Entries Tagged 'Affiliate Marketing' ↓

SEOmoz inspired me today. It’s not just traffic. It’s what you do with it.Yes, we’ve heard it all before… traffic development is just one piece of the puzzle. Can you convert that traffic into sales? newsletter signups? blog subscribers? Can you convert it into ca$h money?

If you’re anything like me, you don’t completely ignore monetization. You spend maybe 5 days a year on it. (The other 360 are spent on building traffic via social media, SEO, etc.) In reality, this split should be more like 80/20. Or even–gasp–50/50!

The trouble is, the SEO’s skillset doesn’t really lend itself to a monetization mindset. As a traffic developer, I look at building an authority site like it’s an Epyptian pyramid where every good link is a single brick… slow and steady wins the race, and focus on the links, links, links.

But this sort of focus has its downside. To maximize revenues, you have to think of your Web site as a business… a business which is a constantly shifting experiment (thanks Squirrel).

“But my site has 1,000 variables. I don’t have the time, software or expertise to revise, test and optimize them all!”

Relax, friend. That’s fine. The good news is, chances are your site monetization has a ton of ‘low hanging fruit’… you can probably work on this for six weeks, and triple your conversion rate, before you run out of ‘easy’ stuff to do.

So if you’re a lazy, monetization-challenged SEO like me, please act on the following five steps, and find out what your real conversion rate is:

1. Conduct a basic conversion rate audit. Conversion Rate Experts have 101 “quick n dirty” points on their conversion checklist. A lot of these points take 20 minutes to implement (for instance: add a testimonial; add a hacker-safe logo; use bullet points near the end of the copy; etc.). If you can find even 10 or 15 points to improve from their checklist, your conversions will improve–maybe double–right of the bat.
2. Conduct a basic usability audit. A lot of usability issues won’t be covered in a “conversions guide” like the one above, but they will still certainly affect conversions. You can fix a lot of easy issues yourself by going through a basic usability checklist. Then, have an expert consultant go through and catch more subtle issues (make sure to fix the basic issues yourself first, so the expert doesn’t waste their time on stuff you could have figured out anyway). You can get a thorough, conversion-oriented usability audit for as little as $1,000. Following this, your newly usable site will yield even more conversions… I promise.
3. Now comes the fun part: rewrite some key pages and calls to action. Many times the usability audit will uncover some themes which will help you rewrite your homepage/landing page copy and/or other key calls to action. I tend to write copy from a “me perspective”, rather than a “user perspective”, and the usability report will usually tell me where do I this. With this knowledge, I can come up with more user-oriented headlines and copy (benefits over features, overcoming common objections, etc.). If you feel your copywriting skills aren’t up to snuff–or even if they are, and you just want a second opinion–hire some expert help. Again watch your conversions increase, and spend the extra money on coke Apple gadgets self improvement.
4. Test a few design variations of your new and improved copy. Now, if we wanted to get really slick, we could test multiple versions of the copy, each with multiple design variations, etc. But I promised you this was low hanging fruit–and I don’t have much patience–so f*ck that. Take your shiny, polished copy (maybe a short and long version) and have ShoeMoney’s guy whip up 3 variations @ $75 apiece. Feed them into Google Optimizer, gear up your volume for a few days, and bam. Either the best performing version has tripled your original (before-step-1) conversion rate, or I’ll refund you all the money you spent on this blog post!
5. Come to PubCon and get sloshed with me. Now if this list was like every other conversion checklist, step 5 would be “continue to make variations, test and retest.” We have already established however that both of us are lazy SEO’s and have limited patience for this kind of stuff. So, pat yourself on the back, take comfort in the fact that you’ve tripled your conversion rate (and each unique is worth 3x what it was before!), book your ticket to Vegas, and let’s get drunk at PubCon. If you don’t get sick by the end of the night, you didn’t give it your all.

p.s. extra props to myself, for linking actual recommended people for each service I mention… it’s so hard to find good people these days.

Today, let’s skip past SEO tactics and get right to the green. As I’ve blabbered about before, many SEOs lack common business sense. In no particular order, here are some tips I think are important for any SEO who is trying to be a better CEO.

1. Decide to make more money.

OK I don’t mean to sound like a speaker at a pyramid scheme “success seminar”, but goals are very important. As soon as your goal becomes “make $XX,000 per month”–as opposed to a goal of say, ranking #1 for a certain keyword, or getting 350 bloglines subscribers to your blog–you’re on a more focused track, and likely to make more money. Smart people tend to achieve their goals, the issue is picking the right goals in the first place.

2. Get a damn accountant.

Having an accountant do your taxes can be surprisingly cheap ($500?), but it is also surprising that a really good accountant can be hired for only a marginally more expensive price. Spend $1000 on a smart accountant who handles a lot of other entrepreneurs, and chances are he’s going to save you a multiple of the $1000 you spend. And a penny saved is a penny earned right? (Did I really just write that? Am I getting old or something?)

3. Depreciate asset purchases as aggressively as you legally can.

A lot of accountants don’t know how to handle depreciation on online assets such as premium domain names, and tend to be over-conservative when depreciating them. So if you’re investing in a lot of online assets, you may want to get an accountant who specializes in Internet business. But even if you have a “regular” accountant, find out how they’re treating depreciation of Web sites and premium domains that you purchase. According to this article, you may be able to depreciate over a 5 year schedule. One single premium domain could wipe out nearly all of your tax liability for the year. (Disclaimer: I am not a lawyer or accountant, do not take this as legal advice, consult your own accountant and lawyer before depreciating anything.) Just be aware of this issue, and use tax law–legally–to your advantage.

4. Raise your prices aggressively and periodically.

OK you may raise your eyebrows at this one, but the truth is a lot of people get “used” to earning a certain amount and then more or less live with that indefinitely. The reality is, online you can go from novice to expert in a specialty pretty quickly (i.e., you can go from novice SEO to pro in 12 months, and you can go from n00b affiliate to super affiliate in 12 months). So make sure to take stock of yourself periodically and try to figure out if you provide more value than you did before (and if so, how much).

Last month I had my business partner call all of the merchants we’re an affiliate for, and ask them if they can pay us a better rate. Guess what? Every single one said yes. Our largest merchant partner gave us a 10% across the board increase. (We’re doing good volume, so they want to keep us happy.) It was probably the most profitable 5 minutes in our company’s history, a short, painless phone call made us an extra five figures this year.

If you perform a service, I think this tip is even more important. Are your prices the same as they were last year? Do you have more clients this year? If so, demand has increased and you should raise your prices. Are you better known this year? If so, your reputation has increased, and you should raise your prices. When a client knows you and likes you they won’t be angry that you’re asking them for more money. They will simply look at the new price and ask themselves if the value is still there, and if it is, they will pay you the new amount. Trust me, they would rather pay you marginally more than go to the bother of finding another provider, who may or may not be a scam/idiot. Another interesting thing is that increased pricing generally leads to increased value perception; you may find that you actually attract more–and better–clients with higher pricing.

If you’re an employee, you should also be aggressively (but politely, and intelligently) asking for a large raise periodically. The difference in the value created between a first year SEO and a second year SEO is huge–as should be your pay raise. If the value you create has doubled (and your boss is smart enough to recognize that), you’ll be able to negotiate for a lot more pay. So do it. Disclaimer: a lot of bosses are stupid, and won’t recognize value. In my experience, most employees also fall into two camps–those who wildly underestimate their value, and those who wildly overestimate their value. Make sure you fall into the third camp.

5. Get a personal assistant.

If you’re creating a lot of value, at some point you have to do what you can to remove low-value activities from your daily work. The best way to do this is to a) outsource what you can (design, programming, etc.), and b) get a personal assistant for other sorts of tasks (research, pick up dry cleaning, etc.) Bonus points if the assistant is hot and wears skimpy clothing. I actually have a “virtual assistant” who lives in another country and would pretty much hate my life if I didn’t have him (and I would get less done and make less money).

Anyone with other good business tips for SEOs, feel free to comment!

“It’s the girth that matters.” — GoogleBot

Problem: You have an affiliate site in the tried-and-true “ads as content” (product comparison directory) format, but it’s either not indexed, or not ranking.

Solution: Make your thin site thicker. Google respects thickness.

Ways to make a thin site appear thicker:

• Remix content. The beautiful thing about datafeeds is you can take free content from the merchant (that other affiliates, unfortunately, also have access to) but rearrange it in a unique way so that the page “as a whole” is unique.
• Find and replace. Go through the datafeed. Take some common words or acronyms and replace them with words that have the same meaning to a reader but look different to a bot. Find and replace PMI with ‘private mortgage insurance’. Find and replace the word ‘mortgage’ with ‘home loan’.

OK those things are just tiny bits and pieces and obviously Google is 10 steps ahead of me in large scale textual analysis, but I believe every little bit helps. In a “signal of quality” era, slight tweaks could mean the difference between being on the right edge of Supplemental, and being on the wrong edge. Of course, appearing thicker only gets a site so far.

Ways to make a thin site actually thicker:

• Combine unique content with the dupe content. A page will still appear unique “as a whole” if you have, say, 200 words of unique introductory text above 800 words of dupe (or nearly-dupe) content.
• Tack some original, remarkable content onto the site and get it well-linked. If your site has 100 pages which are “somewhat thin” and another 20 pages which are “very thick”, the site as a whole is thicker than if you just had 100 “somewhat thin” pages. If you can get these thicker pages links and traffic from social media, the site is also going to be more defensible, period. Even if you only have one page that’s best-of-breed (a true authority/resource), Google’s results are going to be less relevant if they disinclude your domain. That’s the position you want to be in.

So, in summation, here’s my recipe to make a thin site thick: Take all those thin/dupe pages. Remix/rearrange the content a bit. Find/replace some common words. Take some new unique content and sprinkle it throughout. Finally, add a few 100% unique and remarkable pages and get them some quality links. Bam!

OK, roll call for online marketing types, what do we have here? Cost-per-click, margins shrinking, click fraud, check. Cost-per-sale, widely abysmal conversion rates, waaaaay too many merchants thinking 2% or 5% is a fair rip to pay the affiliate, check.

Hey pretty lady in the corner, who are you again? Cost-per-action (CPA)? Hey, aren’t you the one GOOG is moving into? I guess click fraud is forcing Google to hedge a bit. But then, maybe they also know your secret. (OK, a lot of people know this “secret”.)

And here’s the “secret”: It’s a LOT easier to get someone to give you their email address, than it is to get them to give you their credit card number.

And here’s another little secret: The average payout-per-lead (across industries) is in the same range as the average payout-per-sale. Think about it, what’s an average order amount at Amazon or Vitamins.com? $50? What do they pay out on average, 5 or 10%? Meanwhile a whole lot of CPA deals pay $8 or even $20 per lead (yes, a lot of low-end CPA stuff pays out $1 per lead, but we’re talking the range and the average here). The bottom line is, across industries and in-the-aggregate, the absolute revenue from a CPA conversion is in the same range as the absolute revenue from a CPS conversion.

So, we have: 1) higher conversion rates, and 2) similar payouts. Umm, yeeeahh…

Disclaimer: Tons of people make a lot of money on cost-per-sale affiliate programs, and certain types of sites convert very well to sales. And some people get 800% ROI on the cost-per-click spend. I am talking about macro-trends here.

OK, so the truth is out, I love CPA. So do the merchants (lead-buyers): as long as there is quality control and due diligence on the lead-buyers’ side, worries of fraud are virtually eliminated. Meanwhile it’s just as easy to track and measure as CPC. And of course, from the lead-buyers’ point of view, the risk is virtually zero, as long as you know what a lead is worth to you, and provided you track lead quality to each affiliate. So it’s no small wonder some smart merchants are beginning to shift spends from cost-per-click and other channels into CPA efforts.

And I’m not the only guy on the affiliate/webmaster side who loves CPA. In case you haven’t noticed, six-figure lead-gen sites (especially those in liquid niches) are being gobbled up by seven-figure companies (at juicy multiples). And seven-figure lead-gen sites are being gobbled up by eight- and nine-figure companies (at even juicier multiples).

So what am I telling you here? That if you are a smart affiliate, you should be looking more deeply at CPA? Yes, that is precisely what I’m telling you. There are many different strategies you can use to make mad money with CPA (and even I myself am starting to get a bit more creative and occasionally move outside my old tried-and-true model). Here are four such strategies, I am guessing one of them will appeal more than the others due to your personality type (that’s OK–play to your strengths!)

1. Build a site around an existing microniche CPA program. This is the ol’ Big-Fish-Small-Pond idea, find a smaller niche and then you’ll have an easier time ranking in it, even if you can’t get on Digg or afford to buy links. Yes, the risk is higher because if you have one lead buyer and he cancels his program or boots you you’re screwed, but on the other hand you can pump these out faster and spread your risk by building a new site in a new niche every month. Example: Make a site and rank it for “Jewish singles”, but pray to God that JDate doesn’t cancel their affiliate program. (Alright this example isn’t even that “micro”, there are a ton of niches even less competitive than this one.)
2. Build a site around an existing liquid CPA program(s). I believe I thoroughly explained this gameplan in my post earlier this week, the short version is, same thing as above, except in a very competitive and mature niche. Example: Build a site all about auto insurance, and generate auto insurance leads. The end game is when Insurance.com or InsuranceTracker or whoever decides they want your leads and then it’s time to get paaaaid.
3. Build a site around a particular demographic. Take a site like Tropical SEO, it’s not centered around a particular product, but I know my readership (online entrepreneurs / SEOs / affiliate marketers), so I could try and sell you guys on an entrepreneurship conference, or to sign up at such-and-such ad network, or to do a free test of Brand XYZ Analytics On the low end, you can pretty easily build huge amounts of traffic to celeb sites, then monetize with free iPod schemes, FriendFinder, free satellite TV dish offers, paid surveys, etc.
4. Build direct lead-selling relationships in a niche that lacks an existing CPA program. This particular option involves the most legwork (e.g. getting on the phone with people, deleting bogus leads every night before sending them on to the lead buyer, etc.) But it also has a very high upside, the idea here is that you can become the next (much smaller version of) Quin$treet or HealthInsurance.com, by sniffing out an upcoming lead economy and being the first player there. The annoying part is you have to get on the horn and call around until you can find a company (or three) to buy your leads. Example: Sell terrorism insurance leads to a struggling local insurance agent who is desperate enough to do business with a guy (or gal) like you. Re-invest all initial profits. Eventually, you can afford to buy TerrorismInsurance.com, your volume will grow to five figures a month, and then you can start buying leads from other affiliates (become the reseller). The end game is when Insurance.com or InsuranceTracker or whoever decides they want to enter your niche–and they want your leads–and that, my friends, is what we call a liquidity event.

So those are four different ways you can skin the CPA cat, to be honest they’re the only models I am qualified to speak about. If you can pick a good niche and combine one of the above models with a premium domain or some other sick asset like a big ol’ email list, you’re on track to get-relatively-rich, relatively-quick! (Maybe that’s what I should title my e-book.)

p.s. If I decide to build a terrorism insurance site at a later date, man am I going to kick myself for using that as an example

It takes strategy, tactics, balls, elbow grease, money, and smart planning. Mostly, though, it’s a matter of putting in a lot of time every day to “block and tackle” (a.k.a. “the boring details” or “content and links” or “the grind”).

Most people do not have the proper attitude, personality, or personal situation (kids to feed?) to grind it out for 3 or 4 years. You have to wake up, work the 8 to 5 job, come home, lift a few weights, eat dinner, then work 7 to midnight on the side project (which, if it yields any profits, are most likely reinvested).

So, if you can’t/are scared to/aren’t able to grind it out for a few years, this guide isn’t going to help you. Now, even if you are grinding it out, you still are unlikely to build a site you can later sell for $1M: most SEOs are applying their valuable tactics, sweat and money to bad business models.

And that is what this article addresses: making sure that you apply your grind to a site that can sell for $1 million USD in a few years (rather than $20 or $200k).

The Multiple: Why Some Sites Sell for 10x Yearly Profit, and Others Sell for 6x Monthly

To many readers, $1,000,000 sounds like a ridiculous sum to sell a website for (it would seem that way, if you’ve check DP for sites lately). Now, this is partly because “bigtime” websites are usually sold privately, so you’re not going to see the high value ones listed at DigitalPoint or SitePoint.

But we’re also used to seeing low multiple sites for sale on these public forums. What do I mean by low multiple sites? These are sites that sell for somewhere in the neighborhood of 1x their annual profits. If these sites were stocks listed on the S&P, their P/E (price to earnings) ratio would be 1. (Hint: that is an absurdly low multiple for a stock.) Nevertheless, that is the multiple that the marketplace is willing to bear for these types of sites.

What sort of factors would discount these investments so much? (From an investor’s standpoint, that’s what a site is–an investment.) Why, when the investor is willing to pay 15x annual profits to own a share of stock, is he only willing to pay 1x annual profits for a site being sold at DP?

The main reason these sites are so discounted is that they are extremely risky. They generally don’t hold any strategic value for the acquirer (for instance, why Youtube commanded a premium valuation), so their value is solely a function of return vs. risk. The typical site sold at DP:

• Yields revenue from only a single source (Adsense).
• Receives traffic from only a single source (usually a site does well in Google or MSN).
• Has search rankings which are likely not-defensible (based on low quality links, DP co-op weight, links from the webmaster’s own network, etc.)
• Does not have any other valuable assets to speak of besides the revenue stream itself (e.g., there is no newsletter list, no brand name recognition, etc.)
• Overstates profits because the webmaster’s salary (opportunity cost) is not taken into account.

That last bit gets me all the time. First of all, I think it’s pretty hilarious when someone tries to sell a site based on its revenues. If your site brings in $20,000 a year, and you spend $19,000 on cost-per-click, the revenues aren’t really the relevant piece of information, are they? But even in the case above, it is misleading to state that the sites makes a profit of $1,000 a year.

We have to assume that the average webmaster’s time is worth something–let’s say, $30 an hour. If it takes you 2 hours a week to manage the CPC campaign in the example above, your opportunity cost for running the site is $30 x 104 (hours per year) = $3,120. So in fact, this site isn’t making $20,000 or even $1,000 a year… when the salary for the webmaster is factored into account, it is losing $2,120. Small wonder it is selling for such a low multiple! When you combine the overinflation of profit numbers due to ignoring the opportunity costs of running the site with all the high risk factors (single revenue source, single traffic source, etc.) it isn’t surprising that the generally accepted fair valuation multiple at public site-for-sale forums is 1x yearly “profit”.

How to Build a High Multiple Site

The thing you need to realize is that there are plenty of websites out there that are actually selling for 5x, 7x or even 10x their annual profit (and I’m not just talking Youtube or Facebook–I’m talking real, everyday websites that a guy like you or me could actually build if we put in a lot of time and elbow grease).

When you take that sort of sale multiple–7x annual profit–building a $1M website is much more realistic and attainable. If you can clear $12,000 a month (in profit, after subtracting your own salary), that’s $144,000 a year; multiple by 7, minus a few thousand for the accountants and lawyers who do the deal–that’s how you sell a site for $1,000,000.

The trick is, it has to be the right $12,000 in profit per month. It has to be $12,000 a month that is defensible, sustainable, diversified, and strategically valuable to larger companies.

So what kind of site is defensible? The long version is here, but the short version is: good domain name, good brand, diversified traffic sources, diversified revenue sources, and measurable assets like RSS and newsletter subscribers.

What kind of site is sustainable? A niche where consumer interest is growing not shrinking, a site with low legal risk (e.g. you don’t host a bunch of copyrighted files or infringe on trademarks). I also personally believe that profit margins based on CPC campaigns are rarely sustainable over the long term.

What kind of site is diversified? Revenue: You don’t make most of your money from Adsense, and you are selling leads or acting as an affiliate to multiple merchants. Traffic: You rank well on all 3 search engines (or at least 2), plus get a majority of your traffic from non-search sources like direct links, RSS subscribers, bookmarks and typeins.

What kind of site is strategically valuable? One that doesn’t reflect negatively on the entity who owns it, and one that exists in a niche with a mature lead marketplace.

Now, that latter statement needs a bit more explanation. Some people like to go after microniches (low profits, low competition). I take the exact opposite approach, for two reasons: Firstly, as I explained in Warren Buffet’s Advice to SEOs, it is highly profitable to be an average player in a highly profitable niche. (Not always the case when you’re the top player in a low-profit niche.)

More importantly (when discussing multiples), to extract full value when you’re selling a website you need to be in a market with an abundance of website-buyers. To use a specific examples (because boy do I hate generic advice!), if your website generates mortgage leads there are about seven hundred zillion (roughly) mortgage affiliates, brokers, lead resellers and argitrageurs who would just love to own your monthly stream of leads. This is going to create an efficient marketplace for when you try to sell your site, and is going to extract the maximum multiple (price). Potential buyers know there are many other potential buyers out there, so they are less likely to lowball you. It would not be a stretch at all for a defensible mortgage site to sell for 7x its annual profit.

Conversely, when there are fewer buyers of leads in your niche, it is going to be very hard to receive an attractive multiple when selling your site. Let’s say there is only one large niche-widget-merchant in your little niche, and you are one of a few affiliates that generate leads for him. When it comes time to sell your site, who is going to buy it? Super-affiliates are going to heavily discount the value because selling leads to a single niche-widget-merchant is risky and not very defensible. If he cuts his payout-per-lead in half, you don’t really have any option but to continue to sell your leads to him (now for half the payout!). Likewise, if you try to sell the site to the actual niche-widget-merchant, he knows he probably isn’t bidding against many (or any) other buyers, so he is likely to only offer a low multiple to purchase your site.

Here’s a little test to see whether your niche has a mature lead marketplace: Login to CJ, and search for your product/service name. Are there at least 5 merchants coming up for your product or service? If so, the lead buying marketplace in your niche is mature.

To summarize: If you want to build a site you can sell for $1,000,000, build a site that makes $12,000 or more in monthly profit, passes my 10 point defensibility quiz, and operates in a mature (large) lead-buying marketplace.

Back to the Grind: Getting to 12k/month

So we’ve covered how to make a site defensible, and how to pick a mature niche. Now we need to figure out how we can get to $12,000 a month in profit (realistically this is something like $17,000 a month in profit before your “salary”, since whoever buys your site will probably have to spend ~60k a year to get a webmaster to maintain the site).

The rub is, I don’t have a step-by-step plan to help you do that. Even if I did, it would be pretty useless–we all have different talents and resources, so the easiest way for me to get there is going to be very different than the easiest way for you to get there. Rest assured there are hundreds of different tactics, marketing channels, monetization strategies and options to get a site to 12k in monthly profit.

I actually recommend you start with what you know. Tactics: Do you know link baiting, how to program AJAX tools, or low-cost offline marketing? Niches: Where have you operated in the past? Do any of your past niches fit the definition of being a mature lead marketplace? Resources: We all have special connections that make things easier; is your dad an insurance agent? Is your college roomate good at manipulating large data sets? Or maybe your husband has a law degree.

No matter what your personal situation is, your strategy has to play to your own personal strengths. For me, these strengths have included:

• Having a partner who is a lawyer
• Being willing to work 12 hours a day
• Being good at link baiting and social media optimization
• Having a team of low-cost, talented writers in India

In the vein of Warren Buffet’s Advice to SEOs, I’ll admit that the following strategems have also served me well:

• Structuring sites so that the ads are the content
• Building traffic of visitors who are in the buying cycle
• Finding affiliate merchants who don’t operate at CJ
• Partnering with reliable, honest people whose talents complement (not overlap with) my own

And Now: The Catch!

Let’s say that 3 years later, you have the site–it’s defensibly earning 17k in monthly profit (12k after your “salary”). A few things might happen. #1, some big company decides they just have to have your domain name or position in the SERPs or whatever tools/assets you’ve developed, and they offer you a 12x or 20x annual profit multiple to buy your site. That’s pretty much a no-brainer SELL, but let’s not count on that, it’s a (relatively) rare occurance. #2, let’s say God forbid you get sick or have some sort of misfortune, and you need to sell your site quickly–in this case you might get a much lower multiple than you otherwise would, but it can’t be helped.

More commonly, you are in a position where you can choose whether or not you want to hold or sell. And here’s the ironic part: you may very well find that the type of site you could sell for $1,000,000 (at a 5 or 6 or 8x multiple) is worth keeping! Personally I feel like if I can get a site to 12k/profit a month in two years, I can probably get it to double or triple that given another year or two. Why be in a hurry to sell? If you’ve developed truly premium virtual real estate, it’s only going to increase in value; meanwhile, despite your Aunt Gladys who thinks money earned online is “silly money”, if the site is truly defensible, it may represent an option that carries less risk than alternative investments (*ahem* Enron stock *cough* Las Vegas real estate).

If you take the proceeds of the sale of a 144k annual profit site–let’s call our sale price $1,000,000–first you’ll get hit with a long term capital gains tax (at least, us yanks will), and your after-tax pile of cash is now $850,000. If you put that into real estate, the (long term) average rate of return is 3%–you’ll yield $25,500 this year. If you put it in an S&P index fund, you’d average maybe 12%–$102,000. So the alternative uses for our money aren’t even coming close to beating the $144,000 annual yield we got from the website. Meanwhile most of us don’t have the talents to substantially increase the yield we get out of real estate or stock investing (like we would if we were maintaining/expanding a website we founded).

Of course, if most of your net worth is tied up in a single website, there is serious pressure to cash out and diversify that worth (and rightfully so). And most of us with the fortitude and personality to be an affiliate marketer/competitive webmaster in the first place realize that change is good for the soul (and often good for one’s lifestyle)–wouldn’t it be lovely to cash out, put most of the proceeds in an investment account, travel the world for a few months, and start all over again (with a brand new premium domain name)?

It’s a good problem to have. Whether you decide to sell, or hold, or hold then sell then start again, you’re still in a good place. I’m chasing the dream and I hope all Tropical SEO readers are, too!

I pledge to strive wholeheartedly to make the most amount of money while doing the least amount of work possible.

I pledge to develop passive revenue streams that maintain themselves using automated systems.

I pledge to outsource anything that possibly can be outsourced. My core competencies are thinking, planning and strategizing, and my time spent on those activities will yield the highest ROI.

I pledge to have a secretary/personal assistant and/or mistress to take care of pesky details.

I pledge to only give my phone number to very close associates. Everyone else will have to email me. I will compulsively check my email throughout the day, but it may take me up to a week to answer one, especially if the reply requires effort on my part.

I pledge to use Digg, Reddit, Delicious and the like as a shortcut to link building. The Digg community is a bunch of annoying little wankers but I will play the game until my sites all have TrustRank out the wazoo from dozens of successful link baits.

I pledge to get dressed only after the noon hour. Getting dressed implies putting on pajama pants or sweats instead of boxers only. It does not necessarily imply the presence of a shirt.

I pledge to extend myself outside of the SEO realm only into even lazier and more defensible areas. Namely, domaining.

I pledge to waste at least two hours a day on Threadwatch, WebmasterWorld and Bloglines. Not because I’m learning anything new, but because I’m bored.

I pledge to be a Lazy SEO.

In my experience the natural motivation to preserve wealth and income is even more powerful than that to increase it. For us SEOs, this means making our sites, rankings, traffic and revenue defensible.

The following quiz is a little cheat sheet to let you know how defensible your site is. (For some, but not all of you, ‘defensible’ is nearly a synonym for ‘Google-proof’.)

1. Does your site rank in more than one search engine? As Google’s share creeps towards 100%, this question becomes less and less realistic… still, there’s a big difference between 6% of organic referrals coming from Y!/MSN, and 36%.
2. Do you get type-in traffic? Whether type-ins occur because of branding and repeat users, or because your domain is keyword.com, is irrelevant. When people navigate directly to your site, no search engine penalty in the world can hurt you!
3. Does your site have a significant number of subscribers? Subscribers can be be to your RSS feed or email newsletter or anything really–the point is, you have repeat visitors and don’t depend entirely on transient traffic.
4. Is your revenue diversified? If a single CPC ad provider (ahem), or even a single merchant, provides a majority of your site’s revenue, then they certainly have you by the balls. They could cut your payout in half tomorrow without much of an explanation, or they could boot you without appeal or recompense.
5. Do you get bookmarked? If you’re booked on Delicious or on people’s browsers, you can count on some repeat visitors and possibly future links.
6. Does your site have citations and links that send you traffic? Maybe SugarRae’s Hall-of-fame post makes sense now It bears repeating: When people navigate directly to your site, no search engine penalty in the world can hurt you!
7. Does your site have some sort of remarkable value? This question is not asking: is your content “unique”? More like, if your site ceased to exist, would the Web as a whole lose something valuable? Would people’s lives be inconvenienced? If the answer is YES, your site is likely to get future citations, links and bookmarks–and further, search engines will have to think longer and harder before banning you or penalizing you, since not ranking your site might make their results less useful.
8. Does ‘arbitrage’–CPC, email blasting, affiliates–make up a minority of your promotional efforts? As Brian Provost points out, marketing methods such as these are often unsustainable over time due to increased competition, structural changes, commodization and margin erosion.
9. Do you have a strong network in your niche? Maintaining a friendly relationship with bloggers, stakeholders, and even competitors can be the key to standing back up when you get knocked down. Think about it this way–is a merchant likely to screw you out of money if you can get their bad behavior blogged about by industry leaders?
10. Are you thinking about/working on defensibility? There are many ways to make a site more defensible that I haven’t listed. If you are actively working on it (regardless of what you call it), you deserve a bonus point. Even thinking about defensibility–if you can apply some of the principles in the future–is going to go along way in protecting your future wealth (and pride).

Rate Your Site’s Defensibility
Well this wouldn’t be a hokey quiz if you didn’t rate yourself at the end! Count how many times you said ‘yes’ to the above questions.

• 1-3 yes’s: You’re fucked. Probably better and easier to start a new Web site that has a more defensible idea behind it than to fix the old site. In the meantime the old site can sit as an (indefensible) passive revenue stream. (It may also be a good candidate to unload at Sitepoint.)
• 4-6 yes’s: Your site is like most quality Web sites–you have some defensible traits, but still a Google penalty and Adsense booting (or equivalent) would likely cut your earnings by a very high percentage. Even most quality Web sites are fairly vulnerable.
• 7-10 yes’s: Congratulations, you don’t just have a Web site, you have a real, saleable business.