what they really want and putting your focus on helping them get exactly that… is the fastest route to getting what you want. Serve first… then be rewarded.
Length of Sale
This is the amount of time it takes to convert a lead to a customer. In the online marketing space, this is a tough metric to measure, and the length of time and number of exposures people need before the purchase or join varies widely. However, reducing this metric can be accomplished in a number of ways, and it is directly linked to the factors above.
So, if you want to increase your income… instead of trying to get 100% better at something… just focus on getting 10% better in each of these 4 key areas that really matter.
1. Generate 10% more leads per month.
2. Increase your customer lifetime value by 10%.
3. Increase your conversion from leads to sales by 10%.
4. Decrease the time it takes to convert a lead to a customer by 10%.
Let’s do the math…
First we’ll assign a value of 1 to each of the 4 areas discussed to represent our current state (where our numbers are today).
1 * 1 * 1 / 1 = 1 <= Current State
Now… let’s increase each of the first 3 areas by 10% and reduce “length of sale” by 10% (reduced time = better).
1.1 * 1.1 * 1.1 / .9 = 1.47 <= A 47% increase in our business
Getting a 10% increase in just those 4 areas will net you an almost 50% increase in your business! …Pretty cool eh?
This is the point of the 80/20 Rule…
Focus at least 80% of your time on the “Majors” (the 20% of things that really matter), because it’s those 20% that are responsible for 80% of our results.
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If you’re an affiliate marketer, network marketer or just trying to find our way around this whole online marketing thing… be sure to check out how we can help you start getting the results you want.
To Your Success!
~ Jon Ochs
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