Things to know before making money from online surveys firms
It seems so incredibly simple that you wonder why people sweat it out to make a living. Just a few clicks of the mouse every week can earn you a handsome income. Online survey schemes are the new El Dorados for anyone looking for easy money.You need to take just two online surveys comprising 10-12 questions to pocket up to Rs 900 a week. The more surveys you can handle, the more money you can earn.
If online survey companies are to be believed, millions of Indians are making bushels of money through this innovative multi-level marketing model.
"We have almost 1.3 million panelists (members) working for us," says Vivek Gautam, chief marketing officer of Speakasiaonline.com, a Singapore-based market research company that started operations in India about a year ago.
That is almost 1% of the total Internet population in India. At least four other online survey companies are active in India right now, drawing all kinds of fortune hunters (see table).
Meet Sudhir Sharma, an employee of a public-sector insurance company in Delhi, who has been in the online survey business for the past 2-3 months.
"It's a great opportunity to make money in your free time," he says. Police officers, corporate managers, housewives, unemployed youth, school teachers, even IT professionals, are clicking away to glory every week.
Where's the catch? You need to pay a joining fee to become a panelist. The money goes into buying a subscription for the training manual and towards other costs.
The person who referred you also gets a cut. However, the income projections by the survey companies suggest that the joining fee can be recouped within 8-10 weeks. If you join a survey company, the going gets better if you get others to jump on to the bandwagon. For every new person you bring in, there's a referral bonus waiting for you. You also earn rewards for every survey taken by the members you rope into the scheme.
It is this feature of online survey companies that makes them appear similar to Ponzi schemes. These are plans in which the member earns by enrolling more people in the scheme. As more people come in, the older members get paid from the joining fee of the new members.
This continues till no new members can be made and the scheme runs aground. While such schemes have been in operation for a long time, the Internet has helped them expand their catchment areas. In recent time, lakhs of investors have lost money in this manner .
Though their business is modelled on the principles of multi-level marketing, none of the survey companies is a member of the Indian Direct Selling Association (IDSA), a self-regulatory body of network marketing companies.
All big direct selling companies, including Amway, Oriflame, Tupperware and Avon, are its members. IDSA secretary-general Chavi Hemanth says the organisation studies a company's business model thoroughly before admitting it as a member. "If there is any ethical problem or legal infringement, the company cannot be a member of the IDSA," she says.
A company will not make the cut if its business plan violates the Prize Chits and Money Circulation Schemes (Banning) Act, 1978. The Act bans any scheme that promises to pay money for the enrolment of members into the scheme.
Search on the Internet and you will find hundreds of complaints filed by irate members who have lost money in survey companies. But for every complaint, there are three posts by other members singing their praises and narrating how much they have gained from these moneyspinners.
Posing as a wannabe investor, we called up one of the members of a survey company. He's an IT professional, earns a handsome income from his job and was surprisingly candid about the entire business. "Invest only if you can take the risk because there is a possibility that you might not earn any money," he said.
He also gave a very useful tip. "Go for companies that have just started out. Only then will you be able to recoup your investment and earn well. If the company is 2-3 years old, it may be nearing saturation level," he said. In other words, if you join a Ponzi scheme when it is in its last leg, you stand to lose money.
Why are these companies paying so much for so little work? "These surveys are conducted on behalf of our corporate clients and very large market research agencies," says Gautam. "The survey results are used in preparing commissioned industrial research reports which are priced at lakhs of dollars." He says some large Indian corporates, including ICICI Bank, Bharti Airtel, Bata and Nestle, have got surveys done by Speak Asia Online. Some market research companies, however, deny being Speak Asia's clients.
Balendu Shrivastava, group business director of IMRB International, says almost all surveys by the agency are done by surveyors appointed by IMRB. "In a few cases we seek out specialisation of our empanelled partners," he says, but adds that they have not used Speak Asia as a partner.
Incidentally, the Speakasiaonline.com website has generated a lot of interest in the country in the past two months. According to cyber analytics site alexa.com, it is the 70th most visited site in the country today. Most of the people eliciting interest in the company's website are youngsters aged between 18 and 24 years.
So, should you become a member of any online survey scheme to earn money on the side? Ideally, no. But if you do want to give it a try, opt for the one you know the most about, the one that is most forthcoming with details of its business, and the one that is the least costly to get into. Use the online advantage to keep in touch with other members and make sure that you know about the company's whereabouts.
Is there an investor grievance redressal mechanism? No. Such schemes do not come under the purview of the Securities and Exchange Board of India (Sebi) or the RBI. The Finance Ministry too doesn't want to get involved. An e-mail request to the officer in charge of vigilance against scams and fraudulent scheme went unanswered.
