21 January 2008

Stock Market falls will impact on Internet marketing

Significant falls on world stock markets today may spell problems down the line for Internet marketers and publishers. Around the world stock markets have seen losses of around 5% of their value today and it seems likely that this will impact on the earnings of Internet affiliates and web publishers who monetise their blogs and sites using PPC advertising. Although the US stock market was closed today due to a public holiday it is anticipated that the US stock market when it re-opens tomorrow may show similar levels of falls. So how will this impact on online income generation?

The current stock market falls can be traced back to the problems in the US with the Sub Prime mortgage market and the recent announcements by some major banks of major write offs connected with these problems. The impact of these problems on stock market levels has been anticipated for some time and the crunch seems to have finally arrived.

If you are involved in Internet income activities you should be under no illusion - these stock market falls if sustained are likely to hit your bottom line. As the US hovers around a recession and the credit crunch continues there is likely to be much less money in the system to support online advertising and a percentage of potential Internet consumers will think more carefully about making those non-essential Internet purchases. Google Adwords users for example may be more reluctant to fund advertising campaigns in a climate where they perceive, rightly or wrongly, that the returns on such advertising campaigns may fall. In turn this will impact on website and blog publishers who rely significantly on PPC advertising income.

Changes in stock market levels are driven as much by psychology as they are by economic fundamentals so if you are involved in generating income through online activities you need to keep your fingers crossed that what is happening is a short term market correction rather than a longer term fundamental shift in the psychology of the market. If it turns out to be the latter then the hit on your bottom line could be significant and sustained.

1 comment:

Rick said...

I think you are right that it will impact on adsense publishers and affiliates. However although people may keeper a tighter hold of their wallets they may also be looking for other earning opportunities so it may not be all downside.