The Only 3 Things You Can Do to Increase Your Revenue

Building a business can often feel quite overwhelming. One of your most important tasks is to make the business grow and it seems like there are unlimited possibilities and an endless list of tasks.

Well, I'm about to make this a lot easier for you. When you get right down to it, there are only 3 things you can do to make more money. In this post, you'll get the big-picture overview of these 3 things, so you know what to do next, no matter what your current situation is.​

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The 3 Big Levers

​In this post, you'll discover the 3 major levers you can pull, to increase revenue in a business. For each one, I'll also provide some details as well as resources where you can learn more. In the end, you'll be able to decide which of those levers to pull, depending on where your business is currently at.

The three ways to make more money are:

  1. You can get more people to give you money.
  2. You can get the same people to give you more money.
  3. You can improve your product.​

Let's look at those 3 in a bit more detail.

1) Get More People to Give You Money

In an online business, reaching more people means getting more traffic. And really, the first thing most people think of when it comes to increasing revenue is just that: traffic generation. If you currently get some visitors and make some money, it stands to reason that you can make more money by getting more people to your site.

This is true, although only to a certain extent. It's not just about getting more traffic, it's also about getting the right kind of traffic.

Plus, you can get money from more people without needing more traffic, at all.

How it Works

Fundamentally, there are two things you can do:

  • Get more people through the door (get more traffic).
  • Turn more of the people who are already coming through the door into customers (increase conversions).

Both of these are ways to get more people to give you money. The first is more important if you have very little traffic, the second becomes important once you have traffic. If you have traffic, but your conversion rates are low, getting more traffic is really quite wasteful.

Let's look at these two approaches in a bit more detail:​

Get More People Through the Door

This is about getting more traffic to your site. You can also think of it as making more noise about your business, in more places. Some strategies you can consider include:

  • SEO: on-site optimization and link building - this is especially useful if you have an established site and you're already ranking for some keywords. You can then optimize to rank higher for the same keywords. This is a reliable approach because it means you literally get more of the same kind and quality of traffic as you already have. Use tools like ahrefs and the Google Search Console to find SEO opportunities on your site. If you're new to SEO, check out this Thrive University course on the topic.
  • Open up the taps with PPC advertising - the primary platforms for this are Google AdWords and Facebook Ads. If you have a budget and a good sales page or funnel, this can be a very reliable way to get more traffic and make more money. The downside is, of course, the cost, as well as the risk of losing money.
  • Content marketing - more of a long term strategy, content marketing allows you to build an audience of avid readers and make a name for yourself as an expert in your space. It can also attract organic search and social media traffic over time.
  • Social media marketing - social media marketing is suitable for some businesses and extremely unsuitable for many. If your product or service is something sharable and/or something edgy, running social media campaigns and contests can be a good approach.
  • Affiliate marketing - creating an affiliate program for your business opens up opportunities for other businesses, bloggers and influencers to promote your products for you. Use platforms like Zaxaa or ClickBank.
  • Outreach marketing - outreach marketing includes everything from guest posting, to affiliate recruitment to establishing business collaborations. It's anything where you try to reach valuable partners to get them to link to you, promote you, mention you on their site or similar. Use tools like BuzzStream or NinjaOutreach to organize your outreach efforts.

Traffic Generation Resources:

Traction by Gabriel Weinberg & Justin Mares - this book provides an overview of many different traffic generation tools online businesses can use.

Ultimate Guide to Google AdWords and Ultimate Guide to Facebook Advertising (both by Perry Marshall). Essential reads if you want to get more paid traffic, without going broke.

Backlinko - insightful blog with a relentless focus on well-researched SEO and traffic generation strategies.

Turn More People Into Customers​

Generating more traffic can be a very wasteful exercise, if your site isn't doing a good job of converting visitors into leads and customers. If you're already getting 100+ visitors per day, it may be a better idea to focus on getting more of the people who are already coming to your site, to give you money.

How It Works

Here are some of the things you can try, to increase conversion rates on your site:

  • Run A/B tests on your most important landing pages (homepage, sales pages, opt-in pages). Use tools like Google Optimize, VWO and Optimizely to test different designs, copy and value propositions.
  • Add opt-in forms and opt-in offers to your site - this represents a lower barrier of entry, compared to having to make a purchase. The selling can then happen at a later point in time. With a tool like Thrive Leads, you can also A/B test and optimize your lead generation forms.
  • User test your site - a 5-second-test can help you identify weak points in your site. If there's something unclear or confusing about your site, this is the quickest way to find out. Use platforms like UsabilityHub or TryMyUI.
  • Record your site visitors' behavior - this is another way to find out what people understand and what they find confusing. Tools like Hotjar can help you identify which parts of your website to test and improve.

Conversion Optimization Resources:

You Should Test That by Chris Goward - my favorite book on the topic of conversion optimization. Will take you from zero to a strong, practical understanding of CRO in the span of one book.

ConversionXL - the blog on conversion optimization. Fair warning: a lot of their stuff is squarely aimed at CRO professionals and not very beginner friendly.

Conversion Rate Experts - arguably the OGs [TK: link to bill nye clip] of conversion optimization. Their services aren't affordable for mere mortals, but they frequently post insightful case studies on their blog.

2) Get More Money from People

You may have heard that it costs about 7 times more to get a new customer, than to sell again to a return customer. Or, as noted in this study, you're 14x more likely to make a sale to an existing customer than to a new one.

That's what our second lever is all about: instead of trying to get more people through the door, we can focus on getting more money from our existing customers.

Why does this work so well?

Because once someone has made a purchase and they've had a positive experience, they'll want more! Making an initial purchase decision can be a bit agonizing. Can I trust this company? Will this be worth my money? Should I look for alternatives?

When a customer makes the leap and buys, you can win their trust by giving them a great product and great experience. And in my experience, the result isn't only that these customers are more open to buying from you again, they will actively want to buy more from you.​

One of the top 3 mistakes businesses make in their products and pricing is not giving people the opportunity to give them more money. This is where our second lever, getting more money from the same people, needs to be applied.​

How It Works

Broadly speaking, applying this lever is about increasing customer lifetime value (CLV). Here are some of the methods you can apply:

  • ​Upsell - the classic approach here is that you make an offer for a second product or an upgrade to the product someone just purchased, right after they've made the first purchase.
  • Sell more than one product - this is the simplest approach. Simply have more than one product available. If people buy one of them and like it, they're more likely to buy another. Make sure to use follow-up marketing to make customers aware of the fact that there's more than one product for them to buy.
  • Scaling pricing/multiple packages - typical examples of this would be to have per-user pricing for SaaS or have different pricing depending on storage and bandwidth for hosting services.
  • Sell more access - an example of this would be selling an information product, offering a community where people can interact with you online (more access) and offering 1 on 1 coaching (even more access).
  • Sell a subscription service - a straight-forward way to turn customers into return customers is to offer something on a subscription basis.
  • Improve retention, reduce churn - if you sell a subscription product, reducing churn (the rate at which customers cancel their subscription) is a major factor in customer lifetime value.

Customer Lifetime Value Resources:

80/20 Sales and Marketing by Perry Marshall - this book is more about big picture strategy than nitty-gritty tactics. But it's an excellent read for tuning your mind into the right kind of thinking for maximizing customer lifetime value.

sixteenventures - great blog on everything relating to reducing churn rates and increasing customer success (and thus, lifetime value). Written for SaaS businesses, but a useful resource for any business owner.

3) Improve Your Product

Whatever it is that you're selling, you can increase its value and that will help increase revenue to some extent. In the long term, investing in the quality of your product can be one of the most important pillars of your strategy.

This is a

BIG, FAT WARNING!​

I hope that got your attention because this is really important: you have to understand when this strategy works and when it doesn't. This is where most entrepreneurs get it wrong.

​Improving the quality of your product is a viable strategy once your business is already running. That means you're past the initial Hustle Mode phase. To be very specific, it means that:

  • ​You already have an audience.
  • You're already getting a good amount of traffic to your site.
  • You already have a regular stream of customers.
  • Your business is already generating revenue.
  • That revenue is already growing.

If any of the above points doesn't apply to your business then improving your product is the wrong strategy!

​Improving your product is not a viable way to increase your revenue when you're still in pre-launch mode. That's when you need to create a minimum viable product.

The second thing you need to understand is that improving your product does affect your bottom line, but it does so slooooooowly. It's a long term strategy.

How it Works

A better product generates more of its own momentum. A better product leads to more word-of-mouth recommendations and all the forms word-of-mouth has taken in the online world.​

There's a certain tipping point you can reach where everyone in your target market knows about your product and it becomes the go-to solution - always the first to be recommended. It takes a lot to reach this point and if you don't have a top notch product, it's very difficult and extremely expensive to reach such a position in the marketplace.​

It's easier to reach this tipping point if you have a product that serves a very specific need in a very specific niche. If you do manage to reach this tipping point, the quality of your product and service becomes one of the most important levers for generating more revenue.

Specifically how you can improve your product to this point mainly comes down to understanding your customers and their needs in great detail. Some recommendations to that end are:

  • User testing tools such as UsabilityHub, Usertesting and Validately​. These help you understand how people use your product and let you improve the user experience.
  • Survey tools like PollDaddy, TypeForm and Google Forms. These let you gather input from your users, as well as answers to specific questions.
  • Interview your customers - get on a call with customers and ask them about their experience, problems and favorite tools.
  • Gather customer suggestions - using tools like Uservoice or GetSatisfaction, you can allow users to make feature suggestions and vote on them.

Resources for Building a Better Product:

The Lean Startup by Eric Ries - this book is as popular as it is for a reason. Reading it gives you a strong foundation for building and improving products based on your users' needs.

Lean Customer Development by Cindy Alvarez - "customer development", or the process of talking to customers one on one, is an incredibly powerful business tool. And this book is the best one I've read, on how to use it.

How to Use the 3 Levers

Now you know the 3 main levers you can manipulate to get more money.​ Each one is important in launching and growing a successful business.

​Here's something important to keep in mind: it's better to work on one of these levers at a time.

In fact, that's one of the most valuable things I hope you take away from this post. The worst thing to do is to constantly do a little bit of everything, without making real progress on anything.

What you should do instead is take a look at your business, take a look at the 3 levers and decide which one you want to focus on right now. Then, work only on that until you get a result. And only once you've gotten a result, reevaluate and decide whether you want to keep working on the same lever or switch focus to a different one.

Slow and steady, working on one at a time, will get your business growing at a much faster rate than if you constantly jump back and forth between three levers and a dozen tactics.​

With that said: what's the most important lever for you to work on, right now? What other resources can you recommend? And what questions do you have, about increasing revenue in your business?

Let me know by leaving a comment below!​

Shane's Signature

About the Author Shane Melaugh

I'm the founder of ActiveGrowth and Thrive Themes and over the last years, I've created and marketed a dozen different software, information and SaaS products. Apart from running my business, I spend most of my time reading, learning, developing skills and helping other people develop theirs. On ActiveGrowth, I want to help you become a better marketer and product creator. Read more about my story here.

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17 comments
Martin Messier says May 27, 2017

Hey Shane!

Just a heads-up. The links in your bio aren’t working.

Reply
Alica says May 24, 2017

Hi Shane
It is really nice & informative article who like to increase his Revenue, must read.
Thanks

Reply
    Shane Melaugh says May 25, 2017

    Thank you, Alica!

    Reply
Maarten Oostenbrug says May 24, 2017

Nice post. In general you seem to repeat what Peter Drucker found: there are 2 centres where you make profit: Marketing and Innovation (everything else is cost).

I do see your argument for tech 3 levers. The first 2 relate to marketing and you make an interesting case to look at a strategy based on your existing audience. It would be nice to see follow up articles on how to measure, analyse and decide on that. I believe with thrivethmes you have a very good tool to offer and it would be very valuable for us newbies how to it practically.

I’m sceptical about the 3rd lever: improve your product. Your argument by itself is good (product improvement when you have an customer base). But in most situation you need a product or service as well to have something to start a site about. Specifically seen as part of innovation as profit generator and especially in the context of LEAN startups. I often use Steve Blanks methodology where a key strategy is to develop (not design) and MVP based on learning from your customers what they need. And your article kinda confirms that. E.g. Lever 4 to start generating revenue (is also increasing) is to have an idea, test it with real live audience and learn who and why they actually convert. Even for free, it’s the conversion that validates the problem-solution hypotheses. I’d LOVE to have your ideas on that and how to practically use TT as a jumpstart platform to start businesses. Happy to support you where I can too.

Reply
    Shane Melaugh says May 25, 2017

    Thank you for your comment, Maarten!

    You’re absolutely right: the 3rd lever only works if you have a way to reach people and some starting point to build on.

    Maybe I should clarify that “improving the product” can also include adding new products, pivoting existing products etc. So the kind of discovery and innovation work belongs in this category as well. That’s how I think of it as well.

    I have an idea or two for content following up on this post.

    Can you describe a bit more what exactly you’d like to learn, regarding “using TT to jumpstart businesses”?

    Reply
Tony says May 23, 2017

A really useful article – You’ve taken all my random thoughts, summed them up and organised them nicely in one place. Fantastic. By the way the Hustle Mode link appears to be broken.

Tony S.

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Owen says May 23, 2017

Thanks Shane, another great article!

Quick question: I noticed you have removed the sidebar as it seems more blogs are doing these days. In regards to CRO, did you test this?

Personally, I prefer it visually, just curious if it is something you tested :)

Thanks for everything you do Shane, I have learned a TON from you and appreciate your high level of integrity in all you do.

Cheers mate!

Reply
    Shane Melaugh says May 23, 2017

    Hi Owen,

    This wasn’t tested, no. However, we do have the stats of how the lead gen and CTAs in the sidebar performed and they performed very poorly. So, I know that it’s not a big loss to get rid of the sidebar.

    The reason isn’t about conversion, though. Right now, we’re kind of starting from scratch with this site, so you’ll see things changing over time.

    Reply
Lorenzo says May 23, 2017

Your posts are always clear and packed with useful information.

“The worst thing to do is to constantly do a little bit of everything, without making real progress on anything.”

Yeah. Constant danger if you don’t discipline yourself. I have a question regarding MVPs, since you mentioned them in lever 3. You don’t want to work for months on a product without knowing how your audience is going to receive it, right?

But how do you go about this with infoproducts? If you are selling a software you can often ship a functional prototype and then improve it incrementally using your customers’ feedback. Infoproducts, not so much. For one thing, you run the risk of having to remake the whole thing every time you improve it for consistency reasons. Very costly as a solopreneur. And some products dealing with “systems” are particularly intractable.

Imagine you want to create, I don’t know, a program about improving mental skills using specific exercises you can combine with menial tasks, suitable for people forced to take on boring, repetitive, meaningless jobs.

The customer buys it, he or she starts to train with the routines you have given, and four months later, a new edition comes out where several exercises/methods are essentially declared obsolete, and new ones are given. The customer is left with the feeling of having spent a lot of energy with a less effective method, AND having to go through a whole new learning cycle to keep up with the latest improvements, which may or may not be the final word of the trainer.

Now, if it were a software, like you’re currently doing with TCB 2.0, most customers will be delighted that this tool will become easier and faster to use, and more powerful: they may need to spend a few hours playing with the new version, sure, but they know it will save them a lot of time and effort in the long run.

But the mental skills program? Isn’t the customer more likely to feel annoyed at the trainer, and get the feeling that he was presenting himself as competent whereas he clearly had a lot more to learn? The same could be said for a software, sure, but whereas people GET that developing a software is an ongoing process influenced by many factors including the technological environment, *ideas* born of the mind of a single person are generally expected to be more stable and reliable, and improvements may be seen as a failure to “get it right the first time”, and make you lose faith in the author.

Have you ever had to solve this problem?

Reply
    Shane Melaugh says May 23, 2017

    Hi Lorenzo,

    This is a great question. I’ve got a short post answering this question, here: Minimum Viable Information Product

    Also, stay tuned for our upcoming podcast, where we discuss this in great detail as well.

    I understand your concerns about annoying customers of info products by updating/changing it. However, in my experience this is not a problem. When I sold information products, I updated them and in one case even 100% redid the entire system. I never got a complaint about this.

    There are generally two types of customers: there are those who bought but never actually did anything and for them, the update is new motivation to give it a go. And those who went through everything and put it into action. They’re interested in learning more, refining what they learnt etc.

    An important note here is that when I updated a product, it was always a free upgrade for existing customers.

    Reply
      Lorenzo says May 25, 2017

      Thank you Shane, that post really clarifies things. Which sort of leads me to a fan request, since you are re-working the site…these articles are a goldmine of useful, well-structured and yet concise information. They are ofter evergreen, too, so they would be even more useful if we could browse through them in some sort of complete archive. No sidebar = no search field at the moment.

      Check this out:

      http://jamesclear.com/articles

      Also, on the topic of site rework, your free mini-course pages (at least for the Build a Better Blog LM) still have the Wpsharely shortcodes and CTAs.

      Oh and here’s hoping you include wpsharely’s functions into TCB 2.0…that was a very useful plugin!

      Reply
Martina Roters says May 22, 2017

Before I had read what the 3 levers were I was thinking about the matter and I came – quite “easily” – up with another one: Reduce product(ion) cost. Has this not been the 4th dimension in business all the time?

Reply
    Shane Melaugh says May 23, 2017

    Hello Martina,

    Reducing your production cost is a way to increase profits, but it does nothing for revenue. Important difference. :)

    Reply
Shirley Williams says May 22, 2017

Shane, Your posts are always worth their weight in gold. I’ve just launched my new website with your Thrive Themes. I’m truly impressed with your level of expertise and generosity to share. You’ve made building a website and then marketing it effectively very simple even for a non-techie like me.

I’m definitely a fan !!

Reply
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