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Business Strategy, Tribe

Why Focusing Just on ROI Means You Could Be Leaving a TON of Money (and Customer Love) on the Table

Return On Investment… it’s a term that gets thrown around a lot in business.

But not a lot of people stop to think about what it really means.

The dictionary definition goes something like this:

ROI is the benefit (or return) of an investment divided by the cost of the investment.

The result is expressed as a percentage or a ratio.

For example: If you plunked down $1,000 on Facebook ads for a marketing campaign that generated $5,000 in sales, your ROI would be 500% (or measured as a ratio, 5:1). In other words, you made back 4X what you spent. And that’d be a great result!

But if you want to build a fulfilling, sustainable business that transforms lives…

There’s Another Non-Traditional ROI You Need to Pay Attention to…

I’m talking about Return On Impact.

Return On Impact is a measurement of the experience your customers have as a result of working with you or connecting with your company or brand.

It’s about the actions they’ll take and the benefits they’ll get when they consume your products and services… and it’s about the transformation you help create and the lives you change with the work you do in the world.

Return on Impact covers the entire range of results your customers get — this can include financial gains plus the qualitative, intangible improvements they get to experience such as more happiness and fulfillment as a result of working with you — divided by their investment of time, energy and money.

And it also has much bigger implications…

Return On Impact is multiplied by the total number of people that you impact and the people they impact because of the work they did with you.

Return on Impact creates a vast ripple effect — it’s multiplicative, even exponential — while traditional ROI just divides financial investment over financial cost.

Mindvalley is one of the most successful online education companies in the online world and they’ve seen almost unbelievable growth in just a few short years.

From the get-go, Mindvalley chose to focus on long-term Return On Impact over short-term Return On Investment.

Back in the early days of the internet, Mindvalley invested a significant amount of time and money building out a gorgeous brand and website that was simply unlike anything else in the industry (and still stands out today).

This was a Return On Impact decision and it was a bold move. Why?

99% of the Top Marketing Gurus at the Time Were Flying the “Ugly Websites Win” Flag

Most gurus agreed (and taught) that it doesn’t matter what your website looks like, it’s all about how many immediate leads and sales you can generate and how “ugly” sites converted better faster. So it was totally ok to slap up a cost-saving, butt-ugly website!

But Mindvalley bucked the trend…

Instead of maximizing for immediate leads and sales to the detriment of the customer experience, Mindvalley optimized their site to establish trust, safety and a fun, awesome relationship with their prospects and customers.

They successfully created a rich brand experience on their website and throughout their entire Customer Journey that would surprise and delight their audience and keep them coming back for more.

And then when things started to change — as the online world evolved and matured and customers started demanding better experiences, including user-friendly, easy-on-the-eyes websites — Mindvalley was already way ahead of the curve.

And it’s paid off for them big time 🙂

Mindvalley has a stellar reputation that has grown year after year and the company that started with just ONE online course now offers some of the most popular digital products and programs in the world.

They literally have tens of thousands of loyal customers, millions of raving fans and followers, and several profitable “sister” companies like Evercoach.

Mindvalley’s teachers are among the most respected and renowned authors, speakers and personal growth leaders in the world.

And that’s the unlimited power of Return On Impact in action.

Focusing on Both Return On Investment and Return On Impact Takes Courage

You might need to “sacrifice” some profits in the short-term to invest in powerful, memorable customer experiences that will pay off for you in spades later on down the road.

We all know running a business is essentially about making money… but money isn’t the only reason to make a business decision.

Financials are just ONE consideration, not the ONLY consideration.

When you look at all of your business decisions through the lens of “What’s in it for me,” when you focus only on your Return On Investment, your audience will catch on that you’re in it just for the money.

You’ll shake their trust and potentially damage your relationship with them.

But when you consistently focus on Return On Impact as well as Return On Investment…

When you’re dedicated to creating the best possible experience for your prospects and your tribe even if you have to give up a few extra bucks…

They’ll know they’re #1 in your heart, mind and in everything you do.

That’s how rock-solid reputations and long-lasting relationships are built.

It’s how you’ll grow an audience that loves, trusts and raves about you — and it’s how you’ll continue to attract clients and customers who are happy to buy from you again and again, long after other businesses in your market have bitten the dust.

So What Does Making Return on Impact-Driven Decisions in Your Business Look Like?

I make Return on Impact decisions all the time at Live Your Message.

I’m constantly asking myself, “Why am I doing this? What will my audience experience from this? Why do I do what I do in my business? Why am I creating this new program or hosting a live event or writing this blog post right now? For the sake of what?”

I’ve turned down countless opportunities to promote affiliate products and services that could bring in thousands of dollars in revenue because I don’t believe in those offers. They may be a great Return On Investment for my business but they’re a terrible Return On Impact.

And I’m happy to say that decisions based Return On Impact have created massive long-term benefits and over $10 million dollars from loyal customers who trust that I’m looking out for them and I’m not just out to make a quick buck.

Focusing on Return On Impact changes the way you evaluate business success.

It gets you thinking long-term over short-term.

It gets you thinking about the value of your reputation and relationship with your clients and customers month after month, year after year and beyond.

And that’s the secret sauce that’ll help you build an incredibly successful, profitable and fulfilling business that stands the test of time 🙂

So the next time you need to make a decision in your business — big or small — ask yourself:

What’s the Return On Impact here?
What will my audience experience?
What will wow them?
What’s going to give them the most benefit?

Get clear on your answers to those questions before you ask “What’s my Return on Investment going to be?”

And now, here’s a question for you:

How can you start to shift your focus? What’s one Return On Impact decision you can make in your business today?

Share your thoughts with me in the comments below, I’d love to hear from you. I read and reply to every single comment!

Love it? Hate it? Let me know...

  1. Virginia Reeves

    Marisa – so glad to see Vishen Lakhiani and his company, Mindvalley, put forth as an excellent example of how an enterprise can focus on impact and gain terrific results. I am a loyal fan of several years. Your post serves to remind people that money is actually a result of impact. If you don’t impress, you don’t get clients or a following.

    Reply ·
    1. Marisa Murgatroyd

      Totally agree Virginia! Thanks for sharing 🙂

      Reply ·
  2. Clarence Wilmot

    Companies that focus on the triple bottom line (people, planet, profits) I have been focused on impact for years. Millennials are searching for these companies to work for or are starting their own meaningful businesses. I encourage people to search out the people and companies that are making a difference. Going to the B-Corp website is a great way to get familiar with these impact based businesses.

    Reply ·
    1. Marisa Murgatroyd

      Excellent points Clarence, so true! Thank you for sharing!

      Reply ·
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About the Author Marisa Murgatroyd

Marisa is the founder of Live Your Message, where she turns entrepreneurs into Online Superheroes, and the creator of Start With You where she helps people just like you to discover the business they're meant to build, not just the business they can build. At 4’11 and a quarter, she’s called the shortest woman in marketing — and that doesn’t stop her from having huge ideas. She’s the “go to” brand builder for industry luminaries and heavyweights such as Justin Livingston, Callan Rush, Danny Iny, Alexis Neely and Susan Peirce Thompson. Marisa helps entrepreneurs create a business that is authentic and aligned with who they are, to empower them to turn up the dial on their “inner superhero”, so they can be the superhero to their tribe, as well as in their own lives.

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