If you are growing a site organically it might be worth it to sacrifice the short term earnings for long-term growth, but what happens when it comes time to sell a site? If you site has a strong brand or other intangible brand type assets worth far more than current earnings consider those before making any changes, and do not tarnish the site's image. If you site does not have those, and will likely sell at an auction it will probably sell for some multiple of current earnings, based on a number of factors including
how much work it is to keep the site earning what it is (fixed costs, in time and money)
general category growth (upside potential)
site position in the category (upside potential)
how aggressively it is monetized (upside potential)
Almost everything that has the word potential in it is going to be heavily discounted. Some people will not see the potential, while others will feel that they don't want to bid based on potential (because they feel that is their value add after they buy the site). Before you sell a site, make sure you spend a few months tweaking the monetization to max out your current revenue numbers. That is the base which most buy offers will be built from.
Andy Hagans recently posted about his linkbait marathon strategy to rank his sites at the top of the search results. Brian Provost posted about his love for domaining. Domain names may play a big roll not only in anchor text, but also in overall domain credibility, linkability, and defensibility.
An Example of a Domain Waiting to Fall:
In spite of making over a thousand dollars a month, one of my unappealingly named domain names has cost itself significant credibility and links. Since it is an invisible cost it is hard to estimate how much it has cost, but I have a perfect example of showing how much it hurts.
One time I tried sponsoring an event and they said sure. They got my credit card details and then asked for the domain name. Once they saw the domain name they said sorry they couldn't accept my money. And this is a reputable content site in a field that is easy to like, but on a junky sounding domain name. Ouch.
Being Honest With Yourself:
If you have a quality legitimate content site, and people who typically sell reviews or links are unwilling to take your money you know it is time for a change.
Other Signs of Trust:
If people who need sponsorship are unwilling to take my money imagine how much a bad domain name suppresses my click-through rate in the search results, and how many other links it cost me. If and when relevancy moves toward an attention based metric I am screwed if my house is built on a cheesy domain name that looks spammy.
Domain Buyer's Pricing Tips:
You can sometimes capture emerging field names cheaply, but you are probably going to have to spend at least a few grand to get a good name if you are in an established field.
If you are new to domaining, and can't afford a great .com there are still a lot of great .org and .net names out there available for $1,000 to $10,000.
Is a 301 Redirect Risky?
I will eventually 301 redirect my high ranking ugly domain name to the undeveloped MyKeywords.org domain that I just spent $8,000 buying. Short term I will probably see some drop in traffic, but long-term it is going to be far less risky to create an leverage what looks like a real resource and a real brand.
If you do something like this, make sure you have enough other passive income streams to afford the risk, and keep developing links to the new domain name. Keep that old trusted domain registered and redirecting for many years into the future. If you lose it you will probably lose a large portion of your link authority.
There is No Value in Being Anonymous:
You can spend the money your site is making as a passive income source, but if you believe in what you are doing, and have money in the bank, there is no reason to use a bad domain name. It is like writing nameless.
You can get a decent design for few thousand dollars, or a design modification for a few hundred. You can get good content for $50 a page or less. You can move a CMS for a low price too. The cost of moving and re-branding a non-brand site are negligible compared to the potential upside.
If you ever decide to sell, you are not going to get much out of my-ugly-do-mainz.biz, but if you create a real brand on an undeveloped strong domain name you will be able to sell it for a premium far in excess of the domain name cost.
A large part of making business successful is leveraging your authority and using nepotism to extend your sphere of influence. If things look a bit circular in nature that is because they are. Nearly everything you consume has a self promotional bias, but is that any reason to complain? Wouldn't be even scarier if the things you enjoyed and associated with were self destructing?
Examples of Self Promotional Bias in the Media:
If a politician pushes bogus laws (that they know will never be passed) for self promotion and news coverage then why wouldn't the media companies that grant that exposure also grant themselves some leeway? Do you think a news company owned by GE is going to publish a cover story about pollution by GE? Do you think Fox News will stand up against their big advertisers (even when their advertisers are responsible for causing cancer)? Of course not.
The bigger something gets the more hidden stakeholders it has to appeal to. Very rarely do owners get the opportunity to speak honestly about large companies. In many cases they are obligated not to in order to maximize shareholder value. I have had VCs offer to invest in me multiple times but have refused time and time again because I don't want hidden stakeholders controlling my actions.
People discouraging institutional analysis may say Noam Chomsky's Manufacturing Consent is a conspiracy theory, but why would it be? What business isn't biased toward their own self interests? Self preservation is a core goal of any institution.
Many junk products exist with demand driven by hype, spam, and scammy multi-level marketing, but many
business models exists because we as consumers have holes in our egos and want to lie to ourselves to justify our own flaws and actions.
As technology replaces the roles of many workers while making communication cheaper and easier, people have to do more to earn a living and it is harder to create new ideas, so we have to do more cause driven things to feel purpose and meaning in life.
As for the environmental impact, well, where do we begin? As an oxygenate, ethanol increases the level of nitrous oxides in the atmosphere and thus causes smog. The scientific literature is also divided about whether the energy inputs required to produce ethanol actually exceed its energy output. It takes fertilizer to grow the corn, and fuel to ship and process it, and so forth. Even the most optimistic estimate says ethanol's net energy output is a marginal improvement of only 1.3 to one. For purposes of comparison, energy outputs from gasoline exceed inputs by an estimated 10 to one.
A new study based on a series of seven US polls conducted from January through September of this year reveals that before and after the Iraq war, a majority of Americans have had significant misperceptions and these are highly related to support for the war in Iraq.
The polling, conducted by the Program on International Policy (PIPA) at the University of Maryland and Knowledge Networks, also reveals that the frequency of these misperceptions varies significantly according to individuals' primary source of news. Those who primarily watch Fox News are significantly more likely to have misperceptions, while those who primarily listen to NPR or watch PBS are significantly less likely.
Just like how we want to believe certain lies to make ourselves feel good, we also consume things
that reinforce our identities and worldviews.
How many decidedly centrist political blogs are successful compared to the number of strong democrat and strong republican blogs? It is easier to trust things that are easy to relate to, and trust has more value than objectivity.
I probably read just about every blog post that links to my site because I want to know why people are
talking about me. Is that a self serving bias? Absolutely. But why wouldn't I have that bias?
Changing Someone Else's Worldview:
It is much easier to sell someone something they want than to try to change their worldview.
An SEO thought they were going to change the image of SEOs on Digg by writing a letter about SEO. After getting many votes it was promptly removed from the Digg.com homepage.
It is even easy for a well rounded guy like Scott Karp to view SEO in a negative light after seeing so much negative coverage of the topic. Scott was more receptive to feedback than Digg because he only needs to change his opinion, he doesn't have to go against the group think consensus on Digg to change his content.
It is easy to be popular as a politician in the US by hating terrorists, gays, and gay terrorists. It is easy to be popular on Digg by hating SEOs. Neither of those mean that the blind hate is correct or has any value (other than realizing it creates a market that is easy to exploit - because as a market they are targeted and already letting others exploit them).
Many business owners create business models that explicitly are designed to take advantage of the blind faith, bigotry, ignorance, and hypocrisy core to many popular religions, or other large self-serving authority structures.
As markets mature, market leaders have less time to learn (because they are so overwhelmed with things to do). Given that publishing costs have dropped to zero and web business models are so scalable, is it any wonder that market leaders tend to read less and do more testing on their own (especially if they became a market leader as a side effect of learning)?
In any such environment the good will rise and then naturally protect themselves by strengthening their following (herd). If you want to get to the top (topple them, beat them, match them, whatever), you have to build your own following, your own herd.
What are we doing about this right now? Are you actively finding, reading and linking to one new SEO blog a day?
If you want to be read, then you have to be interesting and you have to attract attention. That's the way it works best - asking for attention or saying that you deserve it won't help.
And yet on my recent blog post about the recent Google (update algo tweak refresh whatever) Aaron Pratt said this:
I am not seeing any loss/gain of earnings in Adsense which leads me to believe their is nothing going on.
Being a good SEO is about noticing patterns beyond your own experiences and surrounding yourself with others who can do the same.
Notice that I didn't outright call the latest Google Update an update, because Google heavily controls that language and wants to obfuscate examination of their changes (wait for the official word from Google on the data push / update / refresh / etc). Just how Google controls their update language, their self promotional bias and control of search related language is largely responsible for the public perception of SEO.
My Experiences With Authority:
Less than 5 years ago I got kicked out of the military. Since then:
I have been flown to a college and asked if I want to become a professor, but I think I wanted far more money than they wanted to pay. Since then I have created numerous passive income streams that far exceed what they would have paid.
I have had multiple VCs want to by a stake in my businesses, but turned them down.
I have been offered to get published by a major publishing house, but turned it down because it would have screwed up my business model. There is no business model in getting published unless you are publishing a thinly disguised advertisement or need the publisher for credibility.
I have been mentioned in the mainstream media numerous times. Not typically for the stuff I know best, but more for getting sued and for being the person who spent $8 registering BlackHatSeo.com. I have had done some long interviews that have never seen the light of day because I was far too honest.
Those were all opportunities at traditional forms of authority, and generally I turned them down because they were not worth the cost. The point here is that generally I am not a fan of most authorities.
Becoming an Authority:
If you are new to the market you do have biases against you: capital, market knowledge, relationships and attention. But you also have the advantage of being able to take the time to create really cool stuff and do lots of tests because people are not expecting you to do lots of things every day, and you can learn from mistakes of those who entered the market before you.
To get market recognition in a saturated market you have to come up with new, interesting, or innovative things. And if you can't do those you have to at least cause human emotions...do things that appeal to people and make people feel love or hate. Look how new SEOMoz is and they are already on the 1st page of Google for SEO and got a ton of media coverage.
If bias toward known authorities is something that is a common flaw with humans and all social structures there is little value in complaining about it. Instead accept it for what it is and let it feed into your marketing. Sure the Good Old Boy's club sucks, but if you don't offer solutions, then complaints about flaws in human nature are void of meaning.
Many top destination sites are adding blogs and other publishing formats to their site to build their authority and market-share. This editorial content creates value, builds trust and authority, and allows for a more profitable blend of content and advertisements.
Yahoo! wraps content in a small bite size video format called The 9. Notice how The 9 packages content, links off to other sites where necessary, but often features other Yahoo! content. This news is packaged as though it is not an advertisement for Yahoo!'s various content properties.
Some of the large platforms have significant market leverage, capital, the ability to quickly test and track the results of tests, improving user feedback integration, recommendation engines, and are adding features to make ordering easier in higher priced and more complex verticals. Add all those forms of value creation and optimization to a blend of ads and editorial content and it is going to be hard to compete with them in the search results.
If you are a niche player and do not have a compelling editorial element or industry standard reference documents it is going to be hard to compete in a few years.
While I still have a MySpace account I never log in anymore. There was too much spam to deal with. And my girlfriend got so many creepy messages that she had to delete her account. Generally, to use MySpace much, you have to do one or more of the following:
not value your time much
have a lot of spare time
be desperate to connect, and have few outlets
be a creep sending creepy messages
be an anonymous creep viewing profiles
be an automated spam bot or something that phishes accounts
MySpace grew too big to keep any sort of community feel the way that Digg has. It tried appealing to too large of an audience, and now it has no value outside of tracking the latest spam offers.
If I had a viral widget idea of course I would still want to pitch that to MySpace, but generally, as an end user, I just don't see any value to MySpace, do you?
This lack of value can also be thought of in ways that search engines may value certain types of websites that are not well integrated into communities on the web. If you spend time and money wading too deeply into those categories (or creating those types of site) you not only waste your time and money, but you also are not focusing on how to build trust and perceived value.
If it is your first site, it is awful hard to understand how to create perceived value and do the marketing well enough to be profitable before getting burned out. I think any type of site can have an editorial element bolted on to add credibility. And editorial content should be easy to add to a site if you are in tune with your marketplace and your customers.
If one channel is easier or more compelling to subscribe to than another then it is going to get more links, more attention, more readers, and win due to network effects. But if the channel gets so broad that it doesn't stand for anything eventually it will melt down, especially as smaller niche sites that are more relevant and easier to identify with are created.
When submitting to directories, buying paid search ads, buying display ads, or ranking in organic search a small company with a smart marketer can seem like it is much more powerful and much more authoritative than it is. But some webmasters undermine their authority by not considering how displaying ads on their own site could affect the perception of quality.
Which Directory is the Best?
Many directories sell sitewide banner ads to other directories, which directly states the other directory is of higher quality and more worthy of submitting to, not only for how the ads flow link equity, but also for the general brand perception.
Sell Yourself First:
Some sites make the same error of undermining their perceived site quality by placing external ads above their house ads or internal products. An earlier version of my site design placed other ads in-line with the content and the ad for my book on the sidebar. The day I put my ebook ad inline with the site content my sales tripled. If you have an editorial site that people subscribe to the easiest thing to sell should be your own stuff since people reading your site already trust you. Now my site has less ads, a better brand perception, and more profit.
Some sites are so optimized for short term profits that they undermine their own authority by placing a large ad block above the content. There are many creative ways to slightly reduce ad CTR while still leaving the general perception of quality to most site visitors. Just about every link you get will be from someone who visits your site. If your site leaves a good perception of quality and trustworthiness it is much easier to be deemed as linkworthy than if your site looks like an ad farm. AdSense aligned top and to the left is the equivalent of a noisy FFA page.
The order you place things in tells readers of your site what you think is most important. If you are in a competitive marketplace it is hard to compete if you place other brands or ads above your content.
Google trusts bloggers a lot, but AdSense generally sucks as a monetization method. It turns out some upstart websites are buying up bloggers. In this video, Babble stated they are hiring 10 of top 50 parenting bloggers. If you hire a half dozen well known work at home mom bloggers part time for $1,000 per month you can leverage their knowledge, reach, mindshare, and link equity. If you can mesh them into a community feel without running into ego problems you become the topical expert for just about any topic in the world ... for $6,000 a month.
In much the same way that people are buying older trusted domains, don't be surprised to see 2007 as a year which many monetization and business experts partner with many naive amatures to create scalable businesses that displace the market position of many of the larger conglomerates like About.com, one vertical at a time.
As faking authority and leveraging older signs of trust get less and less profitable business owners will need to become the topical experts they were pretending to be. As the market for ad dollars, audience, and talent get more and more competitive people skills are going to be increasingly important.
Technorati and Google Blogsearch will tell you who is trusted. Go out and buy them while they are still cheap!
The blogs are not as significant as their self-endeared curators would like to think. Journalism requires journalists, who are at least fitfully confronting the digital age. The bloggers, for their part, produce minimal reportage. Instead, they ride along with the MSM like remora fish on the bellies of sharks, picking at the scraps.
But actions speak louder than words. That same WSJ reported on an unconfirmed TechCrunch rumor about the YouTube acquisition by Google.
They also mention the lack of overlap provided by self selection bias:
This cross-referential and interactive arrangement, in theory, should allow for some resolution to divisive issues, with the market sorting out the vagaries of individual analysis. Not in practice. The Internet is very good at connecting and isolating people who are in agreement, not so good at engaging those who aren't. The petty interpolitical feuding mainly points out that someone is a liar or an idiot or both.
But the web also makes it easy to reference past facts and changes in bias or perspective over time, which is something they are afraid of.
Any attempt by authority to make things seem universally right or wrong / white or black amounts to a self-serving attempt to stay relevant. If they believe their lie enough hopefully they can convince others to do the same.
Professionals do things for money. Amateurs do things because they are genuinely interested. Who would you rather trust?
I am still a fan of AdSense as a way of determining a baseline income potential for a site, but I don't see it as a long-term viable business model for most small publishers. Why?
Smart Pricing (or Maybe Dumb Publishing?)
I friend told me how much he made from AdSense a year ago, and in spite of increasing his network pageviews 200% since then his earnings this month are 10% lower than they were a year ago.
And Google still does a sloppy job policing their partner network. What happens if their editorial review costs increase. What does that do to the percent of ad income Google needs to keep to keep growing?
A Glut of Publishing:
It is getting easier and easier to publish online. The number of people writing is probably growing at a faster rate than the number (and income of) of people reading, which means you will have to be more compelling and put more effort into your content and marketing if you want to keep your pageviews up.
And Google has been placing more weight on authoritative domains, which is squeezing many small players out of ranking in the search results.
Newspaper & Magazine Archives: More Glut:
As business deals are worked out, and trusted archived content comes online, many business models based on AdSense spam will lose a large portion of their traffic to mainstream media companies that are not currently fully leveraging their archives.
If Google bought YouTube how long before they buy Olive Software or create a similar technology?
Frothy Ad Market:
I just saw a big, ugly, and obtrusive AOL ad on Amazon.com's home page. If people are buying general untargeted graphic ads on the largest retail site they must be overpaying for it.
A Lack of Competition:
Some of the executives of Yahoo!'s Publisher program recently announced they were quiting, and with Google's lead in the contextual ad space with virtually no competition, I have to take that as a bad sign for Yahoo!, and for independent publishers in general.
Google's General Arrogance:
Today many publishers noticed bright Google logos in their ad boxes inviting readers to sign up for AdSense.
Potential Text Ad Blindness:
People have learned to ignore banners and common ad locations. How long until people learn to ignore common AdSense formats, especially as the ads appear so prevalently on so many sites? What if people become more receptive to identifying ads (even in the content area)?
Not Worth It:
Add all those up and it gets a bit bleak looking to AdSense as anything more than a baseline estimate for effortless income or a backfill for unsold inventory.
What if instead of monetizing every page, niche publishers used most of their pages to keep attention and link equity flowing their way, and then just monetized targeted high value sections of their sites using well integrated affiliate offers and/or selling direct products?