Can I Clone Your Business Model?

Jan 23rd

SEO Question: What is a reasonable price to pay for professional SEO services?

SEO Answer: There is never a cut and dry answer to the question, but typically the range should be somewhere along the amount of value it adds to your business. For example, if you are only paying a few hundred dollars and expect the person to add millions of dollars to your business, then you are also expecting them to be naive and ignorant to marketing and their market value.

If they are ignorant to marketing and their market value then the odds of them being a great marketer or providing great results are going to be pretty low. As SEO evolves it is becoming more about marketing and understanding markets. If an SEO can't sell themselves for a decent rate then how are they going to know your market well enough to integrate your business into your marketplace?

Good Marketing is an Investment:

An alternate angle to look at the price of SEO is to look at it from an investment standpoint. For many businesses it is a price outside of their reach because most SEOs do not offer much in the line of guarantees AND most sites are easy to clone. The easy to clone concept is one you don't hear discussed much because most businesses probably do not customers to think they would use potential customers for competitive research and niche discovery, but why wouldn't you?

Bad Marketing is a Cost:

I recently emailed back and forth with a new SEO who was trying to outsource the SEO on his own SEO service website. It is going to be hard to add value and understand how social networks work if you don't at least do it well on one of your own sites. But if a person does SEO for their own SEO site it makes it easier to visualize the hubs and authorities in other markets.

When you hire someone you are paying them both to work and to learn. If they are well versed in their trade they are learning how to apply what they know about their industry to your business. If they are not you are paying them to (at least try to) learn about their industry. I write that both as a person who has been paid a premium to apply trade knowledge, and as a person who provided lower value services as a low price point while getting paid to learn.

What Value Does Your Business Offer?

If I can have no interest in a topic, start from scratch, and clone the market position of a business in under a week then they have not done a good job of building value on their end, and if I have to add near endless value to their business for their business to have any value at all I am better off creating a similar site myself, such that

  • I can work on it whenever I want

  • I can market it as aggressively as I want
  • I can add value where the client was unwilling to because they thought it was too risky
  • if it looks like it is going to fail I can stop working on it at any time
  • I don't have client approvals slowing me down
  • I keep all the profits
  • it can create a passive recurring revenue stream
  • even if it does fail I can use the site for nepotistic reasons down the road

When you think about it over half the businesses around the world are probable just arbitrage plays (depending on how loosely you define arbitrage). The difference between SEO and most other arbitrage business models is that SEO is cheaper, more targeted, and more scalable. But it only stays scalable and fun if you realize the value of what you do and place yourself high on the value chain.

If a business does not add much real value and is easy to replicate then they should view everyone they talk to as a potential competitor, at least until their business has some tangible value that takes significant investment to replicate.

As an SEO or affiliate marketer one of the first questions you have to ask when evaluating a competitive market or potential customer is how hard would it be to clone what they are doing. If a business is easy to clone you are probably better off just creating your own business that would be harder to clone, outrank them, and then sell leads.

Published: January 23, 2007

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Comments

January 24, 2007 - 12:22am

People like to put a price tag on everything. They're happy to think they've got a good deal. But there's a saying, pay peanuts get monkies. This is true in all walks of life, but people think with budgets not expectations.

January 24, 2007 - 1:44am

Great post. I love the point that there are really two ways to make money in this biz:

-SEO'ing websites that are hard to clone for a fee.

-Cloning websites that are easy to clone and generating your own revenue stream.

January 24, 2007 - 1:45am

Aaron,

nice point. Finding the right clients, with the right inclination to tackle their business problems is the real key to good SEO.

You can only be as good as your brief.

Justin
January 24, 2007 - 1:46am

"As an SEO or affiliate marketer one of the first questions you have to ask when evaluating a competitive market or potential customer is how hard would it be to clone what they are doing."

Wow, did you say that out loud? Wonder if you could lose potential customers(good, intelligent types) that would be afraid if you would steal their ideas. Guess it depends on what you would consider hard to clone.

January 24, 2007 - 1:59am

Hi Justin
It is not a question you generally ask so that you can clone everything in the world and own 30,000 websites. It is a question you ask because if others can clone it easily then one of a few things happens

  • they are in such a low margin field or operating with a broken business model to where they are eventually going to get squeezed out on profit margins or by technology
  • when market competition comes in and is more innovative they get trounced
  • they change quickly to add real value to the marketplace

And I actually don't care if I lose some prospects from them reading my honest opinions. If they have legitimate value add businesses they are not the people in risk of being marginalized by people just cloning their offering because they should have tangible value that is not easy to clone.

And if their offering is easy to clone and they don't plan on adding much market differentiation or value then they must not be both intelligent and long term focused. If you are working on short term spam projects may as well work on your own and keep all the profit (as the risk to reward ratio is shaky and your wages would be heavily discounted if you did this sort of work for clients). And the frustration of working with non-smart customers is never worth dealing with at any price, especially if the businesses are likely to eventually fail anyway.

January 24, 2007 - 2:40am

Maybe it would help to clarify what constitutes a website that is easy to clone and what constitutes a website that isn't easy to clone. A good example of a website that would be hard to clone is an online casino. There are legal and licensing issues involved, software to lease or create, and support staff to hire. All of that infrastructure is hard to clone. This would be a natural client for SEO work.

On the other hand, a portal site with reviews of online casinos with affiliate links would be quite easy to clone. Generate the content and then build the links. (Unless there were something unique and wonderful about the content, of course.)

Another example: Hotels.com or Expedia.com. These are websites with entire infrastructures and business models behind them. They've built booking engines and negotiated inventory with hotels and airlines. A website that reviews travel sites, or specific hotels, on the other hand, would be easy to clone.

Word SEO Champ
January 24, 2007 - 8:19pm

Cost would depend on where you are at and difficult of search phrase

The more money you can earn with the pharse the more difficult it is to get listed and the more it is worth to be listed for those words

January 25, 2007 - 9:51am

Right on, Aaron

When I was thinking along the same lines, like I'd rather create a site in no time and keep the profits, instead of giving out on a silver plate to the client.

Funny thing is that when I was working on some project with a nasty client, I put up my own website on a complimentary topic, the client thought I was competing with him and fired me :)

All the more reasons to work on one's own sites and monetize them instead of being paid peanuts.

January 25, 2007 - 9:53am

Err, it should read:
When I was thinking along the same lines, like I'd rather create a site in no time and keep the profits, instead of giving out on a silver plate to the client, I thought I was nuts and was pretty frustrated to continue to work with a client.

January 25, 2007 - 4:28pm

I struggle with the whole 'value added' thing, as most clients don't think in that manner. Most of the clients I get sell niche products and don't have much of a marketing budget. One sells books on how to make centerpieces; one sells humorous greeting cards; another competes in the (competitive) 401k rollover market. So, is it not worth my time to charge them around $500 for providing basic SEO services such as cleaning up Title tags, adding ALT tags, optimizing the use of header tags, addressing anchor text, etc.? I normally don't have much content value I can add, as I'm not real knowledgeable on their particular industries.

I look forward to more dialog on this topic.

Good post Aaron,
Allen

January 26, 2007 - 4:08am

While working in the debt industry, I asked myself 5 years ago, if my clients business model was easy enough to clone. Leads are easy distribute and there are always plenty of companies that are willing to buy them.

I have not had a client in 5 years. The only deadlines I have are the ones I create.

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