Non WWW Redirects
To help eliminate page rank split, and provide your site with a little extra value, implement a non-www redirect. What this redirect will do is change the URL to include the "www" whenever a URL is accessed that does not include it. This can help to consolidate links to the correct page and give your site some additional strength. For more help on Non WWW redirects please see: How to 301 Redirect Non-WWW to WWW URL’s

HTTP Headers
Check your page headers! If you have implemented any form of redirect on your site including mod rewrites, check your HTTP headers. You may be surprised at what you find. Some forms of redirects may use a 302 code where you really want a 301. By checking your headers you can ensure all is well, and troubleshoot problems. On our website we have added our own HTTP Header Checker for your convenience.

Home Page URL
Never have more than one URL for your home page. If your home page is available and displays on more than one URL, then utilize 301 redirects on all but the main URL you want to focus on - in most cases "http://www.domain.com/". All your links pointing to the home page should direct to the exact same URL otherwise you will split the value of your home page into multiple duplicate URL’s.

Google sees "http://www.domain.com" and "http://www.domain.com/index.html" as different pages, but displaying the same content. This splits the overall value of your home page, and can decrease the chances of rankings. By keeping it consistent with a single URL, you remove this split and retain more of the strength.

In theory having your home page split like this could bring with it duplicate content penalties, however, I have yet to see this actually happen - that said, it is best to avoid the risk all together.

XML Sitemap
XML Sitemaps are great for ensuring that Google and the other engines are able to spider your entire site. While an XML sitemap will not directly impact your search rankings it can help as Google is more likely to see any SEO based changes more quickly, which in turn can have an impact.

Robots.txt
This is the first file all search engines look for every time they visit your site. While placing a blank robots.txt file in your root folder will not help with search rankings, it will help reduce 404 errors appearing in your log files.

It is also highly recommended that if your site utilizes an XML sitemap, to include a call to this sitemap within the Robots.txt file. Simply add the following line to ensure that the major engines (including Google) can find your sitemap:

      Sitemap: http://www.domain.com/sitemap.xml

Potential Blockages
If you are finding that your site is simply not being indexed it is possible that you are blocking the spiders in one way or another.

Start with checking your main site navigation, if you are using Flash or some other fancy form of navigation that could be your problem right there. Next check your HTTP headers to ensure that your home page is returning a 2xx code which indicates that the clients’ request was successfully received. Finally take a look at your Google Webmaster Tools for any noted errors. If you are blocking Google, chances are you will be able to uncover the issue with these steps.

Duplicate Content
Duplicate content can be quite damaging to your rankings. Ensure that all content on your site is unique. Never steal or "borrow" content from another site, and never cut and paste large portions of text from one page of your site to the next. By keeping all pages of your site entirely original you stand the best chances of getting a thumbs up from Google.

Fresh Content / Regular Updates
Update your content. In highly competitive markets, sites with old static content can often slip away. Keep your content fresh and updated to keep bringing Google back to your site. If they find new pages and updated pages with every visit, they will come back more often.

Site Age
The age of your site can also have an effect on search engine rankings. While there is little you can do (short of keeping the same domain) to help on this matter, remember that the longer your site is online, the better its chances for success. It pays to select the perfect domain right from the start and not to change domains mid-stream. Older sites that stand the test of time add a level of authority in Google’s eyes. New sites seldom see rankings for competitive terms in their first year.

Note: Site Age is determined not by the date the domain was originally registered by rather by the date Google first discovered content on your site.

Load Time
Load time can have an impact in your Google AdWords Quality Score but it is unknown for sure if it can also impact your organic search rankings. It is best to keep your load time to as little as possible. If it is not already a part of the Google Algorithm, it likely will be soon. Besides, it is also best in order to give your site visitors the best experience possible.

Server Up Time
This can be a rather significant issue. If you find that your web hosting company has a history of down time, change hosts. If Google comes to visit your site once and it is down, not to worry, they will come back, but if Google visits your site often only to find that it is unavailable, you can find yourself with drastically depleted rankings.

Google Local
If you have a traditional brick and mortar store, consider submitting to Google Local. While this will not directly impact your regular organic rankings, you may find your site ranking above the organic results with a "local business results" map listing. This tends to be most common when your business is near the geographic center of a city, and when the search phrase uses a geographic modifier.

W3C Compliant Code
There is much speculation as to if W3C compliant code can have a positive impact on search rankings, and the majority believe "maybe" with some saying "yes". Regardless, it is definitely a good idea to have your site be W3C Compliant if at all possible. Not only may it help you in terms of search rankings, but having compliant code can decrease load times, and help to ensure cross-browser compatibility, all of which are good things. If at all possible, it is recommended that sites be made to be compliant.

Many experts who took part in the SEOMoz "Google Search Engine Ranking Factors" lean towards it not being a big contributor, however, it may be an issue if Google has difficulties indexing a page properly.

A code validation service is available at validator.w3.org.

DO NOT TRY THIS AT HOME
I want to stress that this section is about things you should NOT do. These issues could be damaging to your rankings. If your site is implementing any of these, it may be best to remove it.

Hidden Text
This includes any text that you can simply not see when viewing the page. It may be text hidden in invisible div layers, text located below the fold with vertical scrolling disabled or even text on the same colored back ground (white text on a white background for instance). Whatever the case, hidden text can get your site into hot water and it is not recommended.

Excessive Keywords
Don’t go over board in placing target phrases within your body text. Stuffing keywords everywhere possible just because you can, is not only unlikely to help you achieve rankings, it could very well have the opposite effect.

Duplicate content
Large amounts of duplicated content or pages, as well as stealing or scraping content from other sites is one good way to get your site banned.

Doorway pages
Creating multiple websites or pages with nearly identical, yet slightly different content for the purposes of trying to grab some Google rankings is a good way to get your site into trouble.

If you have created pages of this nature for PPC campaigns, make sure that they are blocked from the search engines as to not get you into any hot water.

Cloaking
Simple - Don’t Cloak. In a nutshell cloaking is when you display different information to the search engines than you do to your human visitors. Google frowns on this, and if they catch you, watch out!

All Flash
Websites that are entirely flash based will not get you into trouble. The reason I have included it here however, is that they won’t do you many favors either. Sites that are all Flash, have little to no content for Google to digest and thus, drastically reduce your chance of rankings. If you must keep your “All Flash” site, it is recommended that you also create a secondary HTML version for the search engines and for those visitors who simply prefer it.

Frames (including iFrames)
Frames are also one of those things that won’t get you into trouble, but do significantly reduce your chances of rankings. If you want any chance of ranking in Google using a Frames site, be sure to copy your relevant content from each page into your ‘noframes’ tag. While this is far from ideal it may help you salvage some listings.

When it comes to including content through the use of an iFrame, remember, Google can not see any of this content located within the frame. It will be of no use to your rankings. If you rely on this content to help your listings, find another method such as a server side include.

TOOLS
In this article I mention a few items which can be made much easier with the help of available online tools. Here are some to help you on your way:

HTTP Header Checker
The StepForth HTTP Header Checker

Spider Simulators
XML Sitemaps, Search Engine Bot Simulator

Page Size and Load Time
1-Hit Load Time Analyzer

Google’s Cached Text Version
Click on “cached” next to your listing in Google, then click “Cached Text Version” at the top of the page. This is Google’s Cached Text version of your page. Substituting www.domain.com with your website will also bring up the cached version:

http://www.google.com/search?q=cache:WWW.DOMAIN.COM/&hl=en&strip=1

source: SiteProNews, By Scott Van Achte, Senior SEO, StepForth (c) 2008

If content is king, make your keywords your servants! It’s pretty simple; good keywords bring lots of traffic, bad ones don’t. If you want that free search engine traffic, the first thing you need to do is to find out what exactly it is that people are searching for in the area that you are interested in. Then you pick key words that relate to your topic of interest, and that people are really searching for. You can have the best content in the world, but if you optimize for the wrong keywords you still won’t get that sought after traffic.

For example, let’s assume I am going to build a site about water heaters, and I want people to come to my site. I need to find out what kind of information about water heaters that people are looking for so I can build pages optimized for the keywords that people are really using.

The first thing I do is go to a keyword tool to do my keyword research. There are a number of keyword tools online, my favorite is Wordtracker. Others include KeywordDiscovery, and the Google AdWords suggestion tool There is simply no substitute for doing your keyword research. With these tools you can put in a seed word or phrase, and the tools will provide you with lists of related keywords and keyword phrases that are searched for, and how many times per month they are searched for. Using these tools there are ways to estimate the size of the market for products and services, ways to optimize you web pages, find new niche markets, and much more.

With Wordtracker I find quickly that many more people search for "tankless water heater" than search for water heater…which surprises me. Nearly as many people search for "hot water heater" as search for "water heater". Wordtracker also informs me that there are far fewer websites trying to be ranked high for "hot water heater" than for "water heater". Ah-Ha! I’ll be sure to optimize a few pages for "hot water heater". In fact, I find that the terms "tankless water heater", "tankless hot water heater", "tankless water heaters", "electric tankless water heaters", and "tankless heaters" all have more people searching for them than "water heater".

Single word keywords are very difficult to get high rankings for, so it’s wise to shoot for longer keyword phrases. Three and four word phrases are what I use most often.

After finding out what information people are looking for, and what keywords they are using to find that information, you can build the appropriate pages and optimize them for those keywords that have significant traffic searching for them.

Now that we have our keyword list and we are ready to build our pages, where do we put the keywords?

The first and probably one of the most important places to have your keywords are in the title tag. This is one of the tags in the head section of the html code of your web page and lists the title that is displayed in the web browser. Internet Explorer displays this tag in the top bar of the browser window. It’s very important that you always write for humans. The search engines are getting smarter and smarter, and they are looking for sites optimized for humans, not search engines.

Get some of your keywords into the keyword meta tag, not crucial but it won’t hurt.

Make sure you have some keywords in your Alt tags for your images…don’t overdo it though. Write it for humans, but try to work a few keywords in if you can. Alt tags are displayed as a popup when you pass your mouse over an image.

The Description Meta Tag is still a valuable place to use your keywords. Many search engines will look at the description Meta tag for keywords to compare against your body copy. Yahoo uses your description tag as the description of your site in their listings. Consider the description tag just like it is named, a concise description of your site. Keep under 50 words.

Your body copy is obviously a very important place for placement of your keywords. Remember, write for humans. If your keywords don’t appear in your body copy, you won’t place high in the search engine results for those keywords. Work your keyword into the text appropriately. Select one or two keywords and make the page specifically about those keywords.

Use your keywords appropriately for humans on your site where you can. This will increase your search engine effectiveness.

source: Entireweb

First to get an idea of how many links you may need, take a look at the top 10 ranking sites in Google and record how many links Yahoo is noting for each site. (This is because Google does not display anywhere near all the links they have noted). The average of this count is often a good indication of how many links your site may need.

There are many different ways to get links to your site including the age old reciprocal link trade, directory links, article based links, and links from press releases.

Reciprocal Links
Reciprocal linking has seen its value drop considerably over the past few years, however, if the site you are trading with is relevant you can still receive value from these links.

Paid Links
Google frowns on paid links, however that is not to say that they don’t work. Often you can find highly reputable and relevant websites which are offering paid advertising spots. If these links are coded to link directly to your website without passing through any tracking redirects, you will in many cases see value in the form of both direct traffic and increased link densities and rankings.

Articles
Writing and distributing industry specific articles is a great way to help boost both your link counts and site traffic; for examples of such content see StepForth’s SEO Blog News articles. Consider writing articles on a regular basis and submitting them to some of the more popular services such as EzineArticles. Be sure to include a link to your site from somewhere within the article, or at the very least within your bio. Try to use a target phrase as part of the anchor text for additional value.

Press Releases
If something of importance has happened to your company such as a new product launch, or other notable achievement - essentially anything news worthy, put out a press release. Submit this press release through services such as PRWeb or PRNewsWire. Again, be sure to include a target phrase as part of the anchor text.

There are also a number of places you can get links that have basically turned south, and are not generally recommended. These include signatures in form posts, guest books, and other typically free links.

Forum Posts
Forum posts can help to marginally raise your link counts; however, with this one you must be careful. Only add a link to your site in your signature if both the forum allows it, and you are a respected member of the forum. If you are a solid contributor and your posts have depth and meaning, and the forum is highly relevant to your site, then having a link in your signature may give your site some juice. Posting wildly to random forums will in most cases get yourself banned, and will be both a waste of time and potentially make you and your site look bad.

Guest Books
In nearly all cases, do not post your link to guest books. If you happen to stumble upon a guestbook that is highly relevant to your site, the other comments are relevant to your site, and you have something useful (and again relevant) to say, then perhaps consider it, but typically focusing on links from guest books is considered SPAM and is best avoided all together.

Blog Comments
Having a link from your blog comments is not necessarily a bad thing. If you find a relevant blog post of use, and have something relevant and constructive to say, don’t be afraid to enter your link into the "URL" field of the form, but don’t try stuffing links into the comment itself.

Link Farms & Bad Neighborhoods
These are sites that allow you to simply post your link no stríngs attached. They are mostly long scrolling pages with countless links. Stay away from them. If you see one, run in the other direction. These links are bad, will not help with your rankings, and in some cases can actually damage your rankings.

Stay away from sites that cross link with obvious spammers. These networks of SPAM sites are not ones you would want your site associated with, and if you achieve links from enough of these sites it can adversely impact your rankings. Even more important, NEVER link to any of these sites - as that will certainly tie in your connection to them and give Google reason to discount your rankings.

DMOZ, Yahoo and Other Directories
Directory based links can be of significant help, especially if they are from highly reputable directories, the two biggest being DMOZ.org and the Yahoo Directory.

Getting a site into DMOZ is like Gold. Google loves links from DMOZ and your site will reap the benefits. The big catch however is actually getting your site into the directory in the first place. Find the perfect category for your site and check to see if it has an editor. If you see a link "Volunteer to edit this category" try and find another relevant location. Pages without active editors take much longer to get listed into. Once you find the perfect directory submit your site every 4-6 months until listed. If you are lucky you will get in eventually.

Yahoo Directory is seen as an authority in the eyes of Google, and getting your site in will help your link reputation. This link does come at a price of $299 per year, but will play a role in helping your website achieve top rankings.

There are a number of other valuable directories out there that can help you with your search rankings. Before submittíng to any directory the key is a combination of relevance and authority. If the directory is relevant and active, it may be worth considering.

GOOGLE WEBMASTER TOOLS
Google Webmaster Tools can be very useful for your optimization efforts. It may not directly help you obtain higher rankings, but can help you trouble shoot if you are experiencing problems. It will also allow you to remove URL’s that you don’t want indexed and set various preferences such as your domain, crawl rate, and geographic target.

XML Sitemaps
This is the most common reason people use Google Webmaster Tools - the submission of their XML sitemap. While you can use your robots.txt to have Google find your XML sitemap, by submitting it directly to Google you can check up on the spidering status.

Error checking
Webmaster Tools is also quite useful for checking on various error URL’s that Google may know about. Under the Diagnostics > Web Crawl you can view any errors that Google has to report on your site. By cleaning up any errors you can help boost your chances of rankings.

Links
From inside Google Webmaster Tools you can get a much clearer look at what sites Google is noting as having links to you, and give you a better indication of the need, if any, to raise your link counts.

WWW Preference
Be sure to select your domain preference under Tools > Set Preferred Domain. In nearly all cases you will want to select the version including the "www" .

SUMMARY
Inbound links play a significant role in successful Google rankings. By focusing on relevant links, as well as by diversifying where you get those links from, you can build a solid foundation for your search rankings today and into the future.

Stay tuned for Part 3 (of 3) where I will discuss other considerations including redirects, HTTP headers, and a number of other factors which play a role in successfully conquering Google.

source: SiteProNews, By Scott Van Achte, Senior SEO, StepForth (c) 2008

THE RIGHT KEYWORDS
This article is not about keyword research so I will not spend too much time on this topic, however, I felt it was important to at least brush on this slightly. If you are interested in reading more, please see Keyword Research for Organic SEO.

Make sure that your targets are achievable. If you select the wrong keywords, it can make your entire optimization experience essentially a waste. Choose keywords that are attainable but yet still provide a reasonable search frequency for your industry. Your phrase selection should also be targeted to bring qualified traffic to your site.

Using the hotel industry as an example, targeting the word "hotel" would make very little sense but by narrowing it down to "Victoria BC hotel" you now have less competition, and a more qualified audience. Keep your targets in perspective and go after the obtainable rankings.

WEBSITE OPTIMIZATION
There are many on-site factors that play a role in your search engine rankings. Here are a number of those factors and what you can do to increase your chances of success.

Title Tag
The title tag plays one of the most important roles in search results at Google, and is almost always the heading Google chooses for each of its listings. Placement of your target phrase is best used near the start of the tag and repeated again in the middle or near the end. Three uses of your target phrase may be helpful in some instances, as long as it is not too overwhelming. For best results each page on your site should have a totally unique title tag.

It is also important to remember that because Google will use this title as the main heading for your listing, you will want to keep it attractive to potential searchers. Try to also add a call to action, or other wording to help make your listing appear attractive to searchers.

To help illustrate the fact Google takes this tag into consideration, simply do a search for your target phrase and take a look at the titles of the top 10. I tried a search for a rather broad term "hotel" and saw that all 10/10 listings had it in the title tag, and 6/10 had it as the very first word. A quick scan showed that the entire top 30 either had the word hotel, or hotels in their title tags.

If you do only one thing to your website, make sure that all your title tags are relevant, unique, and contain your target phrase for each page.

Meta Description Tag
The Meta Description tag is still occasionally used by Google as the description which appears in the search results themselves. While this used to be a more common practice Google tends to use it most often on sites with very limited content, or those which are flash based. I have seen it still used for content rich sites, however this is less common.

The Meta Description tag still has an impact on search rankings. Your best bet when using this tag is to keep it short and sweet with your target phrase close to the start and not repeated more than 3 times. Like the title tag, each page on your site should have its own unique description tag.

Meta Keyword Tag
When it comes to Google this tag is useless, and won’t influence your rankings. There is some speculation as to whether a spammy keyword tag can however, have a negative effect on Google rankings. As a result, if you do utilize a keyword Meta tag for the smaller engines, it is best to keep it clean and play it safe.

Density
Keyword density plays a role in overall rankings; however, it is not as cut and dry as it once was. Once upon a time there was a magic number that when used could almost guarantee top rankings.

This is no longer the case. Today the ideal density varies from industry to industry, phrase to phrase. To find out what density you should aim for, take the top 10 or 20 search results and see what percentage those sites are using. In most cases you will find that the majority of these sites have a very similar density to one another, and this average density is a good estimation of what you should aim for.

Body Text and Keyword Placement
The location of relevant text on your site will help establish the overall importance of your target phrase. While you do not want to overwhelm the engines and site visitors with a bombardment of target phrases at the top of the page, try to sprinkle in some instances as close to the top of the page as possible.

Synonyms
Be sure to include various synonyms for your target phrases within your body text on your site. Google will use these synonyms to tie in the overall relevance of the page for your main target phrases, which in turn can improve your odds.

To find possible synonyms you can use a thesaurus, but the best way is to search Google itself and see exactly what they consider to be similar. Simply search in Google for your target phrase preceded with a tilde, such as "~hotels". Next scan through the search results for any text Google has bolded. These are all words that Google considers to be related. Using the "~hotels" example Google brings up phrases such as ‘travel’, ‘tourism’, ‘accommodation’, as well as various hotel chain names such as ‘Hilton Hotels’.

Keywords in Domain
There is still some speculation if having a target phrase as part of your top level domain (TLD) is of use to search rankings. From my experience, yes, there is value here, although, nothing like it was several years ago.

If you are starting off in the online world and are contemplating which domain to go for, consider one that uses your target phrase, assuming that it is both relevant to your business name, and uses no more than a single hyphen. While multiple hyphens in a domain can be successful, they are very common with highly spammy websites, so it is best to not take that route if possible.

While having a keyword located within your domain can provide some ranking juice, I would not suggest heading out and doing a domain swap. In most cases you would be better off working on your existing site than starting from scratch with a new domain.

Keywords in page specific URL
Using keywords for specific page URL’s can also help add a little bit of value to your site, providing you use them responsibly. Consider using a keyword as a directory name and as part of a file name where it naturally makes sense to do so. If you have a website that focuses on tourism and includes local hotel listings, you may want to consider the following structure for your page on the Hilton:

MyTourismSite.com/Victoria/Accommodations/Hotels/Hilton.html

Heading Tags
Placement of target phrases within heading tags helps to establish the importance of those given phrases. That said do not over do it, or abuse it. Only place target phrases within a heading tag if it makes sense to do so, and don’t flood a page with numerous tags. Heading tags are not as critical as they once were, but still a good contribution to a well optimized page.

Link Anchor text
This is the actual text you clíck on as part of a link. When full or partial target phrases are used within your text links they help pass on some value to the linked page for those phrases. This is also true when considering surrounding text. When the content around the link is also relevant, the link holds slightly more value.

While a link that simply states "clíck here" or "www.domainname.com" does have its place, they provide considerably less value than a link that would use "discount hotels" as its anchor.

Image Alt Text
While image alt text still plays a minor role, its biggest part is within the use of image based navigation. If you have an image linked to another page, the alt text will be attributed much the same way as standard link anchor text is.

Image Alt text should always be short and to the point and should accurately describe either the image itself, or the page the image is linking to. Do not use alt tags as a place to stuff keywords.

Inline Links
These are links that are found mid sentence or mid paragraph as opposed to a simple listing of links as found in a menu or possibly on a sitemap. Links found mid paragraph tend to pass on a little more value from the surrounding text and can provide more relevance to the linked page.

Site Navigation
It is absolutely imperative that your website be fully spiderable by the search engines. This may seem obvious, but often webmasters overlook Google’s ability to crawl a website. Google has become very advanced in what links it can follow and how it can spider a website, but there are still some things that can cause significant roadblocks.

- Flash: One of the most commonly made mistakes is the use of flash. If flash is used as a sole means of site navigation then you can count on Google not viewing your internal pages, and having a significant disadvantage in terms of site rankings.

- Java Script / DHTML: These days most Java Script and even DHTML menus can be spidered by Google, however, this is not always the case. If your site utilizes any kind of fancy navigation and you are wondering why Google has not indexed your internal pages, check out Google’s Cached Text version of your page. If you do not see any text links, then your navigation may be invisible to Google.

- Images: Image based navigation has been safe for many years now, but if your site uses this form of navigation it is essential to have brief, relevant alt text on all your buttons. This alt text will act much like standard anchor text for text based links. This is not only for the purpose of search ranking value, but take a look at Google’s cached text version of your page. If you have image based links that do not have alt text, those links do not appear. This doesn’t mean Google won’t follow them, but for anyone viewing your site on a text based browser, your links will be invisible to them.

URL Structure
Avoid long elaborate URL’s with extraneous characters. While Google has reached a point where they can index massive URL strings, it is best to avoid them if at all possible. For dynamic sites consider utilizing mod rewrites to significantly clean up the URL to not only make it more search engine friendly, but more user friendly as well.

MyTourismSite.com/?locid="victoria"&catid="accommodations"&type="hotel"&comp="hilton"

stands a better chance if cleaned up to read:

MyTourismSite.com/victoria/accommodations/hotels/hilton.htm

SUMMARY
Basic website optimization is a critical component for successful placement in Google but is only part of the overall picture. Stay tuned for "How to Optimize for Google - Part 2 of 3" where we will discuss Links and Google Webmaster Tools.

source: SiteProNews, By Scott Van Achte, Senior SEO, StepForth (c) 2008

The SEO Rapper - Lyrical Marketing

On Saturday, March 29, 2008, WordPress 2.5 was released and this release took me by surprise. If you use WordPress then you realize how often plugins are updated and the core itself is so frequent you might as well look to the source before you reuse any code from a previous project because it will have since been outdated. One thing that really impressed me was the new user interface in the admin section which is now starting to look more of a polished over CMS system.

Either way you look at it WordPress is here to stay and will become even more prominent as a CMS and blogging software which remains free, designer and developer supported open source that is extended by people who use it the most. Our Content Management System is based on WordPress and these improvements benefit all of our customers.

Contact us today for more information and get started today with your own WordPress CMS driven website!

Related Links:
The WordPress Podcast Video: Episode 39 Live from WordCamp Dallas
WordPress Version 2.5: http://codex.wordpress.org/Version_2.5
Download WordPress: http://wordpress.org/download/
Free WordPress Themes: http://www.wpthemesfree.com/
Plugins: http://wordpress.org/extend/plugins/
www.showinabox.tv

Google’s paid clicks controversy doesn’t seem to be going away anytime soon, with advertisers joining the chorus of critics who say the search giant has given them the "Google slap."

For the uninformed, the "Google slap" is something of a double-whammy that appears to be the result of a change to the AdWords algorithm. According to a Wired blog post, many advertisers who use Google are seeing a spike in prices paid for ads with a simultaneous drop in conversion rates.

One anonymous Wired source said he could tolerate a rate hike, but not a drop in conversions. According to the Wired source, a campaign that yielded 100,000 impressions for ads served for two keywords in February dropped to about 20,000 impressions in March. The anonymous source claims the drop in impressions from February to March resulted in a parallel drop in revenue from $250,000 to nearly zero.

While the lost business may seem catastrophic, Google has maintained that its changes are meant to cut back on so-called thin sites that provide little content while raking in huge chunks of cash via AdSense. 

Article Provided by: imediaconnection.com

Article Provided by: SiteProNews

We’ve struggled to get formal business metrics for Craigslist, but ClickZ has summarized a recent report from Classified Intelligence that should help. CI estimates Craiglist’s numbers, but it has at least gone through the laborious process of counting listings, pageviews, etc.

So here are some metrics:

2007 Est. Revenue: $55 million
2008 Est Revenue: $81 million
Monthly Pageviews: 9 billion
Monthly Job Listings: 2 million
Monthly Ad Listings: 30 million
Employees: 25

Estimated Costs

Let’s assume that each of Craigslist’s 25 employees costs about $125,000 a year, all in. That’s probably high–Craigslist is run like a non-profit–but it should be in the ballpark. This adds up to about $3 million of salary and other HR costs. Let’s assume that Craigslist will grow this year, and let’s assume that it spends another few million on prosaic costs like rent, insurance, travel, etc. Total estimated 2008 operating expenses: $7.5 million.

On the "cost of sales" line, let’s assume that Craiglist spends a boatload on servers and bandwidth to keep the site running smoothly. Craigslist’s content is not at all bandwidth intensive–all light text, no computation or transactive processing like eBay or Google–so this should keep its costs well below those of other huge global sites. Let’s call it $50 million a year. (This is probably high–grateful for any help in refining).

Add all that together and use the CI revenue estimate, and you have a business with about $80 million in revenue and, say, $25 million in operating profit. Apply a 10X revenue multiple and/or 25X operating income multiple, and you would have a company worth about $750 million. But obviously Craigslist is worth a heck of a lot more than that.

Craigslist’s Real Value

Why is Craigslist worth more than meets the eye? Because it’s run like a non-profit. Craig Newmark and co. don’t give a damn about generating revenue or profit, and more power to them. But if Craig ever want to sell Craigslist, he’d probably want to get something closer to true value for it–which means we need to think about the company’s real earning power.

Let’s assume that, instead of charging for job ads in only 11 cities, Craigslist charged for all job ads (currently 2 million a month). Let’s assume that it also charged for another 5 million of the 30 million ads on the site each month. Let’s assume that Craigslist users were so horrified by the outrage of being charged even a de minimus listing fee that two thirds of these listers stormed off in a huff so that the 7 million of paid listings dropped to, say, 2.5 million a month. And let’s assume that Craigslist charged its standard $25 job listing fee for all of them.

What would that generate in revenue? $62.5 million per month, or $750 million a year.

Let’s further assume that this outrageous affront to a minority of users–$25 per listing!–would require huge customer service and processing costs, so that Craigslist’s overall cost base jumped to $250 million a year. Then we’d have a business with $750 million in revenue and $500 million of operating profit.

Let’s put very conservative revenue and operating profit multiples on that–say 7X revenue and 10X operating profit–and we’re conservatively looking at a business worth $5 billion.

Thoughts? Speak now or forever hold your peace.

Article Provided by: WebProNews

Article Provided by: WebProNews