Q: Steve – Do you think it is really possible for the small guy to make money online? It all seems so dominated by Amazon and Google. What are small businesses supposed to do?

Inez O, Nashville, TN

A: Back in the late 90’s I read a book that really shifted my thinking about small business and the Internet. Called Striking it Rich.com (now out of print), the book profiled 23 “incredibly successful websites you probably never heard of.”

One of those sites was AsktheBuilder.com.

The book profiled the site and its owner, Tim Carter. Tim is a nationally syndicated columnist and his website is a font of home improvement columns, videos, tips, and help.

His is also your prototypical small business, with but one and a half employees. Yet not only has Tim been incredibly successful with his online business, he’s convinced anyone can have similar success.

How? Hold on and I’ll tell you, because last week the affable Tim told me.

But first, let’s get an idea of just what online success might mean for a small business:

When Tim started his site back in the mid-90s, he sold ads manually – making phone calls and getting banner ads. But the advent of Google revolutionized his business. All of a sudden, instead of having to sell ads one at a time, he was able to sign up with Google AdSense and have Google populate his content with ads.

How successful was this strategy?

So successful that Google recently did a case study about AsktheBuilder. Here is what Google says:

“In April 2004, Carter learned about AdSense for content sites. He recognized that it would enable him to reach thousands of advertisers and screen ad quality with minimal time and effort. Carter immediately experienced a jump in advertising revenue of 400 percent. His monthly advertising revenues, including AdSense, grew from $1,500 to $7,500.”

Wow!

But it gets better. The case study concluded with the fact that AsktheBuilder soon began to make $1,400 a day in ad revenue. But according to Carter, that is now incorrect. Today it makes significantly more than that.

So how can we duplicate his success? Here are the steps, according to the master himself:

1.Tap people’s pain or pleasure: Tim Carter says that people go online for one of two reasons: Either for pleasure (to play games, shop, learn, etc.) or to alleviate pain (pay a bill, research solutions, and so on.)

To create a site that draws a lot of people, and therefore Google ad revenue, you need solve problems. Like what Carter does by helping people easily learn about do-it-yourself home improvement solutions.

Solving problems therefore requires that you create content on your site, whether that be written or video. If yours is a service business or you are a consultant and you want to sell your expertise online, you need to create easy to understand articles for posting on your site.

Note however,  even if yours is a product-based, this strategy would work for you too. Tim says, “Figure out how to give your knowledge away for free and become an expert; get people to trust your information and sell ads around that.”

For his part, Carter is now also moving strongly into video solutions and believes there is even more profit to be had there. (You can see his videos either on his site, or on YouTube.com/AsktheBuilder.)

2. Become an SEO expert: Carter does no marketing of his site, other than creating the best, most useful articles and video he can and then making every article as search engine optimizable as possible.

More than 1 million people a month find his site through nothing more than organic search results.

3. Tweak AdSense: Google says “Carter quickly began tests using AdSense channels trying different ad formats, colors, and placement to gauge relative effectiveness. He immediately found ads with a yellow background resulted in a 40 percent drop in income, so he discontinued them. One winning strategy Carter discovered is a rectangular format . . . he saw a 20 percent jump in revenue from placing the rectangle in the upper left corner inside his articles.”

So can a small business make it online? You bet, and in a big way. Just Ask the Builder and you will see how!

Today’s tip:
After last week’s column about whether there really is any “free money” out there for small business startups, I heard from Matthew Lesko. He points out that his business has zero unsatisfied Better Business Bureau consumer complaints, and that the New York Consumer Board mentioned in its report that his company was not being investigated for any wrongdoing. Valid and legitimate points.

How To Succeed As A Small Business Online

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