The world is full of those chasing fame and fortune on the internet. The glittering lures of e-commerce, Adsense and cult-hero-dom draw them from far and wide, looking for easy money, good hours and groupies. It is not like that.
Just like the rock-and-roll industry has its Rolling Stones, Madonna and Led Zeppelin, the internet examples are all there for us. Tim Ferriss achieves widespread fame with his (excellent) book and website The Four-Hour Work Week. Manolo’s Shoe Blog is reputed to pull six figures a year. And of course Mark Zuckerberg at the ripe old age of 22 turns down a billion dollars for Facebook.
Just like the music industry, the reality may not match the legends. Many of these reports come from those who profit from the frenzy in the industry – objectivity is often questionable. And just like music, for every shooting star there are thousands of wanna-bes banging away in seedy bars while holding down a day job.
Internet entrepreneurship is very like pop music. If Sony knew for sure how to engineer a hit they would only publish a few CDs a year. The model is that you keep throwing them at the wall and see what sticks. Same with websites. So many aspiring intrapreneurs seek that one great idea that will go platinum, like Craigslist or Skype or Facebook or Digg or YouTube or Wikipedia or MegaUpload or GameFAQs or so many others.
I have my favourite examples, where I think “dang, I should have thought of that!” These include Neopets, tinyURL, Wikia, MissBimbo and The New York Times.
(Just kidding about that last one, but let us consider it for a moment. It illustrates the point that along with the internet poster-children of pure e-commerce, there is another large group of sites that succeeds on the internet because they are just another channel to a successful bricks-and-mortar business.
(Contrary to common assumption, Amazon is more part of this latter group. Even though it was born from the internet it needs serious real-world infrastructure investment and management, so I do not consider it a pure internet play. Other examples are CafePress and Lulu.)
But for every success there are thousands of failures. Right now my most successful site has a traffic rank on Alexa of 1,341,140. That’s right – it is on its way to being the millionth-most-popular site on the Web.
Blogging is the latest big thing: we’ll all grow rich by exposing our brilliance and wit to the world, who will come in droves to click on Adsense links and product referrals. ProBlogger tells us about the six-figure sites, but Technorati tells me they are “currently tracking 112.8 million blogs”.
The odds are against us.
The ones who really get rich in the music industry are the venue owners, publishers and promoters. In the same way the big winners on the internet are the advertising middlemen like Google, and the myriad hosting companies. Thousands of aspirants risk their time and money each month chasing success and almost all of them lose.
I have a site that has a Google page rank of five, and it draws tens of thousands of page views a month. It pays me over a hundred dollars a month, heading towards two hundred. If I charged the time I spent on it at my usual IT consulting rate it would owe me over a hundred thousand dollars. That isn’t good ROI.
Many hopeful rock bands spend tens of thousands on instruments and amps and lighting, then can’t get a gig. Recently on www.websitebroker.com a site was offered for sale: “…This website cost a little over $20,000 to develop. It is a complete Flash 8 video streaming website with a content management system and registration system … Price: $8,000”. This is even worse ROI – real money gone.
And then there are the dreamers. Successful entrepreneurship requires good business sense and gritty pragmatism. How about this ad on www.buysellwebsite.com “…currently developing a video game trading site which will allow users to trade video games with each other…Are there sites like this already? Yes, I have seen a couple and they all make money and you can too if you market it properly… Price: $60,000” – for an unfinished site entering a market with established competitors.
Most sites for sale go for a few hundred or at most a few thousand dollars, so don’t go spending tens of thousands on developers and designers. Launch the site as rough and ugly as you can and just test the waters to see if anyone actually cares – the equivalent of banging out a few numbers at the local pub on a Saturday night to see whether the crowd produces cheers or bottles. AdWords is a superb medium for testing ideas and marketing for a very low cost – you only pay if they click so lousy ideas cost you nothing!
If the crowd loves it and you take off, then you can use the revenue to pay for the fancy stuff in a self-fuelling process that will grow readership. Dump the sleazy manager you started with and find some classy gigs to play at. That is, move on from Adsense and DirtCheapHosting.com to targeted advertising services and robust hosting platforms.
Until then don’t give up your day job.