Wikipedia defines leverage as “A force compounded by means of a lever rotating around a pivot” and “By extension, any influence which is compounded or used to gain an advantage.” The latter part of that definition has the most applicability for online businesses.
Leverage is frequently defined in either economic or mechanical terms, but it has a much broader applicability, including the internet marketing industry.
So how shall we interpret “any influence” for our home-based businesses?
One of the most used ways for a home-based business to gain the advantage of leverage is by re-using available content. I’m sure you’ve seen the countless ebooks currently advertised on the internet – most of these are examples of re-using content, although some may have been originally written as ebooks, most began as a single blog post, or a response to a customer email, perhaps even one one or more FAQs.
In the world of finance, the benefit gained from leverage is typically written as a ratio of some type; e.g., a debt-to-equity ratio. Such ratios are useful for accountants, but accountants are not the primary audience here.
What advantage can we realize by leveraging our existing content? Consider the following simplistic example : Assume you could write a single document for one customer in ten hours and then sell it for $50.00. You have earned $50.00, but it took 10 hours of your time to earn that $50.00; effectively, you would have earned about $5 per hour (less than the current minimum wage) for your effort and made zero profit.
Assume, however, you take that same document (and change it to remove any customer-specific or proprietary information) and offer it as an ebook to the marketplace for $19.95, and that you ultimately sell 100 copies of your published ebook. You would have earned $1995, and if you subtract the $50 to create the initial text less another $5 to customize it for any customer/proprietary info, that would leave you with a much larger profit of $1940.00.
This example describes the leverage advantage, specifically the benefit obtained from re-using existing content.
Once we become aware of leverage, we discover that there are many different ways to apply it to our online businesses. This article addressed only re-use of content, but there are many other ways. Other articles describe additional ways that home-based businesses can benefit from leverage.
If you like what you’ve just read, and would like to learn how to use leverage to help put your income on autopilot, get the Infinite Income Plan here.
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