My group at AIG did quite a bit of sponsored marketing in the bank channel. We co-marketed our accident insurance products to customers of the largest banks. We tested quite a bit of opportunities, and the variables in each of those opportunities, and we invested a lot of money in channels and demographics that worked.
During my second year at AIG, a former boss of mine from a college internship turned his family’s mortgage business into a full bank. Not only did I help him acquire the generic domain name he wanted/needed, I also helped him with other domain related things. Since his company was founded in 1947, he had a large customer base, but it wasn’t comparable to any of our bank partners. Despite my efforts to do a marketing test with this bank, my then boss didn’t allow it. Even if the test was wildly successful, it wouldn’t be possible to scale, so it was a waste of time.
As you may have noticed, I have been doing a lot of testing. I’ve been developing geodomain names, directory websites, automated mini sites, self-created mini sites, and everything in between. My goal is to find successful development models that are scalable. When I find something that works, I want to be able to do it over and over again with the same success. Whether a project earns $5/day or $500/day, it doesn’t really matter if you can scale it at a reasonable cost and time expense.
As you continue to develop and test models, I hope you keep this in mind. If you build on successful website, but it takes all of your time and effort, yet you aren’t earning enough to make a living, it’s not going to work. Even if you hire someone at half the cost of your time value and earn a profit, it’s likely that person won’t be as proficient as you.
I think it’s better to have many smaller successful sites that require less time and effort than one large one that doesn’t earn enough to make you a living and can’t be scaled.
You hit the nail on the head with this post Elliot – dead on!!
That has been a great part of my success; and at times the biggest thing holding me back….scalability.
I see you don’t have turkey brain meltdown today – great to see a powerful and meaning post such as yours this post turkey-day….keep truckin’
I agree with your last statement El. Small sites are much less time consuming over the long haul in terms of management.
Also agree if a a site only earns a couple bucks a day it’s still worth it for the initial work, as long as no significant ongoing management is required after being developed.
I completely and have used te same approach myself.
After finding a goo model I’m happy to have over 120 of my domains developed using a system that has worked very time nd time again.
While every sit is not a major success together they are helping me put-together the down payment for my first investment property.
I think of investments like energy – don’t want to create or destroy – just convert from one form to another!
I think what is more important than having a business model that works is to find a pool of fish that are hungry. You have to find a way to feed the hungry fish. That means people need to pay attention to everything around them. Just making another business that deals with the same stuff that hundreds of other business makes it very hard to get any customer. If you can come up with a novel idea, you can feed the fish. For instance, social media was not a big hit until Facebook came around. Now there are social media websites left and right. I would never tell a person to make another social media website. You need to think of the future. What will the future bring and what will the hungry fish want to eat?
Thanks so much for shedding the light.
Building a network of smaller sites seems more appealing & manageable to me than producing a single huge hit.
Would love to closely follow your advices and see how things work out.
Morgan – If your virtual properties are so succesful why would you use the money thrown off by them to buy a physical real estate investment property? Unless you are buying the property in cash the ROI will be pathetic and your chance of seeing any meaningful appreciation over the next 5 years is very slim.
Chen – I disagree with you, I rather have one HUGE hit than have to worry about a network of sites to pay the bills. Ultimately, it would be fantastic to find a model that produces a huge hit that can be produced over and over again, but if I have one huge hit that I can put on auto-drive fantastic.
Marc Rich (a famous commodity trader) said it best “it takes just as much time and effort to get a small deal done as it does to get a big deal done.
I agree with Chen. If that one HUGE hit is a business, you are making a living by running a business. Having one website that people use as a SERVICE beats having 20 websites that people just visit for a minute and leave (and worse never return).
Let me give an example. One of the websites I’m working on involves a professional forum community where the media/publishers can gain access to professionasl before publishing their content. That is all of the details I will give. Spending many hours marketing this website to the media/publishers is worth the time because of the valuable service it provides. I would rather make a living by running this business than doing a bunch of websites that make a few bucks a day (nothing wrong with doing that as I will be having websites that just make a couple of dollar a day/month as well).
everyon is expert
It’s very benificial to read different schools of thought.
In practice, I see Elliot’s approach of many smaller sites offer more opportunities to test different industries. For starter like myself, it’s like throwing spaghetti on the wall and see what sticks first. Only after the initial spaghetti phase that one has a better idea on what to razor-focus on. Thus, improve the chance for organic growth to turn into a large site.
A hugh sige is like a dream comes true. But a SINGLE huge site may also pose higher political/financial risks if one works in a sensitive market or industry. IMHO.
A huge website is like CNN, Google, YouTube, Facebook, etc. A website that is for a business that drives regular customers, and a lot of them, is what I am getting at for a huge site. Think in the terms of WebMD.
One of the struggles is coming up with the idea that can feed hungry fish. The American culture is so saturated with so many services and products that it almost makes it not worth the effort trying to drive traffic from Americans. Half of my websites deal with IDNs, and half of the other sites are for Americans. For instance, one of my businesses deals with health news review (seperate than the other business I noted previous in this discussion). I’m not going to bother with the American market. I’m going to make websites that focus on African, South America, India, Japan, etc, countries. More and more people from those countries are coming online. The biggest struggle is being able to translate your English version of the website into what they speak (i.e., chinese).
Your post really inspired me. I just add a translation service to my very primitive website at:
Many still view non-American traffic as worthless. But I agree with you that there is no bad traffic, only wasted traffic.
I am currently using a template that Elliot recommended to build a bi-lingual geowebsite of mine (www.hainan.tv/en/) . Sorry Elliot if link is not allow here.
No problem chen. Look at this way. There are 1 billion people in India? The American culture is saturated with everything you can think of. What I did for one of my website ideas (the second one listed on this discussion) is use a concept that was already done in the American market and use that same concept for a location in another country that doesn’t have that service. The first website I mentioned in this discussion is global focused.
There are already millions of blogs, hundreds of social networking sites, thousands of debt collection companies, and the examples are endless. We have the rest of the globe we can try and tap into. That is why my first website I talked about I’m going to make all media around the globe have access to the professionals in my forum (I don’t want to give details away as it is a very unique idea).
In an audio interview we did recently Eric Borgos (Bored.com) discusses the network vs. large branded site approach in detail. He came away from his experience (after selling Bored.com and its associated network of sites for $4.5M) feeling that one large site is the better way to go. You can find the interview here: http://www.domainnoob.com/blog/2009/11/how-to-make-money-online-no-really-my-interview-with-eric-borgos-of-impulsecorp-com/
Thank you for posting the interview link. That interview gave me an idea for a website. Thanks.