MIAMI — The 2012 XBIZ Summit’s educational seminar series, presented by AWEmpire, concluded today at the Shelborne Hotel on Miami’s sexy South Beach.
Sponsored by Epoch, WhiteLabelDating.com, PornHub, Affil4You, CCBill, GTBill, OrbitalPay, NETbilling, MojoHost, ExoClick, CECash, Sex Entertain, Sofort, Humboldt Merchant Services, Saboom, Pay4 and PussyCash, among others, the XBIZ Summit runs from May 15-18, providing a wide range of networking and learning opportunities for the event’s attendees.
Up first was a look at “freemium” porn and the next generation of free adult websites, entitled, “Going Free: Creating Sticky, Ad-Supported Adult Sites.”
“It’s a simple fact,” says XBIZ, “consumers desire and seek free online adult entertainment and it’s up to you to figure out how to profit from this reality.”
“In response, a new generation of adult sites is evolving to satisfy this spendthrift audience; focusing on free as the foundation of porn’s new economy,” the seminar’s promoter states, adding that this session will examine proven business models for profiting from free, including ad-supported sites, along with the strategies needed to keep visitors returning and clicking on ads.
Moderated by Vegas Ken of TheBestPorn.com, the highly anticipated session’s featured speakers included Lux Alptraum of Fleshbot, Colin Rowntree of Sssh.com and Jason Hart of Lead Wrench, along with XBIZ’ Stephen Yagielowicz.
The expert group set out to reveal if paysites remain a preferred destination for free adult website traffic, as well as to analyze the effects that large tube sites have had on consumer’s expectations and how these desires play into free sites today.
“It’s good to have a blend,” said Rowntree. “Premium membership websites and live video chat, hard goods, etc. It’s more important than ever because of the wealth of free content out there that you have to have a good repertoire.”
“Part of the process is redefining what a free site is,” Yagielowicz added, noting that today’s free, advertising supported adult sites are a far cry from the ‘photo gallery and banner’ sites of yesteryear.
As for how much free tube sites have affected adult, Rowntree had a straightforward answer: “Dramatically,” Rowntree said. “Consumers, they hit the tubes. That can work to your benefit.”
Rowntree credits this appeal on the near infinite number of videos offered by these sites, but does not necessarily see this as a competitive disadvantage.
“Less is more,” Rowntree said. “If you have a blog, put up one really nice picture and then do an editorial or a story or a fantasy around it; and within that story, link words to things. … If it’s say, a Bulgarian tap-dancing midget model, you send that link to Wasteland, because that’s our specialty…”
An advocate of smaller, tighter operations, Yagielowicz agrees that size is not everything.
“To give it some context, I’m one of the last of the one-man bands,” Yagielowicz said. “I can’t compete with sites that have a million and a half videos so I don’t try to go head-to-head.”
“In an era when PornHub and all the major tube sites dominate the consumer mind-set, unless you have the capital and the infrastructure to compete with a tube site of that size you will need to find a different way,” Yagielowicz added. “Because I can’t compete with them, I have to find ways that they can’t compete with me.”
“Finding a niche and finding your voice is incredibly important,” Alptraum offered. “If you want to stand out now, you have to do something that’s different and unique.”
Next, Douglas and Marcus from AWE presented an exclusive executive session on “How to Succeed as a Live Cam Model,” providing moneymaking tips along with insider information for those promoting live interactive services.
Primarily targeting current and prospective live cam models and performers, the leader in live online video chat detailed the fundamentals of webcam consumer psychology, and offered sage advice on the best equipment choices to obtain the finest audio and image quality possible.
Outlining an array of promotional considerations, including how to use social media such as Twitter and Facebook for publicizing webcam shows, AWE revealed how anyone can profit from this wide world of interactivity and personal connectivity.
The pair of presenters kicked off the session with an overview of the history of AWE’s flagship site, LiveJasmin.com, which features “colors so vibrant you feel them” — a technique that boosts the brand’s identity through its bright and unique color scheme.
Simplicity of design and operation is vital to such a feature-rich website, because as Douglas put it, “if your users need to think, then you’ve lost them.”
LiveJasmin.com takes a very pragmatic approach to its ongoing maturation, with Douglas noting, “Every user development is driven by interactivity, while affiliate program developments are driven to satisfy partner needs.”
The company’s incredible traffic volume caused envy amongst attendees, with the revelation that LiveJasmin.com is the world’s largest video chat site, boasting a sub-100 Alexa ranking, which translates into roughly three percent of all daily Internet traffic — the only “for pay” website sporting this volume.
The company says it is “wide awake: sensitive to emerging legal, procedural and technical changes.”
“We cannot copy anyone, we have to be the ones to innovate,” Marcus explained to the audience. “We find opportunity in challenges instead of perceiving them as threats.”
One such challenge is the evolving European cookie laws, which should eliminate cookie stuffing, lower piracy and usher in a new era of increased revenues for AWE affiliates and white label owners.
AWE offers true domain-based tracking, making it ready for the current reality of marketing online to European consumers.
The pair went on to discuss the market leading features of its Whitelabel 2.0 product, which is available to affiliates for the cost of a domain name — a cost that is mitigated by using a sub-domain.
This platform is ideal for performers with a fan base, such as porn stars with active Twitter followers or premium website members that want to see more. It is available in 17 languages (with real-time chat translation performed on the fly), and offers search engine and social media marketing tools, discount coupon codes and more.
Integration with the Escalion risk management system increases transaction success rates by up to 10 percent and reduces charge backs, while the Gravity heuristic recommendation system boosts sales. Mobile and tablet compatible versions of Whitelabel 2.0 work with the iPhone, iPad and other devices, while the new Featured Show API allows for private members area shows (such as in an amateur site), with syndication to the AWE network of 3,000+ websites, allowing fans to follow models.
AWE will even send your custom newsletter out to your white label website’s members.
Marcus told the audience that integrating a white label site into your network will allow owners to grow their organic search traffic through better positioning, while adding it to a solo site will increase conversions, retention and overall user spending — with performers and studios able to earn up to 80 percent of sales.
Douglas also advised performers to start out small, saying that a PC, high-speed Internet connection and basic HD webcam such as the Logitech 9000, will do the job. Growth can happen as profits roll in…
“Size is everything in cams, since no traffic equals no sales,” Douglas concluded. “The sun never sets on our empire.”
It would not be an XBIZ event without the latest in online billing technologies and issues being discussed, and this year’s Summit was no exception, with “Biller Insights: A Journey into the Mind of Today's Adult Site Consumer,” coming to the fore, to blend consumer’s psychology with technology.
“Perhaps more knowledgably than operators in nearly any other adult industry market segment, today’s Internet billing companies know what sells and what doesn’t, simply by way of the huge amount of sales data they collect from companies offering all sorts of goods and services to online consumers,” states the XBIZ Summit website. “In this panel, consumer demographics and psychographics will come together against a backdrop of the latest in credit card and alternative billing tools, to discuss tips for join page optimization, regional billing, evolving banking and privacy regulations, plus the overall economy and how these factors combine to impact sales.”
With Mike Ackerman of Actually Helping on hand to moderate this informative session, the panel of experienced billing experts included Frank Gannon of Epoch, Gary Jackson of CCBill, Ralph Berkien from 2000Charge, Ananda Sisk of CommerceGate, Wendy Nelson of NETbilling, Karen Campbell of OrbitalPay and Cathy Beardsley from SEGPay.
Although many attendees may cringe at the thought of yet another billing panel, this session was far from the norm, lacking in self-promotion and delivering an abundance of profit-building information.
Focusing on today’s market, the panelists discussed the most profitable websites types.
“Although subscriptions dropped off as people moved to single purchases, we have seen a steady increase in subscription sales over the past six months,” Jackson stated. “Sure, live cams are up, but the biggest increases are in companies with multiple business models and revenue streams.”
Berkien said that he has seen a slight overall decline in ACH, but big growth in South America.
“In Brazil alone, e-commerce grew 42 percent in 2011,” Berkien stated. “In 2011, 81 percent of all Internet users in Brazil bought something online.”
Campbell opined that while niche dating and cam sites seem to be doing well, you have to have a well-rounded portfolio to offer to your customers.
“We have some membership sites that are investing in their niche and growing their sites,” Sisk said, adding, “There’s still a market out there for membership sites,” echoing the other panelists comments.
“Cams are definitely the top sellers right now, but when they’re well run, niche websites are growing,” Gannon offered. “If you constantly exceed expectations, you’ll be in business for a long time.”
Beardsley noted that she sees growth in membership sites that also offer individual clip sales, while Nelson said that video-on-demand and anything interactive is what is drawing in consumers.
The discussion revealed that merchants are increasingly using custom landing pages, leveraging relationships and incorporating white label sites into the mix, but the basics will still need attention.
“Some owners are so busy updating content,” Gannon said, “that they don’t realize their site is impregnable by consumers.”
Sisk says that deploying WAP and mobile join pages is important, while Campbell emphasized the need for clean and easy to navigate websites. Part of that equation, Jackson noted, is using the native language, currency and pricing that the prospect uses, along with having a customer support number in their region. Nelson agreed, saying that many adult merchants are moving into the European market, so multicurrency options are important.
“30 percent of European customers have a credit card, but they don’t like to use it,” Gannon stated, adding that Epoch supports 14 different languages and currencies.
“There is such a thing as having too many billing options,” Sisk stated, advising Summit attendees that testing and streamlining of the checkout process is important; while Berkien noted that alternative payment systems are not “alternatives” in many countries — they are the primary billing mechanism.
Billing options are not the end-all however, as Campbell commented, “If you don’t manage the risk on your account, you’re done.”
The new Single European Payment Area (SEPA) and MasterCard’s new Payment Facilitator Program, accompanied by a rising of its total chargeback rate to 1.5 percent, effective this August, also earned some discussion time.
With the amount of information presented in the XBIZ Summit seminar series, it is likely that many attendees are asking questions about the future of the adult entertainment industry and their role in it. Hoping to provide answers was the final presentation, “An Industry in Flux: Where Are We Headed?”
“Be a part of a colorful debate on the current and future state of the adult entertainment industry, featuring a panel of influential industry figures, as they reveal their projections for what we can expect in the coming months and years,” teased the event’s promoters. “For decision makers tasked with developing their online company's future business and marketing plans, this highly anticipated session is sure to be an eye-opener.”
An eye (and ear) opener it was…
Moderated by Douglas Richter of AWEmpire, panelists included Colin Rowntree of Wasteland.com and Mike South of MikeSouth.com, joined by Brad Mitchell of MojoHost, along with Dominic Ford of DominicFord.com, plus Michel Lozier from Maleflixxx / Sureflix and Mark Galione of CyberCat, Inc.
Richter began the session by asking the panel about the state of adult innovation, pointing to Netflix and its adoption of the adult-backed Gravity platform, which boosted revenue by more than $80 million.
Rowntree replied that the industry is still innovating, as evidenced by companies like Pink Visual, with its leadership in mobile, cloud and augmented reality technologies — along with the industry’s overall marketing prowess — but not all panelists agree that mere ads equal industrial innovation.
Galione, however, agreed...
“Adult showed the mainstream how to use affiliates. We made money when no one else did,” Galione said, adding, “We need to reinvest in our businesses because people are getting very blasé about our industry.”
“Adult is stronger than mainstream on the affiliation front, but way behind on advertising,” Lozier stated. “The person with the right business and revenue model will own the future.”
“The barrier to entry is not what it used to be,” Mitchell said. “Adult isn’t for hobbyists anymore.”
Mitchell also noted that “innovation is not about hiding your bank account or getting more MIDs.”
“We need to take some of the focus off of marketing and put more money into technology,” South said, adding, “We also need to stop trying to figure out how to screw the customer.”
That message of personal responsibility resonated with the other panelists.
“You need to run your business like a business,” Mitchell said. “For example, if you’re going to host your own join page, then you need to be PCI compliant.”
Looking at older technology from a modern vantage point, Ford opined that print is not yet dead.
“While print isn’t dead, it is definitely showing its age,” Ford said. “And there are so many more traceable metrics online.”
For a current perspective on adult technology, the mobile arena served as a great example.
“From nine to 11 percent of traffic coming into our tours are on mobile devices,” Rowntree said, highlighting the importance of this audience, which has specific needs, including alternatives to the Flash technology that is incompatible with Apple’s iOS devices, such as the iPhone and iPad.
South sees MPEG-DASH as the cure for this problem, saying that the technology “is the future, and will solve compatibility problems with different platforms.”
Lozier agreed that technology is not the only cure to compatibility woes and declining profits.
“Clearly we are a maturing industry,” Lozier said. “The business models are changing, not just on the technology side, but on the revenue side.”
“Our company is agnostic to the screen, whatever size it is,” Lozier added.
Piracy was also on the panel’s radar screen.
“Content is still king,” Mitchell said, “but the people monetizing it are not the ones producing it.”
“I believe in vociferously going after people that are pirating content from member’s areas,” Ford said, explaining that one pirate may spread your content to thousands of illicit file sharers.
Despite the ubiquity of piracy, Galione believes that “sex will always sell.”
While a crystal ball was not on the stage, the panelists looked to the future to see what it holds.
“The future belongs to the integration of mainstream and adult,” Lozier says, “But the question is, ‘how do we sell the traffic?’”
Mitchell summed it up a bit more simply, however: “The future of adult is whatever you make of it” — some seriously sage wisdom indeed.
With this edition of the XBIZ Summit seminar series wrapped up, event goers still have plenty of entertainment to look forward to enjoying. One eagerly awaited example is Friday morning’s MojoHost Farewell Yacht Cruise, when leading web hosting provider MojoHost welcomes XBIZ Summit attendees on to its luxury yacht for a final send-off on the Miami Beach coast. This event allows visitors to toast the grand finale of the 2012 XBIZ Summit in style, while making last-minute connections at this lavish special event that honors those who have reached the summit of the adult entertainment industry today.