The ups and downs of online business giants

In view of the fact that 85% of Internet users make their purchases online, the future of e-commerce looks very promising. However, it doesn’t necessarily mean that each and every online business is guaranteed to be successful. Online industries are much like offline ones: while many industries strive, the others can go into a decline and fade away.

 

This way or another, one of the main goals of a business, whether online or offline, is making a profit. If your business doesn’t bring any profit, it’s a red flag that may trigger an IRS audit wondering why you are still in business.

 

We have tracked the online sector in order to select online business niches showing signs of decline. Here are the results of our research.

 

It’s true that the adult entertainment industry generates good profits online. Back in its old days, online mainstream pornography was a booming business that pioneered with great practices like live video and making purchases online. Today, the mainstream pornography is a mature market, saturated with established companies. This can be a tough business for novice webmasters, only the strongest will survive.

 

In contrast to mainstream porn, niche porn targets untapped audiences with specific sexual preferences. Today’s consumers are incredibly demanding. They expect to get everything they need as soon as possible, and they’re not willing to surf the Internet in search of the right site that best suits their interests. That’s why niche porn sites such as gay or alt porn sites are becoming more popular and thus more profitable than mainstream adult sites.

 

The same can be said about online dating sites. Niche dating sites also perform better than their mainstream counterparts. Why is it so? The answer is quite obvious. The vast majority of mainstream dating or pornography sites cater to heterosexual single folks. By doing so, they ignore the preferences of untapped audiences and that is a big percentage of population. So, it’s no surprise why niche dating or pornography sites are doing so well.

 

This very word makes Internet users shudder. People hate the idea of spam, and they loathe a ton of spam emails they receive daily. Even though email users still receive unwanted spam, it doesn’t mean that it still works. But let us be honest, there would not be any spam if it didn’t bring a profit.

 

According to a professional spammer, spam is becoming a dying breed and here’s why.

 

“Spam business can bring a profit only to those companies that use webmail bots that break captcha protection mechanism,” he said. “ It’s an expensive technology and companies have to spend thousands of bucks as Yahoo, Google, MSN and AOL change captchas frequently in efforts to block spam, so the technology happens to be cost-ineffective in the long run. Some companies waste even more when using work force (mainly from cheap labor countries) to solve captchas manually. Mature spammers have turned to porn spam. They use special email bases of real porn seekers. And it can work if $100,000 bucks have been invested to get those email bases.”

 

Spam was created as the way of advertising products and services. It really worked when there were no anti-spam filters and when it was something “new” for Internet users. But now that Internet users are fed up with spam, it’s not going to work like it used to.

 

 

With the advent of the Internet, online trading has become extremely popular among new and experienced investors from all over the globe. Needless to say why this industry with billions of securities being traded on a daily basis has become a great attraction for securities fraud scammers.

 

Online securities fraud may come in various forms: distribution of fake investment newsletters or posting “investment advice” in investment chat rooms and forums. Stock fraudsters used to make good profits online. But now the situation is a bit different, mostly due to stock market instability. Today’s investors are more cautious than ever before, waiting for data on economic factors rather than promises of risk free investment and good returns. In a slow economy, they’re not likely to invest in suspicious-looking opportunities and, as a result, online stock fraud generates lower overall profits.

 

The bottom line is that online industries also experience a life cycle. Just like people, they are born, grow, mature and fade away. No matter how profitable and booming this or that online industry is, there’s no guarantee that its success will last forever.

 

Declines are inevitable, but everything happens for a reason. So, what are the reasons for declines in online industries? Customers like everything that is “new” and “improved”. If people get bored with the idea, the industry may wave good-bye to its multi-million profits.