Over the past 15 years starting a new business has become easier than ever before. The daily dread of horrible bosses, annoying red tape and ringing alarm clocks that force you out of bed before God gets up is forever behind you as you make that long-awaited jump to start your own online business. Your dream of financial freedom and peddling your own wares is almost as easy as point and click.
Almost. I might have left out a few details.
While the ease of starting a business online is great for life, liberty and the pursuit of sticking it to the man, it can also have its drawbacks. Just like starting a 100 mile sprint may be easy, finishing is another thing altogether. Every business must still follow basic business principles of success in order to attain a long and profitable life.
Your business’s place in history
Mom and Pops have been around since Abel sold Cain a little something from his road-side pets-and-rocks stand. Since then, the stronger guys have been using their leverage to force the little guys out of business. But the Internet provided a way for the little guy to fight back. It leveled the playing field and became a place where David could slay Goliath.
Due to their flexibility, lack of red tape and ability to make decisions without forming a super-committee, Mom and Pops were the first to really use the Internet as a sales channel. In fact, they were what initially fueled the growth of the Internet as they found ways to compete that were previously unavailable to them. Their corporate counterparts lagged far behind for many years.
Many mom and pops were able to use the internet to grow their small businesses to be medium-size companies and, in some cases, large corporations. Jeff Bezos started a small online bookstore and turned it into one of the largest online retailers in the world, Amazon.com. Amazon is a stiff competitor to Wal-mart (which also started as a Mom and Pop) and is, in part, responsible for the demise of Borders Bookstores. (Ultimately, the demise of Borders was its own fault. “Adapt or die.” They didn’t do the former so the latter snuck up on them!)
But not all Mom and Pop owners have ambitions of turning their start-up into a billion-dollar behemoth. Getting bought out by Google for $3.1 billion is rarer than some people may believe! Many Mom and Pops are content to shoot for something slightly less ambitious, or even desire to stay small so they can maintain their flexibility, freedom and live life without all the stress.
Your business’s place online
Small businesses continue to move online to find their place of success. But so are larger corporations. Maintaining the online success that was easy to achieve ten years ago has become more and more difficult.
The barrier for creating a web presence gets smaller with free tools like WordPress and Facebook, yet competitors, both small and large, are investing increasingly larger amounts of marketing dollars into their online campaigns. What seemed like a large investment five years ago is only a fraction of what many companies are spending today.
While starting a business on the Internet today is still relatively easy compared to doing so off-line, building a successful business has become more expensive and time consuming than ever. For many small business owners, the cost of SEO is getting out of reach.
A good SEO consultant or firm might cost between $100 and $500 per hour. Employing a full-scale SEO campaign can run anywhere from $12,000 on the low end to $100,000 or more per year, all depending on the industry and how badly you want to beat the crap out of your competition (figuratively speaking). Be careful, your competition fights back. A small twig doesn’t do much damage against a competitor holding a club!
SEO costs like those mentioned above may be chump change for large corporations, but they do make the online environment a less viable marketplace for new businesses on limited budgets. This is why do-it-yourself SEO articles are so popular. Why pay someone to change your oil when you can get dirty, ruin your clothes and scream curses at your car all on your own! (A little insight as to why I don’t change my own oil.)
But even do-it-yourselfers eventually run into the ROI factor. It may be cheaper to do it yourself, but the return on the time invested is just not there in the long run.
Your business’s place with your competition
It’s no longer easy for small businesses to achieve easy online success. That’s not to say the Internet is no longer a welcome place for those with grand dreams of starting their own business and making it big. It’s just that the competitive landscape must be duly considered before making the leap. Those who already have an established online presence have the advantage. New sites take more time to build the authority and reputation that is necessary to push past the mainstays.
There is really no reason why a new site should outperform an older site in the same industry that has already established trust and reputation online. The only way to overcome that is to beat them – not by manipulating the algorithms, though that can work for a time – but by making your site more valuable, reputable and trustworthy than your competition. Being unique helps too!
But just because you’re the mainstay doesn’t mean that you can’t be out-performed in the rankings. As long as your new competitors are willing to build a site that is more valuable, reputable and trustworthy than yours, they have a shot at being competitive. And the more money they invest in making that happen, the greater the opportunity they have in overcoming those that are spending less.
If you’re comfortable staying a Mom and Pop shop, this won’t concern you much. If your dreams are bigger than that, you need to be doing more than monitoring your competitors. You need to be outsmarting (and in some cases outspending) them.
Your business’s place in marketing
If you’re fine being a small fish in a big pond, then you’re also fine not having top 10 results in the search engines. And if you’re not fine with that reality, then you need to adjust your goals. Not every hardware store can compete with Lowe’s or The Home Depot, but that doesn’t mean that they won’t be successful. You don’t need to be #1 to make a comfortable living!
However, if your ambitions are greater than staying a small company, you have to think like the big fish. You may not be able to compete against The Home Depot today, but you certainly won’t get there until you create an online marketing game plan that factors in higher budgets year after year. The Home Depot spends millions in marketing. Good luck beating them with your paltry $1000 per month campaign!
To be considered a competitor you need to change your drive, motivation and financial investment. Look to apply similar online marketing strategies and tactics, even on a lesser scale for now, but plan for growth until you’re matching or exceeding what your competitors are doing.
Even though the barriers to starting a business online are still less than starting one off-line, the mindset of success shouldn’t be. Earning first-page placement for your keywords requires much more than throwing up a website. You must be willing to invest in whatever it takes to overcome your competition. More determination, more effort, more patience and more marketing.
If you don’t know what or where your place is as a business, your marketing efforts will find it for you. You can complain about Google, argue with your SEO or rub a magic lamp, but until you’re ready to make a serious play for the next level, your marketing plan will put you in your place, which is right where you belong.
Follow me at @StoneyD, and @PolePositionMkg.