Archive for November 2008
Servers that cost more than my house
Over the last few days I’ve been debating over the best hosting solution for my most mammoth project. Finally we’re there and I’m very happy with what we’ve got.
Here’s something to think about - the servers will cost me more than my house does! I am sure that’s true for many internet businesses, but at the moment this is all being personally funded by me until we go live and start making money. At the moment things are such that I am happy and perfectly able to do this.
Why have I gone for something so expensive?
We do have some high end requirements as we are building is a platform for media distribution and aggregation. i.e. there is going to be masses of downloads, streaming and data transfer. We could have actually spent a lot more, but what we have opted for is something which is perfect for the initial launch and very scalable. The scalability was a major part of the consideration. I don’t want to experience problems later when we have increasing volumes of traffic and can’t grow our back end fast enough to deal with it.
We needed a solution which:
- Is located well for serving both the US and Europe
- Has a redundant set up - one server can go down and we’ll not lose any data or experience any downtime.
- Has the ability to transcode media files from one format and resolution to another
- Has its own mini CDN (Content Distribution Network) which makes large data downloads such as video streaming more efficient.
- Can plug straight in to a larger CDN if we have to.
- Can have up to 1000mbps per server connection – that’s a massive amount of data being transferred at the same time, we have loads of space to store media and
- No restriction on monthly bandwidth
- Masses amount of storage space
We have all this! Beyond that I get lost in the technical specifications of the servers.
I can’t wait to start getting some sites up and running.
I mean I really can’t wait - I need to get the sites up and making money to pay for this before it bankrupts me!
On an unrelated note
I’ve just had to replace 3 more tyres on my car and have the windscreen replaced on another. I don’t believe anyone has worse luck with cars than us. I’ll definitely be getting something fast, impractical, environmentally unfriendly and uneconomical when the time is right. I can’t see how it will possibly cost me any more than the current sensible cars do.
Personals hourly activity
Following my last post curiosity got the best of me so I had to investigate to see what the hourly usage was like on my sites.
Looking at unique page views it’s very clear that everything is very much how I would expect it to be. Hourly usage is at a peak from 5pm up to midnight. It dips while everyone sleeps and then picks up throughout the day.
Though I’ve not plotted payments over this, the trends do very much follow what I have observed. There are payments very soon after midnight, then little during the morning where it slowly picks up and hits a peak post 5pm which continues through the evening.
At the moment new traffic comes evenly from organic and paid campaigns, with no throttling our end, the distribution across the day is purely from when people choose to access the site or click on a link/ad somewhere.
I aim to have 30% new traffic to the site on any day. Unless we targeted very aggressively traffic at off peak times and stopped completely during peak different times it would not affect the graph much. And we’d have to ask ourselves why we would do that - is the ROI on members in the middle of the night better than those that will come to the site during normal hours? Again, it’s not tested but I seriously doubt it, so much so I won’t bother investigating just yet!!
I’ve not looked at day of the week activity, partly because it is far to easy to influence with newsletters which go out. If you send out a newsletter Wednesday you’ll be biggest spike of activity from this newsletter soon afterwards. This is particularly true on dating and community sites. What would be more interesting to know is on which day the same mailing gets the highest response….
If you do start looking at information like this to optimise advertising or any other call-to-action initiatives it’s important to realise that the moment you start reacting to trends, such as hourly activity, days members will read emails, you will also skew your results, so you need to segment and so that you can either test alternatives, or have a “normal” data set to compare to.
Analysing white labels
Today has been a little slow, not many sales yet, though it is mid-afternoon, mid-week and sales tend to pick up later in the day, and later in the week. I’ve not actually run a report to find out the exact bias on this, perhaps I should.
Ross, I know you read this, what’s your general finding on whitelabeldating.com - Approx what % of sales come in after 5 or 6pm during the week compared to earlier in the day, especially on casual sites like the ones I run with you?
I’m approaching a suitable time frame in a couple of days where I will have had sites with White Label Dating for 3 months so I am trying to dig in to my statistics to make comparisons to other platforms I’m promoting and have promoted in the past.
Affiliate Vs. White Label
Traditionally affiliate programs will deliberately hide a lot of the detail, often just give you your balances and member totals. They don’t want affiliates knowing what their own site performance is really like, what the margins are etc. It’s also true that when affiliates are paid a CPA they don’t need to be as interested in what goes on other than the conversion rate from traffic they send in to payments.
Generally an affiliate program will promote itself to an affiliate using the best case scenario - “earn $100 per payment” - what they don’t always tell you is that it’s only for confirmed credit card detail payments, or you need to be converting at 20% to get this. I’m not saying there is anything wrong with this, it’s perfectly normal marketing and if affiliates make a profit everyone is happy.
White Label systems are generally more transparent with their commissions because they have to be, though this is not always true. Where you have to be careful is being given way too optimistic conversions and retentions rates which lead to unachievable expectations. Something I have witnessed and experienced personally. Not good!
Analysing a sites performance
The difficulties in comparing one system to another are:
- data is presented and accessed differently
- it is time consuming to collate
- I have to use a few algorithms to standardise the different data I collect.
Though I do like lots of statistics, most people are not as analytical as me. There is no great demand on white label providers to produce really extensive reports. Having worked for a white label provider I also know it is not a trivial matter.
Having too much data can be dangerous! You won’t find the information you need quickly, worse still if you produce multiple reports and there are discrepancies between them you’ll waste a lot of time scratching your head trying to figure out what is going on and debating which numbers are most accurate. Something I have fallen foul of. In my case I asked for explanation on the numbers from the platform owners but still to this day have no answer!
As I work with white labels, running my businesses on their platforms, I do need to have access to enough data to understand what my members are doing. I earn over the lifetime of those members so need to be able to plan and budget accordingly. Currently I have enough information at my fingerprints to do this.
The most important information you need is: Members, Paying Members, New Sales Totals & Re-Order Totals for any given month or pay period. This is enough to produce accurate reports.
The one variable I have little control over is time, which you also need when trending your members. Patience is not one of my virtues!
Once my first phase number crunching is done - I’ll post my findings.
Quarter of a year on
It’s been just over 4 months since I went full time self-employed again. 4 months ago was more or less the time when people started noticing and talking about the current global economic crisis, so arguably not the best timing to break out and go it alone!
The day I stopped working for another company I lost a very significant portion of my income, overnight. But rather than hold back and reduce my expenses, I chose to increase them by taking on developers and running with some of my own ideas.
My slightly risky approach meant I had to set myself some very ambitious short term milestones:
- replace my respectable salary with direct income from my businesses
- cover increased cost of taking on employees
- retain profit for increased marketing
I have an offshore development office, and use other remote on demand services, mostly paid in US Dollars. Over these 4 months the Pound has slid massively against the Dollar so my targets were made even tougher, and I am currently looking to increase my dollar income to make this a issue disappear.
Progress
Despite the slightly negative conditions I’ve hit all my targets and growing close to the top of my ambitious projections. Currently at 40% per month.
It took only:
1 month to re-launch old sites and create a couple new ones
2 months to replace my income
3 months to cover all costs, exceed previous income and have additional profits
4 months… where I am now, with even higher profits, and I’ve got a few bits and pieces literally just going live which should increase sales further.
If I can I will write a little more about the exact progress of the sites I have, and the partnerships I have formed with other companies. I’ll have more exact figures and statistics to quote in about a week. I hope some might be useful to others. Especially my findings with competing service providers within the dating industry such as World Dating Partners and While Label Dating, there are also other companies entering this space which I intend to find out more about.
Time for a beer… 1.30am, a little late but fuck it!
Daddy Again
What a fun few days.
Phoebe had a party on Saturday with a few friends of hers to celebrate turning the grand old age of 3!
Monday was actually Phoebe’s birthday, and on Tuesday, after an ultra sound scan we announced to everyone that Phoebe will soon have little brother or sister.
I might scan the scan if I get time! Happy days.
More sales records
October was a record month, and yesterday’s sales blasted all previous records (also set in October). This is all very positive as these are still very early days with next to no marketing being run. The next few months should be interesting!
October could actually have been better if we’d launched the campaigns that were planned. But instead the time was spent choosing a number of other additional sites and services to promote alongside our main sites. By mostly partnering with established companies compared to building everything in house we can save money and have nearer launch dates, thus freeing up cash for more marketing while bringing sales forward. This in theory will make sales growth much quicker.
I also spent a lot of time in October cleaning up some company taxation issues, not straight forward but I do now have the right set up to make significant savings in the future.
Lastly and by no means least, Phoebe is having a 3rd birthday party tomorrow. Right now I am a pretty happy bunny… One that should be in bed.
