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I'm interested in :
the kind of business model required
the infrastructure needed
the technological expertise
levels of start-up finances required
I know there's a lot of big questions in there, but I'm trying to decide how feasible it would be to set something up with just two or three of us.
Any advice appreciated.
People will take the risk of signing up with you as long as you keep the minimum deposit to a tenner and don't take a set up fee.
Your real problem will be getting quality traffic. And if you have quality traffic, you would probably make a lot more money using Overture, Google or Espotting than setting up your own from scratch.
I would say don't bother unles you can bring something new, such as a niche PPC or a clever new account management system, way of bidding, or advertising format.
Infrastructure and costs... Buying pre-packaged scripts (like the aforementioned SmartSearch scripts) is good way to go. It means a very small investment and you can contract a programmer to customize your scripts as you go along.
As far as actually making a profit goes... Unless you have a lot of startup capital you can't expect to make any significant amount of money from internal advertisers early on. Instead your profit will come from backfill partners while you work on getting enough traffic to interest serious advertisers.
The disappointment and loss you experience going down those dead ends is the pits. But it has to be that way sometimes. Rome wasn't built in a day.
If you are determined that PPC is good or a desired biz to be in then I say go for it. I have 6 of them and one has done very very well.
I tend to trust what I'm told a bit more than I should, I'm glad I didn't ask for advice before trying. Had I known how many times I'd be left not knowing where to go next ... I'm sure I'd never tried.
Most smart folks here claim a dating site has little chance unless built as an affiliate using a ready made member database. I'm about to try anyway. It may fail, but I'll give it a good chance to fly for a few years.
If you want to go PPC consider this:
A. Most folks will be far better off not having their own advertisers but simply being an affiliate of a larger PPC.
While you may only earn 30% to 50% of the advertisers bid (as an affiliate). Your resulting earning per click will still be far greater than if you gather your own advertisers. This is true cuz small (even some rather large) PPCs cannot supply as many visitors as larger ones and advertisers will not bid up the keywords even half as high as at larger PPCs.
B. It can be rather difficult to establish a good working relationship as an PPC affiliate. Click fraud is a major concern and they may ask you so many questions you feel like they are trying to rob you blind. You will have to start where you can and work your way up. Some PPCs pay affiliates more than others, but many won't talk to you til you have a huge amount of searches per month. A million searhes per month will just barely gain you a review at Overture and Findwhat. Even then, you may or may not be approved.
Being an affiliate of a SE is OK. Yahoo was an affiliate of Overture until they bought Overture.
C. How will you drive traffic to your PPC?
Most smaller successful PPCs create an affiliate base of their own. There is much distrust among publishers when it comes to new, small PPCs. There have been abuses and publishers (affiliates)have not always been paid.
We are just putting the finishing touches on an affiliate program ourselves. You will want anti-fruad measures built into your program or you will destroy your relationship with advertisers and other PPCs.
I shouldn't have to say it, but handling your business affairs (such as paying affilates on time) has to be something you take pride in doing right every time. The only thing that travels faster than good news ... is bad news.
D. You see lots of PPCs using several feeds (that is they partner with several different PPCs) and show results from them all. Don't do it. Even if you intregrate them perfectly to where they don't look messy, you will still make your page load times way too high. Not everyone has broadband you know. I just like one simple feed. If you do have a few listings of your own it won't slow you down any.
Another good thing about partnering with another SE is if you only have one single feed, you won't worry so much about can my script handle the traffic flow ... after all, you won't have advertisers nor listings in your own database.
E. Do throw in a few free listings. Even if it's only 50 or a hundred. Do you know how many people search for Mapquest or Hotmail during a day. If the PPC you partner with doesn't have an account with Mapquest, and they probably won't ... then your visitors did not have a good experience.
It's nearly impossible to compete with Yahoo and Google for returning visitors. At leasts we can throw in a few relevant results for keywords like "ebay" that we know will be searched for frequently. At least we can make our site look pleasing to the eye. We may not get many returning visitors, but we do what we know is a part of what needs to be done to make that happen.
Tomorrow we can hopefully learn how to do it better, and the next day maybe we will learn a bit more and next year ... who knows, we just keep doing our best.
Those companies have been known to help alot of individuals out with startup issues and will give you alot of information on what they are looking for and how the industry works.
Also if you become somewhat successfull you will find that a dedicated server would be needed to run a high traffic ppc site.
The PPC industry will always base your reputation on quality not quantity.
I suggest looking into a very good "anti-fraud" system/script as well. Generally you will have to do this yourself, but some sites will help you in your development phase.
Some will also help you with coding if you need help with scripts.
[edited by: jatar_k at 6:16 am (utc) on Oct. 17, 2006]