If I receive one more e-mail telling me how to build a recession-proof business on the Net, I’m going to scream.
Really.
It’s a great example of how some marketers have no scruples; continuing to perpetuate the “making money on the Net is easy” myth. Worse, they’re blasting this message to an increasingly vulnerable audience. Due to the global economic recession, hundreds of thousands of people in North America alone have lost their jobs in the last 6 months. I have no doubt many are looking to the Net to generate revenue in absence of other options, or as a possible alternative to re-entering the rat race.
Here’s the truth…
There is NO recession proof business (OK, maybe one. But unless you’re interested in learning the fine art of funeral directing, you’re S.O.L.). The truth is that people – from one corner of the globe to the other – are not spending their money. They are saving what they have, preparing for rainy days ahead. They are not spending their money in brick and mortar stores, and they are not spending it on the Net.
Anyone telling you otherwise is not telling you the truth.
Sure, there are all sorts of ways to generate revenue on the Net. But most rely on people either buying stuff – software, digital products, hard goods – or clicking on ads to generate advertising revenue. But here’s the rub…
Because people are not spending, they are not interested in offers, and they are not clicking on ads. I can verify that my own advertising revenue (from Adsense, Chitika, and Kontera) on UltimateFatBurner.com has dropped by more than 25% over the last year. Sales of products I recommend are down too… significantly.
Overall, revenue is down – big time! Worse still, the biggest spenders online are Americans… and they have been hit hardest of all!
Bottom line?
The Net is absolutely, positively, unequivocally NOT immune to the current global economic downturn.
That does not mean, of course, you should not entertain the idea of a web business. The cost to build one – especially compared to any brick and mortar venture – is peanuts. And the margins are sky high. Once you’re up and running, your costs to generate revenue might consist of little more than the cost of monthly hosting and autoresponder service.
And yes, I know about this first hand. For instance…
I bought a small sports nutrition franchise in late 2006. Setting this little venture up took about 6 weeks of 14-hour days of back breaking labor and about $100,000 of cash. I have yet to see any return on my investment. To be honest though, I did this as a long term investment, as well as an opportunity to indulge my passion and get out of the house (working from home is not always all its cracked up to be).
Now that I’ve done the “brick and mortar” thing, I can tell you one thing with certainty: I will not be doing it again. Instead, I have returned my focus online, launching Real-Customer-Comments.com in 2007, and hiring staff to help me take UltimateFatBurner.com to the next level. If all goes well, there will be new, related ventures on the horizon too!
To summarize…
The Net really is where it’s at. I believe that YOU can make money online, if you are willing to do the hard work, and are realistic about your expectations. But things are tough all over… and the Net is no exception.
Leave a comment