Techemistry Blog

Reverse Sale: The Answer?

5/7/2012 4:13:00 PM -- Ted Krapf

How do you monetize your online presence?  If you are 'in business', I would think you are probably in the business of making money.  Are you running an eCommerce site?  Are you advertising to your visitors?  Are you selling a service, subscription, or knowledge?  In the late 90's, it seemed like everyone was getting into the online game.  Giant ideas came and went.  Some things have changed, but undeniably some very simple, non-technological principals still apply:

A great idea isn't the answer, filling a niche is.  Giving every possible option isn't the best idea, stressing the important options are.  Providing customer service is key, but providing excellent service is paramount.  Simplicity over complex.  You don't need to build a spaceship to get across the street.

What I find most interesting the the concept of the reverse sell business model and how it is applied to the web.  Take Facebook for example.  There are 100's of millions of users on Facebook.  Not a single one paid to join.  They pay no monthly subscription fee.  Not even a licensing fee.  Yet Facebook must have a mega amount of expenses for just their incredible infrastructure that operates the system.  Perhaps the reverse sell has become so common place in the virtual world that entrepreneurial folks are missing out on extending it.  

Think of the revolutionary jump from say a (almost completely defunct) arcade now.  As the business owner you have to invest in very expensive equipment, employees to babysit the patrons, rent, electricity, etc.   Now tell imagine someone telling you the customers aren't going to pay for play time, but instead you have to generate revenue from the ad placements on the walls.  You'd jump off a building.

The incredible audience potential on the web obviously changed that paradigm.  Some sites today use the advertising model: sell pay-per-click (PPC) ad spots on their site.  Traffic = cash.  Some take a gentle tiered approach.  Free membership gets you ten features.  A paid membership gets you twenty goodies.  The yearly subscription get you all the goodies.  Others give the user everything for free and a simple monthly or one-time charge removes the ads.

What I am curious to see is what that next reverse sale model will be?  Throughout the history of business, people have found clever ways to capitalize on their skills and ideas.  How will your next idea fare?  Blast off or bust, just keep trying.

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