the goose

Index style websites are the proven model for generating solid cash-flows online.  Daft, MyHome, RevaHealth, Maybefriends.com and Google have all proven the model.  Collect together a searchable collection of homes/people/clinic or chics and you can make money from it.  Estate agents, dentists and horny teenagers have doling out to get included in these services for years.

It makes sense. These sites help you get paid/laid.  Well worth a few bucks.

But what next?  I’ve spent the evening playing around with the excellent Spotify.  For me, this excellent little app really marks the true demise of the traditional music industry as it was known.  I’ve been enjoying all the music I can eat for FREE. It makes sense.  The cost of producing and marketing music is dwarfed by the potential for sales.  The music industry used to have a free ride – recording once and reproducing the material under copyright n times.  What has happened is that market forces have caught up.  Bands now make money from live events and merchandise.  They are back to selling time – albeit very very well paid for time.

So when is the same thing going to happen to specialised search?  I’ve watched with some amusement as Google gets more and more specialised in their search results – displaying maps, currency conversions, timezone information and phone numbers for local services.  Feck it – Google can even get you laid in Buenos Aires.  Why pay a dating site?

So what is little old Piehole to do?  We have some well funded potential competitors who could decide to creep into our corner of the web.  Right now we’re pretty happy with the state of our competition but just as the music business found out – not everything stays rosy forever.

At the same time as watching search get more and more specialised, I spent a good bit of time studying the MLM community.  While it isn’t something I got involved with  – I think there is something to learn from what is going on there.  Most MLM or affiliate schemes effectively pay their network for sales leads.  Traditional index websites are also charging for these leads but the leads are bought in bulk in the form of a monthly subscription.  You aren’t guaranteed any leads at all in fact.  You are just sold the opportunity to attain leads.

In pretty much all industries, this works out better for some clients than it does for others.  Not everyone on maybfriends ends up with a wedding ring – or even a date.  Some end up with all the dates they can handle.  The site works the same for all but some are just cuter/smoother/younger/slimmer than others.  In effect – the ugly ones are subsidising the bold and the beautiful.  Great news if you are a looker.  Not so great if you aren’t.

This doesn’t seem right and I think – eventually – the market will correct this.  Either – as in the case of the dating websites, free alternatives will come in (eg: plentyoffish.com) or something else will happen.  For obvious reasons I’m hoping it will be something else – and here is my punt on what that something else is.

Subscribers to index websites will stop subscribing and start paying for leads like they do in the affiliate market.  You only pay if you actually manage to get that date or finally manage to actually get someone to view your property.  The reasons why we don’t pay be the lead at the moment is largely down to the cost involved in collecting variable amounts of money from many clients.  There is also a certain difficulty in verifying that a lead was valid  – but none the less  – there will be a move towards more accountability for in lead generation.  Rather than pay for a month on a dating site – why not pay more for an actual date (legally of course)?