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I forgot to post this last month. My Incubator,, made the SD Union Tribune. Check it out here:
Danny DeMichele in the UT

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The Problems With Selling Lower Priced Point Items Online

Long ago, in an internet day far far away, you could very easily sell a $30 or lower price point product online. These were the days when traffic was cheap and getting your site ranked in the search engine organic rankings were practically guaranteed.

Those days are over. The average cost per visitor through paid means (sponsored search and paid media) is nearing $2.00 a click (compared to $.50 per click in 2000). SEO is now much less predictable and often times takes much longer than it did in the past. It is certainly more difficult and not something you can build a business exclusively around anymore.

The biggest issue is that despite the increased cost in traffic, conversions haven’t really moved up at all. Unless you are a big brand, or you do a tremendous amount of off-line direct response advertising, the highest you are going to convert at is in the 2-4% range. Meaning, for every 100 visitors you pay for, at the very most, you are going to convert 4 of them into a buyer (the average is closer to 2% for a product under $50).

So if you do the math, the picture looks bleak:

1. Cost per visitor of $1.00 (Probably higher, but trying to no be so doom and gloom)
2. If you convert at 3%, it will take you $33 to create a purchase.

How on earth is a retailer to live off of a net-loss margin? There are a couple of options for you:

1.Continuity – have something that someone needs on an on-going basis. Figure out a way to bill monthly or quarterly.
2.Upsell into other peoples products – After someone checks out on your site, offer up a complimentary product from another company. You have seen this probably with magazines.
3.Sell in packages. If you can get away with it, force people to purchase 2 or 3 products.
4.Dangle Free Shipping – Find a price point that makes you profitable, and dangle a free shipping coupon if their order hits that number.

Posted in Internet Trends, Online Marketing | 1 Comment

What you need to know about Google Suggestions, Live Search

I did a post over at about Google suggest and how it works, check it out:

Early this month we talked about some news that Google removed “Scam” as an auto-suggestion in its search suggestion tool. It looks like we all celebrated too early because it is back in the suggestion box. If you do not know what I am speaking about, here is a little back story on what Google suggest is, why it is here, and why you should care about it. Full Blog Post Here

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Google Farmer Update – Who Should Care?

This is going to be one of the shorter posts I have written. I am getting a lot of questions in regards to the Google Farmer algorithm update so I thought I would put down a couple of notes on the subject.

The Google Farmer update, which took place in late February 2011, is an algorithm specifically targeting scraper sites and sites with little or no real unique value.

95% of legitimate online businesses need not concern themselves. If anything, it will help you drive further up the rankings as other sites will get removed above you. The website owners that are worrying right now have probably worried for sometime, they knew that Google would catch up with their crappy content one day.

Basically, the filter is weeding out sites that scrape content from other sites which is giving the public no real value. A Google searcher does not need to see the same content regurgitated on multiple websites. Google is looking for more uniqueness, plain and simple.

If you have a good website, with good content that you created, you need not worry. If you don’t, I suggest you get writing. Google might not have gotten you this time, but they will get you.

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Tips on how to hire an SEO company / employee

Hiring an SEO is a very difficult thing to do. I have been hiring them for years as employees, I couldn’t imagine knowing how to weed through the garbage if I did not have the knowledge that I do of SEO. Now a days, SEO is in many times the make it or break it for an online company and going with the wrong company/employee can have a severe impact on the future and success of your company.

I am going to break this post up into two sections, hiring the SEO company or the SEO employee:

I. Hiring an SEO company:
There is nothing consistent about SEO companies. You can put five good SEO companies up against one another and they will deliver you 5 distinctly different contracts; 5 different prices, 5 different payment terms and a host of different guarantee’s and promises. How on earth do you judge one company vs. the other when you are dealing with apples-to-oranges-bananas-grapefruit contract comparisons?

-Tip 1: Don’t compare on price. This is one of the biggest problems I have consistently seen. Sure, if the contract is outside what you can afford, get rid of it. But just because one contract is $5000 and the other is $1000, doesn’t mean that the $5000 is better. On the flip side, don’t go with a company because they appear to offer the same service at a more expensive price. You don’t want to go on the cheap when it comes to SEO. You are not buying paper towels. You are buying a service that could be the deciding factor in how successful you will be online.

-Tip 2: Know what they are doing. A reputable SEO firm will break down, with absolute transparency, what they will be doing for your company. If they are unwilling to show you specifically what they are going to do on a monthly basis, and specifically what it will cost, that is a red flag in my book.

-Tip 3: Verify Results. Many companies claim to have gotten crazy results for a client, but often times they are not verified. There are many ways for a company to verify their results. Speaking to the owner of their said placements is a great start! Also, how good of a job have they done for themselves?

-Tip 4: Check References. Don’t just go off glowing references. Anybody can make this up. One time, a client wanted to hear from 3 companies that we lost because we did a bad job for them. Shocked me at first but it was genius. Especially in the SEO world, none of us nail it 100% of the time. The best of us (I am willing to admit it) only have success with clients 70-80% of the time, so if they come back to you stating they have no companies they have done a bad job on, stay clear of them to.

II. Hiring an SEO employee
This can be dicey. Still not easy for me as I run an SEO company, but hiring (and managing) one in house to run SEO is a different aspect all together. I typically ‘ recommend in-house, unless you understand the SEO process well, but if you are hell-bent on doing this, here are a few tips:

-Tip 1: Finding an SEO. When you get a stack of resumes in, how do you filter through them? How can you verify what they are saying to be true? Unless you know SEO, it is hard to tell. I would look for a person that has verifiable references, can show 10 websites across a spectrum of verticals that are ranked well. If you are an e-commerce company, I would not hire an SEO that only has experience in the hotel industry as those are two entirely different campaigns. Also, have them write down 10 things he would do to your site out of the gate, see what he comes up with. Then, take those responses and hire an outside 3rd party to critique them. It might cost you $500, but much less the cost of a bad hire.

-Tip 2: Entrepreneurial SEO’s. Watch out for the entrepreneur-SEO: I am an entrepreneurial SEO and no matter what you paid me, I would be a horrible employee. If an SEO consultant comes to you looking for full time work, and his entire experience is him working on his own, don’t hire him. He will be gone the second one of his sites are doing well enough to pay his bills. Almost any SEO you hire will have side projects, that is something you will need to deal with. Just make sure they have experience with working with someone.

-Tip 3: Plan on management. How will this SEO report to you? Aside from monitoring placements, which can take a long time to achieve, make sure to plan out how you are going to measure him/her for the first six months. This first 3-6 months might be an opportune time to hire an outside consultant to monitor for you.

Good luck on your new hire! And just remember, how ever you move forward, make sure to be patient at first. No SEO company has control of search engines. It takes time. But if you hire the right company, and give them room to work, SEO will be one of the highest ROI marketing initiatives you will do.

### This was a post from Danny DeMichele‘s Newsweek page###

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