E Is Now The Time To Invest In Web Services?

Social media has virtually brought every adult to the internet and businesses are looking to sell products online. This paradigm shift has inspired more people to embrace online shopping, which in return attracts more businesses to the online community. But to succeed, businesses still must find their space in this crowded marketplace called the internet.

Therefore, e-commerce platforms like Allkitchenfind.com, which specializes on kitchenware, have been forced to stick to their specific market segments. Those that fail to comply have ended up closing their online stores in half the time they used to set them up. Selling products online is now as easy as on a storefront. Platforms like Shopify (NYSE: SHOP ) and BigCommerce have made it possible for new businesses to find customers with ease. But it is not as black and white as it sounds.

The rise of drop shipping means that now you do not need to have your own products to capitalize on the e-commerce marketplace and this intensifies competition. Platforms like Oberlo have made it easier for businesses to find products to sell online without having to worry about the issue of inventory. So, what happens to those that make their own products? They will have to keep up.

So, who are the obvious beneficiaries?

Companies involved in web services will be on top of the beneficiaries list. Every small business looking to launch their products online will have to use a reliable web host especially for those that are just starting out. And those that want to stand out can add auxiliary services such as customized e-commerce platforms for their products. This is where companies like GoDaddy (NYSE: GDDY ), Web.com (Nasdaq: WEB ), and Endurance International Group (Nasdaq: EIGI) among others come in. These companies have enjoyed significant revenue growths over the last few years due to the increased demand for web services.

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Most of them do a lot more than just providing general hosting and domain registration services that made them famous. However, if you talk about GoDaddy, the first thing that pops into the minds of many people is that it’s a domain registrar.

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Disclosure: Opinion expressed here is my own. It's not a recommendation to buy/sell a stock, and I have no position in any of the stocks discussed in the article.

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Rudy Patel 3 years ago Member's comment

$GDDY & and others are good stocks to go long for now since investors are betting on it's growth.

Maithya Kitonyi 3 years ago Author's comment

It looks pretty interesting. It's one of the largest players in web services, so I would say it probably has a good chance of going on a run. Interesting times ahead.

Www 3 years ago Member's comment

I completely agree. It will have a nice run, but how long they will be on the upward path is something we will never know