The news this week is pretty dire. On the heels of the US Government's bailout of Freddie Mac, Fannie Mae and AIG Financial, stock markets in the US, Russia, Japan and elsewhere are suffering tremendous losses. The NYTimes paints a linkbait-worthy, interactive picture of the financial industry's collapse. If you're anything like me, this news brings on some anxiety and fear - neither of which are good for startup businesses or those seeking to grow. Thus, I figured it would be worthwhile to give a brief synopsis, discuss the causes and symptoms and make some predictions and suggestions for the search industry and those in online marketing on how to weather and even prosper in the upcoming storm.
First, there's a number of items causing the turmoil:
- Subprime Mortgage Crisis - This BBC interactive graphic piece does a good job explaining the problem, but in essence, lenders discovered that by leveraging the bond market, they could issue loans to far less credit-worthy borrowers at higher, variable-interest rates. With far more people able to afford mortgages, housing prices continued to rise from their already high levels in the early 2000s. From there, the path was obvious. Interest rates and foreclosures went up (due to both the insolvency of some less-than-ideal borrowers and the rise in variable interest rate loans), making houses unaffordable. Defaults led to price drops, which led to more homeowners finding the price of their mortgages higher than the value of their homes and walking away. This spiral led to even more price falls and defaults, which eventually took their toll on the investors in the subprime mortgage bonds (and the banks that issued them).
- Gas & Energy Prices - High oil prices stem (most probably) from rising demand in emerging economies, middle-east conflicts, natural disasters and an enormous increase in speculation about so-called "peak oil" (the point at which Earth's accessible oil supplies start to dwindle).
- Inflation - Gas prices impact an incredible range of goods and services, including virtually any product requiring transportation. Higher oil prices also drive up energy prices, which cause a rise in consumer and business costs across the board.
- Bankruptcies/Insolvencies of Financial Sector Firms - The events surrounding Freddie Mac, Fannie Mae, Lehman Brothers, AIG and Merril Lynch all contributed to the last 7 days of upheaval that resulted in an extreme confidence drain on investors.
Second, there's the immediate results on Wall Street and other trading markets worldwide:
- On Monday, September 8, the Dow Jones Industrial Average sat at 11,510. As of Wednesday the 18th, it had fallen to 10,609, a loss of 9.2%.
- Traders rushed to buy "safe" investments like gold and Treasury Bonds, despite the extremely low rates of return on these vehicles.
- Russia's Micex index fell 25% (and lost $425 billion USD in value) in what's being called the "biggest financial crisis since the default of 1998."
- Asian markets suffered tremendously as well, from Australia to Japan to Hong Kong and beyond.
Third, there's the longer term issues that arise when stock markets plunge and investment capital turns risk-averse. Sadly, the confidence (or lack thereof) of investors often turns into a domino-like effect:
- A Higher Cost of Capital - Lending rates will rise to account for the greater riskiness, meaning capital will be less available to grease the wheels on financial transactions of all types.
- Lowered Investment in Businesses - Business owners and investors will reduce their inputs, meaning business opportunities will go un-exploited due to potential riskiness. Startups will have a tougher time getting funded and those who own companies will be less likely to expand or make significant purchases.
- Job & Wage Cuts - As companies look at ways to save, they'll inevitably hit on employment, causing a rise in unemployment. This has the added impact of further damaging the economy as those without jobs will contribute far less to the economy as a whole.
- Higher Borrowing Costs - In addition to making private ventures more costly, this will have an extra impact on the already suffering housing market and probably hurt the economic picture even further.
- Lower Spending by Consumers - When investors and businesses tighten their belts, consumers almost always follow. Once again, with consumer spending dominating economic activity, particularly in a rough housing market, this is sure to incite further declines in the world's economic forecast.
If the outlook sounds grim, that's because it is. Many of the financial analysts you'll see in the media are parroting similar lines - they've never seen it this bad before. Of course, that kind of quote makes its way into nearly every media article on financial downfalls; it makes for a more dire piece that way, and the financial media feeds off bad news (case-in-point: WSJ's soaring traffic over the last week).
What about the Internet/Search World?
There's some good news here. Tech stocks have not been hammered the same way those in the financial sector have. Google, Yahoo!, Microsoft, Apple, IBM and other mainstays are actually surprisingly cash-rich, and have fairly solid fundamentals. The online ad market may be weakening, but the trend towards greater Internet usage is accelerating at a tremendous pace in the developing world (and Google's lending a helping hand there) as well as continuing a slower but visible rise in developed nations.
There's a number of factors that make me believe, personally, that the Internet is actually a very good place to ride out this type of a storm:
- Web businesses in general have virtually no connections to the real estate / financial markets directly (though they certainly can be impacted by general market downfalls caused by the recent insolvencies).
- Web adoption is rising around the world (though it has tapered off slightly in the US), and broadband continues to drive increases in usage.
- Higher gas prices make using the web a more attractive alternative activity.
- A downturned economy means more people seeking bargains, and the web has become the best resource for that pursuit. Price sensitivity and web usage have been linked in the past, and I suspect that trend will continue.
- The generations emerging as the majority of the workforce will soon be digital natives and this spells tremendous new opportunities for the web as an economic force.
- Search demand isn't dropping. Just because investors are running scared and buying gold, silver and t-bills doesn't mean the world's digital population is going to stop performing searches. There might be less discretionary spending, but my guess is that such a larger fraction of it will be performed online in the years to come that it will outweigh the potentially lower conversion rates.
- SEOmoz's own conversions haven't dipped at all in the market turmoil, suggesting that folks are turning to SEO and finding value. In fact, cancellations of PRO memberships have actually dropped as well. Granted, this is hardly a macro symbol of the online marketing world, but it does suggest that businesses continue to allocate budgets towards SEO. We've also gotten a solid number of requests for consulting work, adding further credence to this prediction.
Recommendations of Internet Marketers and Web Startups
I'm certainly no seer, but I do have a bit of experience in this field. From 2001-2003, Gillian and I weathered an ugly storm of a downturned economic climate, lack of investment opportunities and a market that generally despised anything "dot com," and yet managed to build a successful company from the ashes. I'll share my best suggestions below:
- Snap Up Cheap Talent - if the job market does turn south, that spells opportunity to grab some great people, often at less exorbitant salaries than in an up-tempo economy. Some smart startups in NYC are already jumping on the tech talent lost in the last week.
- Invest in Easy-to-Test, High ROI Projects - Rather than taking the "let's sit this one out" approach, I'd suggest taking a slightly riskier route and investing in projects where you can quickly and easily determine potential ROI. Stagnation is not only bad for business, it's bad for the economy as a whole, and those who generally come out on top in business as a whole are the same ones with the guts and brains to invest in smart projects when times are tough.
- Market in Trackable Ways - Networking can be tough to measure, as can brand marketing, TV ads, print media and other non-electronic forms of advertising. If you're going to cut back, do so in these arenas and re-invest somewhere you can watch your money grow in exceptional detail... like SEO, PPC, e-mail marketing and web advertising. With every click tracked, you'll know exactly what you're spending and how much it's earning you.
- Watch Your Burn Rate - With investment and even credit hard to come by, it's a good time to review the soundness of your financial picture and outlook. Check your balance sheet and cash flow statements and be sure you can weather 6-12 bad months. If you can't, you've got two options - invest in growing quickly or find ways to cut expenses. The former may seem riskier, but if done right, it's much more appealing and potentially smarter than trimming budgets and people (as you're often also cutting into sales when you scale back).
- Make Sure Your Business is Your Passion - This is always true, but in times of economic turmoil when you might have to work longer, harder hours and miss out on some of life's luxuries, the best cure is to love what you do. Chris Anderson even gives you a better shot at succeeding than the pros :-)
- Start Your Own Business - The ease with which anyone can start an online business makes it an incredibly attractive prospect, and if you're reading SEOmoz, you probably already know a hundred ways to earn a living off the web. Find your niche and dive in - it's a surprisingly low cost investment, even if it doesn't work out.
Looking forward to hearing from you about how you plan to weather the stock market storm on the web.
p.s. I'm taking a few extra days off after my wedding last weekend, but should be back to more regular contributions on the site on Wednesday the 24th.
I'm not one to embrace any kind of "the sky is falling" doom and gloom.
I tend to take a "the lights are still on and the stores are still open" kind of approach to these things.
But what we're going through is a once in a lifetime experience.
The author of this article from the Washington Post gives us two great quotes:
You know you're in a heap of trouble when the lender of last resort suddenly runs out of money.
and
What we are witnessing may be the greatest destruction of financial wealth that the world has ever seen -- paper losses measured in the trillions of dollars.
I personally think it is all rather exciting. The important thing to remember is that this isn't a permanent condition.
Rand hit the nail quite squarely on the head: out of every financial crisis there are some individuals, companies, or industries that make money as everyone comes out of it.
Internet Marketers could and should be that someone.
It wasn't the gold miners who made money during the gold rush - but the people who sold the miners their tools, clothes and alcohol.
On last Sunday's "This Week" Alan Greenspan said this is a "once-in-a-century financial crisis".
So the question is - what are you going to do with it?
Once in a century sounds about right, at least now we have safeguards in place that will prevent anything like the fallout seen in the 20th century.
@timstaines *knocks on wood*
I personally think it is all rather exciting. The important thing to remember is that this isn't a permanent condition.
Summed up my thoughts precisely. :-)
Ever Since the fall of Bear Sterns we are worried about the impact on this in the Indian IT Industry. Most of the financials which went burst (Fannie, AIG, Lehman, Meryl) had directly or indirectly outsourced their jobs here. We are hearing job cuts in the BPO sectors like HExaware TCS etc. Our Sensex (Bombay Sensitive Index) fell from 18,000 to 13,000 and we are worried that it may touch 10,000 levels.
So what is it for the search and seo industry in India. More and more small startups on SEO will be emerging (Even from the bedrooms). There will be lot of freelancers in the market. The SEO charges will go down and so will the quality. The BPO companies will now shift to the webdesign and SEO industry.
It is not a good sign at all for us as there had not been a single new job in the IT industry for the past 3 months. As the financial sector has collapsed too there wont be any fancy jobs for the freshers with loads of money. Now that every graduate in India has a computer and broadband they may perform more searches because they don't have a job and nothing else to do. But these searches will not be of any commercial value as they don't conduct any business online or offline using those searches.
In short there will be lot of activity but not much of money. I am surprised that the US FED have bailed AIG. Those guys should be put behind bars as they enjoyed a luxury on general public's money with lot of hype. When there was profit to AIG it went into their pockets. Now the game is over and they want the American general public to pay for their(AIG) mistakes
the same is the story in india buddy...they talk about globalization when it is gud and now disassociate themselves from US economy...
claiming their balance sheets are strong...PC is one fu* of a guy...he thought he is too intelligent...but yeah he made his money in the last 5 years as FM...
the banks in india too have lent a lot of money to real estate gamers and smugglers and everyone...it is the worst land of corruption...ashamed of living in india...
regarding India - I think the situation outside of the UK and US is still good as there's a good deal of out-sourced off-shore development work - as its cheaper and can be done this way. So there's a ray of sunshine there..
One thing I also learned from weathering the dot-com bust at a startup is that there are always opportunities. Whether you're investing, running a business, or starting a new business, you have to take a few deep breaths and get creative.
One opportunity I'll add to your list is crowdsourcing. People are doing solid work at ridiculous rates in certain areas. Long-term, I'm not thrilled about that (I hate seeing design and coding become a commodity), but as a small-business owner, you'd better believe I'm using these services where it's prudent.
I have been advising 2 - 3 friends who run small accountantcy businesses to keep a look out for talent from Meryl Lynch this week, and I am sure a number of small firms will do the same.
It is a dire week for the Financial world, and although there will be some shockwaves filtering down to online marketing (a large number of lucrative PPC/SEO contracts are in the financial world), I think as you point out, there will be an after result of online performing better.
I think Offline media is going to start suffering a bit more, due to accountability or measurement issues with ROI, and online will keep on devouring that market.
With recession comes search for cheap alternatives to everything, and most of these searches will be online - hence a bigger share of traffic, and demand from brands to place themselves in these areas.
I would also advise SEMs who are in the Financial market, to also investigate traditional Recession boom industries. For Example Local Holidays, as the cost of holidaying abroad goes up etc. These markets will grow and will probably be more stable to work in. And these are the guys who will start spending the big money.
I think Offline media is going to start suffering a bit more, due to accountability or measurement issues with ROI, and online will keep on devouring that market.
How will the online guys escape from the ROI computing issues that you see? What measurement issues you see really?
It's challenging to measure offline conversions because you don't know if someone purchased a product as a direct result of seeing your advertisement on television. Online you directly track an ad from click to purchase. If it takes 10 clicks on one ad for a purchase, you have a 10% conversion rate. It's not as easy to track that offline.
Also, coming from a traditional advertising background, television and print are very expensive ways to advertise. Online advertising and optimization of Web sites can provide much higher ROI at a lower cost. In a tight envirionment long term results (from traditional brand advertising) are not as important as current results (SEM and SEO).
And as a side note: when consumers are faced with the threat of high gas prices, online retailers have an advantage because people will turn to online shopping instead of driving to the mall.
Which is actually rather silly, as they then have to pay those same gas prices in the form of shipping costs. I guess those costs are just a little more invisble than the price of filling up an SUV these days though.
"Which is actually rather silly, as they then have to pay those same gas prices in the form of shipping costs."
It's true and I did consider that while writing the sentence. If an incentive like 'free shipping' is thrown into the mix combined with great prices, then there's a good chance for higher ROI in uncertain times like this. Marketers should adjust their messaging accordingly when the economy slows.
"And as a side note: when consumers are faced with the threat of high gas prices, online retailers have an advantage because people will turn to online shopping instead of driving to the mall."
This statement is dead on, no excuses. Yes, you do pay for shipping. But that fuel cost is shared with others that are getting stuff shipped.
If you have ever jumped in the SUV (yes I have a big one for sale cheap) and driven from store to store, only to go home empty handed... The fuel cost is almost invariably higher to jump in the personal transport than it is to pay shipping.
Plus when the stuff you order online arrives (a daily occurrence at our place) it's like Christmas. Bonus and way less frustrating.
Most of you won't relate to this because you're young and beautiful, but there is not much more frustrating to a soccer mom than going to the mall, being ignored by the teenage staff because everyone over twenty is invisible.
More and More people are going to be shopping online. The business owners that lock up good SEO's early will be able to ride the storm in high style.
Those late to the party won't be noticed back on page twenty five. They will be the ones closing their doors thinking the internet just didn't work for them.
Okay, this is me getting off my soap box.
there is still nothing like seeing the product in real display and then buying it...the moms aren't going to care for the teens either...they pay and buy it...it is not that they are giving it for free...
but it is traditional problem...though offline conversions are measured to an extent by asking the buyer on how did he know the product or something on similar lines...
but more importantly advertising expenditure will be the first to suffer in periods like this...whether it be online or offline... google is not going to see the same kind of money through advertising this year unless something dramatic happens...
Things are going to keep going south. There's no doubt about that. What is there to hold them up? You just need to look at the rate of increase in average home values over the last 15-20 years. Talk about a bubble. Compare it with income averages.
It was greed. Borrowers sought mortgages to buy homes well beyond their means, brokers sought out these buyers and rushed the deals through to make their fees, lenders bought up the risky credit because it paid better.
As far as where we, internet marketers, stand...well I don't like to be a pessimist, but I don't think we're so sheltered as we might like to think. When things get very bad, we're going to feel it just like everyone else. People will spend less, off the web and on. That said, there are certainly worse fields to be working in.
Market corrections are a necessity.
Rough times like these force you to cut the excess, to get more efficient, more creative and compete better. Survival in these situations is in our nature. We've survived millions of years of war, disease, starvation and otherwise brutal competition with our fellow man to make it here. A market downturn, as severe as this one may be, isn't going to be the end of the world.
Hey, at least this won't be boring!
"It was greed." Completely agree.
I would only add the blame reaches much farther than borrowers, brokers and lenders.
Those in charge of oversight did absolutely nothing. I have to laugh at politicians demanding answers to questions they should be answering themselves.
I am not sure online marketing is immune to the present crisis, however it exposes your presence outside to customers only too happy to take advantage of the opportunities.
Good point - I think what we're seeing now is that government regulation is necessary for some markets and that it needs to be proactive, not reactive.
I have been feeling this pending 'greater depression' a lot lately. I own a retail 'brick and morter' store and sales year-over-year for this month are way down. And I'm in a very nice, high income area.
That's why im racing to take my business online and get the customers who want to shop but can't afford to drive. Lowcosts compared to opening another physical location.
On inflation, I don't think inflation is tied to gas prices. Inflation is more $$$ chasing the same goods. So, in an over-simplification, inflation is due to The Fed printing money out of thin air. Not to mention that the US dollar has been de-valued by almost half.
I, like Vin, find these times to be more exciting than scary. But that said, I am financially stable and (so far) not directly affected by the various bankruptcies, collapses, and crashes the world is experiencing.
I am actually delighted to think that many people might be scared enough by current financial events that they decide to finally stop living beyond their means and accruing debt. That would be a very positive development.
My husband worked for Hull Trading Company in Chicago in the 90's. HTC was founded by Blair Hull, a very interesting guy who (in a completely irrelevant aside) was the person Barack Obama defeated to become an Illinois senator.
Anyway, long before Mr. Hull had political aspirations, he was a trader and a canny, savvy one at that. I remember reading an article about him (I think in a business magazine) that told the story of what he did during the stock market crash on October 19th, 1987.
Basically, after a long, terrible day, all of the traders went home. Many were in financial ruin. But Blair Hull stayed behind, and as the story goes, stood alone on the trading room floor and quietly bought up share after share at rock bottom prices.
In the following months, the market rebounded and Blair did very, very well. The article I read went as far as to say that he saved the market that day by keeping things afloat. I don't know if that's true or not, but I know that he didn't run when everyone else did. He found a way to capitalize on the crash and in doing so, helped others and himself.
There are been several posts in the past few years at SEOmoz about finding that "sweet spot" of overlap between what you love to do and what you're good at. Vinny wrote one almost a year ago called Finding Your Niche. If there was ever a time to find that special place, it's now.
While many people reading this blog post have the same skill set, and many have the same interests, very few have the same skill set and interests. If you can find a way to build a business around your uniqueness, you are set.
Thanks for your post, Rand, and best wishes for your marriage to the lovely Geraldine!
I'm sure you don't mean to trivialize the plights of hundreds of thousands of American families who have found themselves left with no choice but to leave their homes. I think saying that you're "delighted" by the situation may be a bit too much on the sweet side
Several of my family members are right now in danger of having no choice but to default on their mortgages. This is due to rising costs of living and stagnant wages - not the bill coming due on so-called "McMansions."
I'm not sure millions of American families who found themselves in need of a home and were told by morgage brokers, "no problem, there are programs for people who don't have high income," are entirely to blame.
"Beyond their means" is defined very much by the cost of homes. Shady credit practices drove these prices through the roof. How many people do you know who can drop $500,000 cash on the table? Most American families had no choice but to borrow to pay for homes at inflated prices.
Of course, I agree that this correction is necessary. This bubble had to burst - it should have burst 10 years ago, when the damage could have been minimized.
And I do appreciate that your point is to stay positive and forward-thinking during times like these. I agree it is crucial.
I simply can't say that I am delighted by the situation.
I could write a book on how the housing crisis happened. But let's just say ALL of the following groups are responsible for the bubble and for sub-prime loans gone bad.
Buyers who wanted to buy the most house they could for their monthly payment (we buy off of what we can afford each month - not the total amount of the house or the total cost of the loan).
Sellers who thought their house deserved to be sold for a little bit more than a nearly identical house sold for a month ago right down the street because their grass was greener and the other people's house smelled like cats.
Lenders who kept trying to keep their staffs of secretaries and closers working by offering more and more competitive products (Loans with up to 120% LTV, Pick-your-payment plans, Interest Only, Reverse Amortization, Variable Rates, No Down Payments, No Doc or Low Doc, and Sub-prime).
Lenders are in the business to sell loans - that is what they do. And when everybody is offering the same low rate because most loans are eventually sold to the same wholesale market - you only have your loan packaging to keep you competitive.
Appraisers who tried to keep food on the table by keeping their customers happy. Their customers were real estate agents and lenders. If an appraiser couldn't find some way to justify a high price and get a deal done the likelihood he would be called back next time was slim to none. No overt coercion, but just a subtle message that this is how things work.
Legislators who demanded that the mortgage market and other lenders create more loans for people who don't have good credit or great incomes. That is - they wanted them to make more sub-prime loans widely available.
Yes, these same legislators are now the ones screaming about why lenders created the sub-prime mess. That's what politicians do - they blow with the wind.
Real Estate Agents like me who knowingly or unknowingly let it all happen and moved the papers around all so we could get some commission check.
There isn't any one group of innocent victims in all of this. And there isn't any one group of villains.
Yes, there are homeowner's who may lose their home because they didn't really know what they were getting into. But they weren't innocent - or at least most of them weren't.
I've been at a lot of settlement tables (over 400), I've sold a lot of houses in the affordable range as well as high-end McMansions. I've never once met a buyer who had been "duped" on the totality of their mortgage.
They might have some surprises at the settlement table regarding points, closing costs, etc. But they knew what their monthly payments were going to be.
If anything they are guilty of being overly optimistic and not even comprehending the downside.
A lot of people truly thought they could continue to make their payments, or they'd get a raise, or they'd refinance in a few years when housing prices went up and interest rates went down again.
But we know now that didn't happen.
Actually, my husband and I were some of the people who did take advantage of the loans you speak of. That was about 9 years ago.
We bought a home that was actually less than our mortgage broker told us we could afford (they always want to stretch you further than you can go) and in the past 9 years since then, we have stayed in the same home even though our income has doubled and most people would have "moved up" long ago, incurred no credit card debt, and were able to re-finance when the mortgage was up.
We have watched other people not do what we did - they bought homes that were outside their means, furnished them on credit, and then continued to enjoy a lifestyle that cost more than they made. I'm not saying that everyone was this way, but many were.
I always get a sick feeling inside when I read about how much credit card debt Americans have. And statistics say it's almost everyone, although the amount of debt varies. It has seemed like nothing - not 9/11, not wars, not talk of recession - has motivated most people to stop charging and start paying off their balances. So yes, I am glad if something motivates them to do that.
I am never delighted by suffering, so I have mixed emotions about our current times. I'm sorry if I didn't express that better in my first comment.
I have a friend who is about to lose her home; the electricity's been turned off and it's in foreclosure. I have helped her financially since she has 6 kids; but the reason this is happening is because she and her husband bought several properties even though they didn't have the money to do so, hoping to rent them out and make some money.
None of their homes are now worth what they paid. Is their crisis caused by the current financial crash? Somewhat, but really it's that they're finally paying the price for some very poor decisions. I love my friend and want to help her, but the truth is her situation could have been avoided.
Rand,
I believe that we offer businesses a great value for their money.
Traveling to a store on the internet is much cheaper than getting in my car and driving to the store. I live in Oregon so there is no tax savings for me.
Advertising on the internet is much cheaper than on television or even the radio. What is the broadcast version of organic listings? ;-)
What better way to give a fledgling business a shot in the arm than a good old SEO make over?
It's a scary situation, indeed. But I agree with those that believe that those who can find ways to prosper in these times will be the true winners in the end. I only hope that whomever is elected in November can guide us through all this and get us to the other side with as little damage as possible. I don't see the recent actions as socialism either, it's a real push to try to prevent a repeat of the great depression.
Interesting comments here, My take on it all is that despite the economic uncertainty there's opportunities all over. Lets not forget that the economies of countries have been suffering for a while now - and we saw this in the tourism industry - with more people going on holiday domestically. Which whilst bad news for international - it was an opportunity for domestic tourism. We'll be able to see this across the board - one persons loss is anothers opportunity. Regarding the SEO/online industry - I think we're ok - whilst people wont see huge new projects going ahead due to cost cutting, what we will see is companies trying to optimize the amount of money they can get from their existing channels and properties - and using SEO/ppc/email optimization is a key way of doing this. The job market in the UK doesnt seem to be slowing hugely in our market... The areas I do see being impacted are things like the valuation of Facebook (till they prove ROI) and social media - again till its proven for some industries.
Edit: even the changes in banking are already proving an opportunity for some amongst us.
And for those wanting the cities angle on this heres City Boy (those from london will likely be familiar with him writing for the papers here)
PR: wait... I: wait... L: wait... LD: wait... I: wait...wait... C: wait... SD: wait...
I could use an economic "bailout", that $600 in May didn't really do much for me. I will say when your "bailsbondsman" fannie mae, AIG etc needs to be bailed out then you got problems.
I think its safe to say the Internet Marketing SEO industry will take one of the smallest hits of all industries...if any.
excellent reading, both the blog post and all the comments made here... being based in Europe I was wondering myself how badly online businesses could be affected by the threatening financial markets crises in the US. I agree with Rand with the points he make about internet still being there to stay despite economical downturns, though I cant help but thinking: 'if economy worsens and financial markets collapse due to scepticism or whatever reason, and so that has a knock on effect impact on smaller businesses who may at the same time be less keen to keep up online advertising expenditure at the same level, for sure sem/seo services vendors will be affected too.' So i still think that if the US crisis had evolved into actual crisis, we would all be affected to more or lesser extent, dont you think?
It has been a dire week, in fact most if this year has been pretty dire, generally in Australia our banking industry is pretty solid, even though are share markets seem reactive to whats going on in the US, even though our economy is linked tighter to CHina and Japan.
That being said hopefully within a few months the whole world will be better prepared for such situations, and perhaps start to rely a lot less on the US banks.
On a side note though Rand, good call with regard to migrating your marketing mix to the online/trackable kind. Costs are highly scaleable, and can be mixed providing you hit CPAs, unlike the hit and miss "traditional marketing/branding". I believe the web should be central to all campaigns, primarily for its direct responsiveness, and in todays financial insecurity the case for the web has never been greater!
thanks for the tips rand. I especially agree that if your business is your passion then you shouldnt fail. Our businesses are taking off nicely in the past year, and look at continuing.
We lost some money when the market died down in January, but will hold off until things are looking a bit steadier before going there again.
There are several urls for this post:
1) https://www.seomoz.org/blog/what-does-the-stock-market-implosion-mean-for-your-online-business
2) https://www.seomoz.org/blog/What-does-the-stock-market-implosion-mean-for-your-online-business
3) https://www.seomoz.org/blog/what-Does-the-stock-market-implosion-mean-for-your-online-business and so on...
gues it is the same for everypost on this blog...
why don't you guys 301 redirect all upper case to lower case stuff?
Our business has not been affected by the current economic disaster. I doubt it will.
The government "bailouts" are socialism
Agreed, the bailouts are socialist by themselves, but the gov't is not and should not go generally move in that direction unless it's going to help keep businesses like yours and mine from being affected by the current economic disater. IMHO, we would all be much more exposed to this situation if it weren't for the bailouts. Do you disagree?
I think the jury is still our on how this will affect SEO companies.
On the bailouts however; I couldn't agree more.
Why would the goverment bailout private mortage companies and banks? The execs always inflate the numbers preceding the collapse ala Enron and make millions and then the tax payers foot the bill for their crimes. INSANE.
I love the new landlord government.
I just want to share an observation for online shopping sites looking to grow traffic.
I rarely shop online b/c I hate to pay the shipping fees. I was in a store with my son last week looking to buy a pair of shoes. When I was told the store did not have the size we needed, and offered the option to have the shoes shipped to my home in the correct size for a shipping fee of $2.99, I leapt at it. It would have cost me as little as $8.00 in gas to visit one or two other store locations.
Lesson learned... if you have a shopping site, point out the cost of shipping could very well save your customer money by not having to spend the gas money to pick the product up.
Congratulations on your nuptuals.
You put a lot into this blog and all the comments were also very insightful. These are difficult and interesting times. Not sure if my son's job with survive as his company's main client is Lehman Brothers but we'll all take each day as it comes and rely on God.
I'm going to read this over again because it was so meaty and I'm sure there are some practical ideas in here I can use.
Thanks!
Great tips Rand.
The tips are great to know and it's good to see that you've been there before (hard times) and got through, amidst the turmoil. Being a startup, it's good to find tempered wisdom. Gracias, amigo.
USA is moving towards socialism. Government of USA is taking over Private companies and spreading socialism. How times change!
https://rajeshmsharma.blogspot.com
These are emergency actions. When someone is bleeding to death you take action to stop the bleeding and worry about infection later. It's not a change in policy, it's a temporary change of priorities during a dramatic emergency.
Precisely!
I am totally against any move towards financial socialism, but that’s not what’s going on here with the bailouts. It’s hard to listen to people say “USA is moving towards socialism” when it seems just the opposite to me. Generally big businesses influencing the gov’t and not the other way around.
So lets compare this statement on socialism to the airline industry. Just because deregulation has taken place doesn't mean that we are going to get rid of the FAA. The same goes for lending, in a capitalist society we have the right to choose who we get loans from or loan to, just like we have the right to choose which airline to fly. That doesn't mean that lenders shouldn't have to adhere to standards just like it doesn't mean that the FAA should stop regulating the safety of flying.
very true man...funny indeed...
I am sorry Rajesh, you can not lament socialism tag to USA for the apparent lack of innovation in your country.
hey buddy it is nothing against U.S really...what is disgusting is the way that the guys who blundered are getting reprieves...the same is true in most countries i suppose...