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Andy Deemer: And just a warning: this episode has some saucy stories along with the business learnings, so if you’ve got kids or coworkers around you might want to use your headphones. Hi! My name is Andy Deemer and you are listening to the Fail Better Podcast. Today I’m talking to John Hargrave, the creator of Zug.com, which was the first comedy site I ever saw on the web. It was the Borowitz Report without the Tweets, or Funny or Die without the UGC. For 15 years it was serving up awesomeness, and then… it died. Today I’m going to find out what happened. John Hargrave, welcome to the Fail Better podcast.

John Hargrave: Thanks for having me, Andy!

Andy: So you’re currently the CEO of Media Shower.

John: I am.

Andy: What are you guys doing there?

John: Yeah, so we are a content marketing company, and we believe in making content better. That’s our tagline and what we mean by that is both we’re making our clients content better — so we’re improving their blogs, their websites, their landing pages – but we’re also making the world better. That’s really our mission to create great content that that improves the web.

Andy: What are your tricks to driving traffic and driving views and engagement.

John: Yeah, it’s all around engagement. We’re not really a content company, we’re a results company — and results really come out of users engaging with the content. You know, first of all you’ve got to make the content good — like this podcast! It’s got to be interesting. It’s got to draw people in. It’s got to deliver. But then within content, especially if it’s written content, there’s lots of ways that you can keep people reading. Lots of images, for instance, and especially kind of funny images work really well at keeping people engaged. Offering links to related content that answer questions that people might have, that’s another way of getting them engaged. So we have lots of little tools like that, that our platform helps people insert into their content.

Andy: Tell me about the best case study you’ve got, or the happiest customer.

John: Hahahah, we have so many, Andy! I don’t know that I could choose just one – it’s like naming my favorite child! Well, we have a couple of case studies on the website. One of them is from a company, they do surety bonds — they’re called Surety Solutions. And surety bonds are like these very specialized kind of insurance contracts. They have thousands of these different surety bonds. What we helped this company Surety Solutions do was create good content around every one of these different bond types. And what happened was, because they were the first ones to really get into Google by writing good content around each of these specialized surety bonds, they now kind of own that market. So whenever you type in one of these surety bonds, you find their site. You know that’s not maybe the sexiest market but that kind of approach, where you find this kind of content hook into whatever your thing is — your product, your service. That’s a strategy that anybody can use.

Andy: [00:03:13] While I’m sure that being first to market helped them, initially, how do you guys stay ahead of the competition? How do you stop others from stealing that top ranking?

John: [00:03:23] Well it’s all about continuing to improve on what you’ve got. So we spend a lot of time on optimization. I was just on a call before this with one of our clients that has page one rankings on a lot of keywords in this industry, which is very competitive, and what we talked about is: let’s take those pages that are ranking well and let’s improve those further. So in other words, what are other things that users who are visiting that page want to know that we’re not answering. And sometimes we’ll ask users or ask readers that on the page, like what else were you looking for on this page? And we use that feedback to generate even better results.

Andy: [00:04:03] And how many people do you have doing this? You have like 40 or 50 employees?

John: [00:04:07] We have about 2,500 writers and editors in our network who are producing this content for our customers.

Andy: [00:04:15] Wow. That’s pretty fantastic. So things are going great with Media Shower.

John: Yeah. They’re going great. We’re having a blast.

Andy: Let’s talk about your biggest failure.

John: [00:04:25] Hahahaha. Let’s switch it up! Yeah, so our company started out back in 1995 — the very dawn of the public Internet — and we created the first comedy site on the web. It was called Zug.com. Z-U-G dot com.

Andy: [00:04:41] It really was the first comedy site?

John: it was the first. The very–

Andy: I thought that was marketing hype — hyperbole.

John: [00:04:47] No, it really was, and it was really fun, because we were making all of this up as we went along. And our goal was really to make this a massive success, to be the biggest comedy site on the Web. We were the first ones in, and we were going to own this space. The truth was, back in those days, hardly anybody even knew about the Internet. So it took a really long time to get traction. I mean, I’m talking like four or five years of just constantly creating this comedy content, before we really got on the map. And what did for us was a piece that I wrote called “the credit card prank,” and the concept, Andy, was that you know how like when you go make a credit card purchase they ask you to sign — but nobody actually checks the signature?

Andy: Yeah.

John: So I just went and made all these purchases on my credit card, and signed the most ridiculous signatures I could think of to see if anybody would notice. It started with like random squiggles and then it progressed to like Beethoven and Zeus. And then I started signing my name in hieroglyphics, and doing mad scribbles like I was insane. At the end I was writing, “I stole this card” and nobody cared. Nobody noti—

Andy: How do you spell your name in hieroglyphics?

John: [00:06:05] I think it was, if I recall, it was Snake-Eagle-Fire.

Andy: [00:06:13] And no one no one cares when you write, “I stole this card”?

John: [00:06:18] Nobody cares. So everybody could relate to this, and this thing went mega-viral. The next thing we knew, we had a page-one ranking in Google on the keyword credit cards. So think about this: this is like early days of Google. Nobody even knew what the term SEO meant at that time.

Andy: [00:06:35] This is above Visa, above MasterCard, Amex

John: Everybody. Yeah, we’re page one for the credit card prank. And then, all these credit card companies started coming to us and saying “hey, we’ll pay you a lot of money to advertise on that page.” And then we realized, like oh great, now we have a business. So we started doing a succession of these pranks. So we did multiple credit card pranks. We did another one called the Viagra prank where I took Viagra in church and that made it to page one for the keyword “Viagra.” We’re page one for Viagra!

Andy: And yet you’re just – this blows my mind – but about the stunt itself, you just you go to a church you take Viagra, and then you write about what happens? You blog it, basically?

John: Take pictures and write about it, yeah.

Andy: Take pictures of your crotch in a pew.

John: In a pew.

Andy: With a hymnal resting on your legs yet.

John: Yeah. Well, resting somehow. Tent-like, on my crotch. Yes.

Andy: [00:07:36] Tell me more about this experience.

John: [00:07:38] Well, I remember that part of it involved flipping to The Song of Solomon, which — if you know your Bible, Andy — is the hottest of all the Bible books. It’s quite erotic. It’s a love poem. And that was the wrong thing to read in church while taking Viagra, let me just put it that way.

Andy: [00:07:58] Jeez, my grandmother would be so upset with me for laughing at this. I also remember a piece you did about trying to get through the TSA or airport security with a vibrating tool shoved down your pants?

John: [00:08:17] Yeah it was classy. Well, TSA — to me — first of all, is such an invasion of our civil liberties. It really is. And going through the airport is not my idea of a good time. It’s a violation of our rights to privacy and rights as Americans. If you get the manual pat down at the TSA, which I always do — because I don’t want to go through the scanner where they are scanning me, and then uploading nude photos to the government to ogle in their spare time — so I always ask for a manual pat down, because the way I see it, Andy, is a manual pat down is like a free massage by the government. Really is. So, I go over there, and the guy pats you and they ask you, “Do you have any medical devices on you?” And I went in with a vibrator, which was running. I said, “Yes I do. Right here in my pants.” And so he had to go around the vibrator while he patted me down. And awkward. One word, awkward!

Andy: [00:09:13] You don’t get arrested for wearing a sex toy shoved down your pants in an airport patdown?

John: [00:09:18] I have been, in the past, but only once. Only once. I tell about it in the intro to my book, Prank the Monkey.

Andy: Do you want to tell that here?

John: Not really.

Andy: [00:09:29] Ok. You even featured Bill Gates on the side once.

John: [00:09:34] Now this remember was not Mr. Big Bucks-Philanthropy Bill Gates. This was Evil Windows 95 Gates. You remember, he was the most hated man in America. Really. Like, people literally thought Bill Gates was the anti-Christ. We were at an industry party together and Bill Gates made the colossal mistake of mingling with the party crowd while I was there. This was in Las Vegas, at a big industry conference there, and I was dressed like full-on Vegas, in this just ridiculous, colorful, nylon costume, and I had like facial glitter, and my hair was all done up in crazy colors. And I came up to Bill Gates and I said, “Mr. Gates, I just want to thank you for all the wonderful things you’ve done for the world. So, on behalf of everyone,” I said, “I just want to thank you, and hug you.” And I came in, in this ridiculous costume, to give Bill Gates a big hug — and he wedged his fist between us, like as tightly as he could, and like tried to forcibly push me away, while not actually making a scene about it. So I gently kissed him on the nipple. I leaned down. He was wearing a sweater, it wasn’t like a bare nipple, I didn’t lift his shirt. But I gently kissed him on my nipple, Andy, and I think he was grateful. And maybe, just maybe, aroused.

Andy: [00:10:56] Oh my god. What’s your single favorite prank that you’ve ever pulled for Zug?

John: [00:11:04] Yeah, we did a crazy one with a Michael Jackson lookalike. There was a big charity benefit, where they had Diana Ross as the featured entertainment. And this was like a $10,000 a plate charity dinner. Like the mayor of Boston was there. It was a big deal. And we went in, the day of, and we found this guy who looked just like Michael Jackson. And you remember at that time that Michael Jackson was wearing — he was wearing something over his head. What was it? Like a pillowcase or something?

Andy: Trying to be incognito by looking really weird.

John: Yeah, it was the mask. He always wore that like surgical mask over his face. So we had this guy wearing the mask, and he really did look like Michael Jackson. And we had rented a limo. Like, we’d done the whole thing so it looked like it was legit. And I was like Michael Jackson’s handler, and I went to the organizers of the event and I said Mr. Jackson is here, and you know, he’d really like to watch the show. Is there any way we could get him in. And they’re like, “Yes, of course!”, and they clear a table for Michael Jackson and his entourage, which was basically like just a bunch of my friends. They clear out this table and we all sit down and people are like ogling. They really think it’s Michael Jackson. And someone comes over and says, “Can we get you anything?” And I said, “He would like a bowl of nuts.” It was just the first thing that came to mind. And five minutes later this, like, beautiful silver tureen of mixed nuts shows up on the table. I’m like, being a celebrity is the easiest freaking job in the world! So easy! We were there the whole time, Andy, and then the show ends and my critical mistake was, I didn’t get Michael — fake Michael — out quickly enough. I was trying to arrange a backstage meeting with Diana Ross, and I’m down talking with his manager, and the jig is almost up because his manager clearly knows this is not Michael Jackson, but the event organizer is trying to make it happen. He’s still fooled. And while I’m gone, a reporter from The Boston Herald — like the whole place was buzzing that Michael Jackson was in the balcony — a reporter from The Boston Herald comes up and accosts fake-Michael. He’s like, “That’s not Michael Jackson!” So I get the whole entourage, I keep the Boston Herald reporter at bay, I get them out the side door. And with people like literally on our heels we dive into the limo and speed away, before we are lynched by the mob of angry reporters, and people who wanted to know who the hell it was who got the free mixed nuts!

Andy: [00:13:35] Oh my God, that’s beautiful. So the site is doing amazing. These pieces are making waves. You’re covered in The New York Times, and you’re getting great press. You’ve got the top keyword for credit card, the top keyword for Viagra.

John: [00:13:51] Yeah. So, we made a business out of this, and for several years it was really great. I think we grew to something like four and a half million pageviews, or users per month. Yeah, I think that’s right. We were really doing a good job monetizing the site. But then the fail… was a slow fail. It was like the air coming out of the balloon, Andy. The competition on the Internet started going up exponentially. Not only were there more comedy sites coming online, there was just more content coming online period. Then people started to figure out how Google worked, and you had more competition for those results. The second thing that happened was, the ad rates started going down. And if you will allow me to digress for just a moment… If you’ve wondered why, when you go to like a content site, and your hard drive churns and your whole browser seizes up because of all of that bloatware and ads that are being loaded in, it’s because ad rates are so low that publishers have to load their sites up with more and more ads, just to meet the costs of producing content. And it gets worse because people have ad blockers installed.

Andy: [00:15:02] I haven’t seen an ad. I don’t know what you’re talking about. I haven’t seen an ad in years now. I thought they just took advertising off the Internet.

John: [00:15:12] The magic advertising fairies came by one night and removed it all. So that makes it worse because then they have to serve up more ads. And it’s all served through this complicated network of middlemen and ad brokers, many of whom are shady, and the whole situation is just it’s awful. So being a publisher in the middle of that got really, really difficult. You’ve got more competition, less revenue for ads, and after years of doing this we found: this isn’t working anymore, and we shut down Zug.com, Andy.

Andy: [00:15:47] You shut it down. What did you try to do to save it, because now it seems like you’re doing exactly what needed to be done to save it? You’re coming up with ways to optimize content, to get more readers, and to retain readers and increase engagement. What did you do back then to get customers coming back and try and get more ad revenue?

John: [00:16:07] Well, we did a ton of content. I mean we were just constantly churning out content, and what came out of this was a really efficient process and tools to enable us to create a lot of really good content. So we built an entire backend system, by which we could get assignments to writers. And we had an editor that was overseeing those assignments. The writers could produce all of that content right in our platform. It would go to the editor, the editor would approve it, it would get published automatically. So this whole platform that we built on the backend to help us manage that content, is ultimately what grew into Media Shower as it exists today.

Andy: [00:16:50] Really! Just the concept, or…? You’re not still using the same platform and same technology?

John: [00:16:56] It’s like comparing a baby chick to a mother hen. It has gone through much growth and iteration over the years but it is now essentially the same workflow that we created back in the day.

Andy: [00:17:11] So what did you try to do to save it though?

John: [00:17:13] Well, we persevered for a long time, and by a long time — I think it was over 15 years? Over 15 years, we worked on it. We tried so many different things. I could spend the rest of the podcast talking about that. But I think the lesson that I took away was that sometimes the right answer is, to give up. And this is not a popular sentiment. But we persevered for 15 years. Like, it was a long time. And at some point, you to say, “Okay, I can keep persevering until I die, but maybe it’s better if I change direction.” That’s ultimately the decision. It was the hardest decision I’ve ever made. We need to shut it down and focus on what was actually driving the business at that point, which was — by that time, we had started doing original content for other customers, for their websites, for their blogs. And that was the part of the business that was really growing, and that’s what we do at Media Shower today.

Andy: [00:18:19] So you did Zug for 15 years. How do you know when the right time to shut things down, or do the course correction, is?

John: [00:18:21] Well, the book that I’ve since read, that’s been really influential is called The Lean Startup by Eric Reis.

Andy: Of course!

John: It’s like the New Testament. And we talk a lot about that in our company. When folks come on board, it’s one of the books that we go through with them. And that idea of The Lean Startup is kind of the agile approach to software development applied to businesses. So, in other words, when you have a new idea for either a product or a process, you don’t spend a year planning it out. You basically say, “What’s the minimum viable product? What’s the quickest way we could get this out and test to see if it’s working?” And then you make sure that you gather data on that test, so that you can see whether it’s working or not. And then, based on that data, on that feedback, you decide… Is this getting traction? In which case, you continue to do that cycle of improvement. Or, is it not getting traction? In which case, you kill it quickly. And by thinking really short term, in kind of an experimental fashion, you can get a lot better read, and make a lot more progress a lot more quickly. The fundamental thesis behind the book is the companies that grow the most quickly are the ones that learn the most quickly, and that circular process of MVP, test, learn, and iterate, is fundamental to learning quickly.

Andy: [00:19:52] What do you think you should have been testing and learning with with Zug?

John: That’s a good question. I think that—

Andy: I mean what were your hypotheses?

John: [00:19:59] Well, I don’t think we had many hypotheses. I mean I think that we found a formula that worked well at one point in time, with, you know, Google and SEO, and we needed to rapidly iterate on that as the Internet changed, as Google changed, and as more competition came in, and as ad revenue started declining. In a sense, we did, because we ended up here today running a very successful multimillion dollar company. That’s awesome. But it is different from saying, “Okay, let’s take this core thing that we’re doing, and figure out how to rapidly innovate, because obviously things are changing around us so quickly.”

Andy: [00:20:42] Do you think it was complacency that should have been replaced with continuous iteration all the time?

John: [00:20:48] No, I don’t. There was never any complacency. I mean we’ve always worked very hard. I think it was more of a mindset and a cultural process, and that’s what we’ve worked hard to build into the company since then, is this idea of rapid iteration and testing and continuous innovation. The Lean Startup is kind of a misnomer, because we’re not a startup, yet we still think like a startup in that sense. Like, we’re thinking about how do we continuously innovate, improve our platform, improve our services, and test and learn and grow in that way. So I think, those lessons can be applied to any organization — especially in this Internet space.

Andy: [00:21:28] It’s like how you keep Surety up at the top of- you know, keep their content optimized, by continually iterating on it.

John: [00:21:34] That’s right. You constantly look for new surety bonds, new keywords, new opportunities to do good content.

Andy: [00:21:40] Do you think back to Zug and think, “My god, if only I’d done this, Zug would still be alive.”

John: [00:21:47] Hahah. Well, the one thing that I think any entrepreneur needs to constantly be doing is, pushing the boundaries and taking risks. Right? Like, continually pushing forward. And I think if anything, maybe I played it a little too safe, maybe, you know, if we had built a bigger team faster, if we had made some acquisitions, things would have turned out differently. But honestly I never really think that way. I never really think, should’ve coulda woulda. I’m very much into accepting how everything has played out and being really grateful that things have worked out, and that, you know, I learned the lessons that I did.

Andy: [00:22:28] Why was Zug not an Onion, or why did it not become a Funny or Die.

John: [00:22:35] Yeah, it’s a good question. I mean, so The Onion started as a newspaper, and on college campuses, and they kind of built off of that base. And Funny or Die had, you know, Will Ferrell, you know, and they built off of that. But I could tell you the long litany of comedic websites that failed over the years that that we succeeded. I mean, there were too many to count. Do you remember Comedy.com? Do remember that one?

Andy: No.

John: No! Nobody does! Do you remember The Netley News? Remember that?

Andy: No.

John: No? Big Time Warner media property, really big in its day! Crashed and burned! So many came and went, along that time. And comedy is hard. Comedy is really difficult to make into a business. And I think that’s just the fundamentals of comedy. That’s not an excuse at all. I think that’s just, that’s the reality. Some kind of businesses are easier to make work than others. That’s definitely been a big lesson for me.

Andy: [00:23:51] So someone’s coming up, trying to build a new app or a new website that’s a comedy product. What’s your advice for them, other than be funny and make money?

John: Yeah, be funny. Make me laugh! You’ve got to have some kind of unique angle or unique niche. You’ve got to have something that we haven’t seen, and you’ve really got to make sure the content delivers. I mean, comedy is all about content, right? So you’ve got to have some way of doing it. I think a lot of folks look at user generated comedy and say, “We’re going to make that work.” But most people aren’t that funny. That’s the truth. Like you really need some kind of curation, or some ability for people to up-vote things that are funny. If you have any kind of comedy idea that relies on the crowd manufacturing funny, you better have some really good filtering and rating mechanism in there, because most people just aren’t.

Andy: [00:24:51] And then you hire Media Shower to optimize your content.

John: Ha! That’s right.

Andy: One last question: who would you want to hear talk about their biggest fail?

John: [00:25:02] I am a big fan of Jeff Bezos, and I think he’s one of the most interesting entrepreneurs on the planet. I think he’s going to be remembered as one of the greats, like we remember Henry Ford or Thomas Edison. And it’s really exciting to be alive at the same time as some of these great captains of industry. But what really impresses me about him is how quickly he will abandon his failures, and the perfect example is the Amazon Fire phone. Remember that one?

Andy: [00:25:32] I do. They hired– they gave us some pre-pre-launch devices, very early on, to build Beats Music for it.

John: [00:25:40] I mean, think about how much work goes into launching a new phone if you’ve never entered that line of business before. It’s a massive undertaking, and that phone was on the market, I think, for 32 hours! It seemed that way, it seemed that way. It was so fast! How does anybody make the decision that quickly, after putting that much work into it, to just abandon it. But it’s that kind of boldness that I admire so much, and we have an Amazon Echo and I think that a lot of what they learned from the failure of the Fire they were probably able to put into the Echo, and now the Show, and this whole new line of products where they’re succeeding brilliantly. That, to me, is what’s so exciting about failure. You know, failing forward, as I call it. What can you learn from that, that can kind of propel you into the next dimension of greatness.

Andy: [00:26:39] It’s true, it’s true, and therein the podcast lies. Well, I’ll reach out to Jeff and see if he’ll join us on the Fail Better Podcast, maybe even next week.

John: [00:26:50] Next week, he’ll be there.

Andy: [00:26:53] But John, thank you so much for taking the time to talk about Media Shower and talk about Zug.com. Any last words of wisdom?

John: [00:27:01] My last words of wisdom are to make sure that you rate and subscribe to this podcast because your ratings matter. They matter! Andy puts a lot of hard work into this podcast to entertain you for free. All you have to do is payment is rate, share it with a friend, and be sure you subscribe.

Andy: And go to failbetterpodcast.com and click on the links to buy The Lean Startup at Amazon.com. John thank you.

John: Thank you Andy.

Andy: You can also buy John’s tell-all Zug.com memoir, Prank the Monkey, everywhere books are sold and you should. It’s hilarious. More importantly though, learn from John’s failures by iterating and optimizing constantly. You might have the number one result for Viagra and credit card searches today, or the highest trafficked product this year, but someone else is coming up behind you. Never stop optimizing. Never stop watching the hills, watching the plains, watching your back. On that note I’m Andy Deemer, and you can find me and the podcast on Twitter, Facebook, LinkedIn, wherever. You can find more episodes and failures at failbetterpodcast.com. The score was composed by the wonderful Yuri Sazonoff. This episode and this interview were edited for time and joy. If you have fails, feel free to call in and record them on our voicemail. 270-681-0881. Tell your friends to download and subscribe to the Fail Better Podcast, because you don’t want them to lose their premium Viagra placement? Do you?

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