Traffic = Power = Money

The secret to success on the internet can be boiled down to one simple accomplishment: building traffic.

That’s it. If you have a site that attracts a lot of visitors, you will be able to make money. On the internet, traffic equals power, which subsequently equals money.

Depending on the topic of your site, however, it may be easier and harder to generate that money. But even a seemingly ridiculous site such as HotorNot.com has a revenue of $5-$10 million a year (with the bulk of it being profit). If you aren’t familiar with the site, the premise is simple: rate other users on how “hot” they are on a scale of 1 to 10. That’s it. You vote, and get sent to the next photo. When I first saw it, I thought it was amusing but saw no way they could make money from it. As it turns out, they managed to turn it into a casual dating site with a simple subscription service that allowed you to make connections. This simple $6/month revenue stream added up to a revenue stream of up to $10 million a year,

Now, generating revenue might not be enough if your expenses are high. One notable site that has never made a profit is YouTube. To be fair, I don’t think generating a steady profit was part of the original game plan. As a venture capital funded site, millions of dollars were invested in the infrastructure, employees and bandwidth to create what became a “killer app” for the Internet. In the end, the founders and investors did make an enormous profit on the site through its sale to Google for $1.6 billion dollars. Why did Google pay $1.6 billion to buy a site that has never made a profit? Because Google understands more than anyone the value of traffic, and truly believes that traffic = power = money.

As the founder of a well trafficked site, and with plans to establish other sites, the concept of building traffic is always on my mind. I have ideas of how other sites established their user base, but here are a few reasons MacRumors has grown to be as popular as it has:

- Good domain – I was fortunate to be able to pick up “MacRumors.com” as an expired domain in 2000. It’s a generic keyword-rich domain which perfectly encapsulates the topic of the site. It’s easy to remember, and well ranked in searches related to rumors.

- Addictive Content – it’s no coincidence that I started a web site surrounding rumors about Apple and the Mac. I was already an addict. I scoured messageboards and news sites around the web for hints about future Apple products. I don’t expect everyone to understand how this particular topic is as addictive as it is… but clearly it’s not just me.

- Little Competition – We weren’t the first rumor site on the scene. But what was interesting was that there used to be a clear divide between rumor sites and news sites in the Mac web. “News sites” would not report on rumors. They purposefully ignored the entire subcommunity. That seems ridiculous now, as the lines have since blurred, with even mainstream media covering Apple rumors. But I’d say that gave us a 4 year head start over other Mac sites. They weren’t willing to cater to the rumor-audience, so MacRumors was one of only a few rumor destinations for those intervening years.

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20 Responses to Traffic = Power = Money

  1. mattyohe says:

    Do you feel powerful, arn?

  2. Arnold Kim says:

    Well, I don’t bring in revenues of $5-$10 million, so I’ve got room to grow. ;)

    arn

  3. Hrm, wouldn’t it be traffic -> money, which then equals power? ;-)

  4. Good post and so true, if you can generate your own traffic then you have a great website business that can generate a very good income. I personally know people who generate a few thousand pounds a month through affiliate incomes, google adsense and other monetization models.This is pure profit as most of this process is fully automated.

  5. Joel says:

    Good Article Arn! I work at an SEO shop and this rang true nicely. Great observations, great article.

  6. Great post and I wholeheartedly agree. I’ve built up a site dedicated to sea turtles (seaturtle.org) over the past 10 years that now gets a good bit of traffic. The last layout redesign was actually inspired by the macrumors design (my site clearly needs another overhaul!). I have yet to figure out how to take full advantage of the traffic we are getting. It’s a bit problematic because the site is a non-profit and I am reluctant to use traditional advertising. I wonder if you have ideas for converting traffic -> revenue that is more appropriate in a non-profit setting. I get a lot of love from my community, but very low conversion rates on direct donations.

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  9. I am also addicted to Nikon Rumors – that’s why I started a blog on my own @ NikonRumors.com (influenced of course by MacRumors – same story: expired domain).
    Both companies (Nikon and Apple) have a lot in common – very secretive with a lot of hard-core followers.

    I can confirm that this is really addictive and actually a lot of fun.

    Thanks!

  10. Great post! I hope to follow in your footsteps, covering clinical medical news the way you cover Apple news.
    You are an inspiration, and if you come across compelling medical content, Dr. Kim, do not hesitate to drop us a line at InteractMD.com.
    Regards,
    Dr. Mike at InteractMD.com

  11. Before I know macrumors.com, I used to search for apple rumors in google. That used to bring me to thinksecret, appleinsider, or macrumors. But I rapdly started to note one thing: thinksecret news were from 2 or 3 days ago, appleinsider where from yesterday or something, but macrumors was always today. And sometimes even just a few hours ago! And the best part was that it had all the news from thinksecret or appleinsider or any other apple rumor site all-in-one! So I decided to check only macrumors from that day on and bookmarked it. So, I think you should include “fast updates” and “good content” in the reasons for macrumors success. Thanks Arn!

  12. To tell you the truth, I have known this for a long time. But hearing this from you, being as successful as you are, just reinforces the fact.

    After you build a valuable website as an asset it will get easier to expand onto other websites. Because you can leverage the traffic from on website, link juice, or whatever onto others. Plus of course, you will have money to promote.

  13. Good points you provide here. Gotta say, I do agree with you 100 percent. Michael

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  15. Such webmasters try to apply articles from free substance directories to make visitors to their website and make some money. This is mostly important for those who have just begun working as an affiliate for individual companies and do not yet have any funding, yet need to develop small niche websites to visitants to their website so that they can start out making revenue.

  16. Chlo says:

    This is a smart post. You never really explained how you get traffic or did you ?

  17. ggrrr! i want to get this page copied to my ipod touch so i can show my friend, but i cannot figure out how.. will any 1 explain to me how please??

  18. nice. i need ideas from bloggers like your self to get my websites right. great info, well constructed.

  19. Well I agree with your views.If you want to increase your conversions, you can checkout my new widget plugin for peerfly offers.

  20. Hands down, Apple’s app store wins by a mile. It’s a huge selection of all sorts of apps vs a rather sad selection of a handful for Zune. Microsoft has plans, especially in the realm of games, but I’m not sure I’d want to bet on the future if this aspect is important to you. The iPod is a much better choice in that case.

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