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The era of cheap webstores may soon end

Analysis

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The era of classic webstore advertising will soon be over. Today advertisements are more targeted, but costs are getting higher. This is forcing webstores to raise their prices, a Hungarian marketing expert says.

Not long ago, most webstores were using email marketing to promote their products. Nowadays, most users automatically delete webstore advertising emails, so this marketing tool has become totally ineffective, marketing expert Gábor Wolf told business daily Világgazdaság.

In parallel, new platforms have arisen, but those have changed their business model as they have evolved. In the beginning, Facebook offerred a wide reach for free, but lately it has started charging. In one year, Facebook prices rose 10 times, which forced webstores to raise prices too, Wolf added. Not only that, but entering the market also requires higher investments.

Wolf says that this trend will lead to the disappearance of many web stores that are unable to keep up with the pace, while others will shift towards premium products and services. A third possibility is that several smaller players unite to share costs, Wolf says.

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