The Rise and Fall of Online Businesses

You’ve all heard the pitch,

“Join now, this is going to be the greatest business and will be around forever, you will make a fortune”

Or something like this

 

The last couple of months have been a wakeup call to many people that a lot of these so-called businesses are not so stable. Recent events have seen the closure of several higher profile programs leaving many to wonder what happened. It’s quite simple, although the programs themselves said they were legit and safe, they were really operating on a knife edge the whole time. Legally some were never compliant running under the radar while others tried to be compliant but they got too big and could not continue to comply.

So what are people to think for the future? The SEC closed down Zeek Rewards which made some other programs change their compensation, ripping out a lot of the benefits to members. Other programs shortly disappeared and a few high profile owners sold their more successful programs before anyone started to come after them. What is the lesson to be learned?

It is always said to do your due diligence about a program but when you don’t have all the facts how can you? The answer is not a popular one. Any program that is promising to return a daily % rate you can straight away expect that it is operated predominantly as a Ponzi. As much as they try to disguise it and possibly get around the laws minimally that is what they are. You can bet your bottom dollar every HYIP you see advertised is a Ponzi. That is not to say you cannot make money with them but just realize that the return you are getting, someone else is paying for. In the end these programs always hit a point where they fail and people lose money. It isn’t a matter of if , it is a matter of when. Some will last days, some weeks, some months and a very few will last over a year.

Zeek Rewards was a classic case in point. There is still some that hold out for it to come back but the chances are slim. It depends on who you believe, the SEC figures appear to show that the withdrawals were set to overtake revenue in the month after they shut it down. This is a classic Ponzi crash sign. The point that the company has made the most profit and will start losing money. Usually that is when the owners shut it down because they do not have the money to cover the withdrawals. Some programs get around that by stopping withdrawals while still accepting money in, or by having something else absorb the money owed like giving a placement in a matrix that has limited ability to pay out. At the very least this prolongs the program.

There are different programs online and it pays to know what you are getting into. I have just discussed programs that give a % daily, what about MLM’s. Now this is a different thing altogether. Most MLM’s are legit but they require more effort to earn from. They will have a product of some sort with most requiring a monthly purchase. It is easier for MLM’s to be compliant but still some aren’t. If you want to be involved in a MLM a basic thing to think about is are you purchasing something you can use. If the answer is No then it is probably not the one to join. If you want to make big money in MLM you are going to need a big referral base. Don’t believe the hype saying you never need to sponsor, if you don’t you will not make much at all. You must be prepared to put effort in and it certainly helps if you are happy with the product you are promoting.

Something to think about when looking at new programs, the more hype about how much money you are going to make and how easy it is the more likely it will not be as good as it says. The better programs do not rely on a lot of hype instead focusing on the product more. There will be presentations about the compensation but there will also be information about the product is about. If all there is is big hype regarding the compensation it is focused on only the business side and that means the product is probably just there to make it look more legit. Have a look at this banner to see the difference compared to the image at top of this page.

Free Video Email

 

There are other types of businesses online, affiliate type where you are basically getting customers to a product. You do not need referrals for this but you will need some way of getting customers either through a website or through other marketing methods like email marketing, search engine marketing, offline marketing etc. For most people this is a tougher way to earn as they simply do not get the people to look at the offers.

Adsense and other ad distribution networks will pay you for clicks or traffic to ads on your websites. While this is a good, some would say passive, way to generate money you need traffic. That is not always easy to get but if you have some good websites using an ad network and maybe amazon affiliate or other ads can be worthwhile.

Tagvillage fits into the Ad Networks as well although it goes the step further where you can earn without having a website. Owning your own keywords and getting a % from all revenue that advertisers spend on that keyword. It could be the next big revolution for Ad networks. Tagvillage have not yet got there platform fully operational and expectation is that the publisher platform should be released in October and the advetiser platform in November. They have the advantage of building their product at a time when mobile marketing is in it’s infancy and a lot of other Ad Networks are stuck with old framework for their coding. Add to this the dissatisfaction with Adsense who close down a lot of accounts without giving a reason and that they give 10% of revenue to charities there is a decent market for Tagvillage to fit into.

Tagvillage

I like many of you have made and lost money online. I have seen a lot of programs come and go. I have seen some people make a lot of money and others lose a lot of money. I have been involved in good and bad programs, some I knew wouldn’t last, some I thought would.

Stay within your limits and if you want to earn anything online be prepared to put some work in. Do not go for something because it promises the best return or because it it the newest thing around. Those are the most likely to burn you fast. Unfortunately just because a program has been running for a year does not mean it is safe either. Look at what it is and how it compensates it’s members. The harder a business looks like it will be to earn from the more likely it is that it will be legitimate and around for the longer term.

I wish you every success

 

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