Advertising and Internet: Is it good or bad

I always said that I will never comeback to advertising after AdSense. By the way AdSense is not the best solution out there for advertising.

However yesterday I receive an interesting offer to advertise on the website.

It is a good company. I don’t know if I will get their deal. If I get the deal, the readers, the company and I are going to win big time.

Always give value and opportunity will knock at your door.

to be continued…

Groupon campaign behind the scene: the good the bad and the very ugly

Lately I was lazy. Do not worry I am back. I was reading every comment they say about Groupon after my very popular article.

I gave my quick response here.

Now it is time to give you the experience of a merchant. You need to know the complete process.

It is really easy to start a Groupon campaign. You answer their questions and you follow their advices.

Therefore it is easy to duplicate their system. Let me give you the numbers from my friend. My friend had a Groupon campaign for her Dance Class business in Montreal.

Like I said the process is very straightforward. It is almost too easy.

A normal class is $20. She gave two classes for $20. It is a 50% discount.

300 people choose to test this offer.

It is 300 * 20 = $6000 gross sales.  Yes 300 people respond in 24 hours.

Groupon kept 50%. In this campaign my friend had $3000 and Groupon had $3000 (simple math here).

There are two big questions you should know before you start any campaign with Groupon. It is something you should know anyway. You should know your customer cost acquisition. In this case it is 3000/300 = 10. My friend pays $10 to get one customer.

Something is missing in this equation. She gave two classes so the real cost acquisition is $20 ($10 to bring one customer to one class).

The real cost is $20 * 300 = $6000

Oh wait… is she losing her money? Of course she did not lose her money because the Groupon marketing is a win-win situation or almost a win-win situation…. First you pay Groupon only if your campaign is successful.

However you gave away a lot of resource. Not only 300 people signed up but they signed up for a free class.

Like I said the real cost is $6000. Your profit so far is $3000 – $6000 = – $3000

Now you might say it is a very bad deal because I did not include taxes….

It was not a bad deal because 25% that spend for one class buy a second class. 75 % that spend for a second class upgrade for the full program at $250 (it is a 6 months program).

In this case everyone get two classes. You might think that 225 people choose the full program (75% conversion).

It was lower than that. It was 20%. Therefore 60 people choose the full program.

The new money is 60 x $250 = $15 000

Now you add the – $3000 and you have $12 000 in pure profit.

That’s a lot of money in a very short time for zero marketing cost.

On a traditional marketing scenario, in this case, you need 256 people to make $12 000.

However the cost per acquisition is bigger of course (in our example it was $10).

Normally, you need to spend $2560 to make $12 000.

In reality the cost per people is $30 (she needs to spend $30 to get one client).

To get 256 people she need to spend $40 * 256 = $7680

To complete this madness, she save $7680 – $3000 = $ 4680

$4680 for a local business is huge.

My conclusion

Groupon is a great service and it is easy to make money with them. However, you need to make sure you put strong limits because you may end up with more customers that you can handle.

From those numbers, Groupon users are not loyal because they are deal hunters.

From my experience I think it is easy to disrupt Groupon on a local scene because you can give let say 60% to the business owner. You can also be very specific like a company that I love Beyond the rack (more about them soon).

I will not put my money on Groupon because I do not think that 5 years from now they will be there. ( my prediction)

Only in Montreal they have over 20 competitors direct and indirect.

Last word: I’m already hearing about user fatigue about those offers by e-mail.

 

ezineArticle and content farm: they are still a problem

It has been a long time since my last post but I was very busy with so many projects. I am back and I was following the news.

Google finally attack those content farms.

One of them was ezineArticle. I showed it before. They are a content farm. Today they send an e-mail to bring more quality in their network.

This is the e-mail:

We are not stating anything new when we say that quality matters in your articles.

 

It does.

 

It always has.

 

That’s why we’ve made some tough decisions lately and instituted some changes that will impact you immediately. The end user-experience is important to us and should be to you. The value you provide in your articles matters since it’s not only an investment in your future as a credible author, it’s an investment of time to your reader. Getting traffic today isn’t worth the cost if your reader quickly realizes that you’re not in it to help them – that your intent was selfish – and they’re gone as quickly as they came.

 

In an effort to help you succeed even more as an expert author in your niche, we’ll be moving forward with 5 changes that will be effective immediately. This is round one.

 

Effective Immediately:

 

Increased Quality Checks – We’ve doubled the review time per article that our Editors are allowed to focus on format, grammar, spelling, and consistency.

 

WP Plugin and API – We will no longer be accepting article submissions via these tools.

 

Deadlink /Link Diagnostic Center – If your article contained a dead link, we previously would unlink it within 35 days of your first notification and send you 5 notifications to encourage you to fix it. This process will change and if after 2 weeks your link has not been fixed, we will unlink it. You can always edit your article at a future time to update your link.

 

Basic Plus Membership level – You were previously allotted 25 article submissions in this membership level if you did not meet the Platinum membership requirements at the end of your first 10 article submissions. This level was established to help you gain the additional experience and understanding to achieve the Platinum level (quality with quantity). What seemingly occurred was a vicious cycle of the continuous adding of 25 submissions if you still did not meet the requirements. This is no longer effective.

 

The standard 25 now becomes 10. We’ve done this so that we can monitor your progress more efficiently and help coach you on what it will take to earn Platinum. It also weeds out those who fail to or unwilling to learn. If after those 10 additional submissions we feel that you are not gaining momentum, you will not be allotted any more submissions and we will no longer accept future article submissions from you. Your value in using our platform is to increase the effectiveness of your writing. While not always an easy feat for non-writers, we all need to learn.

 

New Minimum 400 Word Count – We’ve been talking about this for a few years now and made the decision that effective immediately, we’ve increased the minimum word count to 400. While we know that we run the risk of frustrating a few experienced high quality authors who can write well in fewer words, we feel that it is the best choice to make. We have not discounted the fact that quality can come in 250-399 words and we are working on an idea that spawned four years ago (but never became live) where we’ll offer another membership level and reward those authors who define the high standards of quality. In fact, along with other amenities, this membership level will be hypersensitive to quality and NOT quantity. More on that will be discussed in the following weeks.

For now, these are the changes that will immediately be going into effect. Watch this Blog in the coming days and weeks for more information.

First it is clear, I was right, ezineArticle is a content farm and this e-mail prove it.

Can they improve their quality?

I do not think so because money will always be a problem.

Mahalo tackles this problem by paying their authors.

Therefore they make sure the quality is there. I was a big Mahalo hater before but now they raised the bar. It is not perfect but it is 10 times better than the average.

I will wait a little bit but right now I cannot recommend ezineArticle.

My best alternative is wordpress.com with your own domain name.

 

Trey Smith and The software system is a huge lie… an iPhone app is not easy

I had no choice to talk about it again because my inbox was on fire today. Almost every top internet marketer in the make money online niche was promoting this launch.

software system

I noticed something crazy though. They use Microsoft and Apple success to justify this “new” service.

Yes Microsoft made billions of dollars with software but it is not easy to make money with software. It is easier than 10 years ago for example but it is still not easy.

If it was that easy every software developers would be billionaire. I will go as far to say that no software developers would be on odesk to look for work….

Why is it not easy to develop software?

To answer that question I strongly recommend that you read Bill Gates bio on Wikipedia right here.

You will notice 3 things:

Bill Gates was extremely smart.(above average)

Bill Gates was a real entrepreneur (strong passion to build something new) and a smart business man.

Bill Gates was lucky to get one of the best deals of all time with IBM.

It easy to outsource a developer but it is extremely hard to develop a smart and bug free software.

Ok are you mad because you will get fewer jobs in North America?

Not really because big companies like Google Microsoft Apple and Facebook are still hiring top notch developer for a reason. It is hard to develop smart software.

By the way I check the TV to internet software he was talking about and the software suck.

Nevertheless, it does not mean you should not buy this program or not consider software development. It is a great opportunity but it is not the easiest path.

My last word about that:

It is extremely easy to build software but it is harder to maintain and debug that software. On top of that you need a great marketing and a great customer service.

Sorry you may end up losing money.

6 month ago those marketer would go crazy over Facebook and twitter now it’s all about software.

PS: to make sure I’m not crazy, Trey Smith hire full time those developers because it is extremely hard to develop and maintain software.