Porn Isn't Recession Proof, Geeky Research

[MWCren]

Alright, so I am not wringing my hands saying the end is near, but when I hear people say that Porn is recession proof, I have to disagree. I was doing a little research to see what was happening. Geeky stuff, I know, but I think its useful if you are wondering if you're the only person in the world seeing a decrease in new business activity.

CCBill changed their subscription numbering system back in Oct 2006. The subscription number ends in a 5 digit number, which grows as the day goes on. This numbering system reflects ALL CCBill subscription numbers generated, not just the ones for my site. If you join BlakeMason, your subscription number might end in 34658, and if one of my customers was the next transaction it would end in 34659, and if the next one was for Fratmen, it would end with 34660. got it?

Here's the trend I see in total sales transactions through ccbill. These are ACTUAL subscriptions numbers for my site, I tried to keep the times similar for purposes of comparison:

Subscription ID: 0107258601000075683 (sept 7, 2007 at 11:24pm)
Subscription ID: 0107282201000072130 (oct 9, 2007 at 11:29pm)
Subscription ID: 0107355501000067340 (dec 21, 2007, at 11:14pm)
Subscription ID: 0108010401000062994 (jan 10, 2008, at 11:19pm)
Subscription ID: 0108052401000039754 (feb 21, 2008, at 11:37pm)
Subscription ID: 0208063101000020940 (mar 3, 2008, at 11:20pm)

Look at the last 5 digits. In September, between 11:15 and 11:30pm the total CCBill new transaction count is over 70,000. By February, that number is down near 40,000 and March is even worse.
While a year to year comparison might be most accurate, I was sorta shocked at the dramatic change since just September.

Looking at last year, similar times of the year, here's what I can find, note the transaction count is in the neighborhood of 80,000:
Subscription ID: 0106308601000086131 (nov 4, 2006, at 11:33pm)
Subscription ID: 0107058201000079586 (feb 27, 2007, at 11:27pm)

These are as close to proof of my theory as I can come up with. Of ALL CCBill sales, which includes str8 sites, gay sites and everything in between. While there are variables, based on days of the week, how many are cascading to Epoch on declines, how many have switched to Epoch as primary, etc. the numbers are dramatic and sobering.

I've been making adjustments for a few months, but I have more work to do. I know its not popular to admit sales are soft or slow. I just wanted to share this because some people get depressed and think they're doing something wrong.

[gaydemon]

Geeky yes, interesting very! ;)

I actually had my higest and best ever day yeasterday on Gaydemon which included highest sales on CCbill as well.

But what I have noticed in recent months is how very volatile sales are. One day they are up like mad, the next down..

[Gaystoryman]

Very interesting and telling. Be nice to see an Epock comparison for the same time period too, to sort of see if it is due to interest, or scrubbing.

There are a lot of variables, however I think that this 'recession' is different than others. So is Porn recession proof? I don't think in this particular 'recession' it is, due to the simple nature of it. In previous recessions houses weren't rapidly being lost, people's homes were their safe haven, while in this economic slow down (as the politicians call it) it is the very safe havens that are being lost.

People might lose a job, so be willing to spend for a month of porn, instead of going to the movies every weekend, or eating out, but when you are going to lose your home, I don't think a month's entertainment online is going to be a choice many would make, as they would if it was simply about looking for new work, or other 'recession' losses.

just my opinion, but this recession will not be porn proof.:bang:

[roupen]

You know my sites have been doing really well recently, but it's not the US that is buying. Domestic sales are actually down but in europe, australia and canada sales are way up. People are loving the weak dollar and I can't complain now either. Whereas I used to get about 80% US sales, 20% international, now it has done the opposite I would say.

[dzinerbear]

Porn is absolutely not recession proof.

When I lost my job back in 2003, we cut back every single luxury. No more partying, no more going out to bars, no restaurants or fast food ... we kept things to a bare minimum. We had both quit smoking a month before losing my job, so that wasn't an issue. If we had had porn memberships, we would have cancelled those.

If I were facing a mortgage crisis and couldn't pay my bills, I wouldn't be buying porn. I might keep my Internet connection, but I'd be surfing for real free porn and downloading off the file sharing sites.

Michael

[tombarr]

Subscription ID: 0107258601000075683 (sept 7, 2007 at 11:24pm)
Subscription ID: 0107282201000072130 (oct 9, 2007 at 11:29pm)
Subscription ID: 0107355501000067340 (dec 21, 2007, at 11:14pm)
Subscription ID: 0108010401000062994 (jan 10, 2008, at 11:19pm)
Subscription ID: 0108052401000039754 (feb 21, 2008, at 11:37pm)
Subscription ID: 0208063101000020940 (mar 3, 2008, at 11:20pm)



These numbers are indeed interesting but are they truly indicative of just the economy or is there some additional impact from their recent system changes? Seems to me their newest system cascading went into effect about the same time that these numbers started taking a hit and have seemingly declined further since then.

I also note that CCBill knows they have received numerous conversion complaints from webmasters where their join form / signup ratios are extremely volitile, one day being normal, the next being super high and out of norms for that site. CCBill published a "study" where they seem to place the blame for this on the actual paysites themselves...suggesting that since they have developed load balanced and geo served join pages, that the problem therefore must lie in the websites themselves...go so far as to suggest that their client paysites should develop what I interpreted as "mirrors" of their sites on several hosting platforms, (yes, even pushing their own server platform at cavecreek, suggesting that it would handle this suggested fix nicely)

For me, this was a bit disturbing... here they had supposedly overhauled their entire payment processing platform, changed the way they channeled joins based upon their new cascade management system, yet they want to place the blame on the website clients themselves.....even though these haven't changed.....

I would say that, yes, the economy is having effect on sales, but I firmly believe there is more to these apparant declining numbers of transactions at CCBill than is being said publicly.

Call me a conspiracy theorist, but something just doesn't seem as it should in the CCBill processing environment these days....despite what their "study" shows.

[gaydemon]

I always believed that if things are bad, i.e. a recession and people feel under pressure they might turn to porn for "relaxation", its a bit like day dreaming. Maybe a way to get away from the depressing stuff just for a while.. But then of course it depends on how bad things are, like Gaystoryman says you're not likly to spend money on porn if you are loosing your home.

[MWCren]

These numbers are indeed interesting but are they truly indicative of just the economy or is there some additional impact from their recent system changes? Seems to me their newest system cascading went into effect about the same time that these numbers started taking a hit and have seemingly declined further since then.


I don't think you are terribly far off the mark with your "conspiracy theories". There are a million possible variables that will cause such a change, and I also believe that CCBill is trying to pass the buck a little on it. I can accept that their cascading system has moved some transactions to other processors, and I also believe that Epoch is getting a nice boost with their cascading/affiliate system.

CCBill load times for join forms has always been a problem. Even with their "load balancing" stuff, its still slow. That entire concept doesn't address issues of internet connectivity to card network approval centers and declines do to un-reachable banking systems.

There were threads at one point somewhere, about declined VISA transactions that people were experiencing with legitimate cards and available balances. The number of declines I've seen in the past few weeks is far higher than normal.

I look to the CC networks and their bank partners as a part of the issue. When credit is tight, a bank might decline a transaction instead of allowing it to push a card holder over-limit to generate additional fee income. I've seen a few more chargebacks recently, and they are usually very rare for me. A person with an over-limit card, or one that is maxed out can get a quick balance reduction by charging something back--an online purchase to an adult site is a perfect target, IMO.

VISA is preparing to go public this year, and although everyone knows adult transactions are a big part of their volume, is it possible they're scrubbing a little hard to keep their revenue numbers high for a good stock price? I dont' get the feeling that MasterCard is as touchy with transactions, now that they're public and have a strong stock price.

There are things going on behind the scenes that we have no control over. I'm just trying to find some comfort in knowing that flat sales aren't my fault.

[dzinerbear]

VISA is preparing to go public this year, and although everyone knows adult transactions are a big part of their volume, is it possible they're scrubbing a little hard to keep their revenue numbers high for a good stock price? I dont' get the feeling that MasterCard is as touchy with transactions, now that they're public and have a strong stock price.

Is it possible that "scrubbing" is just a concept created by billers with broken systems. It sure explain why sites can suddenly see a significant drop in sales without assigning any really responsibility? Scrubbing is a concept the industry finds more palatable because of the chargeback issue. So then when everyone's sales die (possibly because the biller's system is broken again) everyone just says, "Oh they're scrubbing hard, it'll be back up in a day or two."

Michael

[MWCren]

3rd party billers have always been an enigma wrapped in secrecy. I think anything is possible. There are so many links in the chain between horny surfer and paying customer the opportunity for something to breakdown in that process is pretty high.

I've always been leery of the "scrub" because that would usually generate some kind of denial notice, but I think it is a connectivity issue in most cases. Like you said, something breaks and it takes them a while to fix it.

[MrJD]

woa woa woa... that's a HUGE drop from
Subscription ID: 0108010401000062994 (jan 10, 2008, at 11:19pm)
to
Subscription ID: 0108052401000039754 (feb 21, 2008, at 11:37pm)

Everything was within normal flux until then and BAM! almost 30k LESS joins... that's not just a poor economy man. ;)

You've got remember that around that time is when people are paying back the $ they borrowed for xmas. I know I spent a fuck load but managed to keep it off the CC's unlike the majority of people.

The xmas season is always like that. I'd bet if you looked back at last years #'s you'd see a similar dip in sales. Add in the current state of things economically and imo your stats don't prove anything out of the norm is happening really.

[CCBill Paul]

Perhaps I can help a bit here. I will paste below some information on the subscription numbers.

You will see below that the ending digits are a result of the Julian Date and the station ID. Unfortunately these numbers really aren't any indication of our overall numbers.

0006100101000000001 - First 2 Digits are the Station ID
0006100101000000001 - Digits 3-4 are the last 2 digits of the current year
0006100101000000001 - Digits 5-7 are the Julian Date
0006100101000000001 - Digit 8 is the Day of the Week (1=Monday, 2=Tuesday, 3=Wednesday, 4=Thursday, 5=Friday, 6=Saturday, 7=Sunday)
0006100101000000001 - Digits 9-10 are the Payment Method (1=Credit, 2=Test, 3=UserManagement, 6=ACH,7=Telephone Billing)
0006100101000000001 - Digits 11- 19 are the Subscription ID unique to current station ID and Julian Date

[MWCren]

Ok, so if the subscriptions are split between station ID's, then that would explain a LOT. Doesn't quite address the volatility, declines, etc.

So for comparison purposes, you should only compare the unique subscription ID with the same station ID. I see that my March 2008 example is from station 2 with a really low number, the others are all station 1. It appears that the split between station numbers kicked in in January 2008.

Paul, can you explain what stations are? Are they geographic processing points or part of the new system to increase form load times?

[abostonboy]

You know, I was always told my dad that there is one thing that will never go down in sales when the economy fails - booze. People need to drink!

I think some when they cant afford going out to a nice dinner may treat themselves to a good jerk off sessions with some quality porn.

[abostonboy]

Geeky yes, interesting very! ;)

I actually had my higest and best ever day yeasterday on Gaydemon which included highest sales on CCbill as well.

But what I have noticed in recent months is how very volatile sales are. One day they are up like mad, the next down..


Congrats to you! We had our best day ever on Sunday. Broke all records by a wide margin. Monday was pretty sweet as well. Surfers are buying. There is no doubt about that!

[CCBill Paul]

Ok, so if the subscriptions are split between station ID's, then that would explain a LOT. Doesn't quite address the volatility, declines, etc.

So for comparison purposes, you should only compare the unique subscription ID with the same station ID. I see that my March 2008 example is from station 2 with a really low number, the others are all station 1. It appears that the split between station numbers kicked in in January 2008.

Paul, can you explain what stations are? Are they geographic processing points or part of the new system to increase form load times?

They are basically different satellite server locations that host our join forms. So similar to the new CDN in a way but different in a way as well.

[abostonboy]

Ren,

I have a speadsheet with check # and amount from every sponsor since I started in this biz. You would be shocked at how "close" the check numbers are to AVS programs now. That just means fewer checks are being issued.

[TropixxxMichael]

I would have to disagree and state that I still firmly believe that porn is recession proof.

Pornography, like tobacco and liquor, is a vice to many people, whether or not we in the industry choose to see it that way. We have a very low income elasticity of demand and thus remain very stable despite any fall in discretionary income. We produce goods that consumers use regardless of their economic status or level of income or education.

Perhaps the decline is CCBill "number of subscriptions" can be accounted for by a rise in other form of payments (like Epoch, NoCreditCard.com, et.all) or PERHAPS EVEN MORE SCARY that consumers are becoming more savy when it comes to searching out FREE porn on the internet.

[abostonboy]

Pornography, like tobacco and liquor, is a vice to many people, whether or not we in the industry choose to see it that way. We have a very low income elasticity of demand and thus remain very stable despite any fall in discretionary income. We produce goods that consumers use regardless of their economic status or level of income or education.



Agreed. Can you imagine someone, just after getting fired, walk out and say, "I am going to quit smoking." Yeah, right! Then after quitting smoking he goes home and says, "no more jerking off for me". And, don't worry about not having any beer, I just stopped drinking. rofl

The first thing he's going to do is buy a carton of cigs.

[terrytowel]

People are probably sick of hearing this but...since Feb 13 I've only made two CC Bill sale. So for the past month my stats have been 1:5608.5 (for a total of 11,217 clicks covering two sites). And to top it off, several sales I did make the buyer's have opted not to have another re-bill after one month.

[RottenRay]

I'm a firm believer that porn IS recession proof.

Problem is, we're not in a recession yet...

The folks who are barely hanging on by their fingernails aren't going out to dinner anymore, they're driving around on bald tires, and certainly aren't buying porn.

When they finally *do* lose the house and the SUV and start riding the bus to work, they'll have a little more spendable income and start buying porn on their computers again. But right now, they're strapped. They're jerking on what they can remember and hoping not to make a mess they'll have to spend laundry soap to clean up.



Is it possible that "scrubbing" is just a concept created by billers with broken systems. It sure explain why sites can suddenly see a significant drop in sales without assigning any really responsibility?

Actually, I think it's a way of reducing churn. Part of this is the screening that prevents the same CC from joining and cancelling above a certain number of times (per month / week / day? Paul, help us out here!)


Some other things to consider...

I've been able to see a drop in sales every time a major web porn ring is busted.
-- People get paranoid.

As an affiliate, I've been able to see a drop in sales every time a major virus or trojan has been release is announced.
-- People start blocking cookies, and coming back to the join page a 2nd time by typing it in.

A hot week on PornTube or XTube generally means a cold week here in the trenches. Too much free stuff out there.
-- Agreed, not much of it is good. But if you're broke and have more time than money, you CAN surf the *tube sites long enough to get excited enough to pre-dispense.

Newsgroup providers have gotten harder to complain to. I'm talking about the GUI front ends that thumbnail usenet posts.
-- They're unlikely to "help" webmasters since banning an uploader means less free content for them.


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