Dec 29, 2008
In the finance world compound interest is the key to making the financial institutions run and continue to stay in business. These type of businesses loan money out to businesses and individuals and then charge them interest. The interest is how these institutions make their money when they loan out money.
So you might be thinking what does this have to do with the internet and my website or internet company? The power of compound interest is more than just something applied to money, it can be applied to many different things. When things compound they get bigger and bigger.
This is how a lot of credit card companies make their wealth. A $3000 loan can possibly turn into $6000 payback to the creditor because of the compound interest.
In the online world there is a lot of compounding going on. To think about compounding in this sense you want to think about building on top of each other. When building an internet company online it is imperative to use many different tools and applications. In search engine optimization one of the main things is getting inbound links from other quality sources. As a website gets more exposure in many different areas online the inbound links will come in faster and more naturally.
This is due to the fact that the many different sources online all compund their exposure and traffic back to you so as you continue to leverage yourself in many different areas online the compounding force goes into effect and that website will start to grow bigger and bigger.
This is why bigger companies seem to grow faster and faster over smaller companies is because what they have put in place by marketing themselves all over the internet and offline will begin to compound on top of each other and the company will grow much faster than a smaller company who is only in one corner of the internet world.
So in marketing online it is essential to place yourself all over internet land so the efforts can compound together. As you borrow authority from bigger companies by placing generated content and links back to your company the effects get bigger and bigger. This is why it does take some time in the beginning to get a website high in the search engine rankings because the compound effect is not in place yet.
Build your presence online in more than just one corner of internet land and then enjoy the fruits of rankings and traffic as the two of them compound. The more places you are listed, the more inbound links you will receive, the more traffic you will get, the higher the rankings you will receive, and the more keyword phrases you will be listed for. This is the compounding effect that will happen as you build and grow.
So as a business owner use the power of compounding to your benefit and build things on top of each other to get more exposure, traffic, and rankings.