If your Passion is Bringing Profits, Incorporating May be Right for You

Let’s say you’re a fan of Puerto Rican music, or a breakfast cereal nut, or a Harry Potter fanatic. You built a web site to share your enthusiasm with the world, and you put contextual ads on it to earn a little extra cash. And let’s say it’s really catching on, so much so that it’s looking more and more like a real business and not just a hobby. In fact, you’ve come to the point where you’re not only offering content, but also your own line of t-shirts or other merchandiseand you’ve attracted the attention of a new media mogul who wants to invest.

It may—may, mind you—be time to consider incorporating.

Whether you’re generating income from your ads or from selling on the web, you’re probably already what’s called a “sole proprietor.” As a sole proprietor, you and your business are essentially one and the same. You’re liable for your obligations and your taxes are paid as personal income taxes.

What’s in it for you
It may sound intimidating, this idea of going from being a person to being a corporation, but it doesn’t have to be. Incorporating offer a number of possible benefits, including limited liability, possible tax savings, a heightened brand perception (which sounds better, Mike Mattis, Some Guy Who Started a Little Web Site about Wine,” or “Michael Mattis, CEO, Bon Vivant Media, publishers of Vinapedia.net?”) and financial flexibility.

Take your pick
There are different types of corporations, each geared for different types of businesses.  Typical types include:

C Corporation—This is the standard, most common form of corporation. In fact, the “C” simply stands for “corporation.” Clever, yes? In a C corp., the shareholders cannot be held personally responsible for the corp’s obligations, though they can be “double taxed,” meaning that corporate profits are taxed at both the entity and individual levels—that is, dividends allocated to shareholders are taxed as well as the profits that the business makes. More on C Corps »

S Corporation—An S corporation is another standard corporation type, but one that has a special tax status with the IRS that avoids double taxation. In an S corp., the profits or losses of the corporation are passed to shareholders, who report them in their individual tax returns. More on S Corps »

Limited Liability Company (LLC)—An LLC has some of the advantages of a C corp. and some of the advantages of an S corp. Like a C corporation, the individual owners, usually called members, are typically not personally liable for the corporation’s obligations. Like an S corp., taxation is passed on to the members, although the LLC is required to file a tax return with the IRS. In addition, LLCs are highly flexible in structure and management. Unlike either a C or an S, an LLC has different ownership rules. For example, a written consent from all members must be obtained prior to expanding ownership. More on LLCs »

The options don’t end there. There are also General Partnerships, Limited Partnerships, Limited Liability Partnerships and Nonprofit Corporations. For more on these entities, check out Yahoo! Small Business’s Guide to Incorporation, powered by BizFilings. If you’re pretty sure that you’re ready to incorporate, but are unsure which entity is right for you, take a look at the BizFilings Incorporation Assistant tool.

Bear in mind that you may be required to acquire business licenses and/or permits, so you’ll want research the laws in your specific locale. And, of course, it may not be the right point in your entrepreneurial career to incorporate. Maybe you’re not ready to be the Man in the Gray Flannel Suit. You’ll want to weigh all of your options carefully. It takes a pretty serious commitment, one that can turn a labor of love into just plain labor if you’re not ready for it.

Take advantage of these additional Yahoo! Small Business resources to help turn your passion into a successful small business:

Small Business Startup Checklist

Business Plan Essentials

Ten Tips for Starting a New Small Business

Learn the Lingo

—Michael Mattis, Blog CEO, President and Chairman of the ‘Bored’

Using Social Media Marketing to Get More Visitors to Your Site

Editors Note: As a publisher, you know that getting more users to your site is vital if you’re going to earn revenue from contextual advertising. Last time, Louise Rijk introduced the basics of social media marketing (SMM.) Today, she digs more deeply and shows you how to go about developing an effective SMM campaign to help get those users.

SMM Redux
As we discussed briefly last week, “SMM” is marketing that you initiate by uploading or bookmarking and tagging content on social media and networking sites such as Digg, MySpace, Wikipedia, Flickr, del.cio.us and Reddit. 

(The photo at right is a great example of how social media, and the network effect, can work. The photo is called “Whisper” and it was snapped my Brian Scott, who uploaded it to his Flickr account, where we found it. Because we posted it on our blog, under Creative Commons license, and linked to it, thousands more people are likely to see Brian’s photos than would have if he had kept them in a closed photo album or on his computer—M2.)

Depending on the type of site, this content can be text, video, audio or even widgets that users put on their own sites that distribute your content, such as the MyBlogLog badge. (More on these options below.)

SMM Benefits
The benefits of a social media marketing campaign include:

• More Links—SMM campaigns can generate incoming links and result in higher rankings in organic search results.
• More Traffic—SMM campaigns can generate more traffic from profile pages, from links embedded in messages that travel virally throughout the social web, and from pages that rank high in search.
• More Brand Awareness—An SMM campaign can build more brand-awareness through visibility, online reputation and authority in the social media.
• Better “Legs”— If your message gets enough attention in the social media sphere, there’s a chance it will be picked up by other, more traditional media, such as mainstream news sites, newspapers, magazines and television. Think Perez Hilton or lonelygirl15. (Remember JenniCam?)

SMM Strategies
Most marketing strategies involve reaching the potential visitor at a distance, through advertising, email and other messaging. In SMM, you engage directly with your potential audience through existing social media, encouraging them to generate discussion about your content, your products or your services. SMM techniques include:

• Submitting a how-to article or tip sheet to a “voting” site like Digg and Reddit
• Bookmarking an article on sites like del.icio.us or ma.gnolia
• Uploading and tagging images up on Flickr, Photobucket, etc.
• Uploading videos to Yahoo! Video, iFilm, YouTube, etc.
• Establishing a business profile at a social media web site like MySpace or Facebook
• Developing your own widget that lets users spread your content on their own sites

The Social Medium is Not the Message
Way back in 1964, the pop philosopher Marshall McLuhan famously said, “the medium is the message.” What he meant that the form of the media carrying the message is more important than the content that the message conveys.

Well, it probably sounded good at the time. The fact remains, however, that content is king. You can have the best gee-whiz media technology at your fingertips—which we pretty much do these days—but if your content is crap, people will use those fingertips to click away.

Read the rest of this entry »

An intro to marketing through social media

Editor’s Note: Last time Louise Rijk penned a piece for the blog, she wrote on word-of-mouth marketing, or WOMM. Today she goes into social media marketing, or SMM, and explains how you can help drive readership, links and clicks using social media.

Social media marketing (SMM), social media optimization (SMO) and word of mouth marketing (WOMM) are new forms of online marketing that are increasingly taking control of brands, the marketing message and advertising away from the business owner and online marketer and putting it into the hands of the user and the consumer. They’ve created a “new world order” in marketing and advertising. In this new world the goal is to partner with consumers and customers so that they interact with, and call attention to, your products and services.

Online marketers, publishers and business owners need to adapt and find creative and subtle ways to promote their content, products and services. But before we can start doing social media marketing we need to know more about social media and understand the differences between social media marketing, social media optimization and word of mouth marketing.

Social Media Tools
Social media are “Web 2.0” tools and services such as blogs, wikis, online forums, online user review sites, podcasts, RSS feeds and social networking web sites, such as MySpace, Facebook, MyBlogLog, de.licio.us, Digg and even the virtual world of Second Life, that people use to share opinions, insights, experiences and perspectives with each other. Increasingly, social media tools are used by marketers to place and spread their marketing messages, and to generate beaucoup traffic. The better you understand the inner workings of these services and communities, the better you can take advantage of them.

Word-of-Mouth Marketing
We’ve talked about word-of-mouth marketing (WOMM) before. To reiterate, WOMM is based on intense user engagement and relies on finding and empowering “influencers” and “evangelists” to spread the word about a product or service. (Read more about WOMM here .)

Social Media Marketing
Social media marketing (SMM) is primarily initiated on social media and social networking web sites, such as Digg, MySpace, Wikipedia, Yahoo! Groups, Flickr, Yahoo! Answers, Reddit, topic-specific message boards and so forth. These services can be used to spread a message or content (via text, video, audio, widgets, etc.). The objective can be to increase page views and inbound links, help improve your ranking in organic search, improve your brand awareness, or all of the above. 

Your social media marketing campaign is most effective when you have a prominent profile in the social media community. To help establish a prominent profile, begin by carefully targeting your community, engage with it and generate compelling content that speaks to the other users’ needs and desires.

For example, let’s say you’re a scooter enthusiast and have a site that offers articles and advice on scootering, sells scooter accessories through an online store or affiliate program, and serves up contextual ads for scooters and scooter parts. You’ll want to target the groups within the scooter community most likely to be interested in your content, merchandise and advertisements. You can build trust in that community through offering authoritative content—factual data, advice, opinions, photos, video and so forth. Once you’ve gained their respect, your community is most likely listen to you, buy from you and click on your ads.

Social media marketing campaigns can vary from creating compelling text-based content that gets bookmarked at del.icio.us or Furl or makes the home page at Digg to the creation of a video that spreads virally by placing it on video sharing sites. (Go to Flickr or Yahoo! Video and type “scooter” or “Vespa” into the search box and you’ll get an idea of what I mean by a “social media community.”)

Social Media Optimization
Social media optimization refers to making a web site or blog more adaptable to social media. It involves adding compelling, dynamic and fresh content on a regular basis—stuff like tip sheets, how-to’s, white papers, podcasts or videos can be especially sticky, can get more links to and help drive better ranking among search engines and specialty sites such as Technorati or Blogpulse. Other examples of SMO include the implementation of links to social media web sites to make tagging, sharing book marks (del.icio.us, Add to MyYahoo!), and voting for content (Digg, Reddit, Netscape) by visitors easier.

In the next installments in this series, we’ll cover these techniques in more detail. 

—Louise Rijk, co-founder and vice-president of marketing and sales at Advanced Media Productions

Good Luck Terry; Congrats to Jerry and Sue

Yesterday, Terry Semel, our CEO and the man who successfully guided our company through the rocky years of the early ’00s, stepped down. Terry will continue to act as the head of our board of directors. Co-founder Jerry Yang, who has always been our chief Yahoo!, has stepped into the CEO’s shoes. Also, Sue Decker, formerly the head of our Advertiser & Publisher Group and another longtime Yahoo, can rightfully be addressed as “Madame President” in her new role.

It’s kind of big news.

We’re incredibly proud of Terry’s work over the past six years, and we’re glad he’s maintaining an important role on the board. We’re also really excited for the future, and can’t wait to see what Jerry and Sue will do. Expect more cool stuff.

To get the full take, see Jerry’s post on Yodel Anectdotal. Also, check out:

The Official Press Release

Letter from Terry Semel to Yahoo! Board of Directors

Letter from Yahoo! Board of Directors to Terry Semel

Meanwhile, we’re keeping our noses to the grindstone, and this change shouldn’t impact our publishers. We’ll continue to strive to serve up relevant, contextual ads to your websites and offer a first-class experience to our users.

—The Team

Ultimate Connection final-list

Though they may never be mentioned by name on the financial news networks, small businesses have a huge impact. In fact, according to the Small Business Administration, a U.S. government agency, small businesses were responsible for more than half of the U.S. gross domestic product (GDP) of $11,712,500,000,000 in 2004.

That’s not chump change.

We like the kind of gutsy people who take a chance in small biz, because that’s how Yahoo! was born. Jerry Yang and David Filo originally started this little enterprise called Yahoo! Inc., now 13,000-odd (very odd) Yahoos strong, out of a trailer on the campus of Stanford University in Northern California.

The Big Five
Our passion for small businesses is one of the reasons that we got into the Small Business business to begin with—yes, we sell shovels to gold miners—and it’s one of the reasons we’re sponsoring the Ultimate Connection.

The five finalists for the Ultimate Connection have been chosen, and we want you to have a part in deciding the winners. Here are the five small businesspeople who stood out from the thousands of entries we received:

Glen Halliday, who builds custom “crooked houses” that make children smile.

Chris Pratt, a start-small entrepreneur with a big sweet tooth.

Melissa Belland, who has brought the fantasy world of the fairies to real life.

Elena Neitlich, who offers help for hard working moms, by hard working moms.

Mike Willner, an inventor who has taken typing to a whole new level.

Each one of these entrepreneurs shows a passion not just for the business of business, but for what their businesses share with their customers. Now it’s up to you to decide which three of these five will get the proverbial Golden Ticket to New York to meet with Ivanka Trump, enjoy a power lunch high above the city, and receive a $25,000 Yahoo! Search Marketing budget.

Go to the Ultimate Connection website and vote for your favorite.

—Michael Mattis

SMX Advanced wasn’t just for Search Marketers 

We attended the inaugural SMX Advanced conference in Seattle last week and came away impressed with Danny Sullivan’s ability to mount a quality confab. While most of the sessions were geared toward pro-SEOs and SEMs, the main thrust—how to get more users to visit your site—was definitely useful for publishers as well. Especially noteworthy for publishers on a budget was the session on SMM, or social media marketing, which offered many low-cost and no cost tips on how to promote your site through social media services like Flickr, Yahoo! Answers, del.icio.us and many others.

Skip over to our sister site, the Yahoo! Search Marketing blog, and get the skinny.

—Michael Mattis, Blog Cap’n

Yahoo! News profiles the provocative

Are you the sort of someone who lives and breathes the online world? Who’s doing something with the medium that’s challenging and different? The kind of person who likes to stir things up? Maybe a bit of an agent provocateur?

If you think those descriptions apt—and if you’re regular reader here, you probably do—you may be one of the “People of the Web.”

“People of the Web” is a new series of profiles by Yahoo! News, highlighting the adventurers, pot-stirrers, pioneers, firebrands, loose cannons, privateers, mischief-makers and assorted wise-acres making waves, while making it, on the Web right now.

Recent “People of the Web” profiles include former “Growing Pains” sitcom start turned online evangelist, Kirk Cameron, Caleb Shickles, the creator of “Hug Nation,” and Josh Wolf the journalist (or is he really an activist?) who served jail time for refusing to reveal his sources to a grand jury.

You or someone you know could be next. To suggest a “People of the Web” profile, visit the POTW feedback page. And be sure to join MyBlogLog before you visit POTW. That way, even if you’re not chosen to be profiled, everyone will know you’ve been there—it’s like leaving a little link bait everywhere you go. (That’s me in the upper left.)

—Michael Mattis

Introducing Quality-Based Pricing

Web publishing is a circular business. You produce a carefully crafted resource that’s useful and entertaining to your users. You offer contextual ads from a trusted source—that’s us—that strengthen your brand and message and, hopefully, bring you revenue from qualified clicks, which in turn can benefit the advertiser. That’s the formula, and we’ve always thought it a fair one.

In short, we like to think that we provide quality, for you as a publisher, for our advertisers and for the user. It’s a big circle of value. The circle can get warped, however, when users click on ads that don’t meet their needs, which can lead to poor conversions for advertisers.

In our ongoing effort to strengthen our network, we’re introducing a new traffic quality feature called “quality-based pricing.” Under quality-based pricing, the traffic you drive to the advertiser will be priced commensurate with the value that advertisers receive.

It’s an important step that reinforces our overall commitment to deliver long-term success for our publishers, a high-quality experience for users, and high-value traffic to our advertisers.

This may have an impact on your business. When you provide quality traffic to our advertisers, this in turn may lead to better click revenue for you. Conversely, driving poor quality traffic to our advertisers may lead to reduced revenue.

—The Team