THE FORMULA OF BUSINESS Pareto Law and strategies for business success Most people when they think of creating an online business, think of creating a product, sell it and hope to get enough capital to finance their next product idea. This type of thinking is short term, and does not lend itself well to a long term business. When you stop and think about a long-term business model, whether it's online, offline, or a mix of both, you really need to think about the big picture. What you really need is a method of capturing potential customers, converting them into small-time customers, and gradually converting them into customers who spend more with you in terms of three factors: frequency, monetary value, and timeliness. In terms of frequency, I think it is clear that we want them to spend more money on our business on a more regular basis. In terms of monetary value, we would like to see each transaction be larger, and we would like you to spend more per transaction. When it comes to the present, ideally you should buy last week rather than five years ago. This makes them a fresher customer who is more likely to buy again soon, promoting the other two qualities I just mentioned. There is also a fourth quality that is rarely discussed. We don't necessarily care how they buy from us, only that they buy from us. However, some distribution channels are significantly cheaper than others. Ideally, then, the media, or the method you used to bring in the sale, becomes increasingly important. So how do you turn a product-to-product mentality into a successful long-term business? Well, for starters, you need to have a viable business model. And part of that business model must include the "marketing funnel". This is where it comes in. "THE BUSINESS FORMULA" is a very powerful book, as it is the RULES OF SAFETY for creating a business of any kind!