The “old” Internet business model is to give it away FREE!
Chris Anderson, editor-in-chief of Wired and author of “The Long Tail”, has an article in The Wall Street Journal where he explains the current business model of the Internet.
Namely, this “old” model is “free”… to charge you nothing for the service or product being offered in hopes of either getting enough traffic to generate ad sales revenue or when they have enough of a following hopefully a big company will come along and buy them.
YouTube is an example of a company not making any money but commanded an extremely high valuation when it was sold to Google based on the number of users in their community. This is changing.
Given the current economic environment, no company is going to pay for another company with no cash flow no matter how many ‘users’ they have.
With the expansion of broadband, the Internet has become a superb distribution channel combined with superb interaction and community building characteristics. What this does is create many new markets for products, information and services never thought of before because there was no way to reach such very specific niches.
Being able to reach that niche is the key to “The Business”. Developing information via our expertise to sell to our niche is what we’re in the process of doing right now.
Since FREE is dying a slow death, what information or expertise do you have that you could sell via the Internet? Jump in, the water’s fine…
{ 2 comments… read them below or add one }
I have decided against free on my membership product coming out in March. It’s a nominal $2 trial for a week. This makes sure the trial person is “real”, and it was too much work to just give it away.
Exactly. You can still use content marketing to give ’something’ away for free to get someone to opt into your email list but as for your membership site, charge for it and the right people will pay. It’s funny how the dynamic changes when you pay for something vs. not paying. Can’t wait to see what you come up with… let us know when you start your big marketing push… we want to follow along.