::Conversation with a mainstream site owner:: Advice needed.

[xenigo]

Here's my response to a conversation we just had on the phone. He says he wants to try to figure this stuff out on his own. He expressed interest in having me work for a percentage of sales, instead of as an hourly employee. He said it was getting too expensive. He also threw in "well you don't have any experience in the truck industry..." to which I responded "no, but I can sell Viagra online without being a Pharmacist. I can sell anything."

I told him I'd do it for 40%, and by my research is a very fair figure. I need some input.

I was giving our conversation some thought, and I have a few points to mention. 40% as someone who is generating the traffic for your site is on par, if not below, industry standard for doing what I’m offering to do for you. Keep in mind you’re starting from zero. You don’t have any online business to speak of at the moment, so everything I’m doing for you is profit you wouldn’t have had otherwise.

Here’s what I can do, that you will have difficulty doing on your own:



Purchased traffic campaign management: I can make sure all of the traffic we buy is converting properly, and ensure that we’re not overpaying for unproductive traffic.
Search Engine Optimization: I have the ability to generate search engine friendly content that pulls traffic.
Content Production: I can write articles based on the videos, and photos taken in your shop – product installation tutorials, new product highlights, etc.
Networking with other webmasters: I know how to get people to listen to me, as an experienced webmaster. I have a lot of experience with traffic generation via ‘trading traffic’.
Day-to-Day site management: This is a pain in the ass, and you have a shop to run. You don’t want to be tied behind your computer learning how to overcome all the technical problems (and required site maintenance) that come up from day to day.
And you should give this some thought, because it is in your best interest to have me handle this for you. This isn’t something anyone can easily pick up and run with. I know you said you want to do this on your own, but I don’t think that’s very realistic. Also, all of the above site responsibilities don’t require me to know anything about truck technology. I get the product information straight from the manufacturers, etc. If I need to do a product review, I’ll come down and test the product myself.

[Mike AI]

40% of profits or revenue? Also who will be paying for the ad campaign?

If someone gave me me money to buy keywords, and gave me 40% of sales - I would think the guy is too stupid to be in business.

[gonzo]

40% of profits or revenue? Also who will be paying for the ad campaign?

If someone gave me me money to buy keywords, and gave me 40% of sales - I would think the guy is too stupid to be in business.

Yeah and if you cant handle it dude... I can!

DOS TIP - $2 a day on google isnt going to do jack shit.

[xenigo]

That's why I'm here asking for input. What sounds like a more reasonable deal? I got the 40% figure from my buddy who operates a site that his parents own. They do about $70k a month sales. This site that I'm talking about running is sitting idle, and I'll be responsible to grow it from the ground up.

[gonzo]

That's why I'm here asking for input. What sounds like a more reasonable deal? I got the 40% figure from my buddy who operates a site that his parents own. They do about $70k a month sales. This site that I'm talking about running is sitting idle, and I'll be responsible to grow it from the ground up.

How much is the adwords budget?
Do you just plan on using google?
Who pays for the keywords?

[xenigo]

How much is the adwords budget?
Do you just plan on using google?
Who pays for the keywords?

I want the company to cover all the traffic expenses, graphic / design expenses, scripts and hosting, etc.

[gonzo]

I want the company to cover all the traffic expenses, graphic / design expenses, scripts and hosting, etc.


What are you getting 40% for?
You still didnt answer my questions.

[xenigo]

What are you getting 40% for?
You still didnt answer my questions.

Handling everything needed to move product. Traffic generation, adding / maintaining the product database, SEO, content production, writing blog articles, etc.

The owner won't touch a thing. I'll be responsible for everything. I just want him to pay for the nuts and bolts.

[xenigo]

40% of profits or revenue? Also who will be paying for the ad campaign?

If someone gave me me money to buy keywords, and gave me 40% of sales - I would think the guy is too stupid to be in business.

Mike, come on... 40% of profit obviously. If he gave me 40% of revenue he wouldn't have any profit for himself. Honestly I think I'm giving him more than a fair deal.

[PornoDoggy]

First thing I'd need to know about the entire deal is what the norm is for the industry - what does a salesperson in this particular industry make?

40% for lead generation sounds high to me ...

[Bishop]

trucking industry.. what exactly is the product? truck accessories?

[PornoDoggy]

trucking industry.. what exactly is the product? truck accessories?
Yeah, I saw the trucking part - but that's a pretty broad spectrum, which prompted my question/comment.

There's just too many variables here ... are they going to be doing the entire transaction on the 'net, or are you going to be getting them into a shop where somebody else actually closes?

[Dravyk]

40% for lead generation sounds high to me ... On the other hand, site management, traffic management, handling outsourcing ....

If you look at it one way 40% might seem high. If you look at it another way, all that work is probably enough to be a full partner splitting it down the middle at 50%. Tough call.

[PornoDoggy]

On the other hand, site management, traffic management, handling outsourcing ....

If you look at it one way 40% might seem high. If you look at it another way, all that work is probably enough to be a full partner splitting it down the middle at 50%. Tough call.
If the sales are done online then what you say is true.

If somebody else is closing the deal, then it's not.

I still say there just isn't enough information here to make an informed judgement.

[xenigo]

If the sales are done online then what you say is true.

If somebody else is closing the deal, then it's not.

I still say there just isn't enough information here to make an informed judgement.

I didn't think there would be so much confusion surrounding this request for advice. Basically what I'm going to be doing is creating the Amazon.com of truck parts. That means the customer can buy tires, shocks, superchargers, and a lift kit, nerf bars, online... pay for it... and we ship it to him.

I'm going to be creating the site from scratch, and starting with zero traffic. This includes building the product database, and entering all the product codes and product descriptions. Also, maintaining the product database - adding new product, deleting old product, and editing product.

I'm going to be managing the entire traffic campaign (Google, Overture, Froogle, and all the product indexes on the net that will list us...)

I'm going to be writing reviews, articles, and product installation tutorials (photo, and video) for some of the hot products. I'm also going to be doing product reviews on video.

I'm going to maintaining a blog, and exchanging blog traffic. I'm going to be working the forums to generate interest in the site and articles.

Basically I'm going to be doing everything it takes to move product.

Honestly I think he's getting a great deal for giving me only 40%... I don't know why you guys think otherwise. I hadn't said anything about "only generating traffic to the brick and mortar location".

[Dianna Vesta]

It sounds like a win-win if the guy is legit. Do you know for sure that he has those sales and a track record?

I thought you were talking about adult sites. If someone roll up and did all that for my sites I'd take that kind of deal in a heart beat AND get involved in the day to day.

Truck parts? lol- well ok!

I was involved in DRTV products for a company who didn't know anything about import, fullfillment, production, etc. Basically investor that had other skills. I asked for a % of all internet sales & they thought they were getting me cheap cheap until the second month when my % exceeded anything I could make in salary. But I had a contract so after a year they knew everything they needed to know and I was looking for work again. Know what I mean?

So if your deal is a partnership it sounds sweet. If they are giving 40% to build the technical side of things on a limited partnership then I think I'd have to look at that contract really good!

Good luck!

[Grump]

I didn't think there would be so much confusion surrounding this request for advice.

Worthwhile advise comes from informed advisors, thats why all the questions. The profit participation sounds reasonable to me, provided you know what his markup and true costs are. Have you figured out the cost of order fulfillment and who bears that? If the margins are too tight on this type of product line then the 40% might not be worth it for one or even both of you.

[PornoDoggy]

Honestly I think he's getting a great deal for giving me only 40%... I don't know why you guys think otherwise. I hadn't said anything about "only generating traffic to the brick and mortar location".
Were you asking for alternate opinions, or an endorsement of yours?

You didn't say anything that indicated your involvement was more than generating traffic to the brick and mortar location, either.

As far as the deal goes - I'd take it if I were in your shoes, and turn it down if I was in his.

[gonzo]

Honestly I think he's getting a great deal for giving me only 40%... I don't know why you guys think otherwise. I hadn't said anything about "only generating traffic to the brick and mortar location".

I made the same mistake in reading your earlier post as we discussed on ICQ. I wish you luck...let us know how it works out for you. As I told you earlier managing adwords campaigns is a full time job and then some.

Dont think just because you have some keywords that the traffic will flow to your site. I think you will discover the entire process is an art. Which could be expensive in the begining.

[Bishop]

Your best traffic source to start is simple and its not a search engine. Buy ad space on hobby message boards. If you own a Z71 truck and your serious about your truck then your going to seek out a Z71 owners forum. Buy ad space that is targeted to the owners of those trucks. I assume your going to cater to a heck of alot of different makes and models.. the first thing I would do is find the center of the internet universe for each of the models you seriously support. That is targeted advertising.

Leave the engines for later.. the best thing you can do is become a standard place for people to buy upgrades. Support the forums that support your potential customers. It builds a trust factor and name recognition.

Give away a product to annouce your new sponsored relationship with the forum. Make it a very desirable product. When the winner has been selected, ship the product quickly and do everything you can to build a relationship with that customer. If they speak kindly of you then others will do business with you. Get into their community and show your support to pick up customers for life.

[xenigo]

Your best traffic source to start is simple and its not a search engine. Buy ad space on hobby message boards. If you own a Z71 truck and your serious about your truck then your going to seek out a Z71 owners forum. Buy ad space that is targeted to the owners of those trucks. I assume your going to cater to a heck of alot of different makes and models.. the first thing I would do is find the center of the internet universe for each of the models you seriously support. That is targeted advertising.

Leave the engines for later.. the best thing you can do is become a standard place for people to buy upgrades. Support the forums that support your potential customers. It builds a trust factor and name recognition.

Give away a product to annouce your new sponsored relationship with the forum. Make it a very desirable product. When the winner has been selected, ship the product quickly and do everything you can to build a relationship with that customer. If they speak kindly of you then others will do business with you. Get into their community and show your support to pick up customers for life.

Some very good suggestions. Thanks Bishop :)

[Tony Oprano]

interesting thread