Some affiliates are losing millions per month, I’m told, as a result of my TechCrunch post. And Shoemoney has not been shy about his willingness to write blog posts for money. If someone is about to ‘topple an industry’ (highly unlikely), one strategy is to trash his credibility and scare him into not writing anymore. But what I didn’t expect was that folks like Jeremy Schoemaker would be out for blood, misstate facts, and even email our advisory members. I reached out to him, to give him a chance to explain why he would go so far out of his way– so far, no response.
Let’s clear a few things up:
- Scott Richter does not have ownership in BlitzLocal. Yes, we were in his building. No, his dad never threatened to sue any of these gossipers– he’s got more important things to do. Yes, Scott has paid for many meals and entertainment. No, Scott did not cover Jeremy’s travel and lodging to come see us– that was 100% paid for by Blitz, including the loan we made him at Affiliate Convention in Denver when he had no money.
- Gillian Muessig has no ownership in BlitzLocal and is not employed by the company. She is a friend, colleague, and mentor– since she knows how to navigate the waters in building fledgling companies to industry leadership. She is the President and co-founder of SEOmoz and Rand Fishkin is her son. SEOmoz is her baby and she has said so quite plainly– why wouldn’t she take this company all the way? I respect her deeply for her insight and integrity, which has carried her company to where it is today.
- I’ve written a lot of articles. You’ve probably read some of them, maybe without knowing, as I wrote under other people’s names. For example– a number of ad serving posts, as well as most of the ShoeMoney Xtreme guides. Look at the examples referenced in the articles and compare the writing styles if you’re not sure.
- We’ve been burned a number of times: This is common in affiliate marketing. What’s not as common is someone that I’ve had deep respect for and trusted, such as Jeremy, do that to us a couple times, then claim the reverse. He is a prominent blogger and a lot of folks look up to him– therefore, he should be careful as a role model. Yes, the Facebook whitelisted account was his. He called me up while at Facebook and agreed to a 50/50 revshare, so I assigned 2 full-time employees to that account. After a ton of Russian brides and dating ads, and a few hundred thousand dollars in revenue, BlitzLocal was left with no earnings and Shoemoney took 2 employees. We lost a lot of money, which hurt a small business like ours, but we did not pursue him. His recollection is different, although the email trail and IM chat logs of these employees tell another story.
I’m owing up to all the spam (or call it by whatever name you want) that I’ve done in the past. The TechCrunch article was part of that– and there are more articles coming. Facebook has done a commendable job in shutting down loopholes– but there are many, and the players are so clever. Are these players still making money? Certainly. Could we have? Perhaps, but we didn’t. And whatever money we did make was spent on building our local platform– let me tell you that the road to scaling up real clients, especially in local, is hard. We don’t have much money.
I would be naive to think that I have enough power to shut down an industry– I am just one guy and BlitzLocal is a tiny company. Would you ever fall for a MyLuvCrush ad? The folks who read this blog do Internet marketing for a living, and I know you’re not falling for it. At the same time, don’t fall for a hate-motivated piece– examine their motives and then check the facts to see if things add up. Jeremy mentioned that the reason the picture of sheep is the default avatar on his blog is that most will blindly follow whatever he says and not think for themselves.
One thing that has surprised me is the amazing support we’ve received from white hat folks, small businesses, industry friends, and the press. How folks have reacted to events of the last two weeks clearly define if they’re black or white hat. If you’re an affiliate running deceptive stuff, you know that profits are hit-and-miss and that there’s often high school drama involved. We did some consulting for the FTC– a nice surprise, as they promised not to sue. The local and agency work is steady, the people are easier to work with, and you can feel good about what you’re doing. Ironically, we’re helping build a new form of affiliate marketing– it’s the local space. If you define an affiliate as someone who gets paid to promote someone else’s product or service, then you’d likely believe that Russian brides is out and local is in.
There’s two sides to every story, so consider the facts and make your own decision. Meanwhile, I’m getting back to focusing on local. If you want to build a real business with local clients, I’d love to hear from you.
Borrell Associates predicts that in 2009 local online advertising will hit $14.2 billion, while 2010 will be only $14.9 billion– a measly 5% increase.
I would agree that local online ad dollars are not going to grow in the near term– the reason not being hyper-competitiveness, but the exact opposite. Ad dollars on Google AdWords and Facebook are squandered so badly that why would any business want to throw good dollars after bad? If Fortune 500 companies can’t get their PPC and listing campaigns right, what chance does a mom-and-pop have?
Enter small advertising agencies, who themselves are local, serving local clients. Arm them with templated PPC campaigns, templated listings processes, templated wordpress site creation, email autoresponders, and all the rest. Make it idiot-proof, such that anyone (your mom, for example) could do it.
I don’t believe that the giant agency will be able to compete against this new breed, since a call center employee is not as powerful as someone living in your neighborhood who is well-educated, really cares, has less overhead, and is more nimble. After all, if you’re a one-person agency and are relying upon that income to help support your family, you’re going to take your role more seriously. You have to see that client face to face– so you better do a great job.
But to empower this hidden or underemployed workforce– the JetBlue moms of the world– a company needs to step in and create a system that is so simple and so powerful that even the ShamWow guy would be impressed. That is the goal of BlitzLocal and watch as we roll it out over the next year.
You can build the most awesome software, but if you can’t get it in the hands of these analysts– who are franchisees– then it’s no good. This is the equivalent of the “last mile” problem in telecom. It’s less a software development problem than one of organized processes to find, train, and manage this workforce.
The definition of local advertising is starting to change as well. Are industry journal counting Facebook for local, which is now 74% of their 2009 revenues? How about the services popping up to get businesses listed in the various on-line directories, such that they can increase their number of citations — thereby showing up in maps? What about video and other types of user generated content?
Thus, on an apples-to-apples basis, the traditional Internet marketing ad channels won’t grow– and neither will the mega agencies that are trying to scale them. They churn out customers too fast. But overall, I predict tremendous growth of the one man (or one woman) shop– an army of nimble, hungry folks who will be savvy in using Facebook, Google AdWords, and every other marketing channel available to them. The economy is ripe for some massive entreprenuership in 2010. Are you a stay at home parent looking for something other than the next Tupperware, MLM, or Acai scam? Maybe you’re looking for some part-time income but were afraid of computers– or are tired of licking stamps.
If you want to join us, send an email to email@example.com and tell me why.
Between my personal blog and that of BlitzLocal, we’ve gotten about 23,000 hits in the last 24 hours. The TechCrunch Effect is when TechCrunch covers your site, typically on launch day, and brings it down from massive traffic. And you often generate media buzz, with many companies then being acquired.
Fortunately, we didn’t go down– as we were prepared in advance for the 100k-300k hits that sometimes strike from a TechCrunch post.
The article drew 315 comments so far– polarized between mudslingers and applauders, with the applauders slightly winning. Let’s talk about what these folks were saying, bucketing responses into generalized categories:
- Hooray for exposing the spammers.
- What? You mean that Acai Berry doesn’t work and that it isn’t free?
- When is the next article in the series coming out?
- Ads are not spam– there’s a sucker born every minute.
- Stop outing what I do– I’m trying to make money spamming.
- Dennis and his BlitzLocal crew have the cooties and can pound sand (that’s not what they actually said, but you can insert your favorite personal insults in there).
What’s these people are saying also says a lot about them. Let’s start with the vocal minority. There are affiliate marketers who feel the need to defend the flag of affiliate marketing. Remember back in 1999 when David Howard used the word “niggardly” to describe a stingy budget package? Jesse Jackson and prominent members of the black community were up in arms, citing racial slurs. This fellow was crucified over the ignorance of others– since niggardly means small and stingy. No racial overtones, though it’s similar to another word.
My TechCrunch post was about the ecosystem of ad networks, Facebook, advertisers, and app developers– how Facebook has been striving to shut down deceptive ads (it’s the whack-a-mole game), and how virtual currency can perpetuate this behavior. It ends with a positive note on how local advertisers and brands would come on the scene and squeeze the current affiliates out.
Is all affiliate marketing bad? No, since an affiliate is anyone promoting an offer that isn’t theirs. Look at the e-commerce offers on Commission Junction and LinkShare. Those are products we can be proud of. Same with promoting local businesses. If you’re helping small businesses with their Internet marketing, you’re a local affiliate marketer.
The folks who are complaining– are we ruining their livelihood? No, since the article is written from the viewpoint of someone running an ad network. There aren’t that many of us. But it’s interesting to see folks complaining about a view they don’t even understand– they’re not even the subject of the article. You might as well boo if your favorite pro football team loses– though you had nothing to do with their winning or losing, as just a faceless spectator.
Hence, a niggardly response– ones that exposes children playing schoolyard games and attack from the shadows. There is one thing about arguing in Internet forums. If you stoop to their level, you’re no better than them.
For those who want to post a thoughtful response, feel free to write one using complete sentences and proper grammar– then email it to me and I may post it. Or call up Michael Arrington and tell him you have a counterpoint. Or post your response directly in the article comments– then see what everyone else thinks.
I knew when posting the article that some affiliate marketers would be offended. But I also knew that this would help solidify BlitzLocal’s position as Facebook advertising agency. The number of media inquiries and large brands in the last 24 hours have been amazing.
A number of folks are also inquiring about joining the BlitzLocal team– I’d welcome anyone that wants to make a decent living serving real businesses, as opposed to pushing Russian brides ads. It might not be as much money as spam, but it’s an honest living and one that is in an area of growing importance.
I’m grateful for the the good folks that I get to work with and friends like James Hong who gave encouragement, as well as Facebook themselves.
It’s bad enough that there are over 60 million users (including me) wasting real time and real money growing virtual crops to earn virtual points. A new article in TechCrunch blows the doors on an industry that is set to generate over a billion dollars in 2009 (source: Nick O’Neill of AllFacebook.com).
Look out for a guest article I’ve written, which will show up either on TechCrunch or AllFacebook– which goes into the mechanics of ad network earnings on both the virtual currency and social ad side of things. It’s 7 pages long and 2,478 words.
Networks like OfferPal and SuperRewards don’t have long until they’re busted for what’s really going on. And if you’re a publisher doing more than $20k a month and want to do better, contact me privately– I have options for you.
Meanwhile, keep playing FarmVille– it’s addictive as hell! I’m at level 30 now and having a great time. My advice is to grow grapes, as they have the highest profit for any 1 day crop. If you’re patient enough, just buy a ton of hay bales and sell them. Buy 200 hay bales, which cost 100 dollars each and get you 5 experience points, and you earn 1,000 experience points. For the same $20,000 you’d have to spend $100,000 on a windmill.
So what’s your view– a user who doesn’t care, someone who thinks Farmville is a stupid waste of time, an affiliate marketer who wants to cash in on this somehow, or a game developer that is looking for a better way to make money? Love to hear your thoughts. I will respond to all comments here.
There are 540 million directories printed in the United States each year. That’s 1.7 directories per person, assuming just over 300 million people living in the US. There is not one “yellow pages” company, so it’s many companies printing many books.
The average yellow pages book weighs 3.62 pounds. Multiply that by the 540 million directories printed each year and you get 2 BILLION pounds of paper. It takes 24 fully developed trees to make a ton of paper. So you’re looking at 23 million trees each year being cut down to make these books.
The yellow pages industry is a $26 billion annual business, bigger than Google’s $20 billion in revenues for 2008. The yellow pages are profitable and are not dying anytime soon. Most publishers have recycling programs, to quell the environmentalists that protest the waste– but almost none have an opt-out program.
Online advertising programs are cutting into offline revenue. I don’t believe web advertising would ever fully replace print, TV, radio, magazine, and other forms of media– but it will become a growing share over the next 5-10 years.
What say you?
(in other words, how to NOT have a blog that gets no traffic)
Every few days I go into Google Analytics to see what’s driving traffic to my site. If there’s a sharp spike, it’s usually because of a guest blog post or speaking at a conference. If it’s a gradual increase, it’s because I’m ranking on some organic keywords. The number 3 keyword driving traffic to my blog over the last few days has been “facebook application promotion“, and that’s been driving new consulting business to BlitzLocal.
So when you see that you’re getting traffic on an organic keyword, the next thing you should do is search on that keyword and related keywords. So I did that search.
And found that I was ranking #2 out of 58,300,000 results, with the #1 result being Facebook themselves. Here’s what I’ve learned: if Google thinks your blog is good enough to rank on a competitive keyword, then by all means you should blog more about that keyword and related keywords. Maybe you rank on a term that is not ultra competitive, such as “cell phones suck“. Well, with some work, maybe you can eventually rank on “cell phones”. Think of it like winning in junior varsity before moving to varsity or pro.
There are 4 things to consider here:
- How many hits you’re getting: Don’t worry about the terms that you give only a few hits a month– look only at your top 20 terms.
- What position you rank: 10 hits a day could be due to ranking #1 on a low volume term or ranking #35 on a high volume term. So you need to assess how much room there is to grow.
- The quality of those hits: If the bounce rate is greater than 70%, you have a problem. It means that people aren’t getting what they’re looking for– and you know that Google notices that bounce rate, too. In search, it’s called bounceback rate– the percentage of folks who “bounce back” to the search engine results page to keep looking.
- Whether those keywords have economic value: How much are those users worth via AdSense or some affiliate program?
Thus, if you listen to Google, they will help you make more money. I hope these tips helps you get more traffic– and more earnings– to your blog!
Update: Looks like dennis-yu.com is not ranking #1 on “facebook application promotion” on Google.
Got 60 seconds? Check out the 24 funny pumpkin carving images here– they’ll make you laugh. Here’s my favorite one:
Ok, fine– it’s not technically a “carving”, but it’s still hilarious!
Not much more needs to be said about this. Gotta wonder how this ad was approved by Facebook. The guy is naked and she probably is, too. What do you think the advertiser was targeting– old guys who say “creeper” in their profile? This is worse than the “date a cougar” ads from a few weeks ago.