The Anatomy of the Internet Marketing Gold Rush (And Why The Next Wave Could be Starting Now)

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The Anatomy of the Internet Marketing Gold Rush (And Why The Next Wave Could be Starting Now) post image

Internet marketing is a term often used for the industry that teaches people how to make money online. I was thinking about internet marketing today as I was putting the polish on a private blog network for DCers. A lot of my friends have been encouraging me to sell the networks outright. The value proposition is clear: not only could our customers use the network’s immediate value to build up their own site portfolio, but they’d be buying an out of the box cash flow positive business. That’s pretty cool!

That’s when it occurred to me why I’ve been raving so much lately about the AdsenseFlippers. What they are building could be a “next wave” internet marketing company (so far there have been 3 waves). This new wave is one in which there is a ton of opportunity, and relatively low barrier to entry.

If you buy a site from Joe and Justin, you not only get comprehensive training about how to run a successful business, but you get the business too. Where’s the kitchen sink!?

Is this the make money online equivalent of a Y-Combinator style incubator?

Today I laid out what I see to be the 4 “waves” of make money online sites and programs. I think there is a huge opportunity in the 4th wave right now, and the guys at AdsenseFlippers are showing us what it might look like.

A few caveats about my categorization of internet marketing businesses:

  • Most marketers use elements of all categories in their materials.
  • The categories are all amoral– the distinctions I’m making refer to the form of the content in each wave. No one category is more “valuable” or better than the rest.

First wave: “Business Opportunity Gurus”

  • Examples: Frank Kern, Jeff Walker.
  • Characteristics: Highly tuned sales pitches, majority of product cost in marketing, very little useful information outside their paywalls. Focus on list building, sharing, and promotion.
  • Teach: Core transformation and broad persuasion techniques.
  • Sell: The dream.
  • Braggable: “Last month I had a million dollar launch.”

Second wave: “Social Media Salesmasters”

  • Influential marketers: Internet Business Mastery, Clay Collins.
  • Characteristics: Lot’s of useful tips, motivational information, and broad strategic concepts. The majority of nuts and bolts information and case studies are behind paywalls.
  • Teach: How to implement high level marketing and sales techniques in any business.
  • Sell: Direct access to seminars, training, feedback, and coaching.
  • Braggable: “Got an email from one of our previous customers that said they built a six-figure business after buying our products.” 

Third wave: “Transparent Business”

  • Influential marketers: Pat Flynn, Spencer Haws.
  • Characteristics: 3rd wave marketers share a wide range of specific personal experience, screenshots, data, income reports, and case studies of actions they took. They name URLs, and regularly share wins and losses.
  • Teach: Case studies of precise actions taken online. “I did x, and y happened.”
  • Sell: The tools required to duplicate the effort.
  • Braggable: “I’m not trying to brag here people, I show you how much money I made and let you judge for yourself.” 

Fourth wave: “Purchase a Cash Flowing Business” (?)

  • Influential marketers: Adsenseflippers, ???
  • Characteristics: Selling simple cash flowing businesses to investors, business owners, and aspiring entrepreneurs, while providing a wealth of information and a robust community to help improve the profitability and scale of the acquired properties.
  • Teach: The precise actions required to build a cash flow business.
  • Sell: Examples of that cash flow business, or could potentially take equity stake in start-up if they took broader lessons from incubators.
  • Braggable: “I can’t create the inventory fast enough.” 

Trends from wave one to wave four.

  • General—> specialized.
  • High customer acquisition costs —> lower customer acquisition costs.
  • Larger overall market scope (i.e., anyone is your customer) —> smaller market scope.
  • Mystery —> Transparency
  • Difficult to get followers —> easier to get followers.
  • Most content behind paywall –> most content free.
  • Marketing is primary focus of investment —> product is primary focus of investment.
  • Content about ‘why’ —> content about ‘how’.
  • High barrier to entry —> low barrier to entry.
  • Product = experience —> product = asset.
  • Value is intangible –> value is measurable.

If you want to help people make money on the internet, why not set up small internet businesses and sell them at a great price? Sounds like a good deal to me. Can you think of any opportunities here?

Cheers,

Dan

PS, you can get on my mailing list by putting your email address in to the form below:

Published on 02.09.12
  • http://twitter.com/joonahere Joona Tuunanen

    Great post Dan! I really think you are on to something, especially with the trends.

    That leads to a question: why has caused these trends to emerge? 

    Is it just the overall low barriers of entry to the online marketing space, abundance of “competition” and freely available information or something completely else?

  • http://www.earnontheroad.com/ Earn On The Road

    I think the most interesting ones were “marketing focus” to “product focus” and “mystery” to “transparency.”

    I think this isn’t just a trend in the internet marketing world, but the business world at large. If you read the books of any of the major business success icons of the last decade – Steve Jobs, Mark Zuckerberg, etc – You’ll find that the one thing they all have in common is an OBSESSIVE desire to create a great product.

    That’s why MySpace and Friendster failed, why Facebook succeeded. In a smaller scale, I think the “hard sell hard sell hard sell” model works in the short term, but really doesn’t work as well in the long run.

    In the long run, having a high quality product and building a real loyal base of customers is what really matters.

  • http://tigermuse.com/ Johan Woods

    On target and eerily similar to what I’ve been thinking about myself but you formulate it much better and concisely.

    This is a great book – The Fourth Economy: Inventing Western Civilization – a bit long but worth it, that shares some similar thought patterns to what you wrote: http://www.amazon.com/Fourth-Economy-Inventing-Civilization-ebook/dp/B005EVQ1D0

    I believe you are looking at a coming of a new wave. Creating small online business’ for people? All you need are hungry interns, really, like myself.

  • JustinWCooke

    Hey Johan!

    I was just looking for a new Audible book tonight too…funny.  I think they don’t have it on audible yet though?  I DID just get a Kindle Fire too…maybe a good first test here.  Thanks for the recommendation!

  • JustinWCooke

    Hey Dan!

    Wow…4th wave, eh?  We definitely hope so!

    We started off following the 3rd wave or Pat Flynn’s model and, later on, picked up quite a bit from following Spencer as well.  When we started selling “mini businesses” to people we noticed a huge market there.  It’s funny how you’ve been driving home with us (both online and offline) the importance of selling small businesses to people.  Reading this post, I better understand what it is you’re driving at and discussing with us.

    Now…we’re doing this in our mini-niche but your larger point (and a great one, i think) is that this can really be done in ANY niche.  If you find a way to make these mini-businesses profitable and can turn them over to those that will love them, appreciate them, and take them where they need to go…you’re really going to be on to something!

    That could be:

    1. Affiliate Sites
    2. Product Sites
    3. Local SEO businesses with clients
    4. Podcasts with earnings
    5. Awesome content blogs with earnings

    And a helluva lot more I can’t think of right now.  Great insight, brother…love this stuff!

  • http://tigermuse.com/ Johan Woods

    Hey Justin! Yeah, check it out! It’s long but not dry. Really gives food for thought. It has a slow beginning but then goes into some great sections.

  • http://stankavich.com Mike Stankavich

    Go Joe & Justin! :)  Got me thinking, how could I apply this to iPhone app building?  Could we come up with a way to build related iPhone apps for AF sites?  Hmm…

  • http://www.tropicalmba.com Dan

    Build a white label blog app similar to Pat Flynn’s that allows me to offer custom “tropical mba” app to my readers, then pre-establish relationships with advertisers, so depending on the size of my audience you could predict for me how much money i’d be making off the app out of the gate, or you could flip off the ad model and just give me the white label app. For 497 the FLY out the door, but people would probably pay more. You could take the add revenue yourself as well and give the apps away for free. 

  • http://www.tropicalmba.com Dan

    yeah! have you guys thought about taking on VC and developing 5 different ‘flippers’ brands!!! :D

  • http://www.tropicalmba.com Dan

    thanks for the link Johan, got it bookmarked. I’ll get back to your email as well, give me a bit I’m swamped! 

  • http://www.tropicalmba.com Dan

    haha, okay yeah just bought it. Ian is gonna kill me after he sees this months amazon bill!!! 

  • http://www.tropicalmba.com Dan

    i agree, it makes sense to me as communication channels get more sophisticated and high bandwidth, and especially now that your users have more of a voice than ever, there just isn’t any need to have mystery with these types of products (although there are some products that require and benefit from mystery, like private mastermind groups…. which some of the more entrenched marketers use this really effectively)…. but yeah, i think there are structural reasons at play as to why ‘letting the product speak for itself’ is more important than ever.

    thanks for your comment! gonna check out your blog now….

  • http://www.tropicalmba.com Dan

    haha yeah that’s a great question, I’d start here:

    http://www.amazon.com/What-Technology-Wants-Kevin-Kelly/dp/0670022152

    speaking of an amazon bill!!! :)

  • TimHoyt

    “…love them, appreciate them, and take them where they need to go”

    Seems like even in the 4th wave, the product is not simply an income generating asset but an educational asset. There is a large demand for good educational content from podcasts to income reports. And what better way to step up to an advanced degree in Internet ass kickery than buying an existing property and trying to bring it to the next level?

  • http://www.tropicalmba.com Dan

    great point Tim! i forgot about the experience of learning. I’m now off to look for domains with “internet ass kickery” in them…. 

  • Balizumba

    Very relevant post Dan. I’m just a newbie to this online marketing stuff. The more I’m learning the more I see the potential to use the internet to free people from the existing paradigm of “go to school to work for somebody”  to “be independent and self-sufficient in something you love doing while providing solutions to others’ problems”. The latter is the future. Imagine how things in the world could change. Our generation is living the dream of past generations. we are privileged to have the option of having options on what to do with our 24hrs a day. how liberating. let’s take advantage of this experience. But where to learn such a thing? if a system is setup to do this, it sells it’s self. especially if it’s virtual. I’m excited to learn more and test new emerging ideas. Come June I’ll have %100 of my time back to me. :)

  • JustinWCooke

    Nice comment!

    Especially when you consider the TropicalMBA models that are popping up all over the place, giving those options to others around the world.  If I can do my part to get a few people off the treadmill and building their own businesses, I’ll be happy!

  • http://tigermuse.com/ Johan Woods

    hilarious and i’m not going to disclose my amazon bill but it’s nasty

  • http://tigermuse.com/ Johan Woods

    no worries, take your time!

  • http://www.vueltaalmundo.travel/ Raul

    Hey Dan, I really enjoyed this post. Hoping to catch the 4th wave here :-)

  • http://stankavich.com Mike Stankavich

    Dan, we’re working on just that. But I hadn’t thought of sizing the potential ad income for the prospects.  That’s an awesome idea.  Sent you an email with some further thoughts.

    And what if we did a deal with AF to build blog2phone apps for sites to be flipped and take a cut when the site sells?  Hmm, interesting.

  • http://www.tropicalmba.com Dan

    Mike that’s for dropping a line, will get back to you shortly! 

  • http://www.tropicalmba.com Dan

    Cheers! Me too :)

  • http://www.tropicalmba.com Dan

    Agreed man, that’s a great outlook. I believe this is a significant change for our generation as well, I haven’t really been able to articulate it on the blog yet, but I’m sure I’ve taken a swing at it over a few beers :) Looking forward to following along with your journey and helping out where I can. Thanks for reading! 

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  • http://twitter.com/CloudVenturesGr CloudVenturesGroup

    Hey Dan

    I think this is even more applicable today that 6 months ago!.

    Very insightful

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