What's Better... a Well Built and Well Marketed Website Built on a Bad Business Model or a Poorly Optimized Website Built on a Strong Business Model?
I spoke with a someone a while back who wanted to know how much money she should spend to market her website. Her business model was based upon receiving Google AdSense revenue. She wanted more traffic to her website even though the percentage of visitors clicking on her site's AdSense ads and resulting revenues were extremely low. I wasn't convinced that her business model was one that would generate revenues through online advertising.
Many websites are set up to generate online advertising revenues... throw up some content, get lots of visitors and if enough visitors click on your syndicated advertising then the site generates a nice cheque (that's check for our American readers) payable from Google or other advertisers. I wrote about this on our blog before... Markus Frind from dating site PlentyOfFish.com regularly picks up cheques of close to a million smackers at a time. It's because he has a site built around user needs that brings in lots of traffic, generates an extremely loyal following and hence converts extremely well. Markus is a smart guy and he also knew that the web can be an extremely effective channel for dating sites. The bottom line is that Markus' website is built on a strong business model.
AdSense Syndicated Advertising Can Generate Significant Revenues
You can often judge a website with a good business model because Average Time on Site and Conversion Rates are strong. Websites built on bad business models don't get visitors hanging around very long because the content or the offer isn't worth their time. A bad business model isn't going to make you money no matter how much traffic you can attract... think of a specialty store selling smelly socks with holes in the heels or a restaurant with terrible food and slow service. No matter how much you market smelly socks or crappy food customers they are going to leave your business sooner, they certainly won't return again and as a result you won't stay in business long.
So what does this mean? If your website just won't convert is spending money and time to attract traffic worth it? This is a really general comment BUT I often note that if a website isn't converting at a rate of 2% you need to figure out why... and fast.
There can be 2 reasons why websites don't convert.
Your website might not be optimized properly. This can be fixed!
Updating design, content, your call-to-action and other website components can help here. Turn your website into a laboratory. Get some web analytics on your website, then tweak it. Test to see if the changes you make help improve conversions. There are online tools like Google Website Optimizer, Verster or Offermatica that allow you to determine whether one version of a web page works better than another.
Your website's business model isn't viable. In my opinion this is a bigger problem.
A website with a good business model can be tweaked to increase traffic and conversions. But even a well built and strongly marketed website won't save an online business built on a poor business model. If this is the case and making a profit online is your goal don't waste your time! Move onto a more viable business model that translates to the world wide web and THEN build your website.
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