10 things a Directory Model Business needs to be successful

by | Mar 24, 2018 | Business Questions, Business Tips

In the latest of the 10 ideas series, I’m exploring 10 things a directory based business needs to be successful.

If you’ve been around some of the business groups on Facebook recently, you’ve no doubt come across someone with a directory site (even if they don’t necessarily advertise themselves as such). For those who haven’t come across them, a directory model is basically a catalogue of related businesses that pay for listing on your website.  Like the old Yellow Pages, or trade directories, businesses pay a fee to be listed, and then higher fees for priority placed listings that will get more attention from buyers. This may include basic static listings for a minimal fee, and then various packages which include upgrades, such as social media posts, blog posts, newsletter mentions, paid adverts on the site, and affiliate programs. Directory businesses will help other related businesses (often called vendors) get more traffic by having a targeted and engaged audience that are interested in the products the vendors are selling. Having started my first business initially using a directory model, I am particularly passionate about helping other directory owners to actually make money from their businesses and making sure that the countless hours of effort, costs, and passion actually add up to a successful business. The tips below are by no means all there is to know, and given that this is a topic I am especially passionate about, I will no doubt return to this in various forms in the future.

So – 10 things a Directory Model Business needs to be successful

  1. A niche area that isn’t overdone.  The golden rule of marketing is to know your market.  In this case, trying to be all things to all people won’t work.  You need to have a targeted niche, without hundreds of competing directories in the same field.  Before buying a pre-packaged business, ask lots of questions – have they made any other related business directory sites you can see?  How many business packages have they sold and in what areas?  Chances are, if they have sold lots of directory sites, there will be multiple sites in your area already and they’ll just repackage the same templates, images, and posts and give it a different spin for you.
  2.  A niche that will actually be profitable.    How can you tell this?  Have a look at the businesses that would be likely to be signing up with you – are they established? what marketing channels do they already use (and how much are they spending on these).  If there are lots of mum-start ups in your area, then chances are they won’t have huge marketing budgets to spend, and will be social media savvy anyway, and will probably DIY over paying you for your services.  If there are a lot of larger corporate type businesses – they’ll probably have established marketing channels that are working for them, so you’ll have an uphill battle to get a wide enough audience to get their attention.
  3. A business owner with skills and knowledge in the areas that matter.  And no, this doesn’t mean a love of organic swaddles, wedding photography, kitchen tools, funky shoes or wooden kids toys.  This means that you know social media and how it works.  You’ve done online marketing or blogging before and you know what it takes to make it work and to connect with your audience. You have a love of selling and sales and convincing people to buy stuff.  And you have skills in developing a business strategy for growth and marketing that you can start implementing straight away.   I see so many directory owners (myself included!) spending years just getting their head around the whole concept of the directory, learning how to manage a website, social media, who their market is and what they need.
  4. Research on your idea.  I cannot emphasise this one enough.  Don’t just research your customers and whether they would use a directory, but would businesses sign up?  Spend some time in as many business mums groups and look up the directories that already exist in your target market.  Start making notes of the businesses that are listed on them. Chances are pretty high that a) the businesses will also be active in the groups, and b) the business will be listed on multiple sites.  For you to have a chance of adding that business to your site, you either need to be more competitive on price (hard with so many free trials) or more competitive on service (consider how much time/energy you can devote to each vendor for the income they’ll bring in.   For example – if you are setting up a local mums and bubs directory – do some research on how many mums and bubs related businesses are in the area already.  How many other directories already exist in the local and wider area – what are their fees, how long have they been around, what can you offer that they don’t?
  5. A well-designed website.  Having a website that uses the same images, templates, and wording as other directory businesses won’t set you apart, and won’t encourage vendors to sign up for your site.  Do your research, ask a million questions, and EDUCATE YOURSELF on what makes a ‘good’ website, what is SEO, what should be included and what questions you need to ask before buying a directory package.
  6. A backup plan – If you’re offering free trials, it can be six months or more before you even see a dollar in income for your site.  Build in other income streams from the beginning that will help you with some cash flow while you grow the directory side (I’ll do another post on this soon).  Don’t throw in your day job just yet, or make plans that will rely on your directory income magically appearing on a certain date.
  7. SUPPORT  – You are the product of the five people you surround yourself with.  Make sure the 5 people you hang out with the most are positive, supportive, knowledgeable, generous and believe in your dream as much as you.
  8. Money to invest.  While many people will try and sell you the dream, and that your investment is ‘only’ the price of the website, the reality can be quite different.  Having a slush fund to invest in top quality copywriting, Facebook advertising, subscriptions to social media management programs, as well as your own professional development will help ensure your directory site can reach a bigger audience much quicker, meaning you can convert more vendors to signing up for a listing.
  9. In an area that you absolutely love.  And will love in 5 years time.  My advice is to choose an area that you could literally talk about all day long because if your business is successful and becomes a full-time job, that’s what you’ll be doing.  Whilst you may have just got married, or had a baby, or taken your kids on an awesome holiday, or love making hand knitted jumpers, or gardening, chances are, there are a lot of mums out there that have had the same thoughts.  And some of them will also be setting up a directory business.
  10. The right mindset.   For me, changing my mindset to even considering running my own business took a huge mental overhaul.  It meant breaking free from the expectations that I had placed on myself, and that society has placed on me as well.  Did I really spend 6 years of my life studying, and a further 15 years working my way up the corporate ladder to just jump ship the minute my kids came along?    Whilst starting a business initially came from a place of needing an option that allowed me to work from home, it was only when I began to take it seriously, as a business, that the big changes came in my mindset.   If you treat your business as a hobby, and a bit of fun, then that’s all it will be.  You need to get real on your mindset, take all the leaps of faith and set yourself up for success with the right mindset before anything else can fall into place.

I know that a lot of the tips above are negative.  And with good reason.  I hate to see people get ripped off.  And I hate to see businesses target a very vulnerable group of people, mums with young children, who don’t want to return to their day jobs and are looking for a way out.  These businesses take thousands of dollars from families who have most likely come out of a period of maternity leave and surviving on one income.  They invest their savings (or worse, borrow the money) to be sold a dream that turns out to be a fiction.  They’re given examples of other successful businesses that have done it.  They have testimonials that are given under duress, and the threat of business ruin if they complain.  They take advantage of the desperation and dreams of mums, and in many cases, shatter them to pieces.  Only the strongest (or most independently wealthy) will survive more than one year.   Statistics show 75% of businesses fail within 5 years, and the major causes are the skills of the business owner and their ability to strategically run and manage a business.


Got an idea you want me to brainstorm for you?

If you’re feeling stuck for an idea – whether it’s a new business, a decision you need to make, or a content plan you’re after – let me know and I’ll add it to the list.  Be sure to leave your details so I can let you know when it’s done.

What is the 10 Ideas Project? 

Inspired by a TEDx talk given by James Altucher, I am on a mission to make myself an ideas machine.

Every day, I will write down 10 ideas for different things.  These might be business tips, inspiration, content ideas, strategy ideas, things I love, things I hate, and all the millions of ways that I can think of to inspire, motivate and encourage mothers who want to change their lives, by either getting a new job, a new career, start a business, or grow their existing business.   They’re quick, flow-of-thought pieces that map out the 10 first things that come to my mind on a particular topic.  Some days, I’ll expand on them.  Other days, I’ll keep them short.  Some days they’ll be great and some days not so much.  Other days, I’ll make them pretty and use lots of pictures and headings and lovely things.

But I’m making it my mission to keep writing and keep on getting better at them. If you’ve got a topic or idea you’d like me to brainstorm ideas on, please let me know.

I’m always on the hunt for new inspiration.  I’ll be posting them here, and on my other site, Employment Avenues.

If you love my ideas, please tell me (and the whole world), I love to hear your thoughts.  If you think my ideas are terrible, please tell me that too, and I’ll keep trying to get better.



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