Nov 30 2008
Hedging Internet Assets
Although information based Internet business may have recession proof characteristics like unlimited digital inventory and low fixed storage and delivery costs, risk still exists in the supply and service chain that may be affected by the current economic trend indicating a comparatively long and deep recession. Even in the best of times employees of businesses like Google and PayPal are known to demonstrate inconsistent interpretation of policy that have resulted in very costly adverse financial effects to small publishing business.
Hedging is a strategy designed to minimize exposure to business risks. In this case I will examine how Internet publishers can hedge risk exposure to Google and PayPal business irregularities.
The bottom line at Google is they can terminate a publisher account without giving proof why. The blanket escape is based on protecting advertisers from diminished value of advertising and/or their proprietary contextual placement software being revealed.
The good news is that if you can meet Google’s terms of service, then you have also positioned yourself to benefit even more from other forms of contextual advertising. For example, by monitoring the advertisers that Google sends to your site you can get an idea of who is paying for the top spots on your pages.
Advertisers also use other ad networks that pay significantly more for results arising from clicks. It is easy enough to search on the ad title without clicking on the ad on your page to discover who the advertiser is. The next step is to find out whether they have an affiliate program or use a third party like ClickBank or a CPA network like Hydra. Sign up to get the best terms and creatives to place on your site. In this way you can hedge against lost ad revenue by diversifying into more competitive publishing.
PayPal also has competitors who offer similar or better terms and can be used in the event your payments are frozen until all inconsistencies are reconciled. In this case to eliminate the risk of cash flow interruption, the use of other payment processors like Alert Pay can be integrated into your sales process. The way to equally split payment transactions is by using the different pay processors in the same way a rotating split-test can be set up.
A good tool for this is Google’s web site optimizer where you can have up to three different pages rotating in a campaign. You can also use tracking and testing software or an ad server to equally direct ads to your different pages.
More information on software and different ways it can be used to hedge your Internet assets is available at waymore.info. Please visit the site, sign up for my ezine or contact me directly at http://waymore.info/contact
business, publishing, risk
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Brian Hack is an Internet analyst and business builder that writes for the Business Builder Report. He is a Publisher and Distributor of Audio + Ebooks located at http://waymore.info. You can subscribe to Brian’s waymoreEzine to get free Quick Video Tips about packaging your own ebook as well as information about making, marketing and advertising your own products and services.
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[...] Hedging Internet Assets A good tool for this is Google’s web site optimizer where you can have up to three different pages rotating in a campaign. You can also use tracking and testing software or an ad server to equally direct ads to your different pages. … [...]
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