Why Raising Revenue Is More Valuable Than Cutting Costs

Raising revenue is always better than simply cutting costs. Any bean counter can look at an expense and lop it off—even if it's a necessary appendage. It doesn't take much to look at expenses and cut them. It's something else entirely to be able to generate revenue. Generating revenue is the secret to success; so as marketers, we need to focus on always generating more revenue. Periodically, we can 'trim the fat' to eliminate expenses.

Here's something else to consider: Nobody can coupon-clip their way to getting rich. It simply won't happen. If somebody has expenses of $3,000 a month and they somehow manage to cut out all their expenses, then they'll put $3,000 extra dollars into their pocket. They have a maximum gain of $3,000 if they could drive their expenses to zero—which they can't. There's a cap to lessening your expenses, because you can only drive them to zero (theoretically). Now, increasing revenue has a much greater return on investment (ROI). It isn't capped. By increasing revenue, you can make $6,000 more per month by changing strategy or tactics. You could add $60,000 more per month by changing strategy or tactics in a major way.

Now, make no mistake—this isn't a free ticket to spend like a drunken sailor and raise expenses. You must stay lean 'n mean regarding expenses. No bloat allowed.