If Cash Is King, Cashflow Is The Castle
Very often, I am confronted with a dilemma. One was surely an event that took place last week. During midterm exams at the college, in one of my marketing management classes, I caught a student cheating. This person had copies of class notes tucked underneath his chair, which he discreetly read from time to time, particularly when I was not looking his way.
When I caught wind of this, I silently walked over to his table, grabbed the incriminating evidence and, without a word, walked away. (I later confronted him about the incident in private.) Now, we're told as teachers to never take this kind of unethical activity personally. But I couldn't help. I love my students and take their welfare very seriously -- and personally.
I offered a scenario to this gentleman: "If you had to undergo life-threatening, open heart surgery, would it matter if your doctor cheated his way through medical school?" (Incidentally, a recent Internet cartoon jokingly referred to the same matter. A surgeon was about to operate on a patient when he said, "Nurse, please visit 'surgery.com' to find out what we must do next!")
Seriously though, the correlation between cheating and Internet marketing is surely that of spam. In reality, spamming is to cheat one's business out of much more in the long run. For example, I often -- and often passionately -- teach about the negative effects of spam. Unquestionably, spam is profitable in the short term. But like so many other marketers on the Internet these days, spammers think about cash instead of *cashflow*.
Spam will generate sales -- a shrinking minority of people will respond favorably to spam giving a short, temporary boost to any online business. However, like a drug the effect usually never lasts and the need to keep spamming will emerge sooner or later. And similarly, the hangover can often be deadly -- with ISPs deactivating, flames abounding and authorities looming.
Spam is not the only culprit. Many have instituted moneymaking processes on their websites that typically generate either very small quantities of cash or very large quantities in very short periods of time. By far, it is a better approach to institute a process in which continuous streams of cash keep flowing.
Similarly, if your promotional efforts have been to simply generate sales, even if they are ethical, you are solely and wrongfully seeking cash instead of cashflow. This is usually accomplished by advertising only the existence of a business or product, or offering price reductions and sales promotions. It is better to promote the fact your business is unique or special, and not that it is merely "open."
While cash is king, cashflow is definitely a better option. So here's a question: What can you do to infuse an endless stream of cash into your business? While every single business is different, with individual needs, goals and processes, here are two key result areas upon which you may want to ponder.
1) Business Model
Does your chosen business model (in other words, the manner in which your business operates, exchanges goods and markets itself) stimulate cashflow? Or is it one in which the products or services you offer cause it to lose value, or to become saturated in a given market, over time? If the latter is true, then it may be your while to examine how you can change or improve your business model to achieve cashflow. Here are some key questions:
Are there any other businesses with which you can joint venture in order to capitalize on marketing opportunities, share markets, upsell your current customer base or grow (or grow the perceived value of) your offerings? Are there strategic marketing alliances you can form with others in order to enter new markets, tap new segments or implement new business processes on your website?
Can you develop strategic marketing alliances (see my article on the subject at SuccessDoctor.com/article8.htm). Can you develop info-networks, auto-networks or intra-networks so to grow your marketing reach? Expand your market? Expedite your orders? Add value to your offerings? Simplify your customers experience? Reduce costs? Or increase your customers' transactions?
In short, don't stagnate. Look beyond your business, including direct and indirect competitors as well as other, non-competing businesses with which you can team. Look at ways you can generate continuous customers by increasing either the size of their transactions or the frequency of such. Often, you can accomplish this with the help of other businesses or products and in ways of which you may never have thought. Think "outside the box."
As marketeer Corey Rudl often preaches, automation is the biggest, and often the most underestimated, opportunity of the Internet. Whether it's to communicate with your customers on a constant basis, to accept orders (such as by credit card), or to fulfill and expedite your orders, automation should be an important aspect into which you should look.
Are you implementing processes through which you can automate your business, its operations and, above all, its marketing? Are you constantly thinking of new ways through which your orders can be filled, your customers can be served and your marketing can be deployed automatically? Can it all be placed on auto-pilot?
What I call "auto-pilotizing" is the process through which you can engineer your business so that it can operate with as little intervention as possible. For instance, Michael Gerber, author of the bestseller "The E-Myth," states that in today's fast-paced, convenience-seeking culture business success is often inherent in a business' capability of becoming auto-pilotized.
In Gerber's words, it is to think of ways in which you can create multiple copies of your business that are capable of running by themselves without your intervention. It is even to think of how you can add individual value to your business, making it possible to separate it from the owner as well as sell it at a later date.
Now, the goal here is neither franchising your business nor selling it -- at least not immediately. The concept is to *think* in this manner right now. It is to think about how you can automate your business today. And the more you think along those lines, the more value you will add to your business and your offerings, as well as the more cashflow you will in turn create.
However, here's a caveat. Keep in mind that the Internet will demand a more humanizing experience -- a demand that will keep growing over time. One of John Naisbitt's "Megatrends," from his book of the same name, is called "high-tech/high-touch." It means that the more automated we become the more the demand for social interaction will grow. But the question is, can automation and humanization be combined? Of course. Technologies exist today for that purpose -- such as CRM ("customer relationship management").
(While the Internet is still in its infancy, automation and certainly humanization are definitely younger. Therefore, there may be an opportunity lurking in there somewhere for you.) Nevertheless, the bottom-line is to think cashflow, not cash. The more you do, the more prosperous and successful you will become.
About the Author
Michel Fortin is an author, speaker and Internet marketing consultant dedicated to turning businesses into powerful magnets. Visit
SuccessDoctor.com. He is also the editor of the "Internet Marketing Chronicles" ezine delivered weekly to 100,000 subscribers - subscribe free at SuccessDoctor.com/IMC/.
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