Have you ever asked yourself this simple question? Does all the revenue I generate and the profit I make really give me a great return on my intellect? If the answer is no, then read on.
The Old Fashioned ROI
Business is a numbers game. We use numbers as the best way to keep score of how well we are doing.
Accountants have a bunch of industry-specific phrases, aka jargon, they bandy about all the time. Balance sheet, cash flow, assets and profit, and loss statements. When we assign a particular amount of money and then track its profit we call it a return on investment.
In its simplest format, this one is easy to measure. You spend $1000 on a marketing campaign and you generate 20 leads, convert 4 of them who each pay you $500. Thus your ROI is $1000 ($2000 in $1000 out). Simple to understand.
You could get more complex. Work out how long it took you to develop the marketing, follow up the leads and service these clients. Coming up with an hourly ROI. So if all this activity cost you 10 hours in time spent then your ROI is $100 per hour. Which isn’t as good as the $1000 we first calculated.
The 21st Century ROI
We now live in the information economy. The geographical limitations of many peoples IP (intellectual property) no longer have restrictions on our ability to earn more money.
Having specialist knowledge and business intellect needs a new measuring metric. I call it a Return On Intellect™.
Most experts make the same critical mistake. Picking only one mode to deliver their expertise through – and then sticking to that. Stuck competing with their competitors on price.
Accountants make money through accounting. Trainers make money from training. Chef’s cook. You get the picture. This way of thinking is outdated.
The secret to having a better ROI (Return On Intellect™) is to diversify how you deliver what you already know.
Boost Your ROI
To increase your revenue you don’t need to learn new information. Only how to package up your existing IP and deliver it in multiple ways.
Just as relying on one big client is often fatal to a business, relying on one revenue stream for your IP is also risky.
Well-known entrepreneur author Dorie Clark labels it as “a portfolio career”.
Think about all the ways your knowledge and experience could be delivered. Books, consulting, speaking, teaching (Mastermind groups), coaching. Think about the people you look up to in your niche. One thing they all have in common is that they have created additional revenue from their existing knowledge. So what’s stopping you?
There are numerous ways to use what you know and also additional benefits. The more services you can offer your customers, the more opportunities you have to increase their loyalty, by satisfying as many of their needs as you can. That’s a great competitive advantage.
A Unique Selling Point.
However, the biggest advantage is that when you teach others you become an authority in your field. Thus increasing your new ROI (Return On Intellect) even further. It becomes a self-fulfilling loop. Information products have a higher profit margin. Often around 70% vs a traditional business that is around 15-20%.
Knowledge Lost Forever
My in-laws recently retired after 35 years as professional photographers. I tried several times to explain the idea of creating a teaching model around all their valuable experience. Every tip, trick, and shortcut that made the photographs, and their clients, look amazing.
Sadly, they couldn’t see how valuable their information was. Instead, they have taken it into retirement with them. Lost to a budding generation of photographers. Photography studio starts ups who could quickly learn how to run a successful portrait studio if they had access to this knowledge. Studies show that many self-employed professionals struggle selling their business asset. So it makes sense to maximize your intellectual property whilst you can.
Time to ask yourself the tough question (again).
Is all the experience (including mistakes), knowledge, and information of what I do or how I do it, giving me a great Return On Intellect?
If the answer is no, then find a way that you can bridge the gap. What additional products can deliver your intellectual property to create that extra revenue stream and higher profits?
Previously published here and reprinted with the author’s permission.
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