Crowdfunding is the latest and greatest way to raise money for a new business, or even a new product or service you want to launch.

But importantly, Crowdfunding offers a ton more value than just the initial funding it provides, pretty much making it a no-brainer for entrepreneurs to use.

Before I get to the "hidden benefits" which make Crowdfunding so valuable, I need to provide a little background on the concept of Crowdfunding.

To start, Crowdfunding is the process of getting a group of regular individuals (versus banks, venture capitalists or angel investors) to collectively fund your venture.

One of the first Crowdfunding examples is that of Australia's Blowfly Beer. Blowfly Beer, through emails and internet word of mouth, got 40,000 people to invest in their company. The investment pitch was pretty simple -- give us money and we'll give you equity and beer.

As you might imagine, not only did this fund the company's launch, but it gave it a large initial customer base to leverage.

But before you think about going the route of Blowfly Beer, you must understand that if you are based in the United States, you can't use this funding method.

That's because equity investments in the U.S. are controlled by the U.S. Securities and Exchange Commission which prohibits this. Note that legislation is currently underway to try to make it legal in the United States (and I will continue to follow the legislation and update you).

But for now, there IS another Crowdfunding option which Americans, and entrepreneurs throughout the world, can and should use.

This option is a type of Crowdfunding I call rewards-based Crowdfunding. Rather than giving up equity, in this type of Crowdfunding, entrepreneurs give rewards. These rewards are typically future delivery of their product or service.

Let me give you an example.

Let's say you have an idea for a product that you expect to sell for $50. And that if you had funding now, it would take you six months to build and ship the product.

So, today, you get 5,000 people to pay you $40 for it (a 20% discount).

You would then take the $200,000 (5,000 X $40) and use it to develop your company infrastructure and develop and deliver the product.

As you can see, rewards-based Crowdfunding is essentially pre-selling your product and typically at a slight discount to make it worth the "investor's" while.

So it should be clear now 1) what Crowdfunding is, 2) what rewards-based Crowdfunding is, and 3) that it can effectively be used to raise funding for your business.

In fact, just one of the several rewards-based Crowdfunding platforms (Kickstarter.com) boasts that in 2011, over 11,000 entrepreneurs raised over $99 Million on their platform.

Now, while getting funding for your business is great, I want to give you the 5 other key benefits that Crowdfunding offers entrepreneurs like you (because I think they're equally if not more powerful):

1. Market Research

Pre-selling your product is incredible market research. If people buy it, then your marketing message is on target and there is a real need for your product or service.

If people don't buy it, then maybe a market doesn't exist, or you need to adjust your marketing message or target market.

In any case, getting this market research BEFORE raising or trying to raise a ton of money is invaluable. It allows you to test whether you have a winner before going through this process.

2. Built-in Customer Base

When you get others to fund you via rewards-based Crowdfunding, you build a customer base. If you provide a good product or service, these customers will be prone to buy more products and services from you (the same products, upgrades and/or new products you develop) in the future.

3. Case Studies/Testimonials

In today's world, with so much information and opinions, it's hard to know who to trust. And at the top of the list of who and what we trust are the testimonials of our friends and others.

So, by getting testimonials from the customers you gain from Crowdfunding (assuming you delivered them the product/service and they liked it), you can influence more customers to buy from you.

Likewise, if your offering permits, by offering "before and after" profiles of your customers, you can develop Case Studies which influence future customers to buy from you.

4. Word of Mouth Marketing

People who fund your company will tell their friends about it. Particularly if you make them feel like founders/initial investors (which you can easily do via email and on your website and/or via direct mail).

Played correctly, Crowdfunding can result in thousands of customers, most of whom can tell numerous friends and colleagues about your products and services. This word of mouth marketing can be worth millions of dollars.

5. PR

Local media sources are enamored with Crowdfunding as it's new and unique. As a result, countless entrepreneurs who have raised Crowdfunding have been profiled in local newspapers, radio shows and TV broadcasts.

So, with little legwork, raising Crowdfunding can get you lots of PR.

In summary, Crowdfunding can give your business a ton more than just funding. It can give you a massive marketing push and advantage that can ultimately lead to your company's success.
   

Want Crowdfunding for your business? I recently developed a simple-to-follow program called "Crowdfunding Formula."

The program is a series of videos I recorded that walk you through each of the 14 steps to raising rewards-based Crowdfunding. Many of you have already joined the program and raised money.

If you haven't, click here to get Crowdfunding for your business now!

Raising money from Crowdfunding is so much easier and faster than traditional sources of funding like venture capital and angel financing. In fact, I recommend that most entrepreneurs raise money with Crowdfunding first, start growing their companies, and then approach venture capitalists later for additional funding (at which time you will be able to give them much less equity since your company will be more valuable).

And, as you learned above, Crowdfunding will give you far more than money to launch your business, product and/or service.

Access Crowdfunding for your business now!

No business runs smoothly all the time. And I think that all businesses can continually be improved.

So, you might ask, how can you improve a poor business, and how can you continue to improve it over time.

The answer in my opinion is pretty simple. That is, if you use the system I've adopted and used over the past few years.

The system is very straightforward: take the business or business process you are trying to improve, map it out on a piece of paper, and then, for each process, figure out 1) what you are doing, 2) what you are tracking, and 3) ideas for improvement.

Let me give you an example. Let's say your firm provides accounting services for small businesses. Your big challenge is increasing revenues and profits, which is generally going to be comprised of three smaller challenges:

1. Getting more clients
2. Fully satisfying those clients
3. Getting clients to buy more from you

So, how does your accounting firm achieve this goal of increasing revenues and profits? As stated above, step 1 is to map out your processes on a piece of paper.

I can see at least four processes in play here:

1. Lead sourcing: how your accounting firm gets new leads
2. Lead conversion: how your firm coverts these leads into prospects (more on the difference between "leads" and "prospects" later)
3. Prospect Development & Closing: how your firm converts prospects into clients
4. Fulfillment & Upselling: how your firm completes client work and upsells them on additional work they need

The next step is, for each of the four processes, to figure out what you are doing, what you are tracking, and ideas for improvement.

Let's start with the first process, lead sourcing. Lead sourcing here is defined as getting an individual to contact you (either via telephone, email, visiting your website, etc.) because they have a possible interest in working with you.

Your current list of "what you are doing" may include:

• Getting referrals from customers
• Getting referrals from partners
• Newspaper advertising

Your current list of "what you are tracking" may include:

• How many leads you are getting each month

And your "ideas for improvement" may include:

• Trying new forms of promotions such as radio advertising, social media marketing and direct mail
• Improving your customer referral program by offering rewards
• Better tracking lead sources and which leads convert so you know which lead sources generate the most customers

Here's the punch line (I'll complete the process below, but I want you to understand the end result here), by breaking up and scrutinizing all the specific processes involved in the whole system, you will identify ways to massively improve performance.

Let's move on to the second process, lead conversion. "Lead Conversion" is the process of converting an individual from a "lead" (someone who has gone to your website and/or called you) to a "prospect" (someone who has shown a more serious intent of buying from you).

Your current list of "what you are doing" may include:

• Fielding phone calls and emails from leads
• Routing them to your best salespeople

Your current list of "what you are tracking" may include:

• How many calls and emails you receive each month
• How many calls and emails become clients

And your "ideas for improvement" may include:

• Developing a better telephone script to use when handling incoming phone inquiries
• Outsourcing incoming phone calls during off hours so leads can reach you 24/7
• Improving the time delay from when the receptionist speaks to the lead and the lead speaks to your salesperson
• Identifying which salespeople perform best with which types of leads and routing accordingly

The third process to improve is "Prospect Development & Closing" or how your firm converts prospects into clients.

Your current list of "what you are doing" may include:

• Conducting initial needs analysis calls with prospects
• Preparing price proposals

Your current list of "what you are tracking" may include:

• How many proposals you give each month
• What percentage of proposals become clients

And your "ideas for improvement" may include:

• Better training your sales people
• Finding better sales people
• Creating better sales scripts
• Improving the quality of proposal documents
• Better follow-up on prospects who initially reject proposals

The fourth and final process to improve is "Fulfillment & Upselling" or how your firm completes client work and upsells them on additional work they need.

Your current list of "what you are doing" may include:

• Face to face meetings and calls
• Preparation of key deliverables sent via email and messenger

Your current list of "what you are tracking" may include:

• How satisfied your clients are
• Number/percentage of clients who re-purchase the same service over time
• Number/percentage of clients who purchase additional services from you

And your ideas for "improvement" may include:

• Have additional points of interaction with clients (e.g., extra meetings; video chat conversations) to build more rapport during engagements
• Bring in a senior manager into all engagements to check work and provide additional insight to better satisfy clients
• Create formal processes that require your staff to ask for referrals, testimonials and additional work opportunities during client engagements
• Adding additional tracking to learn which staff members get the most referrals, testimonials and additional work opportunities

To reiterate, by breaking up any process into smaller pieces and then scrutinizing each of the smaller pieces, it's simple to come up with TONS of ideas for improvement. You will also identify new processes to add which further boost your profits and competitive advantage.

In fact, the problem quickly switches to an implementation issue which is: "how do I start implementing all of the great ideas I came up with."

Here I suggest putting all of the ideas, along with their category (which process they relate to) into an Excel spreadsheet. In a column next to each idea, rank the idea from "1" to "5" with "1" being an idea that can make the most significant and immediate impact on your bottom line, and "5" being ideas that will take longer to implement and/or may not impact your bottom line as much.

Then, sort the ideas by rank. Finally, create a Gantt chart showing which ideas you will start implementing first, next and then last.

By following this systematize approach, you can improve anything. It's real work, but it's relatively fun, and it always leads to success!

Every day I see entrepreneurs trying to find that right balance between keeping their intellectual property confidential while sharing and promoting their business model with partners - especially investors - whose interest they so very much need to pique.

My bias generally falls strongly on the side of transparency - both because it is a virtue unto itself - and because it takes a lot of effort in our “post your business on the Internet for all to see” age to truly maintain confidentiality.

I have a more fundamental reason, however, why I generally advise entrepreneurs and investors not to worry all that much about confidentiality.

Supply and demand.

Quite simply, there are so incredibly few entrepreneurs out there with the “right stuff” to actually build profitable businesses.

And those that have it are on balance, either too busy, too rich, and/or my favorite - of the should be expected ethical type that 999 times out of 1,000 – that as opposed to the problem being someone of substance stealing a business idea, that the far more likely reality is a vast and unrelenting sea of apathy toward it.

Now, this does not mean that there is no place for confidentiality in modern business. But the reason why it is important is almost always more subtle than the fear of idea theft.

You see, for the vast majority of entrepreneurs without eight to nine-figure research and development budgets, the reason why confidentiality is important has to do with the under-appreciated context of mystique.

Oxford defines mystique as "a fascinating aura of mystery, awe, and power surrounding someone or something."

I would combine this definition with one of my favorite lessons from my long ago MBA marketing class – namely that in a modern marketplace there is zero difference between "actual" and "perceived" value.

So, in these contexts, the value of business confidentiality derives not so much from the threat of a nefarious competitor stealing an idea.

Rather, it is how the aura of confidentiality can bestow on a business that lovely element of mystique that draws people and resources to it, and does so in such a way that a nicely high perception of value follows.

And from this perception flow many wonderful things: brand equity, pricing power, and marketing effectiveness being chief among them.

Now for those who say that this is quite the cynical view of things, I would encourage them for the next seven days to not take in any entertainment media - no movies or television or Internet - nor to appreciate the lovely design of an iPad, and certainly to not gaze fondly on an elegantly dressed and coiffed woman or man.

In other words, to suffer for just one week like the terribly poor, extraordinarily unfortunate and very marketplace mystique - deprived people of North Korea must unconsciously suffer through every day of their lives.

And then come back and tell me that mystique doesn’t matter.

So appreciate mystique - that beautiful elixir of the modern marketplace – for its own sake as the incredible gift and blessing it is.

And you entrepreneurs understand how confidentiality and discretion, when utilized gracefully and not ham-handedly, can help create it.

As for investors, look for this “you know it when you see it” quality in entrepreneurs and business models to back.

Every year for the past decade I have heard the same thing, regardless of whether the economy is doing well or poorly.     

And what I hear is entrepreneurs saying that it's so hard to raise money.      

Importantly, whether times are good or bad, the process of raising money is pretty much the same. And whether times are good or bad, the challenge of raising money is still the same. That's because when times are good, there are more entrepreneurs seeking funding. When times are bad, funding sources are a little tighter with their money, but fewer entrepreneurs are contacting them. So, it all evens out.     

So, how should you go about raising money in 2012?

Here are six rules to follow:

1. Bootstrap as much as you can. Bootstrapping is the process of running your business with no outside financing. While you clearly can't accomplish as much as if you had outside funds, bootstrapping forces you to get creative and to figure out how to do more with less funds. Importantly, when you bootstrap, you can 1) start to prove that your business will be viable, and 2) prove that you can execute on your venture. Both of these will help you significantly later when you do seek outside funding.

2. Start by raising smaller amounts of funding. No one is going to write you a $5 million or $10 million check for your business until you've proven your concept. Bootstrapping will help progress your business; but also figure out the smallest amount of funding you could use to progress your business further and raise that amount. Once you raise the smaller amounts of money, and start growing your venture, the larger amounts of money will become much easier to raise.

3. Determine the right sources of funding for now. This is the area that trips up most entrepreneurs. For example, if you're not a technology company and you haven't already proven your concept, venture capital is probably not right for you. But that's ok, since there are tons of other forms of funding that can be a great fit (e.g., angel funding, crowdfunding, vendor financing, etc.). So you must understand all the funding sources that are available to you, and go after the ones that are most applicable.

4. Develop relationships now.  Sure, you are most likely to raise funding if you have a quality product/service that has real growth potential. But, even more importantly, you will attract funding if the funding source likes you and your management team. Because investors and lenders bet on people; even a great product or service won't make it unless it's backed by a quality management team.

So, start building relationships with funding sources now. For example, even if your company may not be ready for venture capital for another 12 months, start meeting with venture capitalists now. These relationships will not only make you much more likely to raise the funding later, but these contacts may be able to introduce you to other funding sources.

5. Develop your business plan and keep it up-to-date. Your business and your business plan are always changing. You need to start now by documenting your vision in the plan. The process of developing your plan will force you to think through your business. It will identify new opportunities. And it will give you ideas on how much you might be able to accomplish via bootstrapping and/or smaller funding amounts (numbers 1 and 2 above).

Keep adding and updating to your business plan so that when you meet an interested investor, you can quickly and easily get your plan to them.

6. Keep your eyes and ears open and network. You never know who will ultimately fund your business. So the more people you meet the better. The more people you tell about your business the better. The more events you attend the better. The more Advisors you attract the better. And so on. You need to constantly get the word out about your venture to the right people to find the ones who will fund you. And when you meet someone who is not the right fit, don't forget to ask for referrals. Since they might just know the perfect investor for you.

Suggested Resource: Want funding for your business? Then check out our Truth About Funding program to learn how you can access the 41 sources of funding available to entrepreneurs like you. Click here to learn more.

Unable to build on numerous exhilarating rallies and hyper-sensitive to every geopolitical tremor, the US stock market ended 2011 right where it began it - with the S&P 500 Index at almost exactly (1257) where it started the year.

I guess that given the heart-wrenching volatility that we have all been subject to recently, a flat year should be considered progress.

The longer view, however, is far more disheartening.

When we consider that the S&P closed 1998 – 13 long years ago - at 1229, or within 2.2% of its 2011 close, we have all suffered through nothing less than a lost generation of investment return.

Think about it, a 1998 New Years baby is now a teenager.

The whole lifetime that is her childhood is a memory, yet that same girl's parents that began saving for her college education on that happy day of her birth, have not seen a penny of return on the money that they worked so hard to make and save.

This is discouraging to say the least.

Luckily, the New Year brings with it both the promise of things to come and the opportunity to "reset" old patterns of thoughts and action that no longer serve us.

And is there anything in business right now that more desperately needs a reset than how we think about making money on our money?

Now, for entrepreneurs, adding greatly to the challenge, is that in the natural hustle and bustle of growing a business what is so often overlooked is how a company’s business plan does or does not support the personal financial plans of the individual stakeholders that make up the company.

This is a tragic mistake – where the entrepreneur is so focused on the day-to-day running of the business that they neglect until it is too late how that business is or is not creating assets in exchange for the lifetime of blood, sweat, and tears poured into it.

Given that my company Growthink’s mission is to help entrepreneurs succeed, I consider this challenge so fundamental and the consequences of further failure so dire that in 2012 I am professionally resetting myself to focus on, above all else, benchmarking and sharing best practices in this regard.

Among other work, this will involve building on my now multi-year experience and inquiry into the brave new world of diversified, “Black Swan” based alternative investments.

Pioneered by innovators like Dave Lambert and Kevin Dick at Rightside Capital, this incredibly exciting arena allows entrepreneurs and investors the opportunity to time and cost effectively build risk managed portfolios of positions in early stage technology companies with "Google-esque” and "Facebook-eque" outlier return potential.

It is a strategy that the realities and the probabilities of 21st century business demand, and one that financial innovators are making available for the first time to Main Street investors.

I will also step up my featuring of the entrepreneurs that I have had the great fortune and pleasure to get to know and see succeed here at Growthink.

Men and women like Liam Brown, Rich Corell, Torfinn Johnsen, Vlad Lempert, and Katie Williams.

Because while “on average” these last 13 years might have been flat, during this same time an ultra-select corps of entrepreneurs have built incredibly valuable companies and have inspired us with their determination, their creativity, and their triumphs.

I look forward to sharing the best nuggets of their wisdom, and hope that all of us capture just a little bit of their special something.

2012 awaits - may it be the best year our entrepreneurial and investing lives.

Let’s make it so.

If you've purchased any of my capital-raising products or followed my essays, you've undoubtedly heard me say that you should never send an investor your business plan cold. (By "investor," I'm mainly referring to venture capitalists and angel investors.)      

Rather, you should always start with a "teaser" email. A "teaser" email is an email that "teases" the investor by giving them a bite-sized amount of compelling information about your company.       

The goal of the email is to see if they are interested. If they are, you will follow up with more information (maybe your Executive Summary and/or full business plan) with the goal of getting a face-to-face meeting with the investor.     

There are two reasons you shouldn't send your business plan in your initial email. First, you don't want to "over-shop" your deal. Over-shopping is letting too many investors know about your company. If too many investors know about you, the law of numbers states that many investors will pass on investing in you (remember, most investors passed on the opportunity to invest in Google years ago).

So, if an investor isn't even interested in your market space or teaser email, they certainly won't invest in your company. And here's what can happen -- an interested investor asks this investor (the one who isn't interested in your space) if they've heard of your company. That investor says "yes" (since you unwittingly sent them your plan) and that they weren't interested. And then their disinterest persuades the once interest investor from funding you.

The second reason you don't want to send out your business plan in your initial email is for confidentiality reasons. You just don't want your business plan out there for everyone to see. Rather, wait until the investor shows that they are at least somewhat interested in your venture before sending it.

So, now that you know that you should start by sending investors a "teaser" email, the question is what to include in the teaser.

Here's the answer: the teaser email should include 5 to 6 bullets about your company and should be very short (200 words or less).  The goal, once again is simply to create a general interest in your venture so the investor commits time and energy to learning more about it (by requesting additional documents or setting up a meeting).

Your bullets should describe what space your company is in and credentials that make you uniquely qualified to succeed (e.g., credentials of management team, customers serving already or showing interest, etc.).

Now one of my subscribers asked me a great question the other day --  what should my subject line be on my teaser emails?

In fact, she said that she felt subject lines such as "Unique Investment Opportunity," "Please Invest in our company," and "Great Investment Opportunity" don't catch investors' attention and/or could turn them off.

And she is 100% correct here.  You should never send emails with subject lines such as these to investors.

So, I put together a few Subject line "templates" for you to use here:

1. Re Your Involvement in XYZ Company

Where XYZ company is a company that the VC has funded and which is in your general space. You would start the email with something such as "based on your investment in XYZ company, I think you will be interested in what we are doing..."

2. "New in XYZ Space" or "XYZ Space Introduction"

Where XYZ is the "space" that you are operating in (e.g., the financial software space). The first line would tie the subject line to what you are doing.

3. Referred by XYZ

Where XYZ is a referral source that knows both you and the investor. This works extremely well, but clearly you must first get the referral.

4. Comment on Your Post About XYZ

Where XYZ is a post that the investor recently wrote on their blog about a subject. In your opening line you explain what you agree with in their post and then tie it to your company.

To summarize, send investors a teaser email instead of your business plan to start. And realizing that they receive hundreds of emails every day asking for funding, make sure your subject line stands out and seems like you're offering them value.

Suggested Resource: Want funding for your business? Then check out our Truth About Funding program to learn how you access the 41 sources of funding available to entrepreneurs like you. Click here to learn more.

Below are four of my "favorite" questions that Growthink's Insider Circle members asked me in 2011 via both the "Ask the Experts" service and our live member call-ins [to clarify "favorite," there were many questions that required me to spend 10 minutes or so to answer them on one of our live calls; I couldn't include any of those here or this essay would be way too long].    

Q1. What's the best way to cost-effectively increase awareness of our products as we expand into other markets?     

A. I would use PR, contests and sampling.    

1. PR: PR is mostly a matter of finding an interesting "hook" that the media finds exciting. Figure out what a listener of the nightly news would find interesting about your product, and use that to pitch multiple media sources.

2. Conduct contests on Facebook. If done right, this could get you awareness among tens of thousands of consumers (and businesses). Two great tools to use for this are Strutta.com and Wildfireapp.com

3. Sampling. For many products and services, customers need to sample it in order to realize they want/need it. So identify a highly defined target market, and let them sample your offering.


Q2. What are the best ways to find the market research I need?

A. To find Industry sizing and overview information, use the following queries in Google to find the market size, trends and the names of key competitors in your industry:

• [Industry Name] "market size"
• [Industry Name] statistics
• [Industry Name] "market trends"
• [Industry Name] companies
• [Industry Name] "market share"

Most industries have industry portals, typically top trade journals and associations, that offer tons of great industry information. Search the following queries in order to find these industry sites:

• [Industry Name] "trade show"
• [Industry Name] journal
• [Industry Name] association

To find more competitors that you may not know about, do this: Once you have a partial list of competitors, expand your list by doing a search on Google that includes the names of the competitors you already have. For example, search on:

• "competitor 1, competitor 2, competitor 3, etc." (without quotes)

This will often result in a page that includes those competitors, hopefully as part of a bigger list of competitors.

Also, doing the following Google search on one of your competitors will find related sites and possibly new competitors:

• "related:www.competitorURL.com" (without quotes) (e.g., "related:www.google.com" gives you yahoo.com, msn.com, etc.

Q3. What online marketing tools do you recommend?

A. Here are a few tools I really like:

1. KeywordSpy.com (http://www.keywordspy.com/) and Ispionage (http://ispionage.com/)

Both of these tools allows you to see how your competitors are marketing themselves online. Among other things, you can see the keywords they are advertising on, their estimated ad budgets, their advertising copy, and what keywords they rank organically on.

This analysis allows you to identify where your competitors are getting their best online traffic, so you can replicate it.

2. SnapEngage (http://www.snapengage.com/)

SnapEngage offers online chat on your website. We've been using this with for the past few months with excellent results.

3. BrowserCam (http://www.browsercam.com/)

BrowserCam allows you to see how your website looks in any browser / operating systems combination (e.g., how it looks when someone views your site on a Mac using Safari or on a PC using Chrome, etc.).

4. Compete.com (http://www.compete.com/)

Compete.com allows you to see how much traffic a website is getting, how that traffic is changing over time, and how it compares to others in the market.

Within the premium (i.e., paid) features of Compete.com, you can see the demographic profile of the visitors to your and your competitors' websites, and the sites that refer the most traffic to them.

This is really cool; particularly since if you know the sites which refer the most traffic to your competitors, you can contact them and try to get links to your website included there too, so you can "steal" some of their traffic.

5. Quantcast (http://www.quantcast.com/)

Quantcast allows you to see the demographic profile of visitors to your website and your competitors' websites.

You'll learn whether visitors tend to be male or female, the age breakdown of visitors, their ethnicity, whether or not they have kids, their income levels and their level of education.

If your competitors get a fair amount of website traffic, Quantcast can also show you some cool additional data, including other sites which visitors to your competitors' websites also visit, and traffic frequency (e.g., % repeat vs. one-time visitors).

Q4. What's the best way to grow my business?

If I had to give you just one tip for growing a successful business, it's figuring out how to get residual revenues from your customers.

The vast majority of entrepreneurs and small business owners serve customers once and do a terrible job getting the customers to come back. Rather they waste tons of time, energy and money continuously searching for new customers.

The most successful companies have fewer customers and serve them over and over again. Figure out how you can maximize the lifetime value of your customers. How will you nurture them and stay in touch with them over time (e.g., direct mail, email)? How will you get them to refer more customers to you (e.g., referral programs)? How will you get them to pay you over and over again (e.g., monthly/annual service contracts; book/wine/product/service of the month club, etc.)?

Once you figure out how to generate residual revenues from your customers, you'll be off to the races.

Some of you have been reading and receiving my emails for five or more years. Others of you have just joined my newsletter list. And still others of you are not on my newsletter list, but are reading this article on my blog (more on this important distinction later).  

Regardless of which category you fall into, in this article, I will share many of the email marketing lessons that I've learned over the past several years. Over this time, I've sent out over 20 million emails. Yes, that's a lot of email. And yes, when you send that many emails, you need to spend a lot more time understanding the process of email marketing.  

Here are some of the key email marketing lessons I've learned along the way.   

Email marketing is an exception tool. It allows you to very cost-effectively stay in touch with both your clients and prospective clients.

Which leads me to my first key to email marketing, which is to define how you will use it.

Will you use email marketing to:

• Keep in touch with existing clients/customers?
• Nurture your relationship with prospective clients/customers?
• Sell products and/or services to your customers?
• All of the above?

Whether you are currently using email marketing or not, take a moment to write down how you can use this marketing channel.

Importantly, even if your goal is solely to increase sales, your emails must do more than sell things. We've all been on email lists that send message after message telling us about this offer and that offer. And we all do the same thing in these cases; we unsubscribe from the mailings.

Which leads to the second key to email marketing: you must provide value. You want recipients to be excited to receive your emails. If not, they'll unsubscribe, or they won't open your emails and/or take the actions that you'd like.

By providing value, I'm suggesting that you give the reader tips and advice to help them solve the pains that your products/services solve. Importantly, that's not to say that EVERY email you send must ONLY provide value. But at least half of your emails should provide value or people will unsubscribe or tune you out.

The third key to email marketing is to segment your email list. In my case, some of my email subscribers are focused on developing their business plans; others are focused on raising funding; and others are focused on growing their companies. While I send most emails to all three segments, some emails are sent to only the specific segment that will benefit most from it.

Consider your email list. Do you have discernable customer segments? If so, figure out how to identify (e.g., with a survey) which segment each recipient belongs in, and segment your mailings to better serve them.

The fourth key to email marketing is to test and tweak. The following are key areas to test and tweak:

• Your Email "Subject" Lines: figure out which subject lines your recipients are most likely to open (and then create more Subject lines like them)


• Your Email content: figure out which content/information your recipients like best (based on feedback from replies to your emails, or surveys)


• The time of day which you send your emails (one email marketing expert told me he gets his highest email open rates when he sends out emails at 5:30AM Eastern Time; I have found better results when I email at 6:00AM Eastern Time)


• The days of the week in which you send email (and note that research shows that most marketers see the highest unsubscribe rates on Tuesdays)

 
The fifth key to email marketing (which relates closely to the fourth key) is to maintain your metrics. Here are the email marketing metrics that my team tracks for every email we send out:

• # of emails sent
• # of emails delivered
• # of emails opened
• Open Rate (%)
• # of emails clicked
• Click Rate (%)
• Revenue Generated
• Revenue generated per email sent
• Subject line
• Email content

You've probably heard me and others say this -- you can't improve what you can't measure. By measuring each of these metrics, you can try new things and see which improve your results (and obviously do more of the things that are working).

The sixth key to email marketing is to leverage your content. I alluded to this in the opening paragraph of this article. What I mean by this is that when I write an article for my email subscriber list, I will also at some point post the article to my blog. I do this to generate greater exposure to the article. In many cases, I will change the title of the article on my blog so that it appeals more to the search engines (conversely, the Subject line of my emails have to appeal more to you, my readers).

There are clearly other keys to effectively using email marketing. Such as choosing the right email service provider, and ensuring that you are CAN-SPAM Act compliant. But by following the six keys outlined above, you will be much more effective; you'll be able to use email marketing to increase sales and profits and outperform your competition.

Suggested Resource: Want to learn how to capture more email addresses using your website, how to drive new visitors to your site, and how to maximize your email marketing revenues? Then check out our Ultimate Internet Marketing System to learn how you can build the ultimate online lead generation machine. Click here to learn more.

In a book full of them, one of the most profoundly powerful points made in Oren Klaff’s bestseller "Pitch Anything," is the subtle concept of the powerless of money in the face of entrepreneurial initiative.

Now before you think that the book is some kind of "sound of one hand clapping" meditation, let me explain by contrasting how money operates these days in the world of investment compared to how it does in the world of consumption.

When it comes to buying things and services - of every type, from everywhere around the world –the liquid and creditworthy consumer stands omnipotent.

In fact, the buying options in our modern world have grown to such a dizzying degree that a whole industry has spawned around managing what author Barry Schwartz in a famous bestseller of a few years back termed "The Paradox of Choice."

In the world of investing however, money holds a decidedly weaker hand.

For when it comes to finding that magical risk/reward sweet spot, money has no amazon.com price comparison tools to guide it.

No free shipping and certainly no money back guarantees.

And as for variety and choice, well these days investors seeking quality returns are arguably faced with worse options than at any time in almost of our living memories.

The so called "safe" investments - cash, treasury bills, residential real estate – have for a long time now offered only the double whammy of pathetically low yields and far more insidiously have proven to be anything but safe.

As for the public stock markets – the traditional world of “risky” investments – well the risk is still there for sure, but where are the returns?

So into this paucity of choice and return vacuum steps the intelligent and assertive entrepreneur.

The entrepreneur that understands that while this world of ours is awash in vast, mostly sclerotic, often siphoned, and usually very scared pools of commodities and inheritance - based cash, the "man (or woman) in the arena” entrepreneur is the ultimate, scarce global resource.

Because it is only he (or she) that can graciously grant and give money what it wants - what it so desperately needs - positive expected value and manageable risk - return.

In short, that can give money a purpose beyond the latest holiday bauble.

So in his book Oren Klaff eloquently reminds us (and very contrary to popular wisdom), that when money and entrepreneurs meet it is money that is the beholden one, and that is the beta to the alpha man (or woman) with a plan entrepreneur.

And, those entrepreneurs that know this - that work day and night to become and be this - never “need” money.

The opposite, of course, does not hold.

Hewlett-Packard's new CEO, Meg Whitman, will receive an annual salary of just $1.   

Now, on one hand you might think that since Ms. Whitman is a self-made billionaire (she's one of only 5 female self-made billionaires in the world), she doesn't need the money. But clearly, working for $1 is not worth anyone's time, let alone hers.    

You see, Whitman expects to earn a ton more than $1 for her work. In fact, she hopes to earn up to $6 million per year from her new role.     

Here's how. Along with her meager $1 annual salary, Whitman will receive millions of options to purchase shares of HP. And if she's able to improve HP's stock price, her annual salary could effectively go from $1 to several million.

Now, for HP and Whitman, I think this is a great idea. Whitman only gets paid if she performs and improves the stock price. And if she does a great job, she truly gets an amazing salary. This is classic performance-based compensation.

However, for entrepreneurs and heads of non-public companies, I hate this compensation structure. Here's why.

To begin, your stock price is far from a perfect indicator of the value of your company. For a public company, the stock price often reflects short term revenues and profits. So, when a company reaches its quarterly sales and profit goals, its stock price goes up.

Importantly, simply building your revenues and profits (particularly just in the short-term) are not a perfect indicator of the value of your company.

So, what is the perfect indicator of the value of your company? Well, the answer differs for every specific company. And that's why it's critical to determine how YOUR company might be valued.

Your company could be valued on many things. Sure, your revenues and profits will factor into your valuation, but what about things like:

• The quality of your team: do you have well trained employees that expertly perform?


• The quality of your revenues and customers: do you have a handful of huge clients versus tons of smaller clients? Do you need to re-sell tons of new clients every month, or do you have residuals (clients that pay you month-after-month)?


• The quality of your systems: do you have systems in your organization that enables it to run without you? Do your systems ensure consistent and high quality production? Do your systems provide cost or time advantages versus competition?


• The quality of your product or service portfolio: do you have a portfolio of products or services that would be challenging for your competitors to also create and/or offer?


• The quality of your partnerships: do you have marketing or production partnerships that you can leverage to more expertly serve or gain new customers?

I hope you answered "yes" to most if not all of these questions. While answering "yes" doesn't ensure that you're optimizing revenues and profits today, it does ensure that you have and are building ASSETS that will enable you to be more successful in the future.

And that's what you as an entrepreneur need to care more about; not just how much revenue and profits you generated last month, quarter, or year. But rather, what you BUILT in the last month, quarter, or year that will allow you to outperform the competition and generate significant profits in the NEXT month, quarter, and year(s).

Now, I'm not saying that you shouldn't set periodic (e.g., monthly, quarterly, annual) goals for metrics like revenues and profits. You should. And ideally, you will achieve them.

But what I'm saying is that you must ALSO set ASSET goals. Building new business assets (like better or residual customers, like partnerships, like systems, etc.) build the VALUE of your business. Value that will allow your company to generate significant revenues and profits in the future. And value which will make lots of other companies want to buy you for millions.

So, let's get started on this process. Write down one business asset, that if built within the next 12 months, would significantly increase the value of your business. Next, write down the key steps that will be required to build this asset. Finally, put the first step(s) into your list of goals for this month. And make sure you put the remaining steps in future month's goals until the new business asset is attained.

Importantly, doing this doesn't yield as much short-term satisfaction as having a great sales month. But longer-term, you'll be much more successful. And ultra-successful entrepreneurs are ALWAYS in it for the long-term. Like self-made billionaire Meg Whitman, who ran eBay from 1998 to 2007.

Suggested Resource: Would you like to know the thirteen business assets ultra-successful entrepreneurs build to unlevel the playing field and dramatically grow revenues, profits and long-term success? You'll learn this and more in Growthink's 8 Figure Formula. This video explains more.