Pyrogenic Media

Over the course of my entire live really, I have owned several large websites. I would even go as far as to say I have owned hundreds of websites and domains over my time as a web developer. However alot of them follow the same pattern. That is they get huge, and I slowly let them die until I couldn’t sell it to get a dime.It’s a common problem that many entrepreneurs face, not just in the web space. When you are building something up, when is it time to let it go? When is the right time to bring onboard people that can take the business further than what you can take it.

I have got it wrong my entire live.

Every single website I have owned and got large, as faded out into oblivion. I either lost interest and it died out, or it hit a snag that I was not willing to invest the time into resolving. And only later as I learn new techniques and new ways to promote websites, do I learn “Damn, I wasted that site for nothing”.

There is one time I did end up selling a website : http://www.pyrogenicmedia.com/block-cpalead-site-flip/

And low and behold. As the auction was coming to a close, the damn thing went viral. I was getting thousands upon thousands of visits a day. And it shot up the rankings in google. It’s just one of those roll the dice things.

And so it comes that with me being busy with a fulltime job (I should write about that in the future), running a web hosting company, and my girlfriend having no spare time to update the site. I have to sell one of my longer running sites http://www.purelytoptv.com

You can view the auction here : https://flippa.com/auctions/115719/Streaming-TV-Site—2-Years-Old—High-Traffic—Custom-LayoutDesignCode

It’s kinda sad that I have to let this one go. I have owned it close to two years now. I coded the thing from the ground up with no PHP knowledge at all at the time. And since then, my girlfriend has kept the thing updated. There is literally thousands upon thousands of tv episodes on there, all done by hand, and all done to make sure of quality. The revenue part is something that I just don’t have the time to get right, which is sad considering it is hitting 100k visitors a month, and yet not making as much as I think a site like that can get. We will see how the auction runs, but this is one of those times that I know if I hold onto the site, I will let it fade out. And instead, I am trying to move on.

UPDATE: The auction got removed . Apparently the embedding of videos is enough to trip up the copyright infringement team over at Flippa. To their credit though, they refunded my listing fee back to my credit card which I was pretty surprised about.

A few days ago I was watching a video on Shoemoney’s blog regarding upselling. Someone had emailed him with a question that more or less asked if upselling was really the right thing to do. Shoemoney answered it with a “Yes”, but I feel he was a bit short in the explanation. Really all you need to know is Yes, you should be upselling. But alot of people still have the question of whether this is ethical, and whether you should be trying to squeeze money out of the user even more after they just paid you for a product/service.

First and foremost, I want to say that upsells should never be “required”. Any product you sell should not involve strings attached that require you to do further purchasing for any hope of the product functioning the way it should. Upsells should be more of a way to squeeze the last dollar out of the user if they have it, but if they don’t then they can still function normally.

Cross Sells are much the same. For your product to work, they shouldn’t be required to purchase again. However there are times when this isn’t always the case. For example if you are selling a PHP script, then a cross sell could be web hosting. Which is required, but is a well known fact of buying a script. It isn’t like the user would not have known this before the purchase.

Which brings to a good point what is the difference between cross selling and upselling. Upselling would generally be upgrading the customers account or addon features, but within the same product. For example when you purchase an ebook, they could have an upsell to sell you the full ebook as videos. Or in a real world scenario, when you purchase a vodka and coke, they try and sell you on a more expensive brand of vodka. You are still getting the same product, but in a more advanced form. Cross selling is a bit different, it involves you purchasing the product, but then making additional purchases of related products to enhance your experience. As I used in the example above, it could be that you are selling a PHP script, so you also offer your users Web Hosting. While the webhosting has nothing to do with the original product, it is a supplemental offer that many will take up.

I think alot of people just use the term upsell to refer to both cross selling and the original meaning of upsell. In most peoples mind, it just means another sale after the initial purchase.

So should you be afraid that you are going to alienate your userbase with upsells and cross sells? Absolutely not!

Ofcourse you should not be pestering the user to keep buying, but the option should always be there if the user wants to. Leaving it to the decision of the user is a great way to start seeing if you can upsell. Alot of people leave cross selling links on their order confirmation page. When I ran a small link building service on the side, we partnered with several SEO guides to have them refer customers onto us. Not an exact definition of cross sell because they are merely an affiliate of mine, but they are still trying to sell the user more products after the initial purchase. Basically the order confirmation page read something like this :

Thanks for your order, please check your email for confirmation

To kick start your SEO venture. Check out company XXXXX, use coupon ZZZZ for 50% off your first order

Easy as that. I think most people would agree that there is nothing inherently sneaky about that sales pitch. It is a take it or leave it type offer that many will infact take up. Even if you get a 10% conversion on your cross sell, that is still 10% of people giving you even more money than you would have had you not had it there.

Wondering why I used the webhosting/php script example so often? It’s because it’s exactly what we do with my web hosting company. We partner up as either a prefered vendor, or in some cases, get written into their setup guides, and they refer customers onto us. We snag a few extra customers, and they snag a few dollars for their troubles. And the user is no more the wiser for it. Pushing a hosting company in a php script setup guide isn’t exactly invasive. Infact, it is required.

Ofcourse once you work your way up to marketing guru, you tend to be a bit more aggressive in your pitches with the upsell. Creating huge “One Time Offer” pages. But if you are looking to just get started. Don’t fear the upsell, it is no where near as invasive as you might think.

First and foremost, I would like to apologise for me not posting that much anymore. Running my web hosting company Wachahost has really turned into a mountain of work lately. Not really support wise, but we are always looking to improve the product so we are forever testing new OS’s, new panels, new backup systems etc. Not complaining however, since fiddling around with technology is always fun for a geek like myself!

Something we trialled a long time ago, was Virtulization software for VPS hosting. That is, when you buy a VPS server you are buying a small subset of the resources and you are able to use that account as if it was it’s own server. Almost every webhost has it, so I would be very surprised if you guys have never heard of it.

Anyway, generally speaking, There is two prominent VPS server technologies. Xen and OpenVZ. Xen is what you would think of as “complete” virtulization. It takes all the resources it requires from the main node, and “reserves” them for the VPS. OpenVZ on the other hand, has limits as to what it can take, but does not actually take the resources until they are required. Let me explain a little bit better.

If we have 12gb ram server, and we are selling 2gb Xen VPS’s, then we can obviously only sell 6 servers (Actually a little less since there needs to be ram for the root node to function). But let’s just say 6 for now. Most of you will probably say, well no shit. Quite obviously it divides up evenly. And we have to remember that Xen actually reserves the resources, so you cannot physically sell more than the 6.

If we take a 12gb OpenVZ VPS on the other hand. We have to remember that resources are never actually taken until they are required. So say we sell six 2gb VPS’s. The actual memory consumption may be only 8gb. OpenVZ is more like a “limiter” in my mind. It sets limits for how much you can take, but it does not reserve them outright for you. And this is really where the issues start…

Because the OpenVZ server is only using 8gb out of the 12 in ram, we can probably fit even more VPS on there. It is a dirty dirty tactic, and yet it is something that I see everyday. And for me as a webhosting owner, and also a pretty stand up guy, I have to compete doing things the right way, not overselling, with people who are throwing on more VPS’s onto a node then what it can actually handle. But hold on, if those VPS’s are all running redhot and hit their limit of 2gb, and we have sold over what we should have, won’t there be an issue? Yes, yes there will be. I have been reading quite alot, and issues range from just unresponsive servers to complete crashes. But we have to remember that when someone buys a large VPS such as a 2gb machine. It is very very unlikely that they will use all those resources. The computer I am sitting at right now has 8gb of ram in it, and yet I am only using 1.7gb.

So what happens from there? Well everyday I am seeing people sell 8gb servers, for less than $100 USD. No strings attached. It is one of those “if it is too good to be true…” sayings. I can almost guarantee you that they are using OpenVZ, and the 8gb is merely a limit, not a reserved portion of resources. This post was really brought on by friends of mine really getting done over with the promises. Not that they ever managed to reach their 8gb limit, but that there is other limiting factors such as CPU and IO/Disk Usage that becomes an issue when you over-fill a server.

I would just like to point out aswell, that I am not saying that everyone should buy exclusively Xen VPS servers. Infact at Wachahost we use OpenVZ (I will explain in a later post probably). But just be wary that when someone is giving you some amazing deal on a VPS node and it is OpenVZ (Or virtuozzo) node, it is likely going to leave you underwhelmed.

This has been my question for the past few weeks. It’s like some Aristotle quote of epic proportions. Did the casino rig a “lucky dip” draw for their own gain?

Let me start at the beginning (Always a good place to start). A couple of weeks ago, me and my girlfriend went down to the local city casino. We hardly gamble at all, but the casino has some of the cheapest beers in the city (For me), and they also make some decent cocktails (For the girl). The bar is also located right next to the roulette tables, so while you have a beer and chat about the week that was, you can watch people gamble their life away. It doesn’t sound like a night of fun to watch people blow the last of their savings, but it is just a cool atmosphere.

Anyway, On this particular night they were having this draw every hour. On entry you were given a wristband on your way in with a number on it. On the hour, every hour, they would bring out some burlesque dancers and then do a draw for someone to win a bit of cash. Personally I thought they were a bit tight with the prizes, it was only around 1k NZD which is about $800 USD. Pretty tight for a casino if you ask me. I digress, Our number was mid two hundred thousands, so 250,000 or so. We got there around 9pm I think and stayed till 12pm.

Now here is the interesting thing, we missed the 9pm draw (We only just got there when it was being drawn), but obviously saw the 10, 11 and 12 o’clock  draws. Every single draw was in the mid to high 100,000′s. Ok so a bit of sour grapes that we are 50k off the mark, but think about that. Between these people getting their arm bands for the draw and me getting one at 9pm, there was 50k people through the door. That simply does not happen in an hour. Infact it would take several hours to happen.

Now, call this a crack head idea. But I am 99% sure, the draw was semi-rigged. These people that won must have been there since early afternoon. They would have had to have been there for hours and hours that day. This was even more evident when each draw required about 5 redraws (Each in the 100k again), because the people weren’t there, they had gone home.  The casino was “rewarding” their most loyal customers, those that had been there since early afternoon (And it is now midnight).

Jokingly when I watched the first draw, I laughed that I bet these people winning the 800USD only just covered their losses. In hindsight it is probably true. Even if they had not gambled that much up to that point, most would have blown the prize money anyway. An easy win for the Casino.

Funnily enough, I do not blame the casino at all for taking this action. I do it with my own businesses. For our webhosting, if someone asks us for help with a PHP script 90% of the time we will say no. We are a hosting company afterall, not personal coders. However if that person is a big spender with us, we will always go the extra mile to please. Most notable the biggest spenders can spend up to 10x more than what an average customer spends (This would be even more so in a casino environment).

It may sound harsh, but you only have so many hours in the day. Make sure you set priorities for your biggest customers, even if that means rejecting some lower hanging fruit.

Right from the get-go with Wachahost, we have been looking to sponsor events that were relative to our niche. Both in the real world and the online world, we were looking to offer prizes of both hosting, and even cash prizes (So more sponsorship etc). Considering that we are giving away our product for free, or in some cases passing over cash for nothing but a spot on the sponsors list/banner, you would think that people would be falling over themselves to get us onboard. But the actuality is it has anything but. I don’t demand top notch organising skills from anyone, but there is a few things I look for before we sponsor any contest.

Know Your Contest + Terms and Conditions
This is sometimes not a necessity if we approach you to run a contest with us as the main sponsor (For example us contacting an Internet Cafe about when their next tournament is etc), but we have found many people post that they are running a “contest”, but don’t have any strict guidelines put in place. They are simply throwing out feelers and seeing what people will come onboard. Sometimes this works, but other times it feels as though the person running the event has no idea what the end result should be like. When I put my name on board as a sponsor, I want to know what the prize value should be, what the people need to do to win, what will disqualify them from the competition, and a basic set of Terms and Conditions. Essentially you should already know what the contest is, the last thing to do is find sponsors.

Prompt Replies
I have been in contact with a few people who will only reply to my emails once a week. These automatically get binned because I cannot stand contact with someone only once per week. If something goes wrong or I need to contact you, it just infuriates me if I have to wait a week for a reply.

Tell Me What YOU Want In A Prize
This happens almost everytime. I get in touch with the event contact, and say “Hey, we are company XXX, we are interested in sponsoring the event for either a cash prize and/or free web hosting” and they reply “What will the prize be”. In almost every case, I don’t know what the prize will be, I am not running the contest. I have a maximum of what I will give out, but the person running the contest should have a clear cut idea of what constitutes a good fair prize for their contest. On top of that, all the event runner is doing is trying to squeeze as much out of you as possible. Once again, I am giving away something for free, I don’t expect to be hardballed.

Explain The Benefits/Exposure
Companies don’t sponsor events out of the goodness of their heart. They do it to gain exposure for their brand, and to be plugged in a variety of different ways. No matter how small the contest, a sponsor will always want to be getting as much bang for their buck. The most obvious is a sponsors list on a website somewhere, logo’s on the contest banners, and plugs when the contest is advertised on blogs, websites, and in real world media. When I contact someone to be a sponsor, I expect to hear back from them trying to “sell” me the contest. I want them to tell me how much exposure I will get, and how many more customers I am in for. It sounds corny, and in a way it is. The thing is,  if I didn’t think sponsoring your event was going to be profitable for me, I wouldn’t do it. But that still doesn’t stop you from trying to sell me further on the idea.

Don’t Play The Scarcity Game
Maybe not a point that everyone agrees with. But I personally hate being told that there is some sort of scarcity in sponsors. By that I mean that the event organiser will tell me that there is limited spots, I better get in soon, or that if I wait too long I may miss out. Please, I am looking to give away money in your contest, and you are trying to make me feel as though I need this for the good of my business? Sometimes this is a legitimate worry, as in there is a limit amount of sponsors that they are going for. But generally speaking people will take all the money they can get.

Overall, all these tips run in a similar theme. Know EXACTLY what you are looking for before you reach out to sponsors.