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"Think you can create the next Twitter or Facebook? Good luck with that.\n\nMarkson: Building an online business has many offline challenges. Photo: Blekko\nBy Mike Markson, co-founder, Blekko\n\nMany a consumer looks at an \u201Covernight sensation\u201D such as Twitter or Facebook and muses: \u201CThat service is so simple &amp;#8212; I could do that.\u201D\u00A0 If only it were true.\nIt turns out that starting a business on the web is hard.\u00A0\u00A0 Very hard.\u00A0 And I\u2019m not talking about the technology \u2013 although that part is hard, too.\u00A0\u00A0 I\u2019m talking about the business part: building a user base and finding a way to make money. Those are really hard problems.\nWhether you\u2019re a start-up or an established company, here are the hard truths you must face if you want to build a successful online media property.\n\n All the good names are taken.\u00A0\u00A0 All the \u201Creal word\u201D URL\u2019s are taken and buying one will cost you a pretty penny.\u00A0\u00A0 That means your options are made-up words and phrases (YouTube) or deliberate misspellings (Digg).\u00A0 These names are hard for users to remember and type correctly into a browser.\n\nOnce you do find a name and launch a site, good luck getting the press to cover you.\u00A0\u00A0 The modern public relations channel is broken.\u00A0 No one reads newspapers anymore, and they only cover \u201Cstories\u201D anyway.\u00A0 Unless you have some big time founder or VC, you\u2019re probably not a \u201Cstory.\u201D Blogs can give you some exposure, but their audiences are typically not big.\nOffline advertising won\u2019t help you with exposure. Don\u2019t bother spending your money on billboards, TV ads, radio spots or print ads \u2013 none of them will grow your audience.\u00A0 People don\u2019t migrate their attention from offline ads to online activity.\u00A0 Spending your money on this type of marketing is a well-beaten path to failure.\nOnline advertising won\u2019t work much better.  Banner ads suck \u2013 no one clicks on them.\u00A0 Search ads are great for one-off visitors (or if you\u2019re actually selling something and then they\u2019re an arbitrage play), but won\u2019t convert to organic visits.\u00A0\u00A0 You\u2019re buying your visitors literally one at a time, and that\u2019s no way to build an audience.\nSearch engine optimization is an option, but a limited one. Sure, you can likely scrounge together some visits and show some growth but you won\u2019t build direct traffic or a direct audience through it.\u00A0 To make matters worse, even long-tail queries\u2014think \u201Cdaily vitamins for German Shepherds\u201D\u2014can be very competitive. Only Wikipedia has pulled off the trick of building a leading Web property through SEO, and they needed 2% of Google\u2019s total traffic to do it.\n\nIf you are an established media company, your offline brand probably won\u2019t translate into a large, ready-made online audience. The web is an entirely different medium, and old brands have lots of trouble translating.\u00A0 Just ask the newspapers and magazines how their online brands are doing.\nStealing the competition\u2019s audience doesn\u2019t work online.  The two traditional ways of stealing market share &amp;#8211; price competition and convenience &amp;#8211; don&amp;#8217;t work. Media on the web is free and every site is literally one click away.\u00A0 Product is the only way to build an audience.\u00A0 And the product you build has to deliver a unique experience.\u00A0 And that\u2019s no small feat.\n\nIf, in spite of all of these obstacles, you are successful in building an audience, here\u2019s your reward: low monetization rates. Ad rates online are priced by CPMs (cost per thousand impressions).\u00A0 Your typical news or media site (i.e. not search or ecommerce) probably commands, on average, CPMs of a buck or two &amp;#8212; site-wide.\u00A0 If the site is a social network, a forum page or other community offering, that number goes down to $0.15-$0.30. To make any real money, you need to serve A LOT of page views.\nIn other words, online is not for the faint of heart. It\u2019s very far from an easy place to build an audience, much less make any real money.\u00A0\u00A0 Ecommerce and search are the only really proven businesses online \u2013 and those have a whole host of other issues that go along with them.\nSo the next time you see some company build a site that grabs a big piece of the market and starts making real money, don\u2019t dismiss its success as easy or lucky.\u00A0 Rather admire it for rising to the top in a very difficult environment.\nMarkson is a founder and VP of marketing of Blekko, a Redwood City, Calif.-based search engine that still is in stealth mode."^^<http://www.w3.org/2001/XMLSchema#string>
<http://fortune.com/2009/09/11/eight-hard-truths-about-online-media/>