View Poll Results: Would a recession impact affiliate sales and programs?
- 70. You may not vote on this poll
A recession WOULD have a negative impact on affiliate sales.
A recession WOULD NOT have a negative impact on affiliate sales
March 3rd, 2008, 09:41 PM #1Affiliate Recession Poll?
Listening to Warren Buffett today say the feared recession is already here, I thought it might make an interesting poll on affiliates feelings regarding the recession and how it will impact this business. I'd be curious how others in this business feel a recesion would affect us all.
March 3rd, 2008, 09:59 PM #2
12/10/07 GOOG $718
03/03/08 GOOG $457
Major ad spends down, clicks not converting because people not spending, it's trickling down across the board.
Diversify and be very protective of every pennyContinued Success,
The secret of success is constancy of purpose ~ Disraeli
March 3rd, 2008, 10:06 PM #3
It totally depends on the product/market
iPod sales - yeah they will go down
Insurance - not so much - in fact it goes up for a while
Yeah this is a total shameless plug, but this is why I think affiliates should "diversify their portfolios" and be sure to include some recession-proof offers like education, loans, insurance, etc.
Insurance is definitely a recession proof deal. Over a 5 year recession, insurance shopping stays consistent. It goes up briefly due to more middle class people shopping who normally don't then it levels off.
The same can be said for educational offers for instance. A recession is not going to even touch them.
March 3rd, 2008, 10:19 PM #4It totally depends on the product/market
iPod sales - yeah they will go down
On the opposite end of the spectrum, senior citizens are probably pretty recession-proof; at least the ones who are on Social Security should be.
Originally Posted by HaikoThere is no knowledge that is not power. ~Hemingway
March 3rd, 2008, 10:46 PM #5
The only reason I voted Not Sure is because it depends on the affiliate. There is money to be made in any type of economy. You just have to be smart enough to make changes and sell or recommend what people actually want to find.
March 3rd, 2008, 11:37 PM #6Originally Posted by Leader
But, as this pertains to the question at hand, that would have little effect on am, as senior citizens on fixed incomes are not the target market for many am niches.
Otherwise, I believe a recession would hurt most areas of am, with products (or services) that are true necessities of life being the exceptions. Even insurance, while important, would not be the choice when an out of work father whose home is being forclosed has to choose between auto insurance and feeding his family.
Remember the difference between a recessions and a depression: A recession is when your neighbor loses his job. A depression is when you lose your job.
March 4th, 2008, 12:26 AM #7
The recession is already here and it's affecting everyone.
The recession won't end affiliate marketing but things will be difficult across the board for affiliate marketers and brick & mortar based businesses.
Heating/energy related prices and food prices will soar for everyone.
There will be a problem with currency values & inflation.
... Bernanke believes the current problems are far worse than those arising from the bursting of the dot.com bubble in 2001. A fall in house prices affects more consumers than that fall in share prices did, and inflationary pressures now are greater than they were in 2001, limiting the Fed's freedom of maneuver. Indeed, some small banks will fail--and failing banks, even small ones that don't threaten the stability of the banking system, are likely to prove unsettling, to put it mildly.
All of this leads most observers to expect the Fed to cut rates even more, which Bernanke is hinting he will indeed do ... Adding fuel to the inflationary fire is the falling dollar. Every drop in the value of the U.S. currency makes imports more expensive. And now there is a new problem: prices of once-cheap Chinese goods are rising as China copes with rising wage levels. The price-restraining effect of Chinese imports is, therefore, diminishing...[source]
Any imported goods will be more expensive [i.e. Persian rugs] and the challenge for the affiliate will be conveying value to the consumers.
Dollar at low on economy worries
Myriad of factors behind dollar's sudden drop
Economic fundamentals may explain direction, but other forces also in play
The above will cause headaches for many people/consumers.
Affiliates will have to be sensitive in their outreach to the possible markets.
Flexibility/adaptability and willingness to promote different items will be important characteristics for affiliates -- also affiliates will need to try different ways to promote items.
On the other hand, the possibility to sell is still available for affiliates, in fact business in some sectors this possibility is booming:
Last edited by Rhia7; March 4th, 2008 at 12:51 AM.
March 4th, 2008, 03:21 AM #8
- Join Date
- January 17th, 2005
The good news is: if you can survive the downside, imagine how much better you'll do when things improve!
March 4th, 2008, 07:13 AM #9
I voted "Would Not", but only because "It Depends" wasn't available. Posters above are correct in stating a properly diversified affiliate can weather this storm, and perhaps thrive as ad spending on some terms is likely to decrease, opening the door for better placement for lower dollars.
March 4th, 2008, 07:33 AM #10
I think a recession would have a negative impact on affiliate marketing, but online sales are still growing so the net results in 2008 should still be better than in 2007.
From http://www.internetretailer.com/dailyNews.asp?id=25168 (Jan 28, 2008 article) :
Online retail sales in 2007 reached $175 billion, a 21% increase over $144.6 billion in 2006, according to a new report from Forrester Research Inc. This is the first significant drop in growth after years of around 25% growth. And according to Forrester Research projections, it will be far from the last.
The firm forecasts: $204 billion in online retail sales in 2008, 17% growth over the previous year; $235.4 billion in 2009, 15% growth; $267.8 billion in 2010, 14% growth; $301 billion in 2011, 12% growth; and $334.7 billion in 2012, 11% growth.
March 4th, 2008, 08:19 AM #11
Clearly consumer spending is not expanding which has to effect anyone selling darn near anything.I would rather live my life as if there is a God and die
to find out there isn't, than live my life as if there
isn't and die to find out there is.
March 4th, 2008, 08:20 AM #12
I think I'm getting a few more product sales because gas prices are high and people would rather pay shipping.
March 4th, 2008, 08:39 AM #13
Cartain industrirs are not going to be affected that much.
The supermarkets will keep selling food.
People must feed their pets. We see less walk in traffic recently but online is (very) slightly up.
March 4th, 2008, 09:43 AM #14
I voted that it won't have an impact. At least not much. As Matt mentioned there are some sectors that are relatively recession proof.
Luxury consumer goods may be affected to some point, but what is misunderstood by many is that a recession for one is not a recession for all.
There will always people with expendable income. Those that don't have the expendable income will most likely be looking for better returns / value on each purchase.
Whether it is true or not, today most believe they can find better deals online than off-line. This will drive more consumers to ecommerce and result in increasing volume for online merchants as well as affiliates that provide help in finding those 'better deals'.Someday starts today
March 4th, 2008, 10:30 AM #15
- Join Date
- April 6th, 2006
I agree with all of the above.
From a personal standpoint, I picked a niche that (I felt) was under performing, and had real potential for online sales, even when friends disagreed with me.
So while we may be in a recession, my segment is actually going through a real growth phase - but only online. Bricks & mortar would be a different story..
March 4th, 2008, 12:17 PM #16
Great thoughts and comments so far. I had hoped this would generate some debates regarding this and you all are doing a wonderful job.
Personally I'm not sure how this will go. I lived through one recession already and did okay. I know what to expect for this one.
My thoughts and hopes are that with a recession and higher gas prices people will naturally turn to internet shopping as a way to cut their expenses. Comparison shopping for the best prices, etc. I see this as opportunity in our business. Affiliate business has always been about adapting and finding what works at the current moment, we now just have to find ways to make this work for us.
March 4th, 2008, 01:30 PM #17Originally Posted by 7-days
I totally agree with everyone about certain affiliate models doing very well through the recession. I think overall we will be impacted far less than the "real" world.
March 4th, 2008, 07:52 PM #18
Very true Michael. I was refering to the one of the early 80's as it had the most impact on me financially. The others I was more prepared for I guess.
March 4th, 2008, 10:40 PM #19
- Join Date
- January 18th, 2005
- Southern hemisphere - away from Fukushima
This isn't going to be your run-of-the-mill recession though. This one will be a doozie.
Probably more of a depression than a recession.
The bad news is SLOWLY being leaked out via the MSM to avoid a panic.
March 4th, 2008, 11:48 PM #20
Online Advertising To Have Greater Share Of Marketing Budgets
This article is promising: spending on television advertising will go down (except for special events such as Olympic and other sporting events) but online advertising will have a greater share:
Screen Digest says that by 2012 advertising will be a three tier market with the most being spent online, followed by TV in the middle and traditional media on the bottom. When both search and display are combined, online advertising will see double-digit growth every year to 2012.
"Whilst the overall picture for ad revenues is flat or in decline, two areas will enjoy growth - online will continue to grow at a pace, buoyed up by a strong search advertising market and digital TV channels will be taking a larger proportion of ad budgets by 2012, at the expense of the traditional broadcasters," said Ltang.
March 5th, 2008, 01:00 AM #21Originally Posted by Haiko de Poel, Jr.
Yeah for me things are down from December, but up from last March. Different months bring different sales depending on holidays, seasons etc.
I actually have found more people shopping online because they tend to be able to buy what they want and save money (on coupon sites) and it saves on gas. I know myself buying online saves me from those impulse purchases at checkout too.
March 5th, 2008, 01:12 AM #22
The recession has actually fueled our business. The crap economy has people hedging their bets sending gold prices damn close to $1000.00 an ounce, which has lots of people gearing up to hit the hills.Eathan Mertz
Black Cat Mining - Gold Prospecting & Rockhounding Equipment
March 5th, 2008, 10:14 AM #23
- Join Date
- January 18th, 2005
- West Coast USA
March 5th, 2008, 10:41 AM #24
Wow! Nice find, Adam.
It's interesting to see that 30 states are in Expansion, 5 states are in Recession and 15 are at risk. I guess it all depends on how you look at it (and whether or not you live in one of the 5 that are in recession).
It's interesting to look at the individual cities within various states, too. For instance, Missouri (one of the 15 at risk) shows 6 cities in Expansion and only 1 at risk. West Virginia (one of the 30 in Expansion), on the other hand, shows 2 cities in recession and 3 at risk. How does that work?
March 5th, 2008, 02:30 PM #25
- Join Date
- January 17th, 2005
I completely agree with Drewbert.
This international economic crisis will be like one that most living Americans have never experienced before.
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