Money-Era: is there a sense in continuing?

This is my first post after a very long time of inactivity. I apologize.

Plenty of things happened. One of them was starting another website, a niche this time, aimed at providing a service. A blend of online-real life activity. Totally different than a blog, just a pure e-commerce one. It started mid-January and is aimed at local market.

To be completely frank, I have serious questions that I ask myself: shall I continue with money-era? Shall I spend more time (which I lack) on it? Is there any future here? Or shall I quit and add to statistics, that over 90% of blog do not live longer than 1 year.

I made a promise to myself that I would last that long. So what that things changed meanwhile? It should not matter… Am I a loser? As it turns out, not really.

No wonder I am asking these questions, as many of the blogs focusing on making money online I was reading have gone (or are going) through the same difficulties. The one I admired for a quick success in building up the audience and professionalism all of the sudden went numb. Months later the authors admitted that they are offering it for sale. I am talking here about MakingMoneyOnline.

Another one, with whom I shared the thoughs and exchanged ideas, NewsNotion has changed hands already. The third one which was keeping me up, NeedMoney, has not posted anything since November 19th. The next one I had contacts with, BloggerWorkshop, is currently suspended by a hosting company HostGator. And Andi Putra at his blog is not saying anything since October 28th.

You understand my feelings better now?

On the other hand JohnChow.com and ShoeMoney are doing great as usual. Is it the question of starting in the right time (which means early enough) to build enough base of readers that no matter what they do: try Twitter for money, run a new campaign, it generates thousands of dollars for them? You do not have to answer…

Sorry for chaotic thoughts. I just needed to share them with you.

If you think it is worthwhile to continue on with Money-Era, despite declining Google Analytics Statistics, please write a meaningful comment to cheer me up and show some support

How to improve PageRank?

I have been wondering what are the best link building strategies and I have been thinking how to start an effective link building campaign.  I could have just read a possible answer to my question, learning from TechCrunch how Car And Driver approached the matter of improving their pagerank. The funny thing is that I questioned myself if it would work… I wonder if someone in the magazine asked that question before sending the e-mail asking for links.

Based on the cited on TechCrunch email from Car and Driver, the technique is really easy. You need to write a short personalized e-mail, in which you kiss up to the owner of the site or blog. Best tactic is to find a related content to your site and mention it in the mail. Then you need to complement the author and show the bait, which could be a promise to place a link to his site somewhere on yours. Do not forget to emphasize the fact, that putting the link on your site will improve the Page Rank of the addressee.

Then comes the trade. I strongly suggest you deal fairly and do not try to be the smart ass (as Car and Driver did). They wanted to get two links when offering only one in exchange. And somehow I get the feeling that this might had been the final argument for TechCrunch to publish somewhat bold (if not audacious) email from Card and Driver on their site.

Hope you learn some good practices from this example

The whole story, which served as an inspiration for this post, can be found here: http://www.techcrunch.com/2009/11/24/caranddriver-linkfarm/

Social Media boosting traffic to your website

Social Media is an excellent way to boost the traffic to your website, which should convert to making more money by yourself (provided your blog is monetized). Basically there are two methods of reaching our goal, which is getting users from social media to our blog.

The first: based on the fact, that social media is all about linking and re-linking all kind of content, it fits perfectly to a link-building strategy. This is why you cannot forget about social media when getting more links to your site.

The second method foundation: the crawlers (spiders) - search engine robots - utilize tags exactly the same way as humans: to recognize what the particular article, page or picture is all about. So if plenty of social media users add the same tag to your content, the reputation of the link leading to the content will grow (based on the tag keyword). In other words: the high position in natural search engine results comes from the right keyword. You achieve that by using the right tags.

There are some cardinals mistakes bloggers might make when using social media.

In my opinion the number one mistake is to advertise a product or service too soon. If you do it before you gain the necessary trust, you are ruined. You will be perceived as hypocrite. Expect to be criticized a lot, including being called a liar or a parasite (if not worse).

If I was to give you an advice for social media activity, I would suggest that you should first focus on getting to know the media very well. Try to feel what the particular social portal is all about. Then try your luck at adding meaningful comments. You should focus on writing in a positive tone.

When you get to know the group that is using the portal better, build your profile. It should present who you really are. You should provide reasons why you feel you belong to the group. Once you gain enough trust and credibility, you will be ready to explore the potential market value of the group.

Chrysler story

When watching the CNN today I heard something that truly astonished me and made me think a bit about money making and how much the World can change in just 10 years. Things which no-one would ever think of really happen, impossible becomes possible. As it turns out, the life is ironic at times.

Remember the late nineties era? The common trend of acquisitions and mergers, for many it was a trend hard to understand at some instances. Some mergers were announced worldwide, allegedly being ‘top mergers’ in one way or another. Such was a case of the merger between Daimler-Benz and Chrysler. Lots of PR, plenty of marketing spiel but I remember my astonishment and kind of surprise when hearing that. What for I thought? These two do not fit very well to each other… And someway somehow I could not really believe what CEOs of Daimler and Chrysler were saying back then.

Soon after everybody realized that the merger was not a successful one to say the least. Plenty of cultural differences, hardship to find any synergy and added value, huge costs and hard to see benefits. Mercedes in Europe lost the image of the highest quality brand, the Chrysler in the USA did not really rock with any of its ‘after-merger’ vehicles. Then came the crisis which shook up the corporate world and automobile industry as well.

And today I hear the news of something which initially happened in August and has been rolling since so the first effects will be seen soon. It is about Fiat, Italian automaker, who successfully acquired Chrysler. Oh boy…

Truly ironic… Chrysler, just somewhat 10 years ago married to the high-class, quality, world-wide admired brand. Now, after a painful marriage and divorce is again going into someone else’s hands. But this time it is “Fix It Again Tony” brand,  whose image is rather poor: jokes about the brand could be heard everywhere in Europe. It is a pity that Chrysler, whose position in the USA was above average is now ‘rescued’ by the brand which would not be desired by any reputable, established car-maker.

How ironic is it? Doesn’t it surprise you how the ‘making-money-world’ revolves?

Twitter vs Facebook - which grows faster?

Both Twitter and Facebook are among the most popular web services in the USA, getting a lot of media attention, PR and are sometimes called “fast growing”. What does it mean? Let’s check both of them to find out how they rate against each other.

Even though both services grow very fast - as you probably read on internet in various posts or news - after taking a closer look it turns out, that they do not play in the same league. True, some may say: they are not in the same league, as one is the microblogging platform whereas another one is the leading social portal. Nevertheless I think that comparing the growth rate of the sites from ‘most frequently talked about websites’ list is worthwhile.

I came across a HitWise research, according to which Facebook wins by a lot. Bill Tancer, General Manager of HitWise says, that the Facebook domination is more and more evident especially that recently the number of visits on Twitter has been declining. This is evident for couple of month already, as you can see on the chart below. Twitter growth rate is 0.14%, while Facebook rocks at 6.10%.

Facebook vs Twitter Growth Rate

Another alarming issue for Twitter is that, according to Nielsen Online published in April 2009, Twitter is struggling to keep the users for over 30 days after they registered. The percentage of users who stop using the service is 60!

It might turn out that Twitter was the seasonal hit and its popularity is starting to decline. What is pretty shocking to me is the following: Harvard Business School report revealed, that from the moment of singing up till the moment of leaving the service for good the average Twitter user (defined by the median) publishes only 1 twit! If I were Jack Dorsey (Twitter founder) I would start worrying… It is clear that the service struggles with keeping users, which is not something that potential advertisers would appreciate. Neither it is good for any other form of monetizing the service.

WeddingChannel.com success story

Back in 1996 it was much more difficult to establish an online business; there were no e-commerce platforms, no ready to implement billing systems or no software to run an internet shop on. So Tim and Ray, the founders of the business whom I introduced in my previous post about the WeddingChannel.com, decided to go with a venture capital company, which helped to create the WeddingChannel.com website. They also acquired funds to advertise to big brands right from the beginning.

The innovative approach to improve customer buying experience convinced two key industry players: Federated Department Stores and Brides to become business partners with WeddingChannel.com. This way the site became the number one online destination helping guests to buy wedding gifts. The partnership with FDS made it possible for the WeddingChannel to become an official channel of online sales for all Macy’s and Bloomingdale stores across the country. The second strategic partner, Brides (the most popular wedding magazine), helped to gain press attention and provide the site with meaningful content. Also it leveraged the site’s image.

Nowadays the WeddingChannel.com is the industry leader, gaining over 40 million pageviews per month. The site features the products from such brands as Bloomingdale’s, Macy’s, Tiffany&Co, Crate&Barrel, Neiman Marcus, Williams-Sonoma, Pottery Barn, REI, Restoration Hardware and much more. Over 700.000 couples are hosting their wedding gift registries on the site. The visitors (wedding guests) can choose from over 15 million products. The purchase can be made online or in the regular brick and mortar store.

The WeddingChannel.com founders emphasize the internet as a very helpful media for new entrepreneurs. In Internet there are far less barriers than in a traditional business, especially when considering the customer base and the target market. Tim stresses out that internet is a very powerful tool. As a business owner you can very quickly reach customers across the globe. And, what is most important, you do not have to spend a fortune to have a worldwide reach. Before internet it was not at all possible.

So, do you already know what kind of business will you start? Will it be an internet business?

WeddingChannel is a brilliant example of making money online success

Back in 1997 two friends: Ray Dhake and Tim Gray got together to discuss the matter of establishing a website targeted at weddings. Tim came up with the idea when he realized how much trouble there was to find the right wedding gift. As soon as he found out that so many other people have the very same problem, he talked to his friend, Ray. They came to the conclusion that the best way to address the issue would be to built the right e-commerce site. Solving a problem of each wedding guest was the right approach to start the business.

When Tim and Ray broke down the typical wedding gift buying process to the following tasks:

• drive to the store
• print out the wedding gift list
• find the product in the appropriate price range
• make sure the gift has not been purchased by another invited party
• buy the gift
• bring it with or ship it to the ‘just married’ couple

they were absolutely sure that there must be the easier way to do the wedding shopping!

For the guys moving the process to internet was the obvious way to go. They hoped that for wedding guests it would be a great help to find and purchase the gift online. Instead of putting lots of hours and effort into finding and buying the right gift, they could do it at home, in just 15 minutes. Obvious improvement.

WeddingChannel.com is making money in commissions on each purchase made through the website. Apart from this certain way of monetizing the business, another income stream comes from advertisement - the young couples are a very good consumer group, as they have big budgets to spend not only for weddings, but also for the wedding trip and furnishing a new house. This is why the website generates a lot of revenue from advertisers.

So the reasons for the website to become a great success were the following:

• a great idea: simplifying the daunting process of buying wedding gifts
• a very big audience - there were lots of people feeling the same way as Tim did (buying a wedding gift is a chore) - they were potential website users
• for advertisers soon to be married couples are an attractive target group; this is the first revenue stream for WeddingChannel.com
• second revenue stream: commission on sales

If you have any other examples coming to your mind, or simply have something to add, please write your comment.

And in my next post I will write more about WeddingChannel.com success.

The answer to "How to make money on cooking recipes"

When you think how to make money (online), you might consider the business case of CooksIllustrated.com. Their business model is to publish a printed magazine and expand this by providing one of the best sites with cooking recipes. The numbers speak for themselves: apart from 800.000 printed magazine subscriptions, there are additional 80.000 online subscribers, who pay $3.95 per month or $24,95 per year.

If every subscriber had paid for a year in advance, this would generate the revenue almost $2.000.000 dollars (less 4k). Since it is not very probable, I think the revenue is more around $2.5 million - $2.7 million (if everybody was paying monthly, it would be $3.792.000).

Cooks Illustrated made a decision not to allow any advertising on the page, which is for sure appreciated by many of the subscribers. I do think they have other ways to make more money on site - probably selling books, membership cards, and online subscriptions to exclusive (theme) editions of the magazine.

It seems that the success resulted from the following approach: to provide plenty of useful information to attract new guests to the site and then for those deeply interested provide paid access to detailed articles, tests, comparison, exclusive recipes, etc. The exclusive high-quality content is supporting the revenue stream. The company claims to be independent and is focusing on providing only the best recipes, which have been tested. So in a nutshell: the business is about sharing the exclusive content with the readers (both online and offline).

Another conclusion is that the company management team came to a conclusion, that subscription model is not only a very good way to make money (remember that they do not publish ads), but it translates to expanding the Cooks Illustrated brand as a whole.

Generosity pays off

So when you are thinking about forming a new partnership you must make sure that your potential partner is the right person to do business with. The best approach is to trust your guts. Even if you do not know the person very well, trust your intuition. Remember the first feeling you had when you thought of doing business together. This is the most important. Keep it simple. Ask yourself if you picture that person as your partner. And trust your first answer. Do not analyze too much. Do not spend too much time deliberating. Just measure your feeling: is it yes or no? Or if it is not that obvious or clear, which way is it going? Toward ‘yes’ or ‘no’?

Of course, you want to embark onto a new challenge only with a person you have a good feeling about. So let’s assume you found one. Now comes an important issue. Deciding who would do what? How would you share profits? My answer is: be generous.

Surprising? Perhaps… but this is what I learnt out of my experience.

I used to be very particular about the business. And business partners. I would spend hours on analyzing the industry, the new idea, the resources, risk and chances of success. Then I would try to look for partners. If it went that far we would then discuss our work share and how we would split the profits. And then it never worked…

I guess I had been too particular. To the extent that I always found something to stop thinking about the business, or  partners.

I guess this was wrong. This way you never start a new business or company. You will always find an objection, or 1% or 5% or 10% of the profits that you cannot agree upon (either way).

It all changed recently.

I got a proposal to become a partner in a company. Boy was I thrilled with that! And much to my surprise, my prospective partner based his judgment upon his good feelings about myself, trust and the way I am. He did not go into much of the details. He thought about all the important aspects of business: what to do, how to target customers, what the niche is, how to enter the market, how to sell, etc. As it is all very promising (again: the guts, good feeling or intuition) he shared it with me. I think in a very similar way. So he asked me to become a partner.

And he was generous. When I was expecting anywhere from 10-25%, he split it half/half.

Can you imagine how motivated towards the new partnership I am?

Find a partner for your business

When you think of a successful businessman or entrepreneur, there must be a sort of general image that you associate with a person like that. I always thought that people who achieved extraordinary results must be exceptional in their professionalism, posses the vast knowledge in the area they conduct business, be experts in the field. While this view is probably not very far from the truth, it is somewhat limited - I recently I discovered a new way of doing business. It allows to enter the areas which are not very well known to you.

This approach is most suitable for those of you who are pretty busy in your life, doing whatever you do for the living - which means your workday (or week) is pretty much filled in. It also works very well in case you really do not want to have a revolution in your life and change everything: quit your current job and devote 100% to the new challenge in a new industry. So far it sounds very nice: you not only do not have to be an expert in the area, but also you do not have to devote entirely to the new undertaking.

The idea is to form a partnership with a person that you can trust, a person of high integrity, a person that you communicate well with and a person that is pretty much hardworking. You, as a partner, have an idea for the business but not enough resources - be it time or experience. And you know some people in your network who might provide you with services for the new business (your partner does not have the contacts). So here you go: there is a field of cooperation with your new partner, where 1+1 > 2.

Form a partnership based on the golden rule: you and your partner should have some unique qualifications, knowledge, traits of the character, etc. that the second party is lacking. But you must understand each other (not have totally opposing views). And there must be a situation that without each other the business would not start at all, e.g. you have an idea, but not enough time to do it. Find someone who you can trust (and you have a good feeling about) to embark onto a new challenge.

More on that in my next post