We’ve been in business since 1998, going on 19 years now. During that time we’ve seen and helped a lot of internet businesses and clients. Many have stayed with us over the years and some have come and gone. Many of our clients have been hugely successful, many of them have been moderately successful, and some of them have had no success at all. We have customers that have been with us almost since the very beginning and are still going strong today. Our average customer has been with us for 7 years or more and overall are doing well and making a living with their internet venture. However, over the years we’ve seen some customers fail regardless of anything we or anyone could do for them and we’ve compiled this list of the top ten reasons that we believe these failures have occurred based upon our years of experience and observation.

5. Changing the formula, AKA “Muddying the water”

We’ve had more than one customer that has changed what was a successful formula and did what we call ‘muddying the water.” Basically they have something that is working reasonably well. The conversion rate is decent and month to month the business is showing growth. The client is not patient and wants more and more and more and more and so is constantly tweaking everything. Constantly changing the website, moving product around, adding more product, changing prices, everything. They’re micro managing us from a distance and not listening very well to our seasoned advice. There is so much change going on it is becoming very difficult to track in terms of web analytics what changes have positive or negative effect. Growth begins to stagnate. The more this happens the more intense they become about change, change, change. Eventually they are so far from the original formula that was working no one even remembers what it was. And so they begin to fail. If something is working, don’t mess it up. Stay with the working formula and make your changes incremental and slowly otherwise you’ll lose track of what is good or bad. “Do the right thing enough times you will get the right results.”

4. Underlying management budget doesn’t keep pace with growth

Seen this one more than once and it never works out good. The more success the client has the smaller the underlying management budget becomes in comparison as the client gets greedier and greedier and tries to squeeze more and more from the bottom line. The more successful a business becomes the more time and effort that goes into furthering that success and continuing the growth. If the underlying budget doesn’t also keep pace then you are either working harder and harder for less money or simply keeping the same pace as before. The sales and marketing and development budget needs to keep pace with growth.

3. The product is a horrible idea to begin with

This is a biggie and happens more often than I’d care to remember. In some respects it is the mirror image of “there’s a sucker born every minute”. Generally we don’t mince words around here and are known to be brutally honest to our clients regardless of any perceived outcome. We will come right out and tell the client when we think it is a horrible idea and why. We’ll still work as hard as we would on any other project and provide our most excellent service if they insist but at least this way when it fails we told them so. We had a client that invented a product. Paid an engineering firm to tool and die it, built up thousands of dollars in inventory, legal fees, patent fees, etc. Came to us to develop a web presence. Problem was, it was the dumbest idea we’d ever seen. It was a product that was almost exactly like another, very common item on the market that could be found anywhere, cheaply. I know the client took a beating on this so out of consideration I won’t give away anything to say what it was. We did our best for the client after we informed them of our reservations about it and they gave it their best effort but it ultimately failed to sell much of anything and now they have a warehouse full of useless product. Sometimes maybe it is a good thing to get lots of feedback outside of your circle of friends and family and take that feedback to heart before you sink a fortune into your idea. A horrible idea will always be a horrible idea no matter how you try to position it in the marketplace.

2. Bad Marketing Formula

We have a saying around here “do the right thing enough times, get the right results.” The point of this is that when it comes to begin successful on the internet there is a basic formula and you must at the very least, follow it consistently. Over time it will bring results. But often, it takes patience and sticktoitivness. A bad formula will never bring consistently good results. Worse perhaps is not knowing it is a bad formula. So probably the fist step is to identify what is a good formula. There is a ton of informaiton on the necessary steps to a winning internet marketing formula. Generally however it involves some basic areas that need to be implemented. I look at it like this in no particular order.

1. Website design and website development

First you design a website using the best practices of good design. You have to balance the intended visitor experience with optimization for search engines. There is no perfect solution to this but generally if you work with someone that has experience in this they can lead you in the right direction. A website should be thought of like a river. If it is static, never evolved and unchanging then it will stagnate. If it is in constant motion then it will remain vibrant and pure. Part of your winning marketing formula should be to understand and use proper web analytics consistently. Over time this will help you immensely.

2. Search Engine Marketing and Search Engine Optimization

A winning marketing formula is going to include ongoing search engine marketing and search engine optimization and a proper budget for this. We experience two critical misconceptions or negative arguments in this area we simply cannot agree with since they don’t match real world experience. The first is that a lot of people tend to think that once they’ve “optimized” their website to the extreme using the best practices of search engine optimization success should be a given. Not true. This can certainly put you on the right path to success. And often it can bring great success. But generally search engine optimization is a long-term and  ongoing process of development that brings incremental wins along the way. Not to mention that the technical aspects are constantly changes as major search engines keep changing the game and you have to continuously keep up with this. At best you should be experiencing the incremental wins to keep justifying the process and maintain the return on investment sufficiently enough to keep forging ahead. At least with respect to the law of averages because in some instances you’ll have incredible results right out of the gate and in other instances perhaps no results at all (like when it is a horrible idea to begin with). But for the average situation it is going to be incremental which means you need patience and not have your expectations set so high that anything short of huge success is a failure.

The other thing we hear often from within our own industry is that search engine marketing (pay per click) is a waste of money. We believe the exact opposite and being a Google Certified PPC manager we have a ton of experience working with PPC. Unless you simply have a huge social network or develop one (which takes alot of time, effort and often money) or the type of product or service that can get a lot of viral attention you simply cannot afford not to advertise. Yes organic search engine placement is great and yes it can bring a lot of return but nothing is free in this world. Either way it takes considerable energy and investment to succeed. With organic placement you have to invest a lot of time and energy to compete against hundreds or thousands of others trying to do the same exact thing and getting the coveted spots (top 4) is extremely difficult and can take a long time. Even then, you are only going to get a share, not even the lions share because there simply is no such thing anymore. You absolutely have to commit some budget (and a reasonable one based upon your industry, competition and the like) in PPC. This is the only way you can assure yourself of getting some decent market share, control your placement in the search engine and bring in the right amount of traffic to achieve the results you are seeking. Some things to consider when trying to determine the necessary budget to success is what is the average conversion rate for other players in my industry, how much is the average cost per click, how many clicks will I need based on this average conversion rate to turn a profit? These are the kinds of questions we ask and answer for our new clients considering a PPC program.

A winning marketing formula will include the budget for an ongoing program that covers the following areas at a minimum:

1. Website design and development
2. Search Engine Optimization and Marketing, including PPC
3. Website Analytics Management and Analysis
4. Social Marketing and Publicity Management

1. No Budget or Too Small Budget     

We see it all the time. Inquiries from people that want us to build them a website that requires a lot of complicated features or design,  or search engine optimization or help getting more traffic and there budget is only a few hundred dollars.  It simply won’t happen. Sure, they’ll find someone that will take there money but there chance of being successful is slim to none. If you have such a small budget your best bet is to find someone competent and trustworthy that knows the business to give you as much service as they can for the money then learn how to roll up your sleeves and build your own success. Will take a lot of hard work , dedication and trial and error but eventually, if you do the right thing enough times you will get the right results, just no today. Successful Internet business is no different than any other business it takes a lot of things coming together to make it work. Just because it does not have the same costs associated with a traditional brick and mortar business doesn’t mean you can invest a few hundred dollars and expect it to succeed. You can but those instances are rare. Most of us have to spend a lot of time and some reasonable money over a longer period of time to build and grow our business. We need to budget for development and marketing. yes, we can generally do it for much less than a traditional business would have to pay and yes we don’t have the burden of rent, employees, insurance, utilities and a lot of the other types of overhead expenses that come with a traditional business.

From our experience here is what we think at minimum a business should consider for overhead to build and grow an internet business and remember this is at minimum if you intend to do it right:

1. Basic professional website design: – $1500-$5000 depending on complexity.
2. Website Optimization and ongoing search engine marketing program – Our least expensive SEO program is $350 a month and compares to most that start at $500 a month. So figure $350-$500 a month at minimum for a decent search engine marketing program at least for the first year. Our programs include website analytics and analysis, not all do.
3. Pay Per Click – This is going to vary based on a lot of factors such as industry, cost per click, desired return (number of sales you need to survive). We will help our new client figure this out. The rule of thumb is generally about a 2-3% conversion of traffic on average for most industries for the average business or service. So every thousands visitors means about 20 sales. Remember this is bare minimums and can vary widely depending on your exact industry and a ton of other factors so this is not even a guideline per se. But if this was the general average for your industry then you’d need to figure out the average cost per click and then how much it will cost you to get 1000 clicks so you can make those 20 sales, and thus determine what your net profit would be in terms of PPC. Most Professional PPC managers charge somewhere between 10-15% of the monthly spend for their fee with some sort of minimum.
4. Social Marketing and Other Advertising (such as Press Releases) – A reasonable budget for this should be at least a couple of hundred dollars a month. Especially in the beginning you will want to have regular monthly press releases to help you get some bump. Pus if any of them go viral things could take off. And you will want to pay someone with social marketing experience to help you setup, maintain and grow your social exposure on platforms such as Facebook, Twitter, Pinterest and the like and that will usually require at least a few hundred a month to have any decent return. Often times, this might even be bundled in the seo program and can save some money if it is.

And these are just the basics. Not inclusive at all just some basic info from our own experience working with a lot of small businesses. Just a general idea. So you are looking at somewhere from $500 to $1500 or more a month just to run a basic program and at least for the first year, often longer. Sure you can probably do it for less especially if you are going to do a lot of the heavy lifting yourself. But don’t expect to be successful unless you intend to work hard yourself and figure it all out or have at least this much to invest towards your success and a competent service to help you get there.

As a final note, be certain you have someone or a team that is competent and you can trust to spend your money well. Sadly many of the referrals we have received and some of our best clients over the years wasted thousands of dollars on this type of service to start their new internet business and after a few years figured out they were no better off than when they started. Nothing is more frustrating to us than getting a new client that has already spent all of their money with someone else that did next to nothing for them and now they have a sparse budget to try and recover with.