Since I started my first web site in 1998 I have made many business decisions. Many turned out to be good ones, but there were a few that were rather poor in hindsight. Here’s a look back at the top five best and worst business decisions I have made during that time.
Top 5 Best Decisions
1. I Took the Risk of Starting an Internet Business
The best decision I ever made in this industry has to be taking the decision to take of risk of starting an internet business.
Back in 1998 few people had heard of the internet. So it was not surprising that no one supported my decision when I told my friends and family I was starting an internet business.
That fateful decision has enabled me to live and work around the world. I now enjoy a lifestyle that I would never have dreamt possible in my old job as a waiter. Don’t get me wrong - I’m not living a millionaire lifestyle. But I do have the freedom to do things that I would never have afforded on my old waiter’s income.
2. I Switched From a Pay Per Hour to Pay Per Performance Business
After I released my SEO book in March 2002, I was inundated with SEO work. After three months I realized that I would be better off optimizing my own websites than other people’s. There are only so many hours in a day so if I were to work on a pay per hour basis, I would severely limit my income potential.
I understood the true value of a top 10 ranking in Google or Yahoo!, and realized people just weren’t willing to pay what it’s really worth. In 2002 the typical market rate for a SEO campaign was only a few thousand dollars, and that was what website owners were expecting to pay. There were firms charging tens of thousands and even firms charging a few hundred dollars.
The fact is a top 10 ranking is potentially worth tens of thousands of dollars to hundreds of thousands of dollars. In some niches, a top 10 ranking is worth millions of dollars.
I felt the full power of being paid for my performance instead of by the hour, when I increased my income by 207% in 18 months in 2006. I achieved that not by working harder, but by working smarter.
3. I Do My Own SEO
I have always hand coded my HTML webpages and SEO (Search Engine Optimization) just came naturally to me as a result. I am so glad that I decided to do my own SEO all those years ago. The power of being able to create webpages that rank highly in Google and Yahoo! is priceless. I would not have achieved half the success that I have without that skill set.
SEO delivers targeted traffic for free. That allows me to reduce the average cost per acquisition of a customer. As a result, I am able to increase my AdWords bids which is sometimes the difference between my ads being shown for a particular affiliate offer, and a competing affiliate who does not have the benefit of the free SEO traffic.
4. I Advertised in Google AdWords
Google AdWords as we know it today was introduced in February 2002. I started advertising in AdWords in July of that year. Next to SEO, advertising in Google Adwords is the next best form of marketing I have used. AdWords allows me to micro-target potential customers by keyword and location. Aside from word of mouth marketing, which is pretty difficult to control, I don’t know of another form of marketing that is so powerful and yet cost effective.
I have spoken to small business owners who are still skeptical of the power of AdWords. I am astonished as to why they feel that way. If you are reading this article and are one of those people who are still hesitant about advertising on AdWords, let me give you some friendly advice: don’t procrastinate any longer. Make it your top priority to learn about AdWords and start a campaign as soon as possible. Google offer everything you need to know about AdWords on their website. You can run a test campaign for as little as $50. If that is too much of a risk for you, you shouldn’t be in business.
5. I Continually Expand My Knowledge
I don’t think I read an entire book at school. I used to think I didn’t enjoy reading books. That was until I started reading books on self improvement, business and internet marketing. I’m not sure just how many books I’ve read in the last ten years. I have about 150 self improvement, business and internet marketing books on my bookshelf behind me and I’ve probably read over 95% of them.
Do you read books? If not, why not? Don’t have time? Rubbish. We don’t have time to do everything we want, but we can all make time to do all the important things. Expanding your knowledge is so important that you cannot ignore it. Make the time for it.
I make time by reading when I’m waiting for downloads to complete, just before I go to sleep, on the plane, on a train, in the car while waiting for my wife or son, and so on. This might not be everyone’s cup of tea, but I even read when I’m doing a number two on the toilet. If you drive to work, get audio books and listen to them instead of the radio.
You see, you can find time if you really want to. I have learnt so much from the wisdom found in books that I can honestly say a large part of my success is because of what I learnt from them. I read regularly and plan to continue to expand my mind for the rest of my life.
Top 5 Worst Decisions
1. I Sold My First Internet Company
Looking back, I think selling my company back in 2000 was probably the worst decision I have made so far. The idea of being acquired for half a million dollars in cash and stock by a start-up, backed by SoftBank Capital, which also backed Yahoo! and E*Trade, was incredibly appealing.
The reality was that I lost touch with my site visitors and newsletter subscribers, I lost all control of my sites, and every major decision I made had to be approved by senior management which often took days.
It was probably the worst time (not that it was that bad mind you) of my internet business life. And when the start-up company imploded after the dot-com bust, I had to start all over again. I felt lost during the two years between selling my company in 2000 and re-establishing myself with the launch of my SEO book in 2002.
There were upsides; I got to live and work in North Hollywood, and met my future wife, so it wasn’t all bad. I did learn a couple of lessons from that mistake; (1) only accept cash - no stock; (2) do not work for the acquiring company. You can be sure I won’t make those mistakes again.
2. I Didn’t Build a Mailing List
Virtually every major internet marketing expert recommend that you build a mailing list. The proof of the power of a mailing list is in the fact that the top 10 affiliates for all the major internet marketing product launches in I have seen recently all seem to be the same names. The one common theme between all these super affiliates are that they all have built up a large loyal following with the help of their mailing list.
I did try to build a mailing list a few years ago. Heck, I even built one up to about 10,000 subscribers. The problem was that I didn’t enjoy the process of writing a newsletter every week. I got lazy and didn’t email the list for a while. And then I did, a few of the subscribers accused me of spam. This almost got my domain shut down. So I abandoned the list and decided not to pursue that marketing channel.
I am trying to build a mailing list of sorts now. I’m using my blog and Twitter. This way I won’t be accused of spam again.
3. I Didn’t Invest in Domain Names
In the first week of 2000 one of my referrals for a domain registrar I had partnered with registered something like a couple hundred domain names. It never occurred to me that maybe that person was onto something.
It wasn’t until a few years ago that I read about Yun Ye, a Chinese American, who became a legend in the domaining industry when he sold his portfolio of 100,000 domain names for a whopping $164 million!
I finally realized that maybe I should invest in domain names. So I registered a couple of hundred ‘.com’ domains that I thought I could sell for a profit. Boy, was I wrong! I have had a couple of inquiries but I haven’t sold a single domain so far. I even got conned by someone pretending to be interested in one of my domains. It’s a long story but the gist of it is they insist on a domain appraisal to get a ‘professionally assessed’ value. Naturally, the company they recommend has some kind of affiliation with the domain buyer. The bottom-line is that I got conned out of about $70 which is a cheap lesson to learn.
This year I changed my domain investment strategies. I have invested over $10,000 in domains in the last couple of months and intend to invest much more. I am quietly confident my new strategy will prove profitable in due course. I will share with you my new strategy in a future post so stay tuned.
4. I Didn’t Follow the Latest Fad
I have never been one to follow the latest fad. I started blogging years after I knew about it. I still have not joined Facebook despite the fact that most of my friends use it. I only joined Twitter because I thought I better register my name before someone else does.
In an earlier post, “8 Ordinary People Achieving Extraordinary EBusiness Success“, I talk about Ashley Qualls who built WhateverLife.com, a website offering MySpace page layouts for free. The site has raked in more than $1 million in Google AdSense advertising revenue. The business brings in as much as $70,000 a month. Ashley has even rejected offers to buy her young company, including one for $1.5 million and a car (valued up to $100,000)!
I have been to MySpace but have never set up my own MySpace page. As such, it never occurred to me that people would be interested in page layouts to decorate their MySpace page. If I had joined the MySpace fad, maybe the idea of offering free page layouts would have crossed my mind and I could have had the pleasure of rejecting an offer for $1.5 million and a car.
Since I started using Twitter I have come up with some interesting web app ideas. I found known about Twitter for a couple of years now - I should have joined earlier. The lesson from this mistake is that from now on I will jump on every new fad (even before it becomes popular) that comes along, so that I don’t miss the gravy train in future.
5. I Didn’t Build on my Success
I often read about successful business owners who say they reinvest every penny back into their business. I have to admit I have not done that until now. I have used the money to provide a good life for my family and I.
Like most people, I don’t enjoy paying taxes. But I accept that is part of life and if I want the government to provide good services, I have to pay my fair share of taxes. But my tax bill is getting ridiculous. So I’ve decided that I will take just enough out of the business to maintain our family’s lifestyle, and reinvest the rest back into the business.
I will use the money to invest in domain names, especially premium domain names. I was going to invest in real estate, but realized that online real estate (domain names) is potentially a better investment in many ways. The cost of entry is lower, the returns are potentially (and typically) much higher, and it is much easier to convert back into cash, if I need the money.
Final Words
Some wise person (not me!) once said, it is good to learn from one’s mistake, but it is wise to learn from someone else’s mistake. I hope you learnt something from the best and worst business decisions I have made during the last ten years in this industry.
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