One lucky week how I was hooked into business by an illusion

I was hooked into my business (selling painful e-books, yo) by a dizzying dose of early success with Google’s AdWords service in April, 2007.

My first week running a couple of ads I did shockingly well. My clickthrough and conversion rates were very high (the percentage of people who click on an ad, and then the percentage of those who buy something). I quintupled my money or something ridiculous, enough to short circuit rationality. Dollar signs in the eyes, visions of early retirement.

I got excited and obsessive and worked outrageously hard, but my early results were not even slightly lasting. My profits crashed down to a merely “decent” level the following week, recovered slightly in week 3, and in week 4 I nearly lost money. Soon enough I did lose money (cruel, cruel week 6 — I will never forget it). I just about went out of my mind trying to figure out what had gone wrong, and somehow found the juice to work harder still to try to reclaim those early numbers.

It was random. There was a kernel of profitable truth in that first week, but mostly it was just dumb luck. I started with an outlier of a week and then regressed to the mean. It took about another year of data before this became obvious. In the graph of my progress, I could see a freak weak about once every quarter, abnormal in one direction or the other, but it was a good a year and a half before I saw another freak week as good as that first one.

Fun fact: over about five years, I both spent and earned about $50,000 on AdWords, which is somewhere between a high roller and a dabbler. My success isn’t based on AdWords and never was. But I doubt that I would have ended up with the successful business I have today if I hadn’t had that dizzying first week. If I’d lost money for the first month — and I easily could have — would I have persisted? Probably not.