| Affiliate Marketing Views |
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Welcome to the exciting world of affiliate marketing! Or, win-win marketing, because when done well, everybody --- the marketer, the affiliate and the affiliate network---wins. I'll discuss current happenings and my own insights into the implications and provide a forum for constructive discussion in the win-win spirit of affiliate marketing. Hopefully, we’ll create a platform for insightful, prophetic and even contentious thinking, while ensuring it is interesting, informative and valuable. |
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To invest or not to invest?
I'm talking about investing in building a brand for a site that basically generates its revenues from affiliate marketing. On second thoughts, the more appropriate question is not whether to invest or not to invest (there's only one answer to that question perhaps), but rather how much to invest, because brand building is an extremely challenging and time consuming endeavour.
It is particularly challenging in the case of an affiliate site because at the end of the day it is promoting somebody else's product, often a brand that is much much bigger than itself.
There are some basic things that an affiliate site could do to progressively build a name for itself, as a destination where consumers are likely to find links to the best products in the market, starting from the most elementary aspect-- getting the name right (obviously there are constraints here; but time spent on getting the name right and how you are going to position the site will be extremely helpful).
A brand is built or destroyed on the user experience. Can affiliates make sure that the experience users have on their site is memorable? Having the right amount of content and the right features and functionality to help the site visitor in their decision making process are obvious; there are two other aspects that could make or break an affiliates' plans to build customer loyalty.
Are the products they promote trustworthy? An affiliate does not have control on somebody else's product, but he surely does have control on the product he chooses to promote.
Secondly, as an affiliate are you offering the customer reasonable choices and the best choices? If you do, visitors to your site are more than likely to come back again and again because the choices you offered were beneficial to them. Obviously, your financial interests will, to a great extent, dictate the products you will promote, but if you are able to find a balance with the products that are most likely to benefit your site visitor, you will go a long way in building "top-of-mind" recall-- which is what in many ways brand building is all about.
In passing, here is an interesting article about online conversions based on a study by web analytics company WebSideStory. Put the stats & conversion behaviour in an affiliate marketing perspective and draw your own conclusions...
Until next time,
Ben Flux
Updates: Linkshare, DGM , AffStat report
A quick review of some of the recent developments and announcements in the last week or two.
Linkshare affiliates would have received updates a couple of days ago on their Athena registration system. The key changes involve the way Linkshare collects its legal name, which will be based on the entity type (i.e. sole proprietorship or partnership or a LLC, or a limited company); the various tax forms (I suspect it is more to do with affiliates in the United States) and lastly, the option for affiliates to indicate the channels they intend to use for marketing and the ability to edit and manage these channels. The last one particularly may be of great interest to professional affiliates that use multiple channels for their marketing programs.
Meanwhile DGM seems to continue to have its own set of problems. One of my earliest posts was on the migration problems encountered in moving from dgm to dgmpro, and this was way back in September. Yet, the volume of delusional voices just seems to be getting louder, as dissatisfied affiliates raise more complaints. It's time DGM took these seriously and got themselves sorted soon; back in September there was considerable promise for the future, and I hope they are able to live up to that promise.
Lastly, MarektingSherpa has brought out its AffStat 2006, Affiliate Program Benchmarks report, now in its fourth edition, and featuring "data (and anecdotes) from 189 affiliate marketing managers at mid-large merchants including retail, gambling, finance and travel sites". There's nothing quite like learning from fellow players and peers in the industry, which makes reports such as these useful. Check it out.
Until next time,
Ben Flux
From fantasy world to the real world..
Inevitably, there are signs that we are being led into the real world from a world of fantasy where the only way Google's shares could go was up, up and up.... As I write this, shares at Google have dropped a bit; and just follows statements by two analysts that Google is overvalued, and therefore, it was a good time to sell. This comes closely after Yahoo! took a hit in its latest earnings' report.
At this point, I believe it could be viewed as a natural correction by the market; but it will be prudent to watch out. There are signs that the markets, despite all the positive projections and general feel-good factor currently prevalent, are slowing down. If that is indeed the case, what we can hope for is a gradual drop or as the analysts say, a soft landing.... irrespective of whether we directly hold stakes in these companies or not, being in the Internet business we are always sensitive to and affected by the macro picture.
While on stocks, there seems to be a greater interest in stocks related to the affiliate marketing/ pay-for-performance marketing sphere as this post shows. It'd be worthwhile to watch out for the results of all the companies mentioned there. Overall, I'm bullish about the prospects, but in light of the most recent developments with Google and Yahoo, I'd prefer to be cautiously optimistic..
Until next time,
Ben Flux
Adwords tips from an expert
Since we are always interested in getting the best results of our paid search marketing efforts, I thought this piece posted on Marketing Sherpa would be useful, where tips from Andrew Goodman, known as an Adwords expert and an author of a book on Adwords, are presented.
A couple of points,in particular, caught my attention:
a) According to Goodman, there is merit in running ads with a higher CTR and probably a lower ROI, along with running ads with a lower CTR and higher ROI.
The objective is to show that the ad quality is considered high...
Along similar lines, there is a suggestion to set up high bids at the start of a campaign to generate clickthroughs and create a good quality score..
Interesting concept, but obviously one will have to be extremely careful with the cost of getting clicks for the sake of getting clicks..
b) If the ad contains others' trademarks, then the ad rank is likely to fall and therefore he suggests testing out a "with trademark" and "without trademark' approach..
Considering where things are with this hot issue of use of trademarks, affiliates (and search engine marketers in general) are better advised to play it safe instead of getting caught in needless wrangles.
Until next time,
Ben Flux
Paying attention to design & usability
A strong visual design is critical to making online shoppers close a deal, reports ClickZ, quoting a recent study by interactive marketing solutions firm Questus.
I quote excerpts from the ClickZ article:
"Critical to making a decision to purchase goods on a website are site navigation (37 percent); the checkout process (32 percent); and product descriptions (38 percent). Perspective buyers left e-commerce sites without purchasing for a few key reasons. Twenty-nine percent didn't want to register with the site; 22 percent of online shoppers found it difficult to locate products; and 17 percent left to find other e-tailers because they didn't believe the site they were on was trustworthy or secure."
This is probably putting some statistics around something that we probably new instinctively, but often ignore in the quest to get more information in the face of the user.
Unfortunately, affiliates hardly have any say in the design and usability of the merchant sites where the transactions invariably happen. But they definitely have control over their own sites, and where they can help themselves to increase their conversions.
With good, usable design and excellent content, the aim of the affiliate should be to lead the user to making a decision to make the final transaction. If the affiliate can make the merchant site nothing more than a check-out counter, they would do very well.
There is an investment involved; but I believe it is worth it, particularly in the long run. Professional affiliates like us are in it for the long run, aren't we?
Until next time,
Ben Flux
Vertical 'Social Networking' reaches affiliate marketing
Social networking has received a lot of attention recently, and it was probably inevitable that we quickly got into the niche or "vertical" networking sites. With the launch of ReturnonAffiliate, we now have one such site for affiliate marketing/affiliate marketers. It will hopefully serve as a platform for building contacts and sharing knowledge.
What makes a social networking site different from a specialized forum, such as the Affiliate Marketing Forum? In many ways they serve the same purpose-- of bringing together the players in the game. The key differentiator I believe could be the higher level of 1-to-1 communication that a site like ReturnOnAffiliate will provide. Forums will be the one-to-many or many-to-many platform, and probably serve as the 'voice of the industry' along with industry publications and blogs.
The timing of the new site is spot on--- now that the world is beginning to know the size of the affiliate marketing industry and the number of professional affiliates, the scope, opportunities and benefits in interacting with individuals across countries and specializations within the broad umbrella of affiliate marketing are tremendous.
Let's network!
Until next time,
Ben Flux
Brand name use & organic search results: Drawing the lines for acceptable practices
One of the hottest topics raging among affiliate marketers just seems to have gotten hotter---- there is a long thread on the Affiliate Marketing Forum concerning restrictions posed by some merchants on the use of brand names by merchants on affiliate websites.
Going by the posts,it seems that some merchants are penalizing affiliates who rank higher than themselves in searches for their own brands. Now that would be taking things a bit too far, especially if the affiliates haven't engaged in any unethical and devious search engine optimization practices.
We understand the value of a brand to a merchant, and respect that. In fact, I would say that companies must do everything they can to protect their intellectual property and brands. In fact, Traffic Junction helps leading companies protect their brand with our own program, named "Protect My Brand". As part of this program, we help companies monitor (using a combination of powerful software and experienced, specialist resources) the use & abuse of their prized trademarks, and work with them to take both corrective and preventive action.
Yet, merchants also have a responsibility to be fair to the "good affiliates" and be clearer about what constitutes a legitimate practice and what doesn't. We can't forget that affiliates are ultimately trying to drive traffic and sales for the merchants. The latter need to ensure that the restrictions imposed aren't ultimately detrimental to their own interests.
Until next time,
Ben Flux
Paid search boom
At the outset, here's to a Great year ahead!
We are just into the second week of the year and the numbers and forecasts are beginning to emerge, for example, the paid search industry figures and the latest holiday shopping numbers. For this piece though, I will stick to the former.
A ClickZ article quotes from a Piper Jaffray report that the paid search industry is expected to hit $14 billion globally in 2006, up 41%. Surprise, surprise! Google will lead the way.... and expected to grow its revenues by a whopping 58%. What's more, the overall paid search industry, according to the Piper Jaffray analyst, is expected to grow at a CAGR of 37% up to 2010. And the best piece of news for Google shareholders is that the Piper Jaffray analyst has raised the target price for Google shares to hit $600 this year(from about $435).... all this obviously riding on the paid search boom!
Meanwhile, the Search Engine Marketers Professional Organization (SEMPO) in a release states that search engine marketers spent $5.75 billion in 2005! Obviously, affiliates like us would have contributed a not-so-insignificant sum to this figure.
What all of this indicates is that paid search marketing seems to be working really well for the marketers. At the same time, the question that one must begin to ask seriously is, what would be the tipping point? Is there an over reliance on search, and if yes, can it be avoided at all? Most importantly, even as search marketing grows and inevitably becomes more competitive and pricier, how can marketers, in particular, affiliates, ensure that it remains a cost-effective and profitable form of marketing. (That's precisely one of the reasons for the development of our own TJ Optimizer software, to help marketers continuously monitor and profit from their search marketing campaigns).
Irrespective of what software and analytics we use, ultimately it will be the profitability that will count; else, we'd just be losing contributors to those rather impressive set of numbers and projected share prices.
Until next time,
Ben Flux
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