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Why Dot-Coms Fail - a Webmasters Perspective

Everyday we hear that another company goes out of business.

When and why does a dot-com become a dot-bomb?

After checking few dozen defunct companies, I think the main reasons for dot-coms failure are:

  • Poor business plan. In the last years, a lot of investment capital was spent on poorly planned companies that clearly couldn't reach profitability.

  • Poor company promotion. This applies both offline and online. Two newspaper ads and word of mouth are not enough.

  • Poor financial management. Fancy offices, free food, does it ring a bell?

  • Poor Human Resources management. With lots of cash in their hands, many start-up companies hired too many people or, even worse, hired unqualified staff. The hiring of friends and relatives often returned no value on investments.

  • Errors in the company's Web site. Sometimes hundreds of errors could be found in one Web page. Yes, those Web site builders should go back to school- if they ever went to school for HTML at all.

I'll focus my comments on the last reason:

How Errors in the Web Site Can Affect the Company's Health

It's clear that you can make money on the Web if you have customers. You have customers if you have viewers- "traffic" in the geek's language. And you get traffic if your site is easy to find -- near the top -- in the Search Engine Results Pages (SERPs). That's not so easy to achieve.

First of all your site has to be indexed by the search tools: Search Engines and Web Directories.

Although some Search Engines will eventually find your site by themselves, most of the time this only happens if somebody links to your site. In the case of a NEW site, having existing links is almost impossible. Rather than wait for links to be made, start a submission campaign.

A big no-no is submitting a Web site using submission software. Using software of this type may be quick and easy, but some Web Directories and Search Engines do NOT accept automated submissions.

It's true that manual submission is a time consuming process -- you'll have to read AND follow each Search Engines' submission guidelines, to effectively perform the submission ? but it's a necessary step.

Most of the defunct sites I've checked had only a modest presence and visibility in the Search Engines.

Let's say that you submitted your site correctly, you waited a reasonable amount of time - usually few weeks ? for the Search Engines to process your submission, but your site does not appear near the top in the Search Engine Results Pages.

You're wondering why, right? Well, one or more of the following reasons might apply:

1) Your submission was not accepted by the Search Engines. If you used spamming techniques, such as:

  • Repeating keywords in the keyword meta tag or using text in the same color as the background, some Search Engines might refuse to index your site.

  • Page redirection -- including cloaking -- or building artificial links farms can sometimes be seen as spam by some Search Engines. These links farms involve building Web pages for the sole purpose of creating links to the targeted site. For more about spam please read my article:

"Search Engine Spamming Sucks!" [ http://www.web-design-in-new-york.com/articles.html ]

Some Search Engines also have difficulty in indexing pages that use frames or Flash.

2) Your submission was accepted, but your site is not listed in the Top 10-30. Because very few people check pages after the first 30 results, you want to be in the Top 10-30. There are many reasons why a site is not listed high.

The most common reasons are:

  • The lack of your main keywords in the content of the page, in the Title tag and in the Description and Keyword meta tags. Ultimately it all depends of the Search Engines' algorithm- the criteria used by the Search Engines to rank pages.

  • HTML errors. Examples include unclosed tags, unquoted attributes, improperly nested tags, missing the ALT attribute on images. Any of these will affect your site's accessibility, reducing your potential client pool.

A Web site with HTML errors can look fine in Explorer, strange in Netscape or Opera and totally unreadable in a text browser. Although Explorer has the largest market share, an important percentage of net surfers use other browsers. Don't forget the more than 50 million people in the USA with disabilities. Many of the latter use text/voice browsers.

Other Types of Errors in Web Sites

Proper HTML coding is very important but the structure and the layout of the pages are equally important. I saw sites without ANY way to contact the company: no email address, no "contact page". I saw sites so crowded that it was almost impossible to find my way around. I saw sites with ugly color schemes. I saw a site so "heavy" that it took nearly three minutes to download the Home Page.

According to statistics, users have very limited patience when it comes to loading a page. If after eight seconds they cannot see the page, they leave. And we all know what that means or the success of a Web site.

I not only saw all those errors in sites that are now gone but I also found them in sites that are still alive, including, incredibly, some Fortune 500 companies' Web sites.

So Do We Dot-Com or Not?

The answer is a resounding YES! But with one condition, learn from your predecessors.

How can a dot-com become profitable? I don't pretend to know ALL the answers. If I did, I would be millionaire by now.

Advice for Forming and Managing Your Company:

  • Develop a sound business plan, with clear, credible ways to get to profitability. Venture capitalists are much more cautious than a few years ago. They invest less and are more selective in this risky business. They want value returned for their money. After all, statistics show that 9 out of 10 startups fail.

  • Handle your money wisely. Enough said.

  • Hire only the people you REALLY need and be sure ALL of them are professionals.

Advice Regarding the Web Site that Supports Your Company:

  • Do the right thing when you prepare the Web site. Hire reputable professionals to build and promote your cyber adventure. If you already have a Web site, remember that a Web site can easily be redesigned and properly resubmitted to search tools.

  • Have your site designed according to W3C Recommendations - the Official HTML coding rules. Yes, this takes time and it's much easier to use an HTML editor, but the results are much better when properly coded by hand. Watch your site's accessibility and usability. Don't forget to test and validate the code. Talking about testing, do yourself a favor: check the spelling on your pages.

  • Do not use spamming techniques. You might not be caught today, but one day the Search Engines OR your competitors will find you. Search Engines sometimes will use this reason to ban your site FOR LIFE.

For more about spam please read my article:

"Search Engine Spamming Sucks!" [ http://www.web-design-in-new-york.com/articles.html ]

  • Avoid gizmos: JavaScripts, Flash or frames. Bells and whistles will NEVER help your page' ranking. In fact, it will hurt your site's indexing or ranking in the Search Engines and will annoy most of your viewers. So, just don't do it!

  • Have interesting content in your pages, content that grabs your viewer's attention. No matter how beautiful your site is, no matter how much professional promotion you made, if the site doesn't grab viewer's interest, he will leave ? you guessed it -- to your competitors' sites.

Also, use the Title tag, the Keyword and Description meta tags in your HTML coding to list targeted keywords from the contents of your pages. This helps the Search Engines rank your site higher.

  • Promote the site thoroughly. Submit the site properly to Search Engines and Web Directories and pay special attention to the link popularity issue- contact Webmasters of related sites to ask them to include a link to your site. Yes, it takes time, but it's worth it.

So, let's see: do we dot-com or not? You bet we do! There are tremendous opportunities on the Internet. Find your niche, follow the rules, work hard and you'll make it.

It will not be easy but if you believe in your dream and set realistic expectations, you'll be successful.

Good luck!

About The Author

Daniel Bazac is the Web Marketer for Web Design in New York, ( http://www.web-design-in-new-york.com ), a site design, Search Engine Optimization and promotion company. He's been online from 1995 and he's also a seasoned Internet Information Researcher. He can be reached at mailto:danielbazac@hotmail.com

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