Underpricing

In the past I historically set my prices too low. Some of that was due to starting out with a low self-esteem, but just as much of it was due to not appreciating the actual value of what I was delivering. Because I could do something cheap I had no problem doing so, even if my pricing was well below the value delivered. Another thing that caused me to charge too little was a distaste for traditional salesmanship techniques (a difficult hang-up if you are a marketer!)

Where I learned how off my pricing was is when I reviewed work done by some competing firms for 5 figure sums. Some of which was of far less value than what I was offering in my $79 ebook. Well that made me feel a bit like an idiot.

When Low Prices Make Sense

I think when a person is new to a field it makes sense to set prices somewhat low so you can...

• overcome starting friction
• build customer experiences & interaction
• get feedback from customers on how to improve your product or service
• gain testimonials & social proof of value

Setting prices a bit too low helps subsidize creating other pieces of your sales strategy...whereas if you set prices way above market expectations you won't get sales or market feedback.

The Problems With Discounting

But typically discounting should be done for a short period of time, only as something that is given as a reward for being fast acting. If you frequently discount you just lower the perceived quality and value of your product. And while you think you might be giving someone a good deal by discounting you have to look at it in the broader perspective. Offer a lower price and the customer...

• respects and values it less
• is less likely to use it and act on it
• is more likely to be demanding (since they don't see as much value they expect you to spend more time and effort proving it)

all the while you...

• become over-worked and burned out
• work over twice as many hours servicing twice as many people (and, not surprisingly, miss an email or 2 because you are constantly behind)
• sell your time at a discount while watching your health erode

Really the whole set up to discounting is quite stupid.

What About Free?

In a world where traditional advertising is losing efficacy, offering something free that helps gain mindshare and establish a relationship is smart. But free does have limitations. One of the biggest limitations is a sense of entitlement. If a person is a non-paying customer they are not a customer. You have to assume their complaints are worth $0. You owe them nothing and they should be thankful for whatever valuable tools and services you offer for free.

Overcoming Entitlement

After you get enough momentum it makes sense to erect barriers to entry so you can gain value while giving it away. Rarely do one way exchanges build lasting value. If 1,000's of non-paying users are sending you emails asking questions then they are noise that must be filtered through ... a non-trivial cost.

The hard part is that it feeds the ego when you give stuff away and help people out. You think that you help so many people and that lots of people care for you. Put any barrier in their path and you will see how selfish and worthless many of those people are though. Every barrier brings about some level of hate from the most ignorant, greediest, and least appreciate members of the crowd. But if you get something like this you can't respect the sender:

This is crap. Every download link goes back to the same page. Like how are you suppose to download the tool if there's a download link which say #.

Instead of spending time collecting peoples emails and spamming them you should try more in giving better product and easier way to access them.

I like your tools, but it was easy last year to use them, now it's a waste of time. If this system keeps on getting more slower and I've to go through more registering then using I'm better off using something which is less good but instantaneous, which was your product, but it's not anymore.

So I hope you start easying out the process of installing your tools or you'll start loosing your customers.

So that person...

• is not paying me
• uses our CUSTOMER support area
• tells me they like our tools
• wants me to create BETTER products
• calls me an email spammer
• expects me to dismantle my sales funnel in return for nothing (other than random critical hate mail)
• tells me I will lose customers if I don't make it easier for freeloaders to use my stuff
• never intends to pay me

As far as my business interests go, that person is worth less than nothing. If they are still breathing, it is no doubt a waste of oxygen.

Would I rather spend my time helping out that ungrateful USER, or would that time be better spent spending it with someone who loves me and cares for me?

Resourcefulness

Now some people have a tough break and sometimes it is worth helping them out. But in most cases a lack of resources is simply caused by a lack of resourcefulness. And, since change comes from within, if you try to help those kinds of people out they are far more likely to pull you down than you are to lift them up.

Recently a person asked me via a blog comment what they should do if they are smart but can't afford a conference ticket and know nobody. The frame of that question is one which is lacking in resourcefulness. When I was new to the SEO industry part of why I got known was because I syndicated content to other sites, participated in some online forums, moderated some online forums, and blogged day in and day out. I further spent tons of money giving away free software, which some people appreciate ;)

And even when I was less known, had no money, knew nobody, etc. I did not see those as obstacles. They were opportunities. Since I lacked capital I could leverage my time as an undervalued resource until the market started to value it more. I got a job to create cashflow, spent everything I could on learning + networking, helped organize a conference in exchange for a free pass to go to it, and out of the process the only thing I regret is that I didn't savor obscurity as much as I should have. :D

You would either have to be new to the industry or under a rock to not notice how the SEO industry has become more corporate over the past 3 or 4 years. The trend has been slow and gradual with many small steps, but I thought it would be a good idea to try to put the pieces together. What started off as a 5 minute project took a couple hours. I hope you like it! If you are a creative thinker you should be able to get a number of actionable ideas by thinking about how such trends will change your market.

Warning: this image is big! ~ 225KB

http://www.seobook.com/images/corporate-seo.gif

This is sorta a high level document which looks at many existing and emerging trends and how they combine to change the landscape. A lot of small businesses and small online publishers are feeling the following trend

In a recent comment on a blog post about link buying Google's Matt Cutts stated:

Personally, I believe the reason that so many people come to Google is that for the last decade, we’ve worked really hard to protect our users and return the best search results. When other search engines showed pop-up ads, Google didn’t. When every other major search engine offered pay-for-inclusion into their search results, Google didn’t. And Google has taken strong action to protect our users from spam, malware, and poor-quality sites. I think part of Google’s lead (and brand loyalty) in the search space is because we’ve taken strong action to protect our users.

Sure I think they try to protect people (and do a good job), but I never really see the bits that are inaccessible, so I don't know what I am missing. In time I do wonder if you could have too much media consolidation due to favorable reviews of "too big to fail" brand companies while smaller competitors are flushed away for using similar marketing techniques.

To the best of my ability in the above linked image I tried to explain why SEO outing is bad in how it influences the entire search engine optimization, search, and online media ecosystems. If I had to shorten it down to 3 points, those would be...

1. Outing limits media diversity. Media plurality is important, but it is something that Eric Schmidt doesn't get. And it is often the independent types who have the editorial freedom that enables them to highlight major fraud. Some media channels are so driven by advertiser interests that they fire employees who dare to mention risks in advertiser's products. (And I would rather pay a bit more to not drink poisoned milk!)
2. Outing harms small businesses while corporatizing the web. Historically most economic innovation has come from smaller companies. Microsoft was once a small company. And so was Google. ;)
3. Outing drives down the earning potentials of many SEOs and will eventually force many independent SEOs into low paying in-house SEO jobs. Most societies operate on a debt-based money system where debt slavery controls many decisions. The ability to be self-employed, do what your passionate about, and operate outside of that system should be cherished by anyone lucky enough to not have a boss.

Google's Eric Schmidt claims that "brands are how you sort out the cesspool." Brands take money to build, but they are bought and sold just like anything else - only they require more capital and/or more insider connections to buy.

You know those damn bankers who bankrupted their own companies through the use of leverage and predatory lending? And then the same people lied, cheated, and looted trillions of Dollars from United States tax payers to save their companies (and pay their bonuses)?

Well they are not only leading media advertisers, but they now own a HUGE chunk of the traditional media sphere:

One wonders why Goldman and JPM were so eager to provide "rescue" financings to virtually the entire distressed media space: both companies knew too well that sooner or later they would end up with full equity control over essentially the most coveted industry: thousands of TV stations, radio channels, newspaper and magazines. If you thought the media propaganda was unbearable now, just wait.

Unbelievable Stupidity

When I was in the military they would run these stupid drill where they would try to create as much stress and chaos as possible in a short burst of time, find someone who makes an error, and chastise them for it. That killed morale. So to make up for declining morale they decided to run more frequent test and drills. And thus being an enlisted nuclear power sailor in the US Navy is a horrible life that I wish on nobody.

At one point in time I was on watch when a new kid made a mistake during maintenance that killed all electrical power on the submarine. Later we had a discovery meeting where we found out what went wrong. Having been 5 feet from the maintenance, I knew that the kid's boss came over and told him "remember to trip close trip the breaker when maintenance is done." The kid listened to that wonderful tip and turned the turbine generator into a turbine motor.

But since the new kid was dumb enough to listen to the bad advice he took all the shelling and blame. It was as simple as that, but even the captain of the boat (along with everyone in the chain of command - including the guy who gave the stupid tip) were together in a huge group insult fest where they tried to one up each other insulting the new guy. It lasted for like an hour and a half and the lines were so bad that things like do you realize how stupid you are? were said to that kid. I thought that if the meeting lasted another 5 minutes they were going to start chastising him with questions like do you realize how fat you are?

It got so bad that the electricians had to set up a work area to change a light bulb, making each bulb about a half hour process. But since I wasn't an electrician (I was in reactor controls) I could go ahead and change the light bulbs in about 30 seconds each. But if I wasn't helpful to the next division what took me a half hour would have took them about a whole day. The solution to every problem is closer scrutiny, more testing, and more baby sitting.

On the same boat the leaders had us take out the flooring railing in the engine room to have them repainted. This flooring railing was never meant to come off and would not fit out of the boat's escape hatch. BUT someone was stupid and said it must be done. And so there we were using a hacksaw to chop up the floor supports (ruining their structural integrity and making the submarine far noisier and less safe in the process) so the floor supports could be freshly painted and look slightly better.

If you want to see a horribly run organization full of miserable people put them in a confined high stress environment where no matter how shitty they make someone else's life, they get no market feedback or pain for coming up with an endless array of stupid ideas.

The military is a rat testing lab.

You can learn a lot about yourself, what drives you, how to succeed, and how to fail by putting yourself through such a miserable experience...though I would not recommend it to anyone smart enough to be reading this blog right now! ;)

What Drives You?

I respond well to positive feedback and I simply shut down from negative feedback. One of the hardest things I have struggled with is someone I know giving me the wrong kinds of motivation. XYZ knows less than you, works less, sells far inferior products, and makes more so you must be screwing up.

This is true of a lot of direct marketer types who don't give a crap about the success of their customers but are willing to hype anything and everything they can put their name on - even if they make false promises and don't know what they are selling. But if you care about the quality of your product, use what you make, and actually provide real customer service you can't compete on hype without pulling in a lot of people who were not worth having as customers.

In the short run you can't compete with the top line numbers (especially the inflated ones before the affiliate commissions and the huge number of refunds & chargebacks associated with people realizing they bought into a scam), but after a decade of solid effort you can compete with the scammers on earnings (plus many of them get flushed out of the market, constantly replaced by a new breed). But are your goals short term or long term? What are your goals? What drives you? Is it money?

Money in Context

Money is just a tool for exchange. If it is your sole motivation you will end up losing motivation quickly. And as long as you are not printing the money supply and do not have lobbyists working CONgress for funds, it will almost universally hold true that someone dumber than you who doesn't work near as hard will earn more money. But it is not a relevant mindset that will lead to anything productive with your life. What good is money if chasing it makes you miserable?

After reaching a certain level of success an additional dollar of income doesn't provide much additional marginal utility and a singular focus on it can harm other aspects of your life. Money can buy a bit of happiness, but it can't buy a lot of it. And we often spend it incorrectly.

The problem isn’t money, it’s us. For deep-seated psychological reasons, when it comes to spending money, we tend to value goods over experiences, ourselves over others, things over people. When it comes to happiness, none of these decisions are right: The spending that make us happy, it turns out, is often spending where the money vanishes and leaves something ineffable in its place.

Measuring Success

In time smart efforts (combined with a bit of luck and a lot of learning) produce results. So long as you are honest even dumb or failed efforts produce wisdom. But you can't be #1 at everything.

You have to decide what you view as success and stick to comparing yourself against only yourself, or else you will get burned out, singularly focusing on an arbitrary goal while your health and happiness erode. Until the past week I basically had chronic back pain which is just now lifted and I feel like a kid again. That was only made possible because I decided to temporarily close off the site to new members to make enough time for exercise. And it is already working. Paying customers are still getting great customer service, but for now I am not stuck doing as much admin stuff as new members cycle in and out of the site. That leaves a little bit of time for sanity, which I hear is important. ;)

Giving Praise

• If a person who is gifted but lazy is praised they will just become more lazy and arrogant and worthless, feeling they deserve the world even if they did nothing to earn it.
• If a person is doing their best and you keep telling them it is never good enough (like the Navy ORSE testing regime) you are just going to make them miserable, shut them down, beat them into submission, and kill their happiness. Such policies kill motivation and drive away talent.

You shouldn't praise the results, but praise the right kind of effort:

Those who had been praised for their effort significantly improved on their first score—by about 30 percent. Those who’d been told they were smart did worse than they had at the very beginning—by about 20 percent.

Social Clustering

Much like you are what you eat, many of your good and bad traits are driven by (and drive) the people who are in close proximity:

When a Framingham resident became obese, his or her friends were 57 percent more likely to become obese, too. Even more astonishing to Christakis and Fowler was the fact that the effect didn’t stop there. In fact, it appeared to skip links. A Framingham resident was roughly 20 percent more likely to become obese if the friend of a friend became obese — even if the connecting friend didn’t put on a single pound. Indeed, a person’s risk of obesity went up about 10 percent even if a friend of a friend of a friend gained weight.

So if you are living an unbalanced lifestyle and sacrifice other aspects of your life for a singular (and often short-sighted) view of success, it will likely harm you AND the people around you.

The Frequent Failures of Self-Help Groups

Many well established organizations built around causing change eventually become stuck in their ways, fearing change and becoming yet another bureaucratic institution. How much harder is it to create lasting change that creates growth if they bond is built around a weakness?

When people go to support groups they often create bonds around their weaknesses with others who share the same weaknesses. Perhaps this makes the weakness become more ingrained in their identity, makes it seem more normal, and makes it harder to change. If this is true then perhaps the support groups that work are those based around doing something positive, rather than those based around not doing something negative.

And, from an online publishing perspective, if you write about having a specific personal problem (not being able to quit smoking, being overweight, etc.) then that can attract people with similar flaws into your life...recalibrating your sense of normal and making it harder to change the behaviors which create the undesirable results. It is no wonder that most sites in some such self-help categories are scams - anyone who legitimately cares often surrounds themselves with negative influences - making it harder to build and maintain lasting change.

The more you try to erase me, the more that I appear.

Synthetic Happiness

Dan Gilbert has a great talk about how we can synthetically create the happiness that we seek. If our fears or ambitions are not limited then it is hard to be sustainably happy. But by overcoming our fears and limiting our ambitions it is much easier to be happy sustainably.

Do You Realize How Lucky You Are?

Speaking of happiness, I saw the following video on Kevin Kelly's blog, which really helped add perspective.

Now that I have enough spare time to think and grow I see some of the errors in my ways from as little as a month ago. Life is great :)

BTW, this free Clive Thompson article on how social networks work is probably the best marketing article I have read in the past year. It is 10 pages, but well worth the price of admission.

Danny Sullivan highlighted his frustrations with dealing with running Sphinn, a social media voting site for internet marketers:

Sounds easy, right? Sure, but as I’ve learned in the two years since we’ve run it, it’s a minefield.
...
While a community site can be fraught with egos, and concerns about double-standards or fairness, at least you have sympathy for people who are part of the community itself. Who have invested time, or energy or part of their souls to it. You want to do well by them. You want to do nothing for the drive-thru asshole who makes no effort at all.

A number of years ago I bought Threadwatch and eventually shut it down in part because it was facing some of the same issues. Largely it can be summed up with drinking well = pissing well (and, to some, a full on outhouse).

We can complain about human nature, but we can't really change it.

The problems with free for all internet marketing sites are 3 fold

• The economic incentive for sharing is broken. Apply an idea to your own website in obscurity and make thousands of dollars (or more) off it. Share it publicly and lose a competitive advantage as you watch it get cloned and/or burned to the ground. If it is really effective then sharing the idea can not only cost you a competitive advantage, but can also put you on the Google watch list, and make search engineers more likely to penalize your websites.
• There are perhaps at most a few dozen SEOs who both a.) are original thought leaders b.) who frequently share original strategies publicly freely. While there are over 1,000 SEO firms listing in DMOZ AND there are over 4,000 SEO blogs listed in BlogCatalog's SEO category. Most of the market ***is*** noise. Sure people who are relatively obscure have great ideas from time to time, but rarely are they the people trolling public internet marketing sites to vote up a pool of (largely) spam & rehashed content.
• Those who really know what they are doing in the SEO field should eventually be able to earn x hundred to y thousand Dollars per hour. Whereas the media that is freely available is often presumed to have limited value because of its price-point. Even if you share great tips with people they won't value your help. A couple days ago a person who bought a domain name based on a mention here also wanted me to link to them for free. And if you went to their site there was no mention of me and no link to my site, in spite of me being the reason they have the great domain name. Take. Take. Take. Take. Take. No thanks!

Want to get rid of the noise? Charge $100 (or more) to open a new account (and maybe an annual membership fee). That will clear out the 99%+ of the market that are faking it until they make it and/or who are there just to spam the site with dreck. And (if required) you could charge $1 each for votes, making them have a real economic cost.

Such moves would clear out a big chunk of the current Sphinn audience, but no pain no gain. Longterm the site would be far stronger if the signal to noise ratio was improved. Take the earnings from new account registrations and apply that to hiring a full time editorial staff that both writes original featured content AND scours the web to submit stories. Maybe some of the features become member's only.

To further promote hunting for leading content across the web, perhaps whoever submits posts that make the homepage get some "earnings" for finding that story (though this would need some thought to prevent encouraging of spamming...but it is easy enough to have advertising sponsors offer prizes and such that are non-monetary to some degree).

One of the lessons I learned the hard/slow/stupid/painful way is that anytime you put all of the opportunity cost on yourself people will abuse it. They will treat you like a tool and waste your life. And some days they will make you loathe humanity. The more popular you become the more nutcases you reach. (Of course you reach great people as well, but they are not the pain in the ass that the bottom 10% of the market is).

You have to cut off the bottom feeders and charge for anything that wastes your time. Today a guy called me up for phone support for one of our free tools. He got no help because my business model is not built around offering quality tools AND premium personalized support for free. If I value my time at $0 then eventually so will the market. I can't think of another person who works as hard as I do who sits around waiting for calls demanding free help. Of course people can pay for help and get my best. And that is the beauty of economics...it fixes most of the noise problems. But if you don't value your time you can't (legitimately) expect others to do so.

Recently a well known SEO blogger mentioned that they didn't understand why real professional SEOs advocate variation between page titles and on-page headings. This blog post is a free SEO consult for that person :)

Hopefully it clears the public SEO space of some misinformation.

Are You Missing Keywords?

People search for literally billions of unique search queries each month. You either target those searchers, or you miss them. Think about how many people query Google every day, and then look at this graphic:

Keyword tools are driven off of a sample of keyword data, and are thus top heavy. In some cases a keyword tool will only show you 5 or 10 related keywords for a core keyword that has driven traffic to a page via hundreds of unique search keywords.

What is Duplication?

Each piece of duplication in your on-page SEO strategy is ***at best*** wasted opportunity. Worse yet, if you are aggressive with aligning your on page heading, your page title, and your internal + external link anchor text the page becomes more likely to get filtered out of the search results (which is quite common in some aggressive spaces).

Even if you build a site (and a particular page) that are authoritative enough to capture a #1 keyword ranking, if your on-page SEO is strong you still get far more traffic from longtail keywords.

How to Include Variation in Your SEO Strategy

So how can you balance your on-page SEO strategy to capture more of the highly valuable search traffic? You can...

• use singular vs plural
• use synonyms
• use various keyword modifiers
• change word order

The bottom line is using more relevant keyword variations = more traffic.

Apples to Apples

Thinking about this site...we have competitors who have similar site age, way more inbound links, ~10x the number of employees, 5 times as many pages of content indexed by Google, more comments on each page, and yet we still get more search traffic.

Meanwhile I have made over 15,000 forum posts + build out a bunch of other websites (ie: doing a lot of work other than SEO for this site)...so our relative out-performance on much more limited resources comes from using a smarter and more comprehensive SEO strategy.

We don't get as much Twitter traffic, but then we don't target the hype and misinformation game as well as others do. ;) (Everyone has their own niche target market!)

Bonus Tip

Some people understand SEO on a mechanical level. Others understand it on a holistic level. This is one of those tips that separates the men from the boys. ;)

Some content management systems force the page title and the heading to be the same by default. But both Drupal (Page title) and Wordpress (SEO title tag) have plugins that allow you to make the on-page heading different from the page title. This allows you to optimize for different things. You can...

• create a headline for RSS readers that is designed around piquing curiosity and/or targeting emotional reactions to pull in clicks
• create a keyword laden page title that is designed to pull in latent search traffic

Not only does variation allow you to target those 2 different audiences (and pull in more search traffic), but readers often link to content using the official title in the anchor text. So if you make the page title and on-page heading different that can help you get more keyword variation in your inbound link anchor text as well.