Building a Business Around a 3rd Party API

Today I read an interesting post on HackerNews about a price comparison site, PriceZombie, being kicked out of the Amazon Associates program. The Amazon Associates program is Amazon’s affiliate network. Amazon pays a commision for any sales you bring in through affiliate links. Since I have a pretty extensive background with affiliate marketing I have a few thoughts on the dilemma PriceZombie is facing.

After being previously told we were in 100% compliance with the rules, our Amazon affiliate account was closed a few months ago. Amazon claimed we were violating their rules against showing product and price information that was more than 24 hours old. Obviously, this is something ALL price history trackers do, not just PriceZombie.

It seems obvious that PriceZombie was in contact with a representative of Amazon and that they thought they were complying with the terms of their affiliate agreement. However, the account was then banned for “violating their rules against showing product and price information that was more than 24 hours old.”

My first thought, not unlike the HackerNews commenters, was that PriceZombie violated the terms of their agreement and they need to suck it up. However, I’m an Amazon Associate and I don’t remember anything about not using historical pricing data in the agreement. I took at look at the newest affiliate agreement and couldn’t find any mention.

PriceZombie uses the Amazon Advertising API so I took a look at that agreement. No mentions of not being allowed to use historical pricing data. In fact this agreement seems to suggest you are allowed to show historical prices as long as you display a date with that price:

(o) You will include a date/time stamp adjacent to your display of pricing or availability information on your application if you obtain Product Advertising Content from a Data Feed, or if you call the Product Advertising API or refresh the Product Advertising Content displayed on your application less frequently than hourly. However, during the same day on which you requested and refreshed the pricing and availability information displayed on your application, you may omit the date portion of the stamp

I did find a section stating that you cannot store images and that you should update the content every 24 hours. This probably covers the PriceZombie case but it’s not very explicit.

(n) You will not store or cache Product Advertising Content consisting of an image, but you may store a link to Product Advertising Content consisting of an image for up to 24 hours. You may store other Product Advertising Content that does not consist of images for caching purposes for up to 24 hours, but if you do so you must immediately thereafter refresh and re-display the Product Advertising Content by making a call to the Product Advertising API or retrieving a new Data Feed and refreshing the Product Advertising Content on your application immediately thereafter.

I will assume PriceZombie was kicked out for a technicality in the previous rule. If so then why are so many other Amazon price tracking sites still operational? Amazon was making money from those affiliate sales. Why would they want to stop that revenue? Were the margins too thin on the PriceZombie conversions? Is Amazon trying to cover up the fact that it’s been raising prices? None of this really matters.

The Real Lesson Today

People are caught up in the debate about the possible violation of Amazon Terms of Service, but they’re missing the real point here. If you are planning to build a business around any 3rd party API you are exposing yourself to the greatest risk I can think of. Your business can die in a blink of an eye and it’s completely beyond your control. Someone else controls your revenue and can turn it off with the flip of a switch.

It doesn’t matter if PriceZombie violated the TOS. Amazon has no obligation to allow anyone access to it’s API or affiliate program. They don’t even need a reason to deny you access. They can allow Joe’s price tracker to keep running even though they killed PriceZombie. There is no implied equality when it comes to business agreements. They could terminate your agreement at anytime and for any or no reason. Kind of like my employer can terminate my employment without reason.

The real thing we learned today is that you can’t build the core of your business around a 3rd party API. Situations like this happen all the time and people still put their bread and butter in somebody else’s basket. PriceZombie could have taken some steps to ensure they would survive if that Amazon money stopped rolling in but they didn’t. Now it’s too late.

I’m even guilty of this. I’ve built sites in the past with Amazon Associates as the sole monetization but I’ve never seen them as a long term business and I always knew the risk of termination was there. I’ve changed my ways of thinking in the past few years. One of the major changes is the realization that if you are relying on 3rd party monetization then you have hobby, not a business.

Real businesses have something to sell.

I’m not suggesting anyone do this but there is a part of me that would find it extremely hilarious if PriceZombie would 301 redirect all of their pages to the same product on Jet.com. I really want them to update all the links on the price tracker to Jet links but that would be a legal problem using Amazon’s API content improperly. So 301 redirect would probably be safer. Obviously I’m not a lawyer.  

Are Products the Road to Prosperity?

A few weeks ago a wrote a somewhat popular post about my past experiences trying to make money online. I went through the ups and downs of working as an affiliate promoting other people’s products. At the conclusion of the post I said that I wanted to focus on building some type of product. So why do I think products are the way to the lifestyle I want to build?

For a long time my mindset was just to grind it out and make as much extra income online as I could. This led me to affiliate marketing, blogging, and even some low quality “thin” affiliate sites that most of you would label “spam”. I spent so much time promoting other people’s products that I never really sat back and took a look at the big picture. An advertiser I was working with would pull their products from the affiliate network or I would get removed from the campaign for various reasons (sometimes warranted). I spent my own time and energy selling products I had no ownership in. The people who produced the products were really getting all the value. For a small one time fee I would send them a new customer. In most cases they could continue to sell to the same people I brought in through my advertising tactics. I, on the other hand, had to constantly be looking for new traffic, new products, and new ways to connect with people who will open their wallets. I had no path to a sustainable business model.

On top of that my day job is in the professional services realm. I started working as a consultant for a start up that eventually as acquired by IBM. Now I’m part of the IBM Watson team working as an IBM Watson Solutions Consultant. I’ve learned a lot of things over the past five years of services work. There is one business lesson that seems to stick out to me: services don’t scale. This is especially evident in a young startup that is just trying to make ends meet. You constantly battle the problem of having too much work and not enough people or too many people and not enough work. That’s because they way you scale services is to add people. Now there are ways to “productize” services but in the end it’s still usually tied to an hourly rate. Meaning to make more money you either have to hire more people, raise rates, or find a way to bill more time. Now there are a lot of people who have built successful service businesses but it’s clear to me that is not the route I want to go.

During the acquisition process I also learned that sometimes equity doesn’t pay off for everyone even when there is a successful exit. It paid off for some of the first employees. I was a later hire and it didn’t really work out all that well considering I’d taking significantly less salary than I probably should have been making. My final payout from the acquisition ended up not even being enough to make up for one year of the lower salary I took for three years.

My Mindset Changed

enlightenment

In the winter of 2012 I signed up for the 30×500 product development class that’s put on by Amy Hoy and Alex Hillman. You know how you often hear those stories about some startup getting bought by Facebook for bazillions of dollars when they have no revenue? What you don’t hear are all the many, many, failures that didn’t win the startup lottery. I technically did win the startup lottery and I was left with basically nothing except a new corporate job title and my trusty 2009 Macbook Pro that I still get to use today.

Why am I talking about startups? Well, because 30×500 is basically the polar opposite of the startup lottery world. It’s a class focused on bootstrapping. Startups are usually started with some type of an idea. Then proof of concept/prototype/beta is built to test to see if people actually want the product or not. Startups are basically designed to either fail quickly or have hockey stick like growth (many times that’s not revenue growth either). How is 30×500 different? The class teaches you to do research to find what people actually want and then create a product to fill that need. It’s much easier to sell something to people who already want to buy what you are selling than it is to try to force a product to “fit a market”.

The best lessons I got out of the class were probably focused around money. Everything I’ve learned about money most of my life was tied to time. From working for $5.35 an hour in high school. To earning a salary which means your money is tied to 40 hours of your time each week. Then you end up working another 10-20 hours per week for basically free because that’s how most salary positions work in my experience. My parents, friends, relatives always talked in hourly wages. Amy’s class and probably Tim Ferriss’ 4 Hour Work Week taught me that the best way to free yourself is to separate your time and money.

All Hail Products

The best way to separate your time from money is by producing a product. Now what exactly is a product? It could really be anything. I think of products as anything that you can bundle into some type of packages physical or digital that you can sell to multiple people. Ebooks, training courses, software as a service (SaaS) are all ideas of digital products. For all of these things you basically make a large initial time commitment and then smaller ones to support the sales and the product itself.

Now if you notice above I’m not talking about “monetization”. I’m talking about sales. Monetization is what you do when you have a bunch of people who don’t want to pay you for anything so you try to extract what little you can from them, typically in the form of advertising. This really only works well for huge sites like Facebook for example. Even sites as huge as twitter are struggling with the “monetization” path. I’ve gone through trying to monetize traffic in the past and it feels like the wrong approach if you want more predictable success and to limit obvious paths to failure.

The biggest upside to products is the ability to scale. This is especially true of digital products. While scaling physical products might take more work to pump out more products it takes almost nothing to sell another copy of an ebook. How much of my time would it take me to build 1,000 custom websites for clients? Ewww I’m not even sure I want to think about dealing with that many picky clients. If I had to put a time on that I would say 10 per year might be a good estimate (for me) which would give us a total 10 years. 10 years. 10 years of hearing clients argue why that particular shade of blue is not right. How long would it take to sell a WordPress plugin to 1,000 people? I’ve seen people do that in hours. Even if I couldn’t do it in hours I could continue to scale the sales of a product like that while pursuing other things because once the product is created my time is mostly freed from it aside from support and sales.

Yeah but I Can’t Actually Make a Product

There are probably a few of you who got this far but are thinking that you can’t make a product and market a product. You might even think you need a huge following to sell something. After all these bloggers and authors were all famous way before they sold products, right? Wrong!

  • 37signals, the creators of popular project management software basecamp, started off as an agency making web applications for clients. Their first foray into products was a actually an ebook about e-commerce search engines. Basecamp came out of a need they had internally and eventually they turned it into a very successful product. They’ve since branched out with more products.
  • Amy Hoy and Thomas Fuchs started out doing consulting work. They started doing some training classes for corporations and eventually directly to the end user. Their first product was a book about JS called Javascript Performance Rocks. At the time JS was becoming more popular and everyone was making terrible slow web apps. The book help solved that pain. Then they developed Freckle time tracking software for freelancers. Then eventually Amy took what she learned about creating products and packaged that knowledge as a product called 30×500. Amy even had a failure in there when she tried to reinvent email but kept on moving once she cut her losses.
  • Patrick McKenzie created software for teachers to use to generate bingo cards. Yes, he literally built a successful business selling to probably one of the cheapest markets I can think of. Teachers in the US are severely underpaid in most cases and they often spend their own money buying supplies and things like this. Yet they are willing to shell out money for this software. He’s solving some kind of pain.
  • Brennan Dunn ran a successful consulting business. His big entry into the product space was a book called Double Your Freelancing Rate. He no longer runs a consultancy but he does have a project management SaaS application called Planscope and is building more products including training classes.
  • Nathan Barry basically went from being an unknown web developer to supporting his family off a few ebooks.

I could go on and on. There are thousands of people in markets I’ve never even heard about making a living off of products. These stories might not be the “20 year old that started the next Facebook and became a multimillionaire” kind of story. The truth is I’m never going to create the next instagram, but these seemingly ordinary people are making a few hundred thousand dollars from small product businesses. Mostly because they just started blogging with solutions to problems people in their space have. They built an audience by helping people. Eventually those people were also interested in buying their product. The best part of selling a product is that there is a good chance those same people are going to be interested in buying your next product (provided it targets a similar interest). All of the people I listed above have an email list that they have built over the years. I bet each one of them could send out an email announcing a new product and makes thousands of dollars in pre-sales right this instant.

Conclusion

You might be asking yourself: If this guy is so sure products are the bee’s knees then where are his products? Well there is one thing no class can do and that is make a person take action. You will find that most people won’t take action. You could give them an exact blueprint to print money and they won’t do it.

One of the first things 30×500 will teach you is to sell to people like yourself. You already know that market. Well, I have a hard time with introspection so I have been stuck trying to define exactly what it is that I am. I’m not really a web developer. I’m not really a big data engineer. I’m not really a consultant. Maybe I suffer from imposter syndrome? Maybe I’m just realistic in my skill level? I’m probably just more of a generalist but what ever the problem is I’m going to make it my goal to work towards solving it.

There is a lifestyle I want to work towards that I feel like only having ownership in my own business and products can provide. I used to think it required millions of dollars. I don’t think that now. I just need enough to support my family, cover my current expenses, and then a little bit to have fun with. I’ve already worked out a remote work relationship with my employer, but I want to be able to travel with my wife while still making a living. I want to be able to decide one morning that I’m going to move to somewhere sunny (so long as they have internet) and actually be able to do it without permission from a boss. I’ve seen posts from Amy about being too sick to work for weeks at a time but still making an income from her product business. If you had a job and were sick for that long there a chance you would be fired or at least forced to go on Family Medical Leave and lose your income. If you were a consultant and couldn’t consult you would lose your income. With a product business the business can still chug along while you are out dealing with whatever life throws your way. That’s the kind of lifestyle I’m going to work towards building starting now.

 

IBM Watson Explorer

A few people have contacted me about what I do at my day job as a Watson Explorer Consultant. Since this is my personal site I don’t usually focus on what I do at my 9-5. I’m going to write a few posts to explain what exactly it’s like working for the IBM Watson Group and what applications I work with.

Disclaimer: This article contains my own thoughts and opinions and in no way represents IBM or any IBM products. This post is not sponsored nor affiliated with IBM in anyway. Please see the official IBM Watson Explorer website for information directly from IBM.

What is IBM Watson Explorer?

Watson Explorer is a data discovery tool. It allows you to explore vast amounts of enterprise data. The tool allows you to consume and index data from various data sources. Out of the box Watson Explorer ships with many popular connectors for enterprise data systems. Using it’s own proprietary indexing technology, Watson Explorer can leverage natural language processing to deliver relevant query results to end users. The product can also utilize Query Routing to route queries to websites and return the results within it’s own interface. This data can be integrated into a single, 360 degree view, application on the front-end.

IBM Watson Explorer ships with several different modules:

  • WEX Foundational Components
    • IBM Watson Explorer Engine
    • IBM Watson Explorer Results Module
    • IBM Watson Explorer Application Builder
  • WEX Analytical Components
    • IBM Watson Explorer Content Analytics Admin Console
    • IBM Watson Explorer Content Analytics Miner
    • IBM Watson Explorer Content Analytics Search
    • IBM Watson Explorer Content Analytics Studio

IBM Watson Explorer Engine

The Watson Explorer Engine component is the key backend component of the of the foundational components. The foundational components come from IBM’s acquisition of a startup called Vivisimo based out of Pittsburgh, PA. Engine basically acts as an enterprise search engine that can be leveraged to crawl and indexed large amounts of data both structured and unstructured. The documents are stored as XML documents, similar to Apache SOLR. During the crawling process XSLT can be utilized to modify the data of the document before storing it to the index. Engine can be configured to be distributed among many servers to meet big data needs and scale quickly. The web based admin interface allows IT users a simple way to manage this powerful application. For enterprise search applications engine comes with it’s own search interface. To leverage 360 degree views engine must be combined with IBM Watson Explorer Application Builder.

Watson Explorer Engine Admin Interface
The Watson Explorer Engine admin interface

IBM Watson Explorer Results Module

The results module component allows non-technical business users to manage feature of the search results within Watson Explorer. Users can use the spotlight manager to configure spotlights that will show a boosted content above standard search results based on specific keywords. You can also use Results Module’s terminology manager to easily manage spelling suggesting, synonyms, and related terms.

IBM Watson Explorer Results Module
A screenshots of the IBM Watson Explorer Results Module interface

 

IBM Watson Explorer Application Builder

The Application Builder module is used to build 360 views of enterprise data. This applications connects to Watson Explorer Engine and displays the indexed data to the end user. One of the primary benefits of Application Builder is that you can leverage the entity model. By creating an entity for your data you can then define relationships which allows a developer to easily combine and display related data to the end user. Users can choose to follow specific entities that they are interested. Application Builder will then provide them with the most relevant information based on what the user follows.

The technology behind Application Builder is Ruby on Rails. Specifically App Builder uses jRuby which means that the application runs inside a JVM. So for IT purposed it can be considered as another Java application.

App Builder ships with several out of the box widgets that can be configured to display various types of data. Most deployments of Application Builder use many custom widgets. Custom widgets allow a developer to utilize Ruby (ERB), HTML, CSS and JavaScript to deliver a custom experience. This tool is very powerful and is currently being used by many enterprise customers to get the entire 360 view of their data so they can make educated business decisions.

IBM Watson Explorer Application Builder
An example of a “360 View” using IBM Watson Explorer Application Builder.

 IBM Watson Content Analytics

The content analytics module is a separate piece of software from the foundational components. IBM Watson Content Analytics allows you to collect and analyze different types of content. It stores this content in it’s own indices which are currently separate from Watson Explorer Engine. It can consume both structured and unstructured data from documents, email, databases, websites, and other enterprise repositories.  You can then perform text analytics across the data that is indexed by Watson Content Analytics.

What is a Watson Explorer Consultant

I’m a Watson Explorer Consultant. That means I work directly with customers to conceptualize and deliver Watson Explorer Solutions. My primary focus is on the Watson Explorer Engine foundational components. I use the engine, app builder, and results module components to deliver solutions to data problems at companies big and small. I’m currently one of the experts on my team for IBM Watson Explorer Application Builder. I’m able to utilize my past web development experience to deliver some highly customized solutions to customer data problems.

Our team is based out of Pittsburgh, PA but we are also distributed across the world. I currently work from my home in Ohio full time. I spend a portion of my time traveling to client sites to consult with them directly and deliver solutions in person. It takes a special kind of person to be able to handle problems with both technology and humans. If you’d like to reach out to me please use my contact form.

Make Money Online: Documenting 10 Years of Failure

This is the history of my experience trying to make money online over the past 10 years or so. This is by far the longest post I’ve ever personally written and it’s more of an autobiography than a blog post. I feel like I need to purge some of this stuff from my head so I can stop focusing on the past so much and move forward. I don’t really expect anyone to care to read all of this but I feel like writing so here it is. 

The Very Beginning

I’m 29 now and technically that puts me into the Millennial Generation. I think we’re probably the last generation to grow up without having access to computers and the internet from birth. That being said I did have the opportunity to  play with IBM blue screen computers in elementary school, and even get in trouble for figuring out how to use an entire printer ribbon to print a banner for my father’s business.

Fast forward a few years. I’m probably 12. My dad decides this $2000 Bose surround sound system he bought is just too much for our house. He tells my mom to take it back and get the kids some type of computer. I end up with this pretty sweet Pentium 2 Acer gaming PC with Windows 95. AOL was the way you connected to the internet at the time so the old man hooked me up.

Having a computer and internet connection opened up a world of curiosity for me. I was always trying things to see if they worked. I learn MS Paint and made myself an album cover for my totally white suburban 12 year old gangster rap songs I figured out how record (I was hot before the Icy Hot Stuntaz). I then moved on to learning HTML and eventually moving on to things like Visual Basic (I think it was VB6 at the time).

In High School I would often sleep through my classes to avoid the anxiety social interactions caused me. I still got good grades but never challenged myself with the exception of my computer classes. I was always very interested in them and loved learning every little thing I could.

One of my friends in high school, Todd Morrison, had the most epic blogs ever. Full of many things I’m sure he hopes the internet forgets. This was before WordPress even existed. I think he used Coronto and eventually Moveabletype. He probably inspired me to get into blogging later on without even knowing it.

My First Attempt at Making Money Online

Fast forward a few years. I’m out of high school. I don’t take the summer off but I start working full time and going to school. I’ve always had some type of entrepreneur trapped inside me. I think it start with me selling counterfeit CD’s in middle school.  My dad started one of the first Mobile Oil Change businesses I’ve heard of. This was even before Jiffy Lubes started popping up, so maybe some if it gets passed down from him.

I see that blogging is becoming very popular. I also see that advertising is taking over the web as a monetization method. This is post .com bubble bursting but you still hear stories of massive amounts of advertising income that websites are making. Even your average Joe was apparently making a killing of Google’s AdSense program. I’m not going to lie the image below is probably responsible for me even knowing about AdSense. I’m sure if you’ve ever looked into earning income online you’ve seen this picture:

shoemoney adsense check
Jeremy “Shoemoney” Shoemaker’s Famous Adsense Check

So I decide I’ll start a blog and make money via AdSense ads. In October of 2006 I register TeamTutorials.com and start blogging about something interesting to me, computers. I really just generally wanted to help people and trying to answer questions. Figuring out how to do things gave me a chance to learn myself and pass that knowledge on. Things started off slow but I kept writing mostly because I loved learning.

Eventually I started seeing small amounts of AdSense income. It was never much but I thought if I could get enough traffic it might work out. I started looking at where I can get traffic for a site like this and found that there were a ton of tutorial directory sites that would link out to tutorials. I submitted everything I could. This was my first foray into SEO without even realizing it.

Over the next six years I continued to blog and build traffic. I build the site up to about 80,000 – 100,000 page views per month.

team tutorials analytics
Screenshot of TeamTutorials traffic from Google Analytics

At about 100k page views I was making a little bit over the minimum payout amount of $100 for AdSense. AdSense tells me the lifetimes earnings are almost $7,000 for the site. I don’t consider that a success but it was enough to cover the expenses of a dedicated server so that I can play around with other ideas.

Tutorial directories seemed to be getting a ton of traffic. I decided to start one to capitalize on that but it failed and was retired. I was trying to monetize it in the same way.

AdWords to AdSense Arbitrage

I almost forgot about this short stint but in the mid 2000’s people were making money from AdSense Arbitrage. What the hell is arbitrage? It’s basically finding an imbalance in the market. Traders are familiar with the concept.

Basically someone figured out that you could buy cheap keywords on Google AdWords (the advertiser side of the platform) and then send that traffic to pages with links to higher paying Google AdSense (the content monetization side).

So what you would have is a bunch of people bidding on 1-5 cent keywords and sending you to a page where they hoped you click on some high paying ad for a lawyer or something. I never really got into this but I heard it worked for a little while.

Discovering Affiliate Marketing

Now that I saw it was possible to actually make some money online I started looking into it even more. What I found was that people seemed to be making a living with Affiliate Marketing. So I figured I should probably try that.

Affiliate marketing is when you are paid to promote other people’s products and services. Sometimes you are paid a small percentage of sales commissions. Other times you are paid a certain amount per lead. It’s still basically arbitrage but from paid traffic to affiliate ads.

There are a bunch of Cost Per Sale networks out there that many people are familiar with. These are networks that usually work with a lot of big brands and some smaller ones and generally they pay out on a percentage of a sale. A few that come to mind are Amazon Associates, Commission Junction (CJ), ShareASale, and LinkShare. The first real affiliate network I worked with was PepperJam (which was acquired by eBay I think).

On PepperJam I applied for a bunch of different campaigns and was accepted into a few. I started testing out these offers by buying ads on the MSN and Yahoo search ad networks at the time. These networks had less traffic so there was much less competition than you would run into at Google. Which means cheaper clicks for me.

On top of that they would give you crazy bonuses all the time. Things like “Sign up for a new account. Deposit $10 and we’ll give you $100 in free advertising”. I figured if I could test out these ads for free something might work. So I got as many Credit Cards as possible and made an account for each one. I got a few thousand dollars of free advertising credits.

Using those free funds and a pretty new designer fashion brand’s affiliate program. I promoted their products and started seeing a good return on investment (ROI). Once something was profitable all I had to do was scale. All it took to scale at that time was more budget. All I needed for more budget was a higher credit limit. I pushed as much a I could and got my first $8,000 check. Then I kept promoting and earned another $20,000 in a matter of months.

My First Affiliate Marketing Failure.

Then disaster struck. I apparently was violating the terms of the affiliate agreement with my bidding strategies. It was basically a trademark issue in which I didn’t know I was not supposed to be bidding on their trademarks and they added wording into the agreement after I started promoting the offer to disallow that. Of course they didn’t tell me I was doing something wrong until after they got their $200k+ in sales and the time came to pay me my commission. I ended up in a conference call with the network in which they told me the advertiser refused to pay and that they weren’t going to be able to pay me all of my commission. I think they paid out part of the $20k but not enough for me to turn a profit.

I severed ties with the network. I was one of their top affiliates at the time. They would contact me and try to get me back but I just couldn’t risk putting that money on the line and not being paid.

The PepperJam network was started by Kris Jones who went on to sell the company and become very successful. I don’t hold any of this against him but I wish I could have had a better relationship with that company. He seems like a pretty cool guy.

Moving on to CPA

Even after the upset of losing what was probably $12,000 (which is known as a “shit load of money” when you are in your early 20’s) I didn’t get discouraged. I had a taste of freedom and proved that this could actually work. I kept investigating the affiliate world and eventually found a forum called WickedFire.

WickedFire is kind of like the cesspool of affiliate marketing forums. I actually learned a lot by digging into old posts and lurking. The members were notorious for things like posting a link to a gif of swinging dicks when a noobie asked for help. It had/has a strange culture but at one point it was a good resource. They covered everything about Affiliate Marketing even the grey areas.

I think I found barman via wickedfire. His blog PPC.bz was hilariously inappropriate but covered all of the industry drama. As you can imagine an industry of people who post swinging dick gifs is full of drama. I still wonder if  affiliate rapper dullspace ever got a record deal. 

I followed some of the advice on WickedFire and ran some dating campaigns on Facebook. At the time Facebook traffic was very cheap and allowed for way better targeting than any other ad network. I made a few thousand dollars from dating offers and testing various other offers.

The problem with the forums were that if someone shared something that worked then everyone would try the same thing increasing the competition to where nobody could make much of a profit. This started leading to a community of secrecy and really killed the value of forums for me.

The biggest thing I got out of all this testing and income was that I would regularly charge thousands of dollars a month and then pay it off as soon as the bill came in. This allowed me to increase my credit limit significantly at an early age.

My First Big Campaign

As I got some experience behind me I started getting accepted into these smaller boutique style affiliate networks. A few of the ones that I know are still around today are A4D (previously Ads 4 Dough), Convert2Media (C2M), and Motive Interactive.

Jason Akatiff the owner of A4D is responsible for a lot of the things I learned at this phase.

At this time affiliate marketing was still a wild west type of industry. This was before the FTC started cracking down and weight loss products (like Acai Berry) were making a killing. So I decided to ‘slang dem berriez’ as wicked fire would say.

For some of these weight loss products I could earn $60 a sale. Much more than anything else I’ve ever promoted. I started out on my old traffic source and eventually Google Search. I made some money from Google Search but then my account was banned as Google started cracking down on these types of ads.

I knew these products were making a killing but I couldn’t get traffic. Until I got an email from one of the network owners. I remember it being very short and saying something like “Hey MySpace is launching a self-serve ad platform tonight. You guys might want to check it out. ” This was just before MySpace officially died and Facebook took over as the king.

I was working midnight shift but was off that night and visiting my then girlfriend at WVU (now she’s my wife). I stayed up all night making various banner ads and submitting them to MyAds. I set the max budget of $10,000 per day because on most other sites I had a hard time hitting the budget anyway. I went to bed hoping to make $60 by the time I woke up.

I woke up and opened up my MyAds account. I guess there was some type of glitch where if you bid the maximum amount they delivered ads until you ran out of money. Holy fucking shit -$8,000. I literally hit my credit card limit in a few hours. My stomach sank. I was scared shitless. There was no way I would be able to pay that off.

I finally got myself together and logged into my affiliate account. $22,000 in commissions. I thought there was no way that could be right. After it sank in that it was right I needed to move quick to get the ads going again. I called the network and setup a wire transfer. Banks seem to think you are a drug dealer if you walk in with a 6 digit check for some reason. I then paid off my credit card and called all my credit card companies asking for a limit increase. This was before the credit crack down. I may have fibbed my income a little bit but I managed to get one of the cards to give me a $45,000 limit at 22-33 years old.

one ad was literally a killer whale and it said “don’t be a whale use acai berry”.

I scaled the campaign and probably made $60-80k in 2-3 months. Eventually I was contacted by the network owner saying my ads were not appropriate. Some of them were absolutely hilarious and I can’t believe people clicked on them and bought the product. I mean one of them was literally a killer whale and it said “don’t be a whale use acai berry”.

I also learned what it felt like to write a 5 digit income tax check to uncle sam.

So I started making some more appropriate ads. Made a little bit more money but eventually competition picked up. I branched out to other types of ads like CPM (cost per 1000 impressions) that would show on news sites and things.

Being an Unknowing Participant in a Scam

These weight loss product become more and more popular and I see people making way more than I am (hundred of thousands to millions). I’m not going to pretend these product didn’t feel scammy from the beginning but I wasn’t award of how bad it was.

These products worked by having “free trials” that required a credit card. If I got someone to sign up for a free trial I’d get commission. Then the company would continue to bill these people $60-$100 a month for automatic refills of the product if they didn’t cancel. At least that’s what I thought. It turns out they literally wouldn’t let people cancel. Some people got taken for hundreds of dollars. Some had to cancel their credit cards to get it to stop. Eventually some of the people behind these “diet companies” actually went to jail over it. I know some affiliates did too for promoting it.

Automating the Magic

Not that I’m proud of any of this but I started looking even deeper into the grey areas of affiliate marketing and SEO. I also wanted to automate this so I didn’t have to spend so much time manually doing things.

I came up with an idea to automatically create websites and monetize them. There was a plugin out there that would work with WordPress and post links from eBay and Amazon and I would get the commission from sales. I also put AdSense on these sites for extra income.

I didn’t know how to do this but I was working a midnight tech support job with a friend and we had a lot of free time. We started trying to figure it out. I came up with the idea and created a template WordPress site and had Mike Maguire figure out how to automate things.

The idea was pretty simple. I would research keywords that I thought had potential to make money via these ads. I’d add keywords and domain names I wanted. The tool would buy a domain name, setup hosting, install WordPress, install our template, change SEO settings based on keywords given, and then go out to the Amazon API to pull in products. It wold populate the WordPress database with products and descriptions from Amazon, with affiliate links to Amazon and Ebay, and schedule the posts to go out randomly over the next two years. We also had some internal linking setup between the sites to pass on some link juice and help rank in Google.

I found out a few things. I could buy .info domain names for 99 cents meaning I could make hundreds of sites for cheap. New domains seemed to get traffic in Google quickly and then drop off. Stronger .com and .net domains seemed to last longer but making money at this seemed to be a volume game and not a longevity one.

So our auto-poster created hundreds of sites. Some got no traffic but a few got a decent amounts of traffic. We targeted niches like “unlocked blackberry phones”. It really only took a few sites making a little bit of money to bring in a decent income. I think we may have gotten up to $1200+ a month before things took a down turn.

SEO, Spam, and Regrets

During all this time I was interested in driving traffic to all my sites. I started looking into driving traffic to these sites and my other properties. At first I did your typical on page optimization and then moved into building backlinks manually. This is known as “white hat seo”.

There is another side called “black hat seo” which is the things that are frowned upon. At the time people figured out different linking schemes that could drive ranking power back to a main site. These were called link farms. You could create a bunch of crappy sites with spun content (taking content and replacing words randomly so it seems unique to Google). So I built a link farm and started seeing my rankings increase.

Then I learned about a tool that was supposed to be built by some Russian hackers (or so I hear). This tool was powerful. It could blast out thousands of links per day. The tool is probably still active today and it’s was called Xrumer. Xrumer would crawl the web for forums and blogs, create profiles with backlinks, write spammy comments, ask questions on forums and answer with your backlink from another account, etc.

It’s all shady but it worked so I looked passed it. At one point I was spamming so many links from my house that Comcast would repeatedly call me telling me I “had a virus” on my computer. I was using 4TB of bandwidth each month.

Now that I look back I don’t feel great about my time as a “link spammer”. Fortunately for website owners Google basically fixed this exploit with their Penguin and Panda updates so it’s really not effective anymore.

I apologize to all you forum owners for what I did in the past.

Membership Sites and Email Lists

I did attempt to make one product. I started a health recipe membership site. I figured people on Weight Watchers and other diets wanted some healthy options. I found a bunch of recipes and put them with some amazing pictures, so they would share well on pinterest. My target audience was mostly female and pinterest was becoming popular so I thought I might be able to game it.

In the early days of pinterest you could post affiliate links. All you had to have was some products people were interested in and you could make a few dollars from Amazon. Eventually pinterest shut this down and started redirecting affiliate links through their own affiliate id numbers so they would make the money. I don’t know what they do today.

I had free recipes with an option to join a mailing list to get some “premium” recipes for free. People would sign up and go through the free recipe sequence which would eventually end and try to upsell them on a membership to the site.

I had a few signups at $7 a month I think. I had a few requests for refunds which I granted. I didn’t see this working so I shut down the project. I think there are just too many free recipes available out there and/or I didn’t market it to the right people.

I also started using mailing lists on Team Tutorials to drive some revenue by pushing WordPress plugins to my readers.

For the record email marketing is still the method that drive the most engagement.

Focusing on Affiliate Marketing Again

After my stint with shady SEO and automation I decided I wanted to get back into affiliate marketing but wanted to not feel like a douche bag for the products I promoted. Gaming was taking off and I felt like that was something that didn’t really prey on people. I could promote games in good conscious.

I hooked up with a new account manager at one of those networks. I talked to him and he said they had this new game that was doing pretty good. I didn’t really have any traffic sources so I started looking into new options. At this time StumbleUpon had launched their paid promotion.

Thanks to Ryan Berger from Motive Interactive for setting me up with this offer.

You could pay a few cents to have your page delivered via StumbleUpon’s network. This worked out great for my game because StumbleUpon users were basically already bored and looking for something to do, which is why they were stumbling.

After a lull of not really making any money I found a winning campaign with a game on StumbleUpon. I made something like 150k in revenue over 3-4 months. I branched out into gaming networks like MochiMedia (no longer exists).

The thing about StumbleUpon traffic was that it seemed your ad could only be delivered to each user one time. So eventually you just ran out of traffic. Then they changed their pricing and terms. They really didn’t want these types of ads on their network even though the users seemed to respond to them.

Once again I lost a traffic source and a significant source of income. I kept running on the gaming network which still made a few thousand a month but not nearly as much as I was making. Then that network went under and I was bringing in nothing again.

I’m not really active in the affiliate world anymore but mobile was the last big wave i heard of and I imagine it’s still where the growth is. In general mobile is still growing so mobile advertising will grow with it. 

The Downside of Becoming “Rich” Suddenly

We weren’t really wealthy growing up. My dad didn’t even have running water at one point when he grew up. He had an outhouse and a well that he had to go get water from. This wasn’t even that long ago. Basically my family was “dirt floor poor” until my grandpa got a job at a steel mill (which he walked or thumbed a ride to until he could afford a car).

My mom and dad did the best they could but there were points in my early childhood but I know they struggled a bit at points. I remember coming home from school to see a couple hundred dollars of groceries left on our table and receiving a thanksgiving dinner box at school. They shielded it from me but eventually in high school we were pretty much a typical middle class family.

I worked at a grocery store for like $5.35 an hour through high school. Now all the sudden I had hundreds of thousands of dollars in revenue coming in. I didn’t really know how to handle that.

mint screenshot
This is a screenshot from my mint account at the time. As you can see my best month ever I had nearly $90k in income. Followed by a few $20-40k months.

I always told my self I wanted to be rich before I was 24. That goal basically stemmed from some stupid song by Lil Flip. As dumb as that sounds I repeated that line in my head all the time and it became my goal. For a moment I actually thought I reached that goal. I had money right? Well I wasn’t prepared for that money at a young age.

I’m thinkin’ – designer clothes and fashion shows
I’m thinkin’ – all my albums goin’ platinum and gold
I’m thinkin’ – Jaguars and a Bentley Rolls
I’m thinkin’ – bein’ rich before I’m 24

You’d be shocked at how much of my life I can relate to rap lyrics.

I ended up blowing most of it on cars, and vacations, and random shit. I flew my family out to Vegas so I could get married and then spent $1200 on Sky Vodka (the bottles that are $20 at the drug store) in some club. That was probably one experience that was worth the money. My entire family in the Pussy Cat Doll club (when it was in Planet Hollywood) having a blast. I have stories to tell for years about that night.

Shout out to Mike Kerry from C2M for putting up with being at the table next to us that night.

I was never rich as a kid and now I wanted to feel like I was. I was basically living a drug dealer’s lifestyle. Blowing money fast. I got so used to charging $20,000+ per month and paying it off like it was nothing. When the money stopped coming in my spending habits didn’t change. This is when having a $45k credit limit becomes a bad thing.

I don’t really want to speak on this anymore but I’ll just say this. I made some bad decisions and I learned some valuable life lessons about money and happiness. It would be very hard for me to make those same mistakes again. After having this kind of income I no longer believe that money doesn’t buy happiness. It sure the hell made my life easier at the time.

For the future me. When you make some money think about investing it back into your business. Time will come when you can splurge on yourself but that’s after you have built a solid foundation.

Failure and the View from Here

As you can see I had a pretty eventful couple of years. It was really a roller coaster of emotion. In the end I failed at all of these things but I’ve gained a wealth of knowledge. During this whole process I still had a day job. I almost quit to pursue my “business” full time but I never did. I have mixed emotions on that decision. In the end it seems like the right choice but now I wonder “what if I gave it my all?”

Now I work a consulting gig everyday that I really don’t enjoy. The money is decent (I had months better than my yearly salary in the past). I get to work from home. I get to travel and see some cool places. I get to play with some of the hottest software right now but I’m still missing something. I’ve also been dealing with health problems over the last few years and severe depression. I basically haven’t had motivation or even the energy to do anything aside from my day job for years now. I’m completely drained when I’m done working. Things that use to make me feel energized like lifting or running now make me feel even more tired.

Overall I realize my life is good relative to most people in the world but I am still not happy. Depression is a bitch.

So What’s Next?

I tried a lot of things that really didn’t lead to long term success. So what is my plan for the future? First of all my plan is to get healthy. I need to pull myself out of this depression. I need to drop some weight. I need to get back to the gym at least 4 days a week and add some running/cycling on the weekends.

As for business I think I want to create some kind of product. That’s one of the areas I really haven’t tried to fail at yet. I had that recipe site but it was poorly planned and doesn’t count. I’m pretty sure that is one way I can help people while also making a little bit of money. I also believe products are the only true way to the type of freedom I would like to have in life. I would love to be able to travel with my wife while still making money or just taking a day off because I don’t feel like doing a damn thing. That’s the kind of freedom I think products can bring. There are some obstacles in my way but I’ll post more on this subject in a follow up.

One AdSense Change Dramatically Increased My Earnings…

… and I have no idea what it is.

I used to blog actively on my tutorial site, TeamTutorials. In it’s prime the site would see over 100k page views per month. Even in the prime the site barely met the $100 Google AdSense monthly payout threshold. After 2-3 years of not posting it now the site receives 5-6k visitors per month. That’s a significant decrease. The main reason I kept this site was because it used to cover hosting on my dedicated server so I could run other project on it.

After traffic died off the site would average less than $10 per month in AdSense revenue. Well a few weeks ago I remember going into the AdSense UI and changing some things. However, I really can’t remember what I changed. I think I created a new channel and updated all my tracking codes with that channel. I think I may have turned on some kind of delivery optimization settings. I seriously can’t remember exactly what I did. This is like the worst AB test I forgot to actually monitor.

I forgot about this change completely as I rarely check up on this site. One day I decided to log in and see if I was going to be getting my AdSense check soon. The last time I was paid out was in November. So I ran the recent stats and I saw a significant increase in revenue. With 5-6k hits a month I’m generating probably 60% of the income I generated at 100k+ hits. Now if I could only figure out what I did…

Google AdSense Screen Shot

Now, I don’t consider $60 a month impressive at all but the fact that my earnings increased by such a high percentage is interesting. I find the RPM (revenue per thousand views) of $22 to be quite high. In my experience I’ve always had a hard time reaching more than $2 RPM (aka eCPM). It has always been especially difficult for me to monetize sites that revolve around tech as those readers tend to be ad blind or use an ad blocker.

Update

After a few months I went back to check my stats and they returned to the “normal”, pre-change levels. What I think is happening is that there must be a good bit a fraudulent traffic. When a new site is added Google doesn’t seem to adjust for this. After I got some traffic history all of my earnings decreased, including the numbers I showed above. The payout ended up being about 1/10 if the originally reported earnings. Adjustment for fraudulent/bot traffic is the only assumption I can make at this point. I’m not sure if my site is being specifically targeted or if this is common across AdSense properties.