Sunday, January 11, 2009
You might be saying, "How can I grow revenue while cutting expenses?" I believe the answer is knowing what marketing tactics are generating a positive return on investment and which are not. If you want to begin reducing your expenses, treat them subjectively.
Late last year, I began cutting back on a number of services I use to run my online businesses. The first step was to make a complete list of all my expenses. Once complete, I evaluated each one based on:
1. Critical to business operations.
2. Important but not essential.
3. Nice to have.
By categorizing expenses in this way, I found it easy to determine which ones had to go and which ones had to stay. Additionally it gave me an opportunity to consider what level of service I needed. There were many instances where, instead of paying for the "premium" service, I simply downgraded my service - saving me hundreds per month with little or no impact on revenue.
Revenue Generating Tips
Once I reviewed my expenses, I took a closer look at opportunities for revenue growth. Because we're all trying to grow "on a dime", I thought I'd brainstorm innovative ways to enhance my sales.
My list was short but actionable. Here's what I decided:
1. Spend more time asking for and getting referrals.
2. Focus on high margin products.
3. Bundle products to generate a higher price point.
By implementing these revenue generating ideas, I hope to make 2009 another profitable year. When focusing on cost reduction and revenue growth at the same time, you're sure to be successful.