Survival strategies in online media business

Online media has low startup costs and that means that barriers to entry are low. Plus, it is highly technology-intensive. The technology literally changes every day. This is both good and bad news for nano-publishers.

So while non-technical people will find that most tools needed for succeeding at online media business are fairly easy to use and do not require a deep understanding of underlying technology, there will be times when you will be frustrated by crooks who are either technologically advanced or simply employ only dishonest business practices.

For instance, your affiliate income may be wiped out or lost because some crooks have planted spyware on millions of computers. So while your visitors may be on your website and click on a link that contains your affiliate ID, the commission will go to a crook (this may not happen if you work with a reputed company like Commission Junction or LinkShare). Similarly, while you might actually believe Google or Yahoo and try to develop a high-quality, content-rich website that will delight your readers, spammers and crooks will use all possible tricks under the sun to make you disappear from search engine results. What people find our crappy websites that have nothing valuable for the visitor. Or in other words, SPAM like nuisance make life difficult for an online publisher.

Search engines, particularly Google, are always trying to do their best but the way criminals are two step ahead of cops, these online crooks are several steps ahead of search engines. And this is particularly true if you end up picking a topic like Vioxx or Celebrex or Social Security privatization or something else that happens to attract lots of advertisers.

What can you do to protect your business?

1. Try to teach yourself the basics of underlying technology for online publishing and use it to the best extent possible.
2. Never give up on the idea that high-quality, useful-to-reader content pays off. It is not traffic that you want; you want the right readers who will be delighted to read what you wrote, will appreciate it, tell friends about it, and probably click on your very targeted links. These things create a real business that creates wealth. Spammers and crooks are always running around trying to chase money. They will make some quick money sometimes (indeed, this whole thing seems to work and is profitable and that is why so many people do it), but if you are in it to create a real business that you can not only be proud of but also create wealth for your shareholders, always do the right things.
3. Finally, do not react immediately if something does not appear right. In the short run, you will see that your ratings have gone crazy or you have lost traffic for weeks/months. The online world is very dynamic and literally changes by the second. So hang in there and you will eventually win. (Related article: How to get high rank in organic Google search results)

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Traffic quality key for higher ebusiness revenue

As an online publisher, there is a tendency to associate higher income with higher traffic. Many publishers get obsessed with higher traffic and spend enormous resources to drive traffic to their websites. Almost all search engine optimization (SEO) firms essentially try to convince you that traffic creates value. (Related article: Growing traffic without paying a SEO firm)

In building the online media properties in the eCreativa network, we have learned that while more traffic is not necessarily bad, the kind of hysteria that drives some publishers to grow traffic may be a waste of valuable resources. In our experience, quality of traffic is more important than quantity at least when your goal is to generate revenue (which should be the case if you are a business and not a hobbyist). Let us review some case studies in our network to illustrate the point:

Vioxx/Celebrex/Bextra recall: This publication was launched when Vioxx (a pain relief drug used by arthritis patients that was recalled by Merck after it was disclosed that tens of thousands of people were dead) was recalled and several studies highlighted that its competitors Celebrex and Bextra were likely to be recalled as well. This is a niche publication targeted at those people who want to keep up to date on what is happening with these drugs. Advertisers
are plentiful, ranging all the way from attorneys to those selling alternate pain relief treatments. While this section may receive visitors in just hundreds a day, the CPM is very high not only because the advertising is high value but also that the visitors are looking for solution to a problem. These are not just casual surfers who get on the Net to find something interesting to look at. (Related article: Content management success story)

Social Security Privatization: This is another publication that is just weeks old at this time. Our hypothesis is that this will attract visitors who are truly interested in learning more about privatization and how it will affect their retirement planning. While privatization of Social Security will affect every American living today and the future generations, we expect that only a handful of these really like to research the topic and use that knowledge in their personal finance regimen. While it is too early to comment how successful this will be in the long run, the results so far have been very encouraging. (Related article: Secret to success)

Latinas: This is the English section of our Spanish publication Lindisima that is narrowly focused on those Spanish-speaking women who are truly committed to a better lifestyle that included natural personal care products, spiritual approach to life, and a playful attitude. The Latinas section talks to those Hispanics in the United States who are inspired and intrigued by their Latin roots but still want to lead a mainstream life. Not a huge traffic website but extremely profitable.

Management Consultant: This is probably the lowest traffic property in our network but has among the highest CPM. It attracts senior level business leaders who want a totally new perspective on economic and business developments. We know that the day it attracts a thousand visitors will be a big day, but that is not what we are working on. We are more focused on attracting the right kind of audience. We know that it is easy to bring thousands of visitors if you build a work-at-home business website but the CPM in that segment is pathetic. We want to target the reader who is more interested in supply chain management, enterprise resource planning, or communication management system.

So what does it mean?

1. Do not obsess over quantity. Look at the revenue rather than traffic or rank. You are not a business if you do not have revenue no matter how much traffic you have. This point has been proven after the collapse of the bubble. No investor cares any more how many eyeballs you attract if it does not translate into revenue.
2. Quality can make all the difference when it comes to revenue. If you attract the right kind of visitors, you will see results very quickly. While you might be tempted to think that out of all the people that you attract some will be the kind of visitors you really want. Our experience shows otherwise. If you focus all your energy into attracting the right kind of audience, the results will be better and achieved faster.
3. Do your research. Study current events and see how they will create new needs for information. You will have to connect the dots yourself. And then just go ahead and do it.

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Social Security privatization news center launched

During the month of November-December 2004, we worked on launching a complete section on Vioxx recall to help our readers find unadulterated and unbiased information on what their medical and legal options are. Since we are neither affiliated with a drug firm nor a law firm, our readers have responded positively and now the Vioxx recall news center, which has since converted to Vioxx/Celebrex/Bextra recall news center, is #1 (or on page one) in search results in most major search engines like Google, Yahoo, and MSN.

We are very proud of our success because we got the timing right and we have been able to leverage the enormous spending by law firms on online advertising seeking Vioxx victims to join Vioxx class action lawsuits.

We learned a lot of things from our adventure in the world of Vioxx/Celebrex/Bextra. And we have decided to apply the same learnings to another area that has heated up since 2005 began: Social Security privatization. We launched a news center (in form of a blog, which is the ideal format for such a topic that changes daily) on January 17th and within less than 36 hours, it appears on page two in both Google and Yahoo. We expect that this is remarkable performance in such a short period and hopefully the rank will rise as we build more content.

Secret to success

• Research, research, research the topic that is slowly gaining momentum. The buzz normally begins online first and then it moves on to television and radio.
• Pick a topic that has a high buzz factor but also has sustaining power. For example, while divorce of Brad Pitt and Jennifer Aniston has a very high buzz factor, it is not going to last too long. Privatization of Social Security, if it happens, will fundamentally change how Americans live their lives not only now but for years/decades to come.
• Find out how much content exists on the topic. No matter how new a weight loss program is, there is just so little room for more weight loss content. Areas that do not have much content are prime targets.
• Build high quality, useful content that will make life better for your readers. Stay away from deceptive techniques or trying to cheat the system. What will make you rich is not when you mislead your visitors or readers but when you treat them with respect and provide them with what they are looking for. Then they come back, tell their friends about it, and the more of that happens means that more advertising revenue you will get.

Recommended article: Design websites for humans not spiders

Yahoo and MSN tough competitors to Google

For the second half of 2004, we monitored very closely the performance of about 15 online media properties in the eCreativa network and what we noticed was that Google was slipping in terms of driving traffic to our properties. Prior to that we used to think that Yahoo and MSN were also-rans since Google was driving over 75% of the traffic.

Our argument was that unless you had an email address with Yahoo or Hotmail or you were looking for weather or stock market performance, you would not bother with searching at Yahoo or MSN. But then we started to see that we were getting a lot of traffic from both Yahoo and MSN. That is when we started to monitor the quality of results improving significantly in both search engines. It was around the same time that Yahoo started to go aggressively after blogs (we launched about half-a-dozen blogs during this period) and we were amazed by the speed at which Yahoo indexed blogs and websites that the blogs pointed to. (Related article: Value of blogs)

Now we have more comprehensive data to support what we noticed. According to Keynote Systems, Yahoo! and MSN search engines are closing the gap with Google by improving the search experience for consumers and that will lead to increased usage for those sites. According to the study, Google maintains its clear leadership position in the search industry, again leading the Keynote Customer Experience Rankings. However, Yahoo! and MSN have made significant gains against Google since the last Keynote search engine study, published in May 2004. Yahoo!, which remains in second place across the Keynote CE Rankings and other leading indicators, launched an expanded local search service and a new search results page after the last study and, as a result, significantly improved its overall user experience.

The quality of local search results is a major frustration to many search engine users. Across all search sites, almost one in four (22%) users complain that the local results are not what they are looking for or are not ranked appropriately. Yahoo! showed significant improvement in the ranking of the quality of its local search results, tying Google in leading the industry in this key category.

As a direct result of their improvements in user experience, Yahoo!, MSN and Ask Jeeves also saw a notable increase in their standing in the Keynote Future Usage Index, which measures the likelihood of consumers to use a search site as their primary search tool and to return to the site in the future. The index also measures a user’s likelihood to recommend a search site to others or to use a search toolbar offered by the site. Google maintained its position as the leader in the Future Usage Index, but did not improve its overall standing.

Since the last study, Yahoo! has boosted the number of users who said they would consider the site as their primary search engine by more than 20% and MSN by almost 30%. More than 81% of Yahoo! users and 61% of MSN users said they would return to those sites in the future, as compared to just 72% of Yahoo! users and 55% of MSN users stating so in the previous Keynote study.

What we are seeing is that Google is gradually transforming itself into an advertising company and its search engine is only a utility that helps it get there. This is further explained by how aggressively Google is recruiting nanopublishers. We would not be surprised if Google is able to exploit the "power of many" as Amazon and Ebay have done.

So where is Google slipping? We have talked about this in our other article on How to get high ranking in Google search results. The improvements made by Yahoo and MSN are now exposing the inherent weaknesses in the PageRank algorithm. And while we will continue to use Google as a search engine, we often turn to Yahoo and MSN when Google simply returns results that are too "popular" but irrelevant or not current.

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Bloggers increase their power in the world of nanopublishing

In recent weeks there has been a lot of buzz about the growing power of bloggers and the enormous benefits of blogs (Related article: Blogs become preferred content marketing medium among marketers). Of course, there was the cover story in Fortune magazine and commentary by Fool.com. There have been numerous other articles in the mainstream media. But what really excites us is that Parnassus Ventures is organizing a Blog Business Summit. In other words, the blogosphere is heating up. Of course, the most exciting day will be when advertisers and marketers actually start making sales calls in the garages of many powerful bloggers. That will truly be the day when democratization of the Internet will happen. It is no secret anymore (at least among those who care to keep on top of business trends) that blogs have a lot of clout these days. In some cases, they can make or destroy a product.

We ourselves have seen enormous success with blogs in our network. The most noteworthy is, of course, the Vioxx recall blog. The second one is the Management Consultant blog that appeals to a very sophisticated audience of business leaders and strategists. Our other blogs appeal to consumers and rapidly growing in popularity.

How do we leverage blogs?

1. Allow us to provide relevant content within minutes of an event happening.
2. Make us mobile so that we can "work" as long as we can find a computer connected to the web.
3. We tend to write blog posts as articles on our websites, so most of our users never really find out if they are reading a "blog" or they are on a regular website. That way we can exploit all the benefits of a blog while letting our readers enjoy what they like from us - great content. That is why it is important to realize that a blog does not have to be an online diary (as it used to be and still confused by many as the only definition of a blog).
4. Blogs, almost always, get indexed ahead of a web page, particularly by Yahoo that can show results from a blog post within 24 hours. Google, while somewhat slow, also tends to rank blogs higher in search results.
5. Finally, use blogs to drive traffic to your website (if you have one, as we do) by including lots of relevant link.

Recommended link: Oldest blog in our network - MYNIPPON blog

How to transition from email marketing to blogs

Some sobering statistics have emerged from the Relemail Email Privacy Survey conducted in November 2004. In other words, while it may be too early to declare the demise of email marketing, as management consultants have been pointing out for over an year now, the days are definitely numbered. Let us review some of the key findings of the study:

• 83% of users have avoided subscribing to an email newsletter because they weren't sure they could trust the publisher
• 78% do not always believe companies' own email privacy statements
• 87% believe they have received spam from an organization that collected, and then sold, their email address
• 96% say email privacy is important to them 80% say they have tried to unsubscribe from an email newsletter and found that the unsubscribe did not work

So what is likely to replace email marketing?

This is a question that your current email marketing provider is unlikely to answer in a way that serves your best interest. On the other hand, you might actually receive misleading data from a company that has a vested interested in you continuing with your email marketing programs. There is no denying the fact that email receiving, opening, and clicking rates have been consistently dropping over the years.

There are other alternatives, of course, and the cheapest is real simple syndication (or RSS). If you have had an opt-in list of subscribers to your email list, there is nothing much to worry. Your members will simply switch to a new platform and they can do at their own pace. And those that may have been interested in your products/company but were skeptical about submitting their email address to a company that they could not trust, subscribing to your RSS feeds is the best alternative. The recent news that blogs have become the preferred content marketing medium shows that syndication is the next platform for marketing.

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Blogs become preferred content marketing medium

There is a lot of encouraging news for nano-publishing companies like eCreativa Network that operate some combination of blogs (MYNIPPON lifestyle blog, LuvCube love blog, Lindisima Latina Blog, Management Consultant, eBusiness blog, Mujer Cristiana, Consultant Blog, MYNIPPON update blog) and websites (iProceed Strategy, MYNIPPON lifestyle, LuvCube Find, live, and enjoy love, eCreativa, and Lindisima Latinas). There is also some great news for companies that no longer believe in email marketing and have switched to real simple syndication (RSS) as a way to bond with their customers/readers.

Two surveys by the Pew Internet & American Life Project in November show that:

• 8 million American adults say they have created blogs;
• Blog readership jumped 58% in 2004 and now stands at 27% of internet users;
• 5% of internet users say they use RSS aggregators or XML readers to get the news and other information delivered from blogs and content-rich Web sites as it is posted online;
• 12% of internet users have posted comments or other material on blogs.

Still, 62% of internet users do not know what a blog is. So that is both good and bad news. Good, because there is a huge market for nano-publishers like us. Since we are the early creators of blogs, our blogs are already very-well indexed in search engines and more likely to show up in search results. Bad, because our target market is still relatively small. Or in other words, do what you are doing and be patient.

The survey also found that a blog is a better way to reach high-value audience. Both blog creators and readers are likely to be men, young, technologically savvy, broadband users, financially well-off, veteran Internet users, and of course, well educated. Some of these are changing, particularly in the blog readership group, but still blogs are about reaching an audience that advertisers love. These are the group of people that are more likely to drive ebusiness and they are definitely attracted to excellent content - something that we have been emphasizing in the ebusiness blog.

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