Sunday, September 13, 2009

How It All Began

I started marketing online in 1998. Back then, I was creating turnkey websites and selling them on eBay. I was one of the first to do this, so the money was good. I mainly was selling hotel reservation sites. These cookie cutter sites took me about fifteen minutes to create and I was selling them for anywhere between $99 and $500 each.

This was very lucrative for about six months. After that, sites like mine were a dime a dozen, as hundreds of people like me started emerging. The turnkey website category of eBay went from a few dozen sites to hundreds almost overnight. My competition was selling similar sites for as little as $1 each and it was clear that I had to move on.

After the "fall of the turnkey websites" I found a company that was providing a backend solution for online auction sites. Back then, this was a big deal, as there were very few solutions like it. This solution was costing around $2500. I would customize the look and feel of these sites and resell them for upwards of $30,000 each. Ahh the 90's were good!

The success of eBay made many a company feel that they too could create the next big auction site and I was happy to help them with this pipe dream!

After selling four of these customized auction sites new turnkey auction solutions started emerging. Pretty soon, you could get an auction site script for free and I was once again out of business.

What was I to do next? To make ends meet and keep the cashflow coming, I purchased a classified script and customized it so that it was a exclusively for Realtors to list their properties. I designed it as a local real estate site for my hometown. The script cost me $250, which I had to borrow from my girlfriend. The customization took about two hours and I was ready to go.

I then started calling and emailing all of the local Realtors. I charged a monthly fee of $25 to them and allowed them to list unlimited properties. My girlfriend was paid back in two days and within a week I had generated over $1000 in revenues.

Over the next four or five months, I was making steady money with new Realtors and the residual fees from the ones that had already signed up. Then, of course, bigger and better solutions started becoming available to Realtors by the truckload and I was once again out of business.

Now, it's around 2001 and the online gambling business was booming. I took a particular interest in poker. I started an online poker magazine. It was one of the first of its kind, so I got a lot of traffic. I recruited some of the big name players in the game to host their own forums on the site and traffic was booming.

At first, I elected to sell banner advertising, rather then join affiliate programs. I had three main sponsors that were paying about $2500 a month for banner ads. My income was good and I didn't have to do much work, which is always a plus.

Each month, one of my sponsors would send me a report on how many new players were recruited. He would tell me how much money I was losing by not becoming an affiliate. For about three months in a row I was sending about 100 players a month to Party Poker. They argued that if I been an affiliate, I would have been making tens of thousands of dollars instead of teh $2500 a month that they were paying. Finally, I gave in and switched to their affiliate program.

Well, what do you know... now that I was an affiliate, the number of new players that I was sending to them dropped from 100+ a month to about five players a month. My contact told me that I needed to give them more exposure. Instead, I removed their banners from the site all together. You would think that they wouldn't mind, as I was no longer sending them an exuberent amount of players, but they freaked out. They wanted to get back on the site so badly that they offerred to go back to paying the $2500 a month for the banner ads. Hmmm, why would they want to pay $2500 a month if I was only giving them five players a month now? I told them that they could come back, but now it would cost them $3500 a month, which they gladly paid.

The poker business was good to me for the next few years... until the Unlawful Internet Gaming Act was signed in 2006. Once again, I was out of business.

To be continues...

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