Internet Business Breakdown: Do You Buy Money?

By: John Elder posted in Internet Marketing

Hello good people!

No matter what kind of business you own or operate, this simple fact will make or break you. I don’t care what you’re selling, in the end it comes down to this one simple business building block. And most people never think of their business in this way!

You are in business to do one thing….buy money.

How cheaply you buy money determines how successful you will be.

I might spend $10 dollars to buy $20 dollars.

I might spend $200 dollars to buy $240 dollars.

I might spend $4,000 dollars to buy $5,000 dollars.

Investors understand this fact easier because it’s not abstract to them. They spend $1,000 dollars on stock in a company, they expect to be able to sell that stock for more than $1,000 dollars in the future. They’re buying money.

As a business owner you should look at everything you do this same way.

How many orders will I generate if I buy this ad space? If I spend $100 on advertising, will that generate more than $100 in income? If so you have a winner…you can then “buy money”.

Let’s say you spend $100 on advertising, and it generates $150 in income (for example). You’ve just bought $150 and it only cost you $100.

Every penny you spend on your business should be spent with one thought in mind…

“How much money/income will spending this penny generate?”

The Internet is great. You can monitor EVERYTHING. I can throw up a web site and buy ad space somewhere. Then I can watch my server logs and see exactly how many site visitors that ad generated, and how many sales those visitors generated.

I can then determine for every X number of people that visit the site, 1 person buys.

I can then determine for every X amount of dollars I spend on advertising, Y number of people will come to my site, resulting in $Z dollars in profit.

At this point I can pretty much buy money! All you do then is focus on spending more and more money on advertising because you know that whatever you spend on advertising, you’re going to make more than that amount of money from sales.

That’s all for today.

Have you signed up for Elder Academy yet?

John Elder
The Marketing Fool!

John Elder is an Entrepreneur, Web Developer, and Writer with over 21 years experience creating & running some of the most interesting websites on the Internet. Contact him here.

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