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Adult Webmastering Basics: Part 4: More Business Models

Adult Webmastering Basics: Part 4: More Business Models

May 27, 2004
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Will virtual reality boost the paysite market?
Yes, it will soon
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" A paysite adds a layer of complexity to your operations. You must now handle your own credit card processing and be responsible for what is probably an unreasonable chargeback ratio... The major advantage, of course, lies in keeping all of your profits, rather than sharing with a sponsor. "

Last week, we took a peek under the hood of the free site and AVS program business models. This week, we’ll test drive the pay site and link directory options. These sites generally require more work on user retention, as your repeat customers will comprise the majority of your traffic and monetization.

Keeping ‘em Happy Month after Month: The Paysite
The paysite operates along the same lines of the AVS, in that it entices users to sign up based on the extra content they will receive with their password. Unlike an AVS program, a paysite must rely upon itself to host its own sites, maintain its user base, and keep its content fresh and engaging. Users are unlikely to remain members if the offerings aren’t rotated and constantly updated. This model is all about keeping the users happy once you’ve signed them up.

A paysite adds a layer of complexity to your operations. You must now handle your own credit card processing and be responsible for what is probably an unreasonable chargeback ratio. Additionally, many of the resources willing to list you as an AVS site or a free site will not accept your paysite tour as they would a gallery. The major advantage, of course, lies in keeping all of your profits, rather than sharing with a sponsor.

This business model will also add significant cost structures. Setting up credit card processing carries with it an inception fee along with a handling fee per transaction. Your marketing budget will likely be much higher than that of a free site or AVS site, which have the option of attracting visitors with free content. Keeping your member’s area populated with fresh pictures and videos will cost hundreds if not thousands of dollars per month. The higher cost of running a paysite will preclude all but the most serious webmaster from venturing down this road. Properly executed (and optimally, scaled into a network), the paysite can be very rewarding. Improperly architected, it will be a financial drain for many months until it is either fixed or shut down.

The Roadmap to the Adult Kingdom: Link Directories and TGP’s
Link Directories and TGP’s thrive on the growth of the adult industry, providing surfers with a map of the adult Internet landscape. A link directory or TGP site services the user who is looking for either a specific category of materials or simply a clearinghouse of links. The site may focus on a specific niche, or be more broad-based, providing links that cater to a number of categories and tastes.

Several avenues for turning visitors into customers exist for the directory sites. The first lies in the link system itself. By inserting links to sponsor programs, the directory drives surfers towards revenue-generating destinations. These links can be rotated on the homepage, or sprinkled within the search results. Another effective method of monetization propels the same users into per-click sponsor programs, paying for each visitor based on a schedule of set fees.

While the market for banner advertising has cooled off since its heyday in the late 1990’s, some sponsors will still pay on a per-impression basis. Many of these programs ask webmasters to subject their users to sound-based ads which permanently drive away a percentage of the site’s traffic.

Bringing traffic to a directory site usually consists of link trades or purchased traffic. The former method can sometimes be combined with the latter, as the webmaster may opt to purchase bulk traffic to beef up the link trade numbers. This method is especially helpful when first starting out, as a webmaster cannot rely on a brand name to lend negotiation strength.

Adult Orange Juice: Made from Concentrate
Now that we’ve got our foundation set, our workspace planned out, and a business model selected, it’s time to pick an area of concentration. Many niches exist within the adult industry. Some are done to death, and exhibit serious competition. Others have relatively few competitors, but may also have a low level of surfer interest. Striking a balance is an important key to success.

In the next article, we will examine strategies for picking your winning category.


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