Establishing Research Operations for Revenue Growth Management or Net Revenue Management (Lever wise analysis?)

To answer your question directly, the best way to figure our the optimal revenue model is by doing exactly what you're doing right now: evaluate the trends, challenges in the market and calculate how much it costs to build your user base relative to the revenue (potential) they bring in. Commonly if your CAC is out of alignment people start by focusing on the tactics through which they acquire (which to be fair is only natural.) I though like to start on the custom side and work my way backwards. Are you targeting the "right" customers relative to your opportunity in the market. Start by focusing on this question first and making sure you're targeting the right market for your app/service. Next, I would see if you can fractionalize that market further down into a more specific/narrow subset of potential customers. This should allow you to maximize what you are producing in terms of revenue potential and also cut down on the acquisition costs side since you can focus your nozzle more directly towards the target. The bottom line is dont overlook an opportunity to make sure your target market is clearly defined and confirmed/validated. And dont be afraid to question potential false-positives (i.e. just because someone will buy your service doesn't make them necessarily the ideal customer.) try to create multiple layers and variables of filtering that help you make sure you've got the right group of people in your sights.

The first thing you should do (if not done already) is analyze your current traffic. You have to make sure a good percentage of your visitors are actually sticking around to either watch the video or at least enough to look at your other content. If this is not the case, then improving targeting for your ads might be your best bet. It is not just the quantity of the visitors but the quality that makes them worth it. 100,000 visitors that just bounce off immediately after arriving are worth less than 5,000 visitors that actually stay for the intended purpose. A visitor that is on your site for a minute is much more likely to see an affiliate link and/or ad than one that just exits after a few seconds. The next point would be looking at your site performance and formatting. If the site is slow to load, then people are more likely to exit as fast as they came in. Also, if they are there to watch a video clip and all the page is filled with ads everywhere, it does no good to the user experience. Finally, make sure the ads shown on the pages are either relevant to the content in question or relevant to the customer. Good Luck and let me know if you have any questions!

One thing I like about your question is the fact that you're ASKING it. Trying to quantify profit. Most people never even get that far. They treat profit--especially if it is that of their own business--as some ethereal thing they will "get later" if possible. "To manage we must measure" is a business maxim and a fundamental one for me. If we don't build Profit into our revenue equation, we're unlikely to get any. And so asking this question and building profit right into your revenue target is a powerful idea nearly all small business owners totally miss. As for an answer...that amount is really up to you. What do you need to survive? There are so many variables we don't know about: what kind of business, what scale, what paths to market are you using, etc. etc. that affect costs, together with the price tolerance of your marketplace, that it's not possible to give an "average" answer. When I train business owners on how to set their operation up for success, I recommend 20-30% of revenue be built in as a monthly amount for profit. However, this is usually for consultants, and may not be possible for other business models. Sometimes 5% profit is what's achievable, say for a commodity provider, and if they make money with that, OK. Have you done any studies of comparative firms in your niche?

The first question I would ask back to you is how many clients you have currently. What is your retention rate? Your capture rate? From there you could develop a strategy to capture the next 5,000. If you haven't enlisted certain marketing channels or networks, you may be able to make a prediction about how many add'l clients that will bring you. Hope that helps!

100M+ in revenues in 5 years or less does not happen very often. As an example of one sector, here is an interesting data visualization (circa 2008) of the 100 largest publically traded software companies at that time that shows their actual revenue ramp-ups from SEC filings (only 4 out of these 100 successful companies managed this feat, which themselves are an extremely small percentage of all of the VC-funded software companies): How Long Does it Take to Build a Technology Empire? http://ipo-dashboards.com/wordpress/2009/08/how-long-does-it-take-to-build-a-technology-empire/ Key findings excerpted from the link above: "Only 28% of the nation’s most successful public software empires were rocketships. I’ve defined a rocket ship as a company that reached $50 million in annual sales in 6 years or less (this is the type of growth that typically appears in VC-funded business plans). A hot shot reaches $50m in 7 to 12 years. A slow burner takes 13 years or more. Interestingly, 50% of these companies took 9 or more years to reach $50m in revenue."