Marketing masterminds, offshoring experts, gambling gurus, and evil incarnate populated the seminar schedule during the first day of Internext Summer ’06. Whether attendees wanted to learn how to implement new branding strategies, protect themselves from U.S. laws and taxes, explore potential new revenue streams, or just watch a spirited debate about the relative merits of softcore and hardcore content, they got their wish.
The marketing panel—moderated by YNOT Bob Rice and featuring words of wisdom from Consumption Junction’s Marc Womack, Playboy’s Katie Smith, PrideBucks’ Rainey Stricklin, The Adult Broker’s Lori Z., and performer Sunny Leone—not only gave audience members tips and strategies they could put into practice in their own operations immediately, but also revealed that even the big boys on the adult Web face marketing challenges. “It’s hard to track [return on investment] on branding,” Rice said, summing up a lengthy discussion about brand value. “But, it’s one of the most important objectives you have.”
Branding becomes especially important when companies attack the oft-discussed and frequently misunderstood area of viral marketing. As Lori Z. explained, “The affiliate model is a type of [business-to-business] viral marketing,” and webmasters seldom use it to its full potential. With that in mind, Womack provided a six-point plan for influencing an audience with a brief video: Create a compelling clip, post a “home blog” about it that is updated daily, get members of the social networks (MySpace, etc.) to blog about it or otherwise mention it, post it to the peer-to-peer networks, post it to viral video sites like YouTube, and “incentivize surfers to do your marketing for you—and [the incentive] doesn’t have to be dollars. T-shirts work really well, and they’re cheap,” Womack said.
One thing to keep in mind for any marketing campaign, according to Womack, is “Whether B2B or [business-to-consumer], your message must be compelling. You can’t do a boring campaign. It has to be something that grabs attention.”
The members of the Moving Offshore panel didn’t need to do anything more than show up in order to grab the attention of their audience. Moderator-attorney Chad Belville and panelists Marc Lender, Michael Maher, and Rob Bossart provided personal and professional insight into one of the hottest topics of discussion in a world gone regulation-crazy and porn-hostile. Bossart, an international tax attorney and certified public accountant, encapsulated the gist of things when he told the audience that moving a U.S. company offshore can be beneficial if the owners and operators receive professional counsel and realize there are some laws they simply cannot escape. “Most jurisdictions look at servers as taxable property,” he said, adding that taxable business property is one of the criteria used to determine where a company is physically located. However, moving taxable business property offshore while the owners remain in the U.S. doesn’t absolve a commercial entity of all tax liability. “When you bring money into the U.S., you likely will be taxed on it [regardless where the business is physically located],” Bossart said. “The tax burden can be less if you structure things smartly.” However, Bossart advised that if a company employs U.S. performers or shoots content primarily in the U.S., the U.S. government may consider it a domestic entity—regardless where it’s based.
Lender added additional caveats for decreasing a company’s vulnerability while increasing its potential for profit: incorporation in a sympathetic country and maintaining a principal or managing director at the company’s headquarters, processing financial transactions in the appropriate jurisdiction, and finding a banking structure with affordable rates.
Maher provided a real-world example of both offshoring success and tribulation. His company and his family have enjoyed many benefits as a result of relocating to Costa Rica, but the journey has taken three years so far and isn’t quite finished. His advice: “Consult with an attorney, because it might not be worth it.”
“Being worth it” was a concern for another group of adult webmasters: the attendees of the Gambling for Profits seminar Friday afternoon. Although webmasters expressed concern about the uncertain status of U.S. law vis-à-vis online gambling, the consensus presented by NakedPoker.com marketing representative Daniel Zucker, attorney Eric M. Bernstein, and 2bet Chief Executive Officer Bobby Taylor was that the European and Asian-Pacific markets represent a significant opportunity for adult companies that can figure out a way to work with gambling companies. Online gambling represents billions of dollars in annual revenue, and properly aligned with respect to the law and common goals, adult and gambling have the potential to form a powerful political and financial force that will have to be respected.
Rounding out the day’s educational events was the eagerly anticipated Good vs. Evil seminar, which found panelists hotly debating the line between respectable and despicable adult content. It’s an issue that obviously resonated with the audience, many of whom continued the discussion long after the panel dispersed. Jokingly welcoming attendees to the seminar as a “celebrity death match,” attorney-moderator Lawrence Walters set the tone early on by referring to recent inspections under 18 U.S.C. §2257 inspections as “the elephant in the room.” From there, an animated discussion ensued with Homegrown Video’s Spike Goldberg and ClubJenna’s Jay Grdina taking a pro-moderation stance in stark counterpoint to the more extreme position adopted by Max World’s Max Hardcore and Theresa “Darklady” Reed. “You have to be logical and realistic,” Grdina said in pointed condemnation of so-called “extreme” content. “This is a business. How much are you going to make fisting a woman? An extra $20,000? Is it worth it for the half million you’re going to have to pay to defend yourself in court?” Reed, a journalist, author, and fetish practitioner who is well known for her philosophical support of content that pushes some societal envelopes, countered, “I don’t want to be a part of a true democracy where the minority is silenced. I want to be part of a representative government that doesn’t tell people who like to be tied up and have sex to go back underground where they belong because we don’t have the [courage] to represent them.”
