This article *isn’t* about making plans, about creating lists or about writing down your goals – it’s not even about writing at all – so what is the importance of the pencil to your Internet business?

In his book “The Search – How Google and It’s Rivals Rewrote the Rules of Business and Transformed Our Culture” the author John Battelle quotes Louis Monier, the founder of AltaVista.

And what he says is one of the most startling and powerful business concepts I’ve heard in a long time.

He described AltaVista as “a pencil”. Before I reveal why, it’s important to point out that whilst AltaVista arguably died many years ago the principle of the pencil is as sound today as it ever was.

And it’s the pencil principle that has allowed Google to become the power it is today – fielding over half of all Internet searches made.

It’s what has made Ebay a household name from their humble beginnings, together with Yahoo, Microsoft and all the other Internet success stories out there.

It’s also a key ingredient to success with your own Internet business – irrespective of whether you’re running a search engine, an ecommerce store or an information portal.

It also doesn’t matter what market you’re in – from stock quotes to stocking sales, knitting patterns to negative calorie diets – the pencil principle still holds true.

So whats so great about the pencil?

In Monier’s own words a pencil is “a tool that [does] one thing very, very well”.

Don’t let the simplicity of this concept deceive you – like so many other things – the power is in the simplicity.

The difficulty is in the execution.

Think about it.

Ebay is a “pencil”. Amazon is a “pencil”.

Most of the greatest Internet companies are.

Sure, they broaden their appeal eventually – such as Amazon stocking software, DVDs, white goods and the like in addition to their original book line-up, or Google now offering free email as well as search but the core concept is this…

These Internet successes set out to create a pencil – a tool that does just one thing better than anyone else in the marketplace.

Once this has been done, once traffic rises and market domination starts looking like a very real possibility, *then* they look at horizontal expansion.

But never forgetting the original tool they created, and keeping it “ahead of the wave”.

Amazon hasn’t stopped selling books. Google hasn’t stopped offering fantastic search results.

So whatever industry you’re in, however you’re monetizing your traffic, spend some time today considering how (often achieved successfully by using brains rather than big funds) you can hone your site to offer a tool or service that’s so much better, so far removed from your competitors that traffic growth is virtually guaranteed.

Because it’s these “pencil” sites that get linked to from all over the Internet, that garner word-of-mouth referrals, newspaper column inches, repeat visitors and ultimately a fiercely loyal following.

Don’t spread yourself too thin, trying to be all things to all people. Decide on what your market really needs then work on that resource – whether it’s an ebook, an online tool, a piece of software, a service, a portal – whatever – and work at it night and day.

Work obsessively, uncontrollably, unerringly to make it the very best resource out there. And not by a few percent. By such a huge margin that there’s no hope anyone else can compete with you. That there’s nobody to compare you to. Make the difference so big that visitors to your site can’t fail but notice how superior your site is to all your competitors.

Then you’re on the right tracks. Then you’ll have created your pencil, and *then* you can start look at expanding into other related, complementary sub-niches.