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Pay for Performance 

From: Rod Aries

I am scratching my head and making grunting sounds as I have been reading all the various I-Sales comments about pay for performance, and I feel like I am on the other side of the world in seeing all the "we can't," "I won't," "who would," and "not us" comments. What is the big deal?

I learned about the two stages of pay for performance first hand. The first stage is making money for yourself - BUT the second stage (at the end of this note) is where you really earn your money.

The first stage of pay for performance: About 15 years ago I became disenchanted with the corporate world, put my graduate degree in my back pocket and began to sell commercial investment real estate ($500k++) in California. As you are aware, in real estate brokerage, you only get paid when you have totally performed. You learn a lot about how to perform from when going without a paycheck... To say I struggled the first 9 months is an understatement. But once I learned about the second stage, well, it all changed...

Back to search engine rankings... I believe in our service and so should our clients and I am willing to prove it to them.

There are a lot of companies making promises to get a site to rank number one. On this one, they neglect to mention that is it by using a really obscure term or keyword. A reputable search engine company will not make a guarantee that your site will be ranked number 1. If they do, they are probably using this obscure words.

Hmm, I say... Hmm! (grunt, grunt) Just because you can't, doesn't mean we can't.

In fact I believe that a company that WON'T do pay for performance is the one with a questionable reputation as they don't even believe in their own service enough to receive pay based on actually doing what they say they will do.

Also, for the record, we don't do obscure words - we send those clients with obscure words to companies that do NOT offer pay for performance :) We ONLY do pay for performance. And we ONLY do it for tough words. We found that getting high rankings for "easier" words takes almost as much work and doesn't pay as well; so we quit doing "easy" words. We get our clients rankings, and after we have them, our clients pay us.

We can't control the search engines

Yep, algorithms change and search engines go out of business, but you know what? That is not our clients problem. That is our problem.

Our client partners are successful in business and have realistic (well, sometimes) expectations. Most of our clients have the following in common:

* Many have tried to obtain rankings themselves and have not succeeded.

* Feel that when they pay for something, they should get what you pay for.

* Spent a lot of money on having a pretty site, with few results.

* Feel that when they go to an expert, the expert should perform like an expert.

* They are a leader in their industry and expect to assume that position in the virtual world.

Pretty simple. Clients know what they want, they get what they want... and when they get what they want, we get a little bit too.

The other factor is that defining "success" is tough to measure:

We spell it out in a contract. Performance is defined by rankings and by search portal. Our clients pick the keywords they need and we get them ranked... or we don't get paid. A top 10 ranking is worth more than a Top 30 ranking and a keyword like "flowers" is worth more than "online florist's California." And a top ranking at Yahoo is worth more than a top ranking at Northern Light - no offense NL :). Tough words are harder to obtain and tough words cost more.

Who bears the brunt of responsibility for that performance?

We submit reports to our clients, based on our indices, at regular intervals. We then compare expectations to achievement.

BUT I want to make one thing perfectly clear - it is OUR performance that we guarantee; we do not guarantee the sales performance of the client's site. We do not do revenue sharing as we control the marketing, we do not control their sales.

What we have found out a few years ago is that we did a great job, drove traffic and our client had crummy sales. The clients were jumping up and down saying we weren't doing our jobs. Excuse me, when you are 15% higher for a commodity than most anywhere else on the net, you are not going to get business...

Having said that, and with the luxury of hindsight, one area we find that we spend a substantial amount of time, gratis, with our clients, is advising them on how to improve their site, how to write content, how structure their offers in 'net perspective' not real world pitch, how to correctly respond via email, how to compel visitors to buy, how to allow customers to flow through the site, how to prevent only one customer page view and then leaving, how to structure their toll free number, how to test their competitors anonymously and how to test their own site, and much, much more...

In fact, we do all this work BEFORE we engage a client. We don't want to bust our rear ends, achieve high rankings and end up with a dissatisfied customer. It is bad for them and bad for us. Our goal is to make our partners better, not just throw them traffic. We now turn away far more clients than we take as it has to 'work' for us, and for our clients.

We are pretty blunt about it, almost like 'tough love,' and if our clients feelings get hurt, well, it ain't going hurt as much as going a few more months with poor web sales.

And, back to the more powerful, second stage of pay for performance; continuing to use my real estate stint as an example:

Most brokers do about 6 deals a year and call it a great year. I partnered up and I participated in 150 sides of escrow in 4 years. In fact, amazingly, most of my clients were real estate brokers themselves as they determined I could do what they needed to do, better than they could, and that is to make money. And you know what? You learn more about the true way to earn money - in this second stage - and that is not by making yourself money as in the first stage, BUT by being of service to your client, by helping your client get what they want and helping them make money.

Because if you really want a partner, not just a customer, and you want to get paid well, then make your partner do well... that is real performance.

At your service,
Rod Aries

How To Internet Your Business
 
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