Forum Moderators: martinibuster
I am thinking to quit my job now and concentrate full time on adsense. But will it last for long? let's say 5 or 10 years?
what do you guys think?
But will it last for long?
People who want to make businesses that last often spend a lot of time crafting a mission statement. When this is meaningful, rather than an empty political exercise, it can make a big difference in how the business is run and increase its odds of survival.
If you define yourself as an AdSense business and behave accordingly, then you are in a very narrow business that is vulnerable to any number of likely threats.
If you define yourself as a publisher of useful information and behave accordingly, then you are in a very broad business that has been around for centuries and likely will exist for as long as mankind does.
An AdSense publisher views AdSense as their world, and is comfortable being ignorant of other revenue options. A publisher of useful information views AdSense as one possible tool among many, and is always alert to new opportunities to generate revenue from their content.
I would much rather leave my day job to start a plastics business than leave my day job to start a plastic raincoat business. And yet, the difference between the two might all be a matter of mindset.
...AdSense as one possible tool among many, and is always alert to new opportunities to generate revenue from their content.
This is a wise strategy. Working against it--for me anyway--is the reality that AdSense has been a consistent and reliable producer and all the "new opportunities" I have tried so far have been huge wastes of time, energy and money. Live and learn.
This is a wise strategy. Working against it--for me anyway--is the reality that AdSense has been a consistent and reliable producer and all the "new opportunities" I have tried so far have been huge wastes of time, energy and money. Live and learn.
I think Ron's comments up a few messages are excellent. The reality is that there's no one size fits all answer to the original question. It's all about risk management.
And each person's situation is different. On one end is those people who lack skills to make a good living off the Internet, and really will be stuck if there is a significant downturn for their sites, whether it's search engine plunging, or adsense drops (smart pricing) etc.
On the other side are people who developed businesses independent of the Internet, and that will survive even if the Internet went away tomorrow, BUT who profit by, and even temporarily depend on revenue from the net or Adsense.
If ALL you CAN do is earn via Internet, or via Adsense your risk levels are higher than if you are in the latter situation. The risk levels anyone can tolerate is a personal choice.
Level of risk drops to the extent you have diversified income sources, and the ultimate is if you have Internet PLUS Non-Internet revenues. I suspect most adsensians don't have the latter. But it's personal choice.
FInally, I think we can all relate to Andrea's comment quoted. Adsense has worked, other Internet/ad options haven't, and it's easy to become financially and psychologically dependent on adsense. Since we have three separate things -- search engine behavior, adwords advertising behavior, and adsense itself (eg. smartpricing, targetting), any one of those can crash earnings for a site, sector, or set of sites.
It's a really poor risk management strategy to depend on ONE company with whom you have no influence, to produce your livlihood. Or, one medium that is controlled by very few players.
If that's all you can do, you have to do what you can.
And when Adsense is no more, seize something else.
It's the business equivalent of White Water Rafting: live in the moment, take what opportunities come your way, avoid the rocks, go with the flow.
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If the price of oil happens to go up precipitously the cost of a trip across town to shop for things will get very expensive and more people will shop online...
Those goods have to go from the supplier to the warehouse somehow. Oil will be involved.
If the price of oil happens to go up precipitously the cost of a trip across town to shop for things will get very expensive and more people will shop online...
Yep, I need to make a comment about this too...seriously no politics or back biting intended with my comments.
Wait until you see fuel at USD 6.30 for 1 US gallon and see if it makes any difference to shoppers' and commuters' attitudes.
If the UK is anything to go by, no it won't!
I'm not saying that the UK does not shop on-line however if one were to establish a business based upon the increase of fuel prices then I feel one could be very mistaken.
Europe, in general, has more traffic congestion than ever regardless of fuel prices, quite how any government will resolve this dilemma seems to be beyond most politicians.
Maybe the USA could be different owing to the huge distances between major centres. One thing seems pretty sure, we shall know within the next few years.
And major disruptions could occur that would make six dollar gas look very cheap...
In any event, online shopping is getting easier, better and more common. Going to the mall is getting more expensive, those trends will continue and one day a tipping point will be reached where your average person will check the internet before she gets into her car.
Stereotypes notwithstanding, I just won't listen to those hoots and catcalls; numbers are more important.
Wait until you see fuel at USD 6.30
Actually, the current price of petrol, or gasoline, in the UK is equivalent to just under $8 (USD 8) per gallon.
No, people won't stop driving because of six dollar gasoline, but some percentage of them will shop more online before they get into the car to buy that item.
You're right, it doesn't stop them driving and people's attitudes are very hard to comprehend.
For instance Xmas 2005 saw one of my friends complete all their shopping on-line during November. All bargains secured, all presents wrapped, all seemingly completed.
I was very impressed by their organised lifestyle...that was until December 27th through til early January when they duly drove to nearly every major shopping centre throughout the UK for the Xmas and New Year sales!
They went to London, Bristol, Nottingham, Sheffield, Manchester, Liverpool, Newcastle, a different place every day and covered thousands of miles looking for bargains.
Ok, so they had two full week's holday...and no, I do not understand this either.
Can anyone explain to me this rationale and wanton waste of fuel?
These are the battles Adsense has to face, consumer interreaction within a mall.
Actually, the current price of petrol, or gasoline, in the UK is equivalent to just under $8 (USD 8) per gallon.
Only if one is using UK gallons and not American, 4.54 v 3.79 litres!
I rounded down the USD to 1.75:-)
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Consumers tend to put off major purchases in economically volatile times. The effects of which would be evident both online and in the brick and mortar world.
[edited by: Key_Master at 9:40 pm (utc) on April 24, 2006]
But the aggregate numbers are what is more important. With each increment of higher cost in going to the mall there will be some change in the number of people going.
Anecdotal stories about irrational behavior in automobiles doesn't change the hard fact that at some point cost is a factor. While cost won't stop every irrational act of automania it only needs to curb a few trips to cause a difference in net traffic.
Well there is also an irrational impulse to deny anything I assert, I run into that a lot too. It's why I never ever give up.
The mall is a community center and provides human interaction that the internet cannot compete with.
Yet traditional malls are in decline, while impersonal "big box" stores continue to pop up like mushrooms.
Also, mail-order shopping (the predecessor to online shopping) has grown enormously over the last few decades, so there's no reason to believe that remote shopping (whether from a catalog or via a Web site) is going to fade in popularity. And some types of shopping simply work better online than in person: travel, for instance, or specialized electronic and photographic gear that isn't readily available outside major cities.
It will work this way for me with six or ten dollar gasoline too, but I don't have a tight budget. Some people who have trouble making ends meet at the end of the month will discover online shopping... So a slowdown in the economy could be good for e-biz in a perverse way.
That's the trend--pile that onto the larger overall trend of more and faster computing and I see a rosy future for ecommerce. AdSense is not just along for the ride, it's a driver.
I think, we're probably moving towards a mini-bubble burst regarding advertiser money. It won't be as bad as the 99-2000 bust.
The bust will sooner or later come on the advertisers site. My impression is that not everyone here has the same profit increase as Google. Some will, some won't. What matters is the average over all of us. This means imo that Google's increased profit comes largely from their new services and signing up new publishers that match the new adwords customers.
IMO, whenever there was word out that somewhere is money to be made [aka Klondyke, Bubble I], millions will rush into it. This will inevitably result in some big cullings and decreased revenue sooner or later. This will not matter to Google as being the accumulator, but publishers will suffer as soon as the maximum density of adwords customers is reached.
Another big worry factor is, if that point is reached, how will Google react, if the profit margins aren't increasing anymore and the share price will inevitably sink as a result of this? Will they compromise the search engine, their biggest means of power over all of what is internet? Will that then bring a downward spiral, or have they already anticipated this?
Another thing, with content inflation, like Wikipedia, will average Joe user not find a non ad site somewhere else? Is the information on your site not to be found elsewhere? Is somewhere someone rich enough to bring your kind of content into Wikipedia like projects?
Will Google continue by default putting the users nose always to that adfree content on page 1? Can you compete with millions of authors that give away their knowledge for free?
What matters is the average over all of us.
How so? The free market is about winners and losers, not averages. The winners celebrate their good fortune and try to stay on top, and the losers find another way to make a living--whether they're publishers or owners of dry-cleaning stores.
This means imo that Google's increased profit comes largely from their new services and signing up new publishers that match the new adwords customers.
Google's increased profits come largely from signing up new advertisers. New publishers are important in terms of building and maintaining market share, but new advertisers are what drive up bids.
IMO, whenever there was word out that somewhere is money to be made [aka Klondyke, Bubble I], millions will rush into it. This will inevitably result in some big cullings and decreased revenue sooner or later.
Just because some publishers go out of business (or make less money than they did for whatever reasons) doesn't mean ad revenues will decline. A lot of Gold Rush prospectors went broke, but that didn't make gold less valuable.
This will not matter to Google as being the accumulator, but publishers will suffer as soon as the maximum density of adwords customers is reached.
What maximum is that? The saturation point in online advertising is a lot farther off than the saturation point in traditional media advertising.
Another thing, with content inflation, like Wikipedia, will average Joe user not find a non ad site somewhere else? Is the information on your site not to be found elsewhere? Is somewhere someone rich enough to bring your kind of content into Wikipedia like projects?
It's a common misconception among Webmasters that "content" is simply filler and that users are looking for interchangeable "information." But that isn't how the media industry works. Does PC MAGAZINE have different information than PC WORLD? Not really, and CAR AND DRIVER and ROAD AND TRACK pretty much review the same cars. Similarly, Fodor's, Frommer's, Rick Steves, and Lonely Planet will all tell you what to see in Paris or how to get into the city from the airport in London. But that doesn't keep users from preferring PC MAGAZINE to PC WORLD, or ROAD AND TRACK to CAR AND DRIVER, or a Rick Steves guidebook to a Fodor's guide.
In other words, it doesn't matter I'm covering Paris and someone else is covering Paris, too--or if Steve's Digicams and DPReview are both reviewing the latest Nikon Coolpix camera. Information may be interchangeable to some degree, but editorial emphasis, presentation, and user preferences aren't.
Can you compete with millions of authors that give away their knowledge for free?
I earn a good living by giving away my knowledge. So do a lot of other media businesses, ranging from Google to my local TV stations and weekly newspapers.
Yes average statistics, obviously allow for individual successes, but also in Klondyke it was a better bet, to sell food or buy gold, or have a saloon.
And yes your pages could be the one surviving, nevertheless on average with a large influx of publishers sooner or later the price will go down or the individual price for the average publisher, as we are talking with the internet global/nationwide reach, easy access etc etc.
And yes money won't be less worth and that will go the accumulator one tier up, hence Google, Yahoo etc.
That doesn't mean adsense is bad or Google is evil, it's just what tends to happen if the word goes round on new ways to make money. I myself read about it in the Economist and went back into the web after I managed to get rid of my domain for a nice sum pre bust a couple of years earlier and swore never to do it again.. ;)
EFV you seem as you are trying to constantly convince yourself that you are great, your pages are unbeatable and Google will always be nice to you.
All EFV is stating is that there is always an alternative market, view, presentation, option...just as we all do with our web sites, magazines, blogs, mob phones, mp3 players, dvd, sat tv etc:-)
As for the "average publisher," what do you define as an "average publisher"? In a free market, there are no "average publishers," there are only individual publishers whose earnings are determined by many different factors such as topic, traffic, the supply and demand for ads that fit their pages, and whether their clicks convert (or are deemed likely to convert) for advertisers. To use a simplistic example, if mortgage interest rates shoot up to 15%, publishers who run home-mortgage sites will probably see a decline in their AdSense income, but publishers with sites about buying repossessed houses may see their AdSense income skyrocket. And if Los Angeles gets hit by an earthquake, Los Angeles travel sites may feel the pinch, but sites about making homes earthquake-resistant are likely to do quite well.
All EFV is stating is that there is always an alternative market, view, presentation, option...just as we all do with our web sites, magazines, blogs, mob phones, mp3 players, dvd, sat tv etc:-)
Hmm, I was trying to guestimate a possibility of a bust and not if there are individual pages/sites that will survive, may they contain 404's or not.
Of course individual variation will result in many individual outcomes, which are pointless to go into as they will entail quality, Google rankings, stochastics etc etc etc.
My primary answer was regarding adsense as it is today. New adword customers have to be displayed somewhere. So if it wasn't on adsense publishers websites, it will have been on Google sites.
From that one can guestimate where adsense. as it is today, going for most.
Maybe there are new markets to go into new platforms, but that's probably a bit too ambitious to discuss.
If the bust will still be a while off, cause most ad dollars are still off the web, that's good.
Still Google will make more money if it can display ads on their own content, just simple business. So the short term future will likely be that Google will increase the amount of services they offer and one should go into niches that are too small for Google to cover or invest in.
So as EFV states: talking about the Hühner- und Entenbraterei<-------- ;) is the way forward
will unlikely and hopefully be unprofitable/unfeasable for Google.
As for the "average publisher," what do you define as an
---
about making homes earthquake-resistant are likely to do quite well.
Hmm, on the one hand I totally agree, on the other hand there are probabilities of an outcome for existing and future adsense publishers.
So using your example, what is the future of an inhabitant in Los Angeles?
On average I would say not good? Notwithstanding that any inhabitant of Los Angeles can take this information and move to London.
Anyway I come from population level modelling, hence probably the difference in top down, bottom up view.
Given the mass of information, I see what you say about individuality as given and try to estimate the probability on the whole.
So when I mean average this is the mean or the median and variance around it, not denying outliers.
As an individual I try then to guestimate my chances on the variables i have and the probabilities of the overall position.
But as said, I can't go through every possible website hence I guesstimate on the information I have, which obviously has a variance around single events.
I tried for a change ;) not to mention my websites.
Some make money some not etc etc.
In ten years there will be a lot more people connected to information and there will be lot more information digitized. Our SERPS may not hold or may not even be seen as a valid source of information at that time. Imagine all the books in the world digitized and available for reading. There may be organizations creating relevant articles to categorize the book into pages. The means of getting to the information will change - it may no longer be required for us to type in keywords. Can our article on chicken noodles compete with an article from the world's greatest chef - an article that has real-time media to help you prepare the dish?
Considering the pace technology is moving forward - this may not be a distant future.
Regards,
R
How so? The free market is about winners and losers, not averages. The winners celebrate their good fortune and try to stay on top, and the losers find another way to make a living--whether they're publishers or owners of dry-cleaning stores.
EFV, that's certainly accurate, and it's one reason why the amount of TOTAL advertiser money increasing is, while a good sign, not a good indicator of success for any individual website owner.
The "bust" I anticipate may not necessarily mean the whole industry or all sectors. What I think is going to happening (I believe it's already started), is that advertisers may keep or even raise their budgets, BUT, they will realize that they need MORE for their money in terms of return.
That means, despite possibly a bigger ad budget, the actual prices they will be willing to pay for a "click" will (and is - some sectors) dropping. That will affect sites that rely on high prices and margins the most, while it will affect high volume sites differentially, depending on their overhead.
A number of things have been mentioned in this thread that point to extreme instability, which is going to continue or increase. From the economy, dollar exchange rates, oil prices, google search issues, advertiser behavior, MFA and scraper sites, the sandbox, and on and on, it means that the entire enterprise of making money via adsense (and on the Internet) is more and more unstable and unpredictable.
So, would I quit my day job based on today's income? Not unless I was very young with no responsibilities, or retired, or independently wealthy.
To tie into EFV, the winners and losers will change. Winners one month are becoming losers the next. It's a crap shoot.
Those who don't manage their risk are going to get harmed in a very substantial way. Those that apply sound risk management and sound business techniques will survive, and succeed OVER TIME.
All EFV is stating is that there is always an alternative market, view, presentation, option...just as we all do with our web sites, magazines, blogs, mob phones, mp3 players, dvd, sat tv etc:-)
That may be true. But given the possiblity that a majority of adsense people lack the business acumen to operate in different markets, AND they lack any real goods, or even information of value to compete in those venues, what happens to them if their individual adsense revenues crash?
What percentage of "Internet writers" for example, have content good enough to be columnists for the NY Times, or even their local papers? What percentage of Internet marketers are good enough to walk into an ad agency and get a gig?
What percentage of website designers could be graphic designers as professionals?
What percentage of people who have created products, and sell them on the web will have the wherewithal (money, talent) to create ads for other media?
What percentage of affiliate sellers would have NO reason to exist if they can't succeed on the Internet?
But the end of an "easy money" boom won't mean the end of AdSense, or the end of opportunities for publishers and other businesses that deliver real value to the end user. Advertisers need audiences, and in the case of direct-response advertising (such as AdSense), what they really need are targeted audiences--preferably targeted audiences of real prospects, not just people who clicked on an ad because they couldn't find anything of interest on a made-for-AdSense site.
We'll probably end up with an AdSense landscape that's much like the offline publishing and direct-mail industry, where you have everything from no-name weekly shopping supplements and "occupant" mailings to enthusiast publications and customized, highly targeted direct-mail lists. Advertising rates and publisher earnings will reflect real or perceived value, and publishers who can't deliver that value will have to settle for the equivalent of run-of-network or remnant ads.
