In fact, I was intending to write on a similar topic (’US ad expenditure trend‘) until I read this post from ProBlogger today. Basically he is talking about how to recession-proof your blog and I encourage all of you to read that post first (and excuse any duplication here, as I wrote this post in one go as an improvisation on my draft)
As we all are experiencing, the global markets are nose-diving for the past few weeks following credit crunch, sub-prime issues and what not. Directly or indirectly this has affected the job scene, housing market and various other bank rate specific industries such as the automobile sector. It is imminent that it will soon affect online entrepreneurs as well. So if you are a blogger, web service provider or an online content provider chances are you will be going through a lean patch – especially if your main source of income is one of the above – in the coming months.
Factors that could affect your online income
Advertisement revenue: It is imminent that the overall ad spending – not just online ads – by corporates will be coming down by a significant factor in the next few quarters. Cost cutting measures are already in place or on the agenda of almost all companies around the globe. So if you see your AdSense income reduced while receiving the same or more number of clicks, you should know the main reason.
Rates for your content services: The rates for providing content or services, may come down in the next few months. This means that if you are an online freelancer, you may get less number of assignments and/or lower bids per taken up tasks. This could be the case with other consulting services as well.
Affiliate schemes’ rules may change: I expect a few companies to stop their affiliate programs or even come down on the affiliate commission rates. If you make most of your money through affiliate subscriptions you may need to worry about it. This point is similar to the first one where the overall advertisement expenses are cut.
IT spending: If you are providing IT related services such as hosting then there could be fall in rates as well as reduction in customer base because most people are cutting their IT spending after the advertisement and operations costs.
Online storages and other free (consumed) services: You never know how many of those online free storage (photos, applications, video-audio clips, other files) services that you are using will be closing down in this downtime. So if you are not hosting on your own, you might want to take necessary actions to prevent a black-out.
There could be other factors as well but more or less everything is related to the online expenditure by your online partners.
The survival tips!
The following tips may be useful for you to take some positive actions and challenge the prevailing conditions.
Increase your reader-base: Perhaps, the only thing that would not be affected by this downtime is the availability of online time from your readers. Think of ‘5x’ and try to grow your reader-base by at least five times in the next few months. The only way to combat a cut in ad expenditure is to increase your traffic dramatically with more and more readers. The negative impact due to the CPC and CPM ad rates will be offset with this strategy. Also, if you have not already done it yet, you might want to get out of ad programs that are not performing well.
Optimize your ad spaces, rates and ad programs: You will be definitely forced to come down on your Private Ad Sales. Optimizing your ad spaces does not mean that you need to increase the ad area but think of rotating a couple of ads more in steps or optimizing the positions of ad types.
Cut your costs: You might want to come down on your hosting, SEO costs, PPC traffic costs etc. Try to save more by optimizing your outflows. For example, you may end up getting a killer shared hosting deal, with more features at half the current price, in the next few months. Watch out for such cost cutting opportunities on the operational side. Same is applicable to your other costs such as PPC advertising. You may get to work with cheaper (and sometimes even free) but reasonably effective blog ad networks in the coming months.
Launch new blogs: If your hosting provider provides multi-domain hosting for no extra cost, it is time to think of setting up a new blog altogether from scratch, if you have some niche ideas. This will also help to increase the advertisement and content span. Those who have not read about the ‘Blogging Idol II‘ challenge yet, please visit Daily Blog Tips and participate. It is all about setting up a new blog and maximize the ad revenue in 6 weeks!
Write more content: If you are a blogger on your own, creating more content – more frequent writing – will definitely attract more readers. Similarly, if you are a freelancer you might want to spend more time for your writing services to earn more contracts online.
Go for multi-blogger blogs: In the above process, if you are running out of energy, a couple of bloggers may have to sign a pact to deliver more quality content more frequently. I expect the number of multi-blogger blogs to increase dramatically in the coming weeks and months.
Improve your social networking skills: Social network and social media traffic will play more critical roles in the days to come. This is the only way to increase your web presence, popularity and traffic without spending a penny but your time.
And finally, ‘content is king‘, though we are sick and tired of reading that statement over and again! But those who emerge out of this crisis as survivors will be the real big online entrepreneurs of the future!