Online business and platform dependence

A follow-up to the recent changes in the Amazon Associates program:

Diversification Gains Urgency For Business Impacted By Amazon’s Reduced Affiliate Marketing Fees

The message here is clear, and I’ve written about it several times since last week: Never become too dependent on any single customer, or any one revenue stream. 

I learned this during my time in the automotive industry, working for both suppliers, as well as an automaker (Toyota).

I saw it with my own eyes: The automotive suppliers that made components for more than one automaker always had more options and more leverage.

The ones that were—for example—part of the Honda keiretsu (and who only made components for Honda) had almost no options and no leverage.

The same principle applies to online businesses. Don’t become solely dependent on Facebook, Amazon, YouTube, Google, etc. either for revenue, or for reaching customers.

Platform dependence effectively makes you an employee who doesn’t receive a 401K or health benefits. A businessperson, on the other hand, always seeks at least some degree of diversification.