Getting smacked by Google is never fun, but when you run a
multi-million dollar online business that generates much of its sales
through Google’s SERPs, a Google smack down can be downright painful.

Just ask Ryan Abood, who runs GourmetGiftBaskets.com. According to a
profile
by Inc. Magazine, Abood lost $4m when his
GourmetGiftBaskets.com was dropped from Google’s index in 2008, right
before the most important time of the year — the holidays.

The reason? One of the companies Abood outsourced his SEO to was actually buying links to boost GourmetGiftBaskets.com in the SERPs, and Google somehow discovered those paid links. A penalty was applied, and without the top rankings that had been driving business, Abood watched as his SEO’s blunder cost him $4m in sales. In addition, Abood was forced to spend money on AdWords, and even had to let staff go.

Fortunately, he was able to keep his business afloat and was finally able to get Google to let his website back in the index. Today, Abood says he has a stronger company because of his experience, and as one might guess, his company is especially vigilant about paid links.

There are two lessons here:

  • Being almost wholly dependent on Google for your revenue isn’t the most desirable position in the world, even if you are making a lot of money.
  • When Google is the source of a big chunk of your revenue and revenue is measured in seven-plus figures, you have to be really, really careful about your SEO initiatives.

When it comes to the latter, hired help poses some of the greatest challenges. After all, third party vendors who manage your SEO can literally make or break your business. That’s why a hefty amount of trust must be placed in these vendors. Here are a few suggestions for protecting your interests when dealing with them:

  • Know thy vendors. Who are they? What exactly are they doing for you? These seem like obvious questions but somewhat surprisingly, many don’t really know what their SEOs are up to. Assumptions are made and risks are ignored. Big mistake.
  • Cover your behind — legally. Define what your SEO will be doing, and don’t hesitate to set boundaries. For instance, if you don’t want your SEO paying for links, make that clear. And get it in writing, in a contract. A good lawyer, armed with clear instructions about the nature of your relationship with a vendor, can draft an agreement that can protect your interests and provide a significant deterrent to a vendor who might otherwise go rogue.
  • Stay local. While there’s nothing inherently wrong with taking advantage of the global economy, it’s often a good idea to keep your most important vendors geographically close to you. Not only does it usually make relationship-building easier, it also makes it easier to hold vendors accountable. Obviously, if a vendor breaches a contract or acts negligently, resulting in millions of dollars in damages, your odds of obtaining compensation are far greater if the vendor is around the corner and not half way around the world.

Of course, it’s impossible to eliminate all risk when dealing with people you don’t supervise on a daily basis. Which is why for many companies that generate millions of dollars from their positions in the SERPs, the best insurance policy against a multi-million dollar Google penalty may just be an investment in an in-house SEO team.

Photo credit: borman818 via Flickr.