As with any business thriving in one of the most competitive industries in the world, we have multiple streams of revenue. One of ours is teaching SEO. Our students generally fall into two categories: agencies wanting to bring SEO services in-house; individuals wanting to get into the business. While agencies already have the wisdom of running a business under their belt, there tends to be a of bubble-bursting and broken hearts when training individuals on the reality of running an SEO business. Here are some of the common reality-checks.
…easy customer acquisition ends once the pool of potential customers among friends and family has been exhausted
Every individual looking to get into the SEO industry has the same vision – quit their $20 an hour cubicle day-job doing intake for an insurance agency in exchange for SEO consulting at $40 an hour sipping coffee at a local coffee shop. After all, $40 an hour is dramatically less than the industry standard for SEO services, yet it’s double what they were getting paid before! It’s a win-win! It doesn’t take long before they score a their first few clients among friends and family, and they’re off to the races!
Reality strikes quickly. Let’s say right out the gates they find 5 clients, each paying $500 per month. $2,500 the first month without having to advertise is a great cadence! Pick up 5 more next month and they’ve exceeded what they made at their previous job! But the reality is the easy customer acquisition ends once the pool of potential customers among friends and family has been exhausted. There is a big, big, gap in effort between scoring their uncle’s side-hustle SEO gig vs going out into the world and convincing business owners to hand over their hard-earned money, especially when every other SEO agency is hammering them with calls and emails all day long.
The friends and family, who mostly did it as a favor anyway, seem to no longer need SEO services after a few months and end the contract. This is where the dream ends for most folks who get into the SEO business – they simply cannot find enough customers to pay the bills.
Death by a Thousand Cuts
The standard response to the problem above, sort of a death knell if you will, is a surge in low-paying clients. There is no shortage of business looking for someone willing to do SEO for a couple hundred dollars a month. The last step before going out of business, and begging their old boss to hire them back, is to take on new clients at the $100 – $200 per month range. These clients are easy to find because nobody else wants them. I could run a $5 Craigslist ad today that brings Rank Harvest 3 new clients before the end of the week – but there is no money to be made at this level, there is an quantity of non-billable hours such as administration, accounting and communication that come with each new client that $200 won’t cover. And these customers have the expectation their rank will increase, which also cannot be done for $200. It’s a lose-lose for everyone.
They also look surprised when their tax preparer asks them to list their business expenses, of which they have also not properly tracked.
Sadly, small-business owners are essentially priced out of the SEO game. No SEO agency or individual with any real SEO acumen is willing to take them on. They hire cut-rate SEO services time and time again, getting burned, ripped off, and dropped in their search for the mythical SEO unicorn who puts them on page 1 for $200. To date it has never been found.
We can’t seem to teach this one – everyone has to experience it for themselves. Remember the $2,500 being made the first month right out the gates? I guarantee you 100%, without a doubt, they are not going to set aside enough, or any, of that amount for taxes. Don’t get me wrong, they are aware of taxes and might even know the right percent to deduct, but without fail, something in their brain tells them it will be made up for in the future. It won’t be. Everyone new business owner gets slapped with a seeming unsurmountable tax bill the first year and has to nearly sell their car to pay it off. They also look surprised when their tax preparer asks them to list their business expenses, of which they have also not properly tracked.
The Myth of Low Overhead
Doing SEO at home in your underwear would appear to be the ultimate in low-overhead, and in some ways it is. But it’s not zero overhead, it’s just lower in comparison than other industries. For example, at Rank Harvest, the subscription costs to one of the software platforms we use is around $3,000 per month. Every SEO professional, no matter how small, needs an SEO platform. They do things like track client’s rank, show what’s trending, send email alerts to newly discovered brand mentions and backlinks… These quickly run into the hundreds of dollars each month, which is a significant portion of that $2,500 revenue. Suddenly a new client needs to be brought on board simply to cover the cost of this software. But other things creep in as well – the Google suite and Adobe Creative Cloud subscriptions, Quickbooks, Hubspot, web hosting, and renting an address so it doesn’t look like the business is being run out of an apartment complex. Accounting for overhead, similar to setting aside money for taxes, seems to be something the human brain is incapable of understanding until slapped in the face with it.
New SEO professionals somehow get the impression there’s some sort of checklist they can follow to get results – it couldn’t be further from the truth.
The Inevitability of Non-Billable Hours
Remember the part about exchanging the $20 per hour old job for a $40 per hour SEO consulting gig? Welcome to non-billable hours. SEO professionals are not attorneys, they cannot bill for time spent on the phone, writing emails and doing accounting. Every client an SEO professional has, on average, will generate at least 1 hour of non-billable hours per week. First of all, clients not being sent at least 1 detailed update each week will quickly drop their SEO service. Business owners have a long list of vendors wanting to get paid every month; they do a quick mental audit every time they sign a check, and the fastest way to get dropped is if they don’t know what’s happening with their money. Expenses for each client have to be tracked, revenue accounted for, trips to the bank, answering client’s questions, and the time spent blankly staring at the screen trying to figure out how to tell the customer their rank has actually dropped since starting SEO services. Which leads into the next segment…
Rank Has to Improve
Just because SEO efforts are happening, is absolutely no guarantee rank is going to improve. This is perhaps the biggest misconception of them all. New SEO professionals somehow get the impression there’s some sort of checklist they can follow to get results – it couldn’t be further from the truth. Maybe 10 years ago there were, but not anymore. Today, SEO is a mix of a tremendous amount of effort, the right resources and partnerships, and an almost savant-like intuition. Yes, there is a best-practices checklist that covers things like writing meta tags and doing keyword research, but these simply create a foundation to work from and do nothing to improve rank themselves. To outrank the competition, the SEO professional must not only do what the competition is doing, but things they are not doing. It’s the latter that makes all the difference.
No matter how well an SEO professional runs their business from an administrative point of view, they will collapse without getting actual results for their clients. They will continually have clients dropping out, not getting referral business, and end up spending most of their time on sales trying to replace lost business.
What We Teach
As you’ve probably assumed by now, we don’t just teach SEO tactics, we set business owners up for success. Having great SEO skills but no business knowledge, or vice versa, is simply not enough. As with any other business, carving a living out thin air is extraordinarily difficult, especially for SEO and digital marketing as it is a VERY crowded industry. But at the same time, there is a lot demand for SEO and plenty of room for anyone wanting to make an honest go at it and willing to put in the work.