Promotion Tip:
LookSmart Changes Direction

by Larisa Thomason,
Senior Web Analyst,
NetMechanic, Inc.

LookSmart recently announced a big change. It's converting from a paid submission search directory into a pay-per-click (PPC) search directory similar to Overture. This change could mean much higher promotion costs for a lot of sites. We'll give you the details and discuss ways to control costs.

A New Pay-per-click Model

Previously, LookSmart offered a paid submission program similar to Yahoo's Express Submission. Webmasters of commercial sites paid between $149 and $299 to have a LookSmart editor review their site. Sites paid to be reviewed, but there was no guarantee they'd be accepted.

In April 2002, all that changed. LookSmart notified many participating webmasters that their accounts had been "upgraded." They were all now PPC customers. Sites must register for the program by July 15, 2002 or risk being removed from the directory.

Here are the highlights of LookSmart's new policy.

• Set-up Fee: A $49 setup fee is required to open your listing account. This fee is waived for sites already listed in the directory. However, if you want to update your listing, the $49 fee applies and you pay $39 if you'd like to be added to another category in the directory.
  
  
• Minimum Per-click Cost: Webmasters can select their own monthly budget, but each click costs $.15, with a $15 minimum payment per month - that's 100 clicks. Sites that get less than the minimum number of clicks still have to pay $15. At Overture, sites bid on their click amount, but all clicks at LookSmart cost the same.
  
  
• Retroactive Agreement: This change affects sites already in the directory, even if they had already paid for inclusion on the expectation that they'd be in the directory forever. This is the most controversial aspect of LookSmart's new pricing policy. Sites that used the paid submission program get credit for $300 of "free clicks" that are given at the rate of $15 per month for 20 months.
  
  

The LookSmart Small Business FAQ page has more detailed information.

Advantages And Disadvantages

LookSmart's change has been a hot topic on Web discussion boards and many webmasters are angry about the change. They contend that LookSmart broke an agreement that a one-time submission fee would keep sites in the directory pretty much forever. Webmasters at small and medium-sized Web sites are also concerned about the potential for greatly increased promotion costs.

Let's try to look objectively at the benefits and added costs of the new service.

Good stuff:

• Existing sites are guaranteed acceptance into the new program and not required to pay $49 to set up an account.
  
  
• New sites that submit to LookSmart and get rejected only lose $49 instead of $299.
  
  
• Sites are listed quickly. You get feedback within a week from a LookSmart editor.
  
  
• LookSmart partners with many large search sites including MSN, Netscape, and AltaVista - search sites that reach 75% (68 million) of United States Internet users.
  
  
• Sites that LookSmart considers to be "critical for relevancy" will stay in the directory whether they pay or not. That means Amazon, CNN, Coca Cola, and others can breathe a sigh of relief. Maybe you can too, if your site is the "definitive resource site" on kangaroos, tooth decay, or summer camps. But that's up to the LookSmart editors to decide.

And the bad:

• LookSmart's click tracking system is confusing. They process clicks in batches, so the clicks they report to you may not (probably won't) match your server logs. Webmasters complain that they have no way to independently verify LookSmart's numbers.
  
  
• You pay $49 each time you update your listing. If you want to experiment with different keywords or different wording, each attempt costs money. With Overture, sites can bid for the top ranking, but LookSmart's ranking is based on its own ranking algorithm. You may have to experiment a good bit before you can attain a high rank in LookSmart.
  
  
• This represents a sizeable price increase for many customers. Previously, sites got an unlimited amount of clicks for a one-time fee. Now with pay-per-click, each visitor costs you money whether they buy or not. Just 50 new visitors per day will cost you $225 per month.
  
  
• Your site disappears when you reach your monthly click limit - unless you put more money in your account. Searchers may get really confused if they find your site one day, but it's gone a few days later when they return to make a purchase! Smaller sites that haven't had a chance to build up their brand identity and rely on search engines for traffic will have the most problems.

Evan Thornley, Chairman and CEO of LookSmart discusses a few of these issues in this update for small business customers.

Tips And Alternatives

Fortunately, there are ways to control your costs and still be found by visitors.

• Encourage bookmarking! If you're using a PPC engine, you only want to pay once for each individual visitor. Encourage visitors to bookmark your page so they don't have to find you through the search directory each time they visit.
  
  
• Create a unique entry page. If you buy the minimum 100 clicks per month, it would be pretty easy for competitors to knock you out the first day of each month. LookSmart's click-fraud detection system is supposed to guard against this. But since your server logs may not match LookSmart's count, you don't have a good way to independently verify it. Some webmasters created a unique LookSmart entry page for their listing. Something like: http://www.PutYourSiteNameHere.com/LS.html. That helps you track your click-throughs from LookSmart more accurately.
  
  
• Buy later, not sooner. Competition in the directory may be much heavier during the first part of each month when sites' minimum 100 clicks reset. Consider buying your clicks later in the month when other sites' minimum buys are more likely to be used up.
  
  
• Try to wait them out. Until the July 15 registration deadline, sites in the directory are still getting unlimited clicks - even if they haven't registered! But sites that registered immediately are paying. LookSmart extended the deadline once, maybe they will again. Pay close attention to any emails you get and check their Web site frequently. You may get a special deal.
  
  
• Submit your non-commercial site to Zeal. LookSmart only requires commercial sites to pay for inclusion, updates, and clicks. Non-commercial sites can submit to their non-commercial directory, Zeal.com. You'll have to pass a test before you submit your site, but submission is free and results appear in LookSmart and its partner sites.

Read about some other ways to promote your site without going broke.

Also remember that LookSmart isn't the only way into MSN, AltaVista, and Netscape! The complex web of search engine and directory alliances makes it possible for your site to pop up in all kinds of search engines and directories for little or no cost. For instance, MSN gets listings from LookSmart, Overture, and Inktomi. Netscape search gets results from the Open Directory Project (ODP) and gives searchers access to LookSmart, Google, AskJeeves, and Lycos.

All this means that it's even more important to attain a high search engine rank in "feeder" engines and free directories. NetMechanic's Search Engine Power Pack tool helps you optimize your site for individual search engines, submit it, and track your rank.

Site promotion can be expensive. But with Search Engine Power Pack, it doesn't have to be.