The global recession is an accepted fact – right now every major economy in the world is suffering a recession, as defined by two consecutive quarters of negative growth. Worldwide, media outlets scream their headlines of the latest layoffs, foreclosures, bankruptcies, bailouts, devastated retirement savings, repossessions and the like.
On a personal level, every intelligent, caring human hates it – the pain, suffering and stress it generates, and the jump in hunger, homelessness and true poverty that results in more and more instances.
Offline businesses hate it too. In the business-to-business realm, keeping your own business afloat, supporting your share prices and maintaining a positive cashflow are just the start of it – but what about your customers and suppliers? As businesses slash their expenditures, customer lists are shrinking and average order value is plummeting.
And ‘Just-In-Time’ supply systems, the darling of the 80’s and 90’s with it’s reduced inventories, has become a major headache. With no existing inventory to fall back on, corporations are finding it necessary to prop up their suppliers or face a lack of product while they search for new sources.
Business-to-Consumer business is just as bad, if not worse. Millions of jobs have evaporated in the past year alone, taking those salaries with them. Falling home values in the US and UK, for example, have dried up many equity lines of credit, and the general credit squeeze is making it even tougher to ride out the storm on credit. Credit card companies are lowering limits and/or raising the interest rates for those already struggling, exacerbating the situation even more.
And even families with no job losses or income reduction are realizing that savings are at all-time lows while household debt is reaching record heights. So again spending is curtailed in an attempt to pay down debt and rebuild a financial cushion against the unexpected.
Let’s start with the headspace of people using the Internet in general. In tough economic times people don’t head out to the mall as often – because the mall is a place to shop and spend money. But the main reason people go online is for information, so that psychological barrier isn’t there. While they’re still willing to spend SOME money, they just aren’t heading out LOOKING to spend it.
But the truth is,
But even if the market wasn’t growing, sales and profits would still be climbing fast due to higher conversions through new tools and techniques. Like
Web 2.0 sites like YouTube, Google Video, FaceBook, MySpace and Squidoo provide easier access to additional users, and services like Technorati, Twitter, MyBlogLog & Pingoat make getting the word out much simpler. And the best of these tools, blogs, have made it easy for anyone to start
Free blogging software like WordPress and free blog hosting sites like Blogger and WordPress have eliminated the need to invest financially in your startup – a major boost for people at risk from the recession. Using a blog to promote affiliate marketing opportunities removes all financial risk, something that can’t be done in the offline world.
But what of the recession’s effects vis-a-vis
Mainstream Internet marketers sell products and services that teach people how to make money online. In any economic downturn it’s natural for more people to look for ways to increase their income, top up reduced income or replace the income from a lost job. Additionally, the increased workplace stress leads many to consider getting out from under the tyranny of bosses and the corporate world in general and strike out on their own. Since starting an online biz involves the widest opportunity and lowest financial risk, the Internet is the logical choice for a growing number of people.
Affiliate marketing is booming as well – and no wonder! It’s the online specialization that requires the least technical savvy, the least start-up capital and has the shortest income horizon when done properly. What could be better suited to cash-strapped neophytes who need quicker returns?
But niche marketing is the area of online business most likely to derive the greatest benefits from the recession. Consumers who might otherwise head out to exotic restaurants will stay home and create their own meals – and need good recipes to keep up with their accustomed diversity. More people will opt to do their own home repair, meaning they’ll need instructional e-books and videos, and often printed plans as well.
Kids today will not react well to reduced allowances or fewer new computer games – wise parents will be all over the Internet looking for new activities to keep their kids at bay. And how many backyard mechanics first started working on cars because they couldn’t afford exorbitant mechanic rates? Again, someone needs to explain the practices and procedures to them, especially with today’s highly computerized engines!
And being home more rather than continuing their expensive nights out will leave people with a hole in their timetable they’ll need to fill – whether they fill it with reading books, watching DVDs, playing computer games, finding a new hobby or learning a new language, new opportunities are presented for niche marketers.
So how will YOU spend the extra time you have on your hands during the recession? Watching TV? Playing Computer Games? Spending more than you can afford to? Or making money online and building toward your own independence? Be smart – look into