2012 INC. 5000 RANK: 834
HEADQUARTERS: Durham, NC
YEAR FOUNDED: 2001
2011 REVENUE: $18.2 Million
When Ryan Abood looked at the books for his parents' New Hampshire flower shop, one number popped out. Without a bit of advertising, sales of gift baskets had grown 400 percent. For a year and a half, he worked a hundred hours a week to make his spinoff, GourmetGiftBaskets.com, into the third-largest player in his niche. Then, one day, he woke up to find that Google, the source of 80 percent of the company's revenue, had banished his site from its search results. His company ended up the better for it.
On November 11, 2008, I woke up at 6 o'clock and did a Google search on my phone, like I do every morning. We're usually one or two for just about every industry keyword. But we were nowhere to be found. I opened up my laptop. We weren't in the first thousand results. This was right before the holiday season, when we typically make 40 to 60 percent of our annual revenue. It was really, really devastating.
We weren't sure what had happened. Occasionally, Google will drop a site from the index -- just algorithmically forget about you for a few days. People said, "You either have some type of temporary exclusion, or you have a penalty."
I called the two companies we hired to improve our ranking. In the past, I'd done all our search-engine optimization myself. But as we grew, we started paying companies to reach out to relevant sites and ask them for links. Instead, one of the companies admitted it was paying for links. Google looks at that like buying an election.
Google has a form called the re-inclusion request. We call it the Google confessional. We said, "These are the links that were paid; these are the links that weren't paid. We've obviously violated your trust, and we're taking steps to remedy it."
That holiday season, we pay-per-clicked out the wang. We spent a lot of money. They penalize you organically, but they still let you buy ads. We leaned on our affiliate channel. Meanwhile, we were slashing inventory, letting people go, getting neat and trim. It ended up costing us $2 million in sales that winter and another couple million in 2009.
Before the penalty, we had zero social media presence. We sort of looked at it like, "It must be nice to have the time to do that." Now, as part of our whole strategy of never buying a link again, we blog about anything. We're up to 3,200 Facebook fans. We Twitter every day.
This March, we also hired a manager of comparison shopping, a social media manager, an affiliate marketing manager; and we have someone in-house to watch our link portfolio. If somebody might misinterpret a link as paid, we take it down. We're not messing around.
We didn't see the kind of ratings we had before the penalty until Google's Caffeine update, this June. That was our final pardon. Now we're back at the top.
Without the Google penalty, we wouldn't be anywhere near as far along as we are. You have two choices: You can roll over and die, or you can grow beyond it.