Last year one of my friends couldn't understand why I was willing to heavily invest into marketing a content site that was barely self sustaining, but any market worth being in will require some level of investment to achieve worthwhile returns. If one off marketing expenses triple your traffic then they allow you to spend more on content quality and develop the site deeper. Many people are afraid to risk anything on a new channel. If you are already spending your time working on it and are thinking about it you are already investing...but investing half way won't get you as far as pouring yourself into a project will. If you over-invest and fail in a few months at least you learn something. If you invest to slowly you might just be burning your time and money without even realizing what is going on. You only have so much time and attention, so it is best to leverage it on a few strong channels.
Some types of investment (such as large external ones or ones for poor formatting or bloated infrastructure) are bad because they force you to achieve a certain scale to be self sustaining. Seth pointed to a UK magazine named Pulp that died after its first week:
The magazine had been in development for more than a year and had been heavily trailed on TV, radio and the internet. ... Mr Styles said: "Every piece of research we did, every dummy we created and the concept in all its forms was fantastically received from first to last.
"The industry wanted it, the news trade wanted it, the market was there according to every group we asked - but come the acid test the readers were absent."
They would have been better off launching a website and pouring that print and advertising money into content creation and marketing. That would have been far cheaper and far more valuable than market testing.
The web is so easy to track that you can't spend too heavily without getting good feedback quickly.
As Google and others continue to close off easy opportunity you can't be afraid to invest if you want to see sizable returns. If you are growing rapidly and already are at self sustaining that is a great sign, because when you get more efficient or cut your development costs that cost center turns into a revenue stream. If you are starting from scratch it is hard to compete with nothing unless you are exceptionally passionate.
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