I was reading Steve Rubel the other day and he said beware of the Web 2.0 business dependency on advertising for revenue.
So, I started thinking “how do you recession proof your business model?” Well, what happens when you aren’t working anymore, or you don’t have enough money? Well, last time around more of us bought more stuff second-hand off of eBay and Craig’s List instead of buying new stuff from retail stores.
Time to call eBay and find out what they are up to. I’m sitting with Greg Isaacs, director of eBay’s developer’s program, and Ali Croft, tech PR manager, and they are showing me a whole bunch of ways that a blogger or a Web 2.0 site could diversify their income stream and be ready for a recession, or another tech bust, should one come.
For one, they have an affiliate program. Add a little box to your blog and if someone finds something there that they buy, you get 40% or more of the eBay revenue they collect.
Little trick of affiliates? eBay pays more as your readers buy more. Hack? Join a bigger network and your fees could go WAY up! As I build a network I’m going to be using this big time as an incentive to get lots of small bloggers to join up. Since most bloggers have micro audiences, this will be increasingly interesting to a lot of bloggers.
But, for Web 2.0 companies? Well, you can build in eBay auctions into your business plan. Look at Mpire’s site, for instance. They are using eBay’s APIs to mashup items from eBay with their own data. If you buy something off of this site they get a cut from eBay.
One thing that’s changed since the last time I talked with Greg: they don’t charge developers fees anymore. So you can try out their APIs without paying anything. You have to join two things, the developer program and the affiliate program, but they are free to join. Lots of tutorials and getting started guides.
Is this paying off for Web 2.0 businesses? Well, I tried to get him to explain how much, say, FatLens (a Web 2.0 site that sells tickets, some of which come from eBay) was getting paid by eBay. He declined to disclose that. So, I asked him “in general, how much could a company make?” He said he has some businesses that are making more than $100,000 per month in revenue.
How are you diversifying your revenue streams?