Viral Marketing

One aspect of my job as the founder of a software company that I find surprisingly interesting is marketing. I have no marketing budget, but I informally committed to using viral marketing to generate traffic to my website. I knew I couldn't afford magazine ads and I wasn't ready to pay for Google Adwords or banner ads on industry websites.

At first, I just used an online forum in my industry that reaches my target audience. I looked for posts where I felt that I could contribute something to the discussion, but I never mentioned my company or my products. I didn't want to be spammy. I put my name and a link to my website in my signature, though, and I started getting traffic to my website from the forum. In the beginning, about 40% of my traffic came through that website.

Then, a guy on that forum with a website and blog dedicated to the product I develop for noticed my freebie and e-mailed me, letting me know he wanted to post something about my product and my company. He put a link to my website on a page where he has other links to products related to the product I develop for and he posted an announcement on his blog. I got a handful of links from his site every day for a few days and even though it has been months since his blog posting, I still get a few referrals from him per week.

Better still, some other bloggers who just re-broadcast other people's blogs in the same industry made mention of my website. I was surprised by how quickly news spread about my product and company. I had heard of viral marketing, but didn't realize how successful it could be, with very little effort on my part. Back in December, 35% of my web traffic came from the online forum I mentioned, and another 25% came from blogs. I had 234 visits from 166 unique visitors

But recently, I've gotten the product managers for the product I develop on to announce my product releases on their blog and when they do, I get flooded not only with web traffic, but I'll have a dozen people register per day on the site after their post and download the freebies (vs 10-20/week on average). And since they have the most popular blog for my client base, other bloggers and forum users from around the globe then re-broadcast their announcements and now I'm getting referrals from all over the web.

Looking at my stats for the last month (ending yesterday), during which I had two product releases (one was just an update for the new version of the product I develop on), I had 726 visits from 459 unique visitors. More than 50% of my traffic was direct (in part because I sent out e-mail notices to my list of users). 23% of visitors came from the product managers' blog. The rest of the traffic is split up over many sources - 37 more to be exact. Various blogs, online forums, and a few things I cannot decipher.

24 visits, or over 3% of total visits, originated from google searches (not counting google searches from foreign google websites like google.co.uk). I never implemented a Google Adwords campaign because people googling the terms I would use are already finding my site for free.

Viral marketing is my new best friend. Some days I wonder if I might like my next career to be in marketing. Until I started this company, I never would have guessed how interested I would be in marketing. Especially viral marketing where I can watch the message spread over the Internet. It's fascinating!

Are internet sales taxable?

This is the question I was trying to figure out. My business is located in California and I expected I would at least have to collect sales tax from customers in CA (once I have a product to sell, that is). But when I went online to confirm this and to find out what the sales tax rate is exactly, I found a document on the California State Board of Equalization website that surprised me.

If you sell electronic goods, such as software or a database, that are distributed to customers over the internet (as I am planning to do), the sale is not subject to sales tax. If, however, your clients download the software, but you also send them a copy on CD, then the entire transaction is taxable (I take this to mean that you cannot just charge some nominal fee for the CD and tax that).

Here's the source document: http://www.boe.ca.gov/pdf/pub109.pdf