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Running a Directory as a full time Business

Discussion in 'Directories' started by JamieG, Apr 17, 2008.

  1. Event_King

    Event_King Guest

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    #41
    Continued:


    The Fall of my Directory idea - Part 2

    Dealing with Agencies............

    “Dear expensive Ad agencies. We don’t all need brand campaigns to succeed, it would also be nice if you listened to the people that pay you, instead of spending money we just don’t have. We don’t all live in London in easy travelling distance to have more endless meetings just for you to justify your fees, and absolutely hate it when you slam the phone down on us when we reveal that we are a start-up, and you assume that we have no cash flow to buy your expensive award winning adverts”

    "We aren't here to win awards - we are here to win business, so design a campaign that SELLS us, will you Mr Agency."

    Advertising Agencies

    The above is so true of agencies these days. I mistakenly phoned one of these up, (I thought they might also organise PR too) - turned out they don’t, and on mention that we were a start-up, they automatically assumed we had no money, and were rude, very abrupt and slammed the phone down on me - proof that agencies don’t want to know start ups.

    You will get lot’s of this treatment when first starting up in business, but these are just idiots and are only concerned with money, well, if they bothered to check - I had money to spend on advertising (about £3000) yet they decided to treat me with contempt and thus lost me as a client for life. A client is a client, no matter what they are spending as they may only spend £1000, but 6 months down the line, they could spend £20’000.. -- and yet they treat potential new business this way..

    Partnerships - will not make you much

    Ok, I dislike affiliates - shocked? Well, you shouldn’t be if we break down exactly what one is. The objective of affiliates are to sell on behalf of somebody else (usually a company like Amazon), for which Amazon will pay them a pittance for doing all the hard work, well that’s fine so if they want to do that, then go ahead.

    But, these salespeople then mail me something cronic and try and lie that they own these products and if I’m lucky, they will offer me some fantastic big business partnership in their company - what the! These are NOT, I repeat NOT what business partnerships are, no way. (Not to mention the time wasted reading these stupid emails...)

    Proper business partnerships have written contracts, stakeholder agreements and stuff like that, eg: Google buys 10% share of Joe blogs plc for 10.9 billion or whatever. These affiliates did nothing but completely waste my time, and I had better things to do. (You don’t impress nor win business that way)

    Here’s a story of a total waste of my time with a large company called Espotting:

    Visited the Espotting site, looked like a good company, well, at least it was established, and noticed they wanted business partners of some sort. Now, I had a feeling that it wasn’t going to be brilliant or anything, and not even good, but thought I’d try and negotiate something with them. So fired off an email offering my directory as a tool, so they could place Espotting paid results within my search pages.

    Was invited to ring for an informal chat, and requested my company details like traffic flow, visitor information, and some other technical stuff and future plans blah blah. Well, the girl I spoke to enthusiastically flattered me and basically welcomed me as a potential partner. Infact, everything seemed fine, until I questioned what my retainer would be, she said “5 pence per click” , which I told her we don’t do affiliate deals as we aren’t affiliates and a proper company, and “I’ll tell you what the fee is for adding your clients to our listings” - but at that point she declined with some crap about me not understanding the proposition, and at that point I wanted to kill her for wasting my time and getting my hopes up (but that‘s what these websites try to do and rely on), but put the phone down on her, in mid-conversation, instead.

    Stupid girl really to think I would accept that - too funny.

    This is what it’s like though, everyone thinks they can get a piece of you for pennys, sorry it might be life - but it doesn’t work like that with my company. Clearly they wanted the exposure on a targeted portal, but didn’t want to pay for it.

    Lot’s of these idiots about, and the delete key works well. Rarely do these companies get to speak to me on the phone, but if they want that appointment, they better be for real or else they simply don’t get to speak to me. With experience it gets easier to know who is genuine and who is a waste of space, so be very careful as the offer is always dressed up, and rarely do you get the fantastic offer promised. They will try and use your site, as a promotion tool and then go back to clients and say “We have another major partnership arrangement, and this is why you will now pay us £#*$!#*$!x more cash” Ka-ching!

    But in reality all they are doing is building a network of sales people. Not that impressive after all, so what I’m saying is - these large companies won’t admit to clients the exact quality of their partners. So from that point on I ceased chasing partnerships period - it just wasn’t worth the grief involved.

    They just wanted me to be another affiliate.
    SEMrush
    The Pitfalls, mistakes and problems of a web site

    The biggest mistake in the world is made when setting up a business and even more so - a web business, and that is:

    Over-estimating the value of this business

    - infact these were the very words that Rachel Elnaugh of Dragon’s Den fame uttered to one of the entrepruneurs. She later rattled off the following about web businesses:

    1. Easily copied
    2. Any profit assumed from this venture will be so inaccurate

    --- never have words been more true!

    There is a real belief on the web that it’s like turning on a very large tap, and floods of money will pour out. I kind of anticipated this train of thought, but regardless found out that starting out is very tough, and expectations would be wrong, and seriously over-estimated what my sales revenue would be.

    When setting this directory up I felt like God, here I was, finally running a business that I could call my own, and not an inkling of where the cash flow or customers would come from - I just assumed they would magically find me and the cash would tumble in. Well forget magic and the profit does not come from thin air, or just because you have 20’000 pages in Google either! Unfortunately, one has to do sales and be recommended, and many more things are involved for that to be reality.

    1. The visitors will not just swarm all over the site and purchase just because a press release is placed on the web, or offline for that matter.

    2. It will take years to be noticed, build up a directory to a decent level and trust is even harder to win. Are you prepared for the unknown, the late hours and risk of major cash? I thought I was - boy was I wrong - and I knew a fair bit about the publishing game, before even starting the project.

    And having done this, I can say with some authority that this is such an undertaking, a great experience, certainly - but without clients, without visitors or cash flow - you are stuffed as a business owner. Yes, much can be done with money as it takes no talent to spend it, but without it, without clients you have no business anyway, just an empty shell in a vast jungle of pixels, cyberspace and unable to stand out because of the millions of other sites thinking and doing exactly what I thought would be easy.

    My Mistake......

    Er, I spent too much on web design and couldn’t promote, this is why my directory died, or should I say never really took off. I will still keep the directory, but doubt it will be a stand alone company all by itself - just like the rest.

    I found this as I did the sales:

    - Many told me to get stuffed

    - Lot’s of folks wanted the freebie, but none wanted to pay, upgrade etc

    - Many will automatically assume a directory is some kind of scam

    - Few will trust, unless you are a large company

    - Some wanted site wide links or mass listings for a few pounds

    I could go on, but you get the picture - it’s hard, real hard.

    My theory about the future of directories is somewhat mixed, but in my case, being unique or niche isn’t enough, promotion is key to success and especially PR, which basically boils down to large amounts of cash, and sticking in people’s minds. If you can do that, then you might have a shot, but it’s far too big a risk against the players like Yell.com and the almighty search engines of the web.

    This is my story of one person’s dream, that never was. Well, what shall we say: “it was fun while it lasted”

    End
     
    Event_King, Apr 19, 2008 IP
    DownUnder likes this.
    SEMrush
  2. Spider-Man

    Spider-Man Banned

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    #42
    If anyone wants to do the sensible thing, follow on here :p
     
    Spider-Man, Apr 19, 2008 IP
  3. DownUnder

    DownUnder Well-Known Member

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    #43
    @ event kng, a very good and honest read.
     
    DownUnder, Apr 19, 2008 IP
  4. JamieG

    JamieG Banned

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    #44
    It was a good read, it was now and it was when it was first posted last year as shown by Spider_Man. But it digresses from the question I asked. Does anyone run their directories as proper business? :confused:
     
    JamieG, Apr 19, 2008 IP
  5. Event_King

    Event_King Guest

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    #45
    Surely this is a case of "I have a directory, but want it to be a proper business, so if I pretend it is - it thus will be"

    For starters, anything young, new or labelled as a start up IS a start-up, regardless of an owner's feelings. Using directories to make some extra bucks here and there isn't a proper business or being run like one either, and lets not go down the path of trying to convince newbies otherwise, just to extract paid entries.

    I'm not sure which organisation invented the first off-line directory, but it might well be Kellys Industrial Pages (owned by Reed Business) estb: 200yrs, so trying to invent the wheel so webmasters may feel the rush, isn't smart or creating anything useful. Unless these webmasters do something very different, and a general directory so isn't.

    The mass directory industry aren't proper businesses, and few will make it. It seems these directories are made for one purpose only - to serve other webmasters, who serve webmasters - that sell to webmasters etc etc, it's not only nothing new, it's theft from somebody else's effort, run by students, criminals and wannabees - these cannot be proper businesses. No way...

    Real businesses have regular incomes, like every day! ..... directories do not, and submission fees equallying to 2 or maybe 3 per month is not what I would class as any kind of a decent profit. So my conclusion of the directory business, is it's safe, but unprofitable unless major investors are involved, and that the directory is a smaller part of something huge and famous offline.

    Online fame rarely counts, and is so small time, it's hilarious when directory owners shout very minor success as if they are the next Yahoo - it rarely happens guys, and so few make it big. Got to be a message there or do you want examples??????

    Directories as properly run businesses, maybe. Actual huge profit businesses, I say a big big NO.
     
    Event_King, Apr 19, 2008 IP
  6. JamieG

    JamieG Banned

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    #46
    Bang goes our love affair as I have to disagree with you on this... :D

    Business don't necessarily earn income every day, there's no such guarantee in anything. I could have a shop open all day and not see a soul. Your way to negative on directories Event_King, they can make a lot of money over a long period of time if they are run correct?

    Back to the topic on hand as you seem keen to digress whether deliberate or not, are any directories on here run as business's? We've got two that have said yes so far, any more takers or is everyone here running a directory not taking a penny in submissions and therefore only running them as a hobby?
     
    JamieG, Apr 19, 2008 IP
  7. contactusa

    contactusa Active Member

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    #47
    I started a few directories as a hobby and never thought I would make a penny. This was back in 2006. During the first 5 months, I made approximately $300. Then all of the sudden things started to change. 3 of my directories started producing paid reviews on daily basis. Most submitters were SEO firms promoting their clients. My actual record was 7 weeks straight without missing a single day of not having a paid review submission. This was at the end 2007 and the beginning of 2008. There is no secret that after the last PR update, things went south by at least 30%. But at that time I was already involved in a profitable affiliate program which was stormed by my clients from my main business which has nothing to do with directories.

    But back to directories... From a hobby it turned out to be a part time business. I devote about 25 hours a week to my directories and a few SEO and Script sites that I own. The Script sites are a better income producers, but the directories are not much further behind.

    Can you make a living from it? It depends how much you need to make a living. Some will be happy with $400 a week. For others, this will hardly pay the rent, not to mention other expenses.

    The problem with about 95% of all directories is that they do not offer anything else but the basic category/subcategory structure and maybe a few articles. I have found a few that were so different by offering excellent tools, reading and unique services that initially when I entered the sites, they didn't even look like directories. And no wonder, their PR was 5 and 6. So hard to find these days. Right? Most are lucky to have a PR3 or 4.

    I think that with enough of time and effort input, one can become a successful web directory. Try a unique or a custom template. Offer more than a basic directory offers. Aren't you guys tired of seeing the same templates over and over again on thousands of directories?

    Finally, you might be surprised what your directory might become and produce $-wise after a few years of a "hobby" play.

    I remember a few years ago what one of the pioneers of the directory industry said to me:
    Do it for the users, not the Search Engines. Thanks Jamey! You were so right.
     
    contactusa, Apr 19, 2008 IP
  8. DownUnder

    DownUnder Well-Known Member

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    #48
    Hey Boss, can we agree that we all trying to march in tune :)
     
    DownUnder, Apr 19, 2008 IP
  9. Event_King

    Event_King Guest

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    #49
    Ofcourse they make money every day, offline directories do, (but the web ones probably don't). I'm only negative on the things that clearly don't work, and too many directories are made to be successful by their owners when I believe aren't. This tactic is done to sell their ad space, I mean what else will they do - say their directories are crap or something. Wouldn't make any money if they said that.



    You asked a closed question where the only answer anyone can or will give is a YES! But as for the reason I gave above, directory owners are not going to put their own directories down.

    Some never admit they run bad businesses that don't work, they can't as they probably dug themselves a hole by bigging up their directories. Thus, if they admit such a mistake, they will lose face big time and that scares them.

    People make mistakes, and it's because they are so close to their directories that they can't see any way out. Their commitment may be too big to cope with and just forget, never mind any cash injections expended setting the directory up.

    Be a man and accept mistakes and losses.
     
    Event_King, Apr 19, 2008 IP
  10. Event_King

    Event_King Guest

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    #50
    I think they are saying the same thing, but in different ways.
     
    Event_King, Apr 19, 2008 IP
  11. JamieG

    JamieG Banned

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    #51
    I asked a closed question deliberately Event_King. When you ask an open ended question you allow for the politicians of the of the directory world to come out with 'why', 'where', 'when', 'what', 'if', and 'but', without actually answering the question at hand. I did not ask anyone to put their directories down not to compromise their positions.

    The fact most people haven't posted their replies on this thread though actually answers the question I posed and does in fact compromise them.

    What people don't realize is that if you know what your doing, there are ways to earn money without falling foul of the law. If people on here weren't so afraid of their actions and suspicious of everyone else perhaps those of us who actually know certain things could share. Such as the advice I'm likely to send SilkySmooth. :)
     
    JamieG, Apr 19, 2008 IP
  12. enQuira

    enQuira Peon

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    #52
    I am interested in the advice, I answered your question lol.
     
    enQuira, Apr 19, 2008 IP
  13. YMC

    YMC Well-Known Member

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    #53
    I greatly suspect that any thread that discusses income and directories in the same breath will be approached with caution. Directory owners know how quickly their sites can be penalized by the big G and I too have been careful not to say anything that could be misconstrued when it comes to advertising and page rank. The game has changed forever since the manual penalties began and many are wisely trying to protect their businesses by saying as little as possible with regards to their income from directories.

    Had your original question focussed more on the professional/operating side of "directory as a business" and less on the earning a living side of running a "directory as a business" I suspect this thread would have went in a very different and more helpful direction.
     
    YMC, Apr 19, 2008 IP
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  14. enQuira

    enQuira Peon

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    #54

    I agree.
    ___
     
    enQuira, Apr 19, 2008 IP
  15. Event_King

    Event_King Guest

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    #55
    I agree, I was just expecting an open question so as to draw them out, and hopefully make them see sense. It's only a matter of time until many directories shut down because of what I mentioned in previous posts. This is from my forum of several so-called players, these no longer exist and went down:

    Directories that went bust 2005/2006

    Mugomilk
    Just 35
    Jini Search
    J Search
    The Arndale
    Leisure Hunt

    Were these run as proper businesses? Probably difficult to say and impossible to know for sure, but they weren't that good or they'd still be about right.

    Reasons and opinions to why they died are varied, but seem to be based around:

    Ripping people off
    Unpopular
    Scam
    Bad service
    Lack of Traffic
    Missuse of client's data


    My thoughts:

    Real businesses??? this remains to be seen, as many will continue to go bust, and I will give more proof if it's required. As soon as a business scales out, the costs will shoot up, and proper businesses should be able to handle this easily, but general directories are dropping like flies, so what does that tell you.

    It tells me they aren't being recognised as proper advertising services by punters. The sales aren't there, and likely the trust isn't there either.

    regards
     
    Event_King, Apr 19, 2008 IP
  16. richrf

    richrf Active Member

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    #56
    I agree. The question is phrased in a peculiar manner. Maybe it is a lead generation question?

    Rich
     
    richrf, Apr 19, 2008 IP
  17. Event_King

    Event_King Guest

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    #57
    -- I don't see how not posting on a forum gets a penalty - Google just hands them out and it has nothig to do with forums. I'm pretty sure about that.


    Google still penalised me, and I never let on to my engine's profits - ever, and they still knocked me down from a PR4 to a PR2 (homepage). I was a PR4 for like 2 years, but now.

    I don't love Google anymore... hehe
     
    Event_King, Apr 19, 2008 IP
  18. JamieG

    JamieG Banned

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    #58
    I don't agree and think that answer a bit of a cop out of I'm to be honest with you. I asked the question in the exact manner you stated above. People claim they are running 'directory organisations', they speak of 'we' and portray themselves as legitimate companies which perhaps they are. The reason for caution here is more likely to be the fact most have or do earn significant income from submissions and don't declare it to the IRS as someone earlier mentioned. Surely the ones who have nothing to hide would not hesitate to post about how proud they are that they've built up a business.

    As Event_King correctly said, Google doesn't even come into this equation and you saying so is a red herring?

    In fact I'd confidently say that Google would probably actually reward you for being a business rather than a waste of time hobby site that is likely to devalue the content of the web.

    What I meant by my question was clear and in fact could could be put to you YMC, do you run your site as a business or as a hobby for example?

    @Richrf; What are you on about a 'lead generation' question? That's a bit vague? and why is it peculiar? Because it asks straight out and doesn't go around in circles teasing answers out? :confused:
     
    JamieG, Apr 19, 2008 IP
  19. enQuira

    enQuira Peon

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    #59
    I am still curious to know the advice you talked about...
     
    enQuira, Apr 19, 2008 IP
  20. SilkySmooth

    SilkySmooth Well-Known Member

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    #60
    Yes I am curious too as I never did get a PM from Jamie. Maybe he is waiting for others to say yay or nay on his question. Seems as though most just want to digress into other areas though.

    Not in my case, can't answer for others though. Although I do admit that the directories are not the sole entity of my business they are the core of it at the moment.

    Rubbish, not all business's have regular daily incomes. And classifying all directories as only having "2 or maybe 3 per month" is based purely on your own experience I expect and not any real statistics of the industry as a whole.

    I will agree with that, very few actually turn into a big profit business.

    Agreed, it was one of the reasons I came to the forum with free mods, to share want I could with the community, sadly few others have the same mentality. I am waiting for this advice with interest.

    I agree to an extent however please don't confuse "business" with "a company" as there is a difference and your original question used "business". I would be very surprised if everyone who ran a directory was declaring their income to the IRS, fortunately for me I am so I have no problems with answering the question. I am personally proud of my directories but I have no reason to shout it from the roof tops.

    As for Google, totally agree, people need to stop worrying about them. If you are running a good quality service customers will come irrespective of Google.

    JamieG, I await your advice with baited breath ;)
     
    SilkySmooth, Apr 19, 2008 IP