Affiliate Marketing Blog - a Traffic Junction Blog

That’s precisely what Jeff Molander opened up on Revenews. There’s been quite some discussion since he posted the piece a couple of days ago — pretty useful, in fact. Brook Schaaf also had some interesting comments on the issue, which to summarize is this: when does (or should) an affiliate really get credit (read commissions) for a sale? The basis of Jeff’s post is a study by Michael Brucker that details how affiliate cookies are tracked/overwritten as a result of clickthroughs from paid search results/ organic search results, which ultimately dicates who gets the money.

It is only natural to expect affiliates to be very touchy about their cookies being overwritten- it hurts us directly, and so the discussion subtly brought forth big picture questions such as what is fair, what is right etc. etc.

If we were to take a very close look at the models that Brucker has come up with, I think affiliates are getting a fair deal, which makes business sense. I say this as an affiliate, knowing fully well that I may be losing money to a competing affiliate despite having initially driven traffic to a merchant web site– and that too after spending money on generating that traffic. (My comment is purely related to the Brucker models– as there may be other areas where I feel affiliates deserve better from merchants). Also, I’d have issues with the loss of commission if I were operating on a cost per lead (visitor to the website) or cost per click basis for the merchant, but here we are talking about a cost per sale or cost per acquisition . Being in the pay-for-results business, and if that desired outcome is a sale, I have to acknowledge and accept that the last person who got the customer through the door deserves the commission cheque.

I’m sure this is not the last of the cookie issue — there will be more complicated marketing hypotheses and a whole range of techicalities related to cookie tracking/analytics; but let’s combine it with a bit of simple common sense and objectivity.

InternetWorld 2006, one of the biggest b2b events focused on the Internet & Online Marketing in the UK will be held at Earl’s Court, London on May 9-11. The event features an extremely impressive line up of speakers from some of the biggest names in the online business in our part of the world.

The affiliate marketing segment will be quite ably represented by Maz Darvish, CEO of AffiliateFuture who will talk about “Successful Affiliate Marketing”. Meanwhile Simon Trigg, the relatively new Managing Director at dgm will give an important keynote address on “optimizing the relationship between your online channels”.

The event will be a great opportunity to hear, learn and share experiences with industry peers; importantly registration for attending the event is free! What’s more, all online registrants who will attend the event will also be getting a free e-Consultancy report from a choice of 11 titles.

On a lighter side (though I doubt if the event organizers intended this to be treated on the lighter side), we’d also see the announcement of the Internet Idol for the year (wonder if Freemantle is getting royalty for use of the Idol name..!). Guess what, the Million Dollar Pixel man Alex Tew is one of the contenders along with two guys named Larry Page and Sergey Brin of a California-based entity called Google…..

That the exponentially growing blogosphere, which according to some estimates could be doubling in size every few months, was bound to impact businesses was logical– after all one can never ignore size. Yet, we probably didn’t expect the extent of influence individuals letting out a piece of their mind could have as we see today. Some top brands have already experienced the fallout of not paying much attention to the infectious nature of negative opinion seeded across the blogosphere. Jupiter Research has put a bit of science into validating the potential consequences of brands not taking bloggers seriously, according to a report on NetImperative.

According to the research, while the majority of European online users are ‘passive’ ie. they do not participate in online forums or respond to surveys or blog (not too different is it from real life, anywhere, for that matter: how many people really speak up?), a small minority of active bloggers pack quite a potent punch– they are the influential lot who could suddenly wipe quite a bit of sheen off your brand.

Companies that are serious about building and enhancing their brand equity realise what a challenge it is and the kind of time and investment it takes to do so. So, can they afford to let themselves be affected by this vociferous minority?

As a company, we help some top names protect their brands online with a suite of sophisticated products we have built that leverages all our accumulated knowledge in search/online marketing. So, I’d definitely urge companies conscious of the asset value of their brand to look at two sides of blogging: a) ensuring they are keeping track of what is being written about them —- brand name protection goes beyond monitoring brand-bidding in PPC campaigns that we so often talk about b) taking a proactive approach and use the same medium (blogs) to counter the potential public relations/ marketing challenges. One can never underestimate the value of timely, open and quality communication on building and protecting brand value.

HarvestDigital, an online marketing agency in the UK that boasts of some impressive accounts, recently commissioned Metro Research to understand the behaviour of experienced search users. Though the sample size was fairly small (a little over 200 participants), the fact that the survey participants were regular and experienced users makes the study useful for search users engine marketers targeting the UK search engine users (I’d wager that the behaviour may not be entirely different amongst users elsewhere).

The key takeaways from the study results that I see are:

Most users used more than one search engine. So, what’s great about that, one may ask. We all know how dominant Google is and that’s probably the first engine that the searcher thinks of; so why are searchers still having to go to another engine? Lack of relevance/ unsatisfactory results? Cross checking? Checking out another sample? This brings another pertinent question: why aren’t meta search engines more popular than they are currently?

Nevertheless, considering the above, it is in the marketer’s interest to ensure that they are getting ranked high on the other engines as well. The traffic that these search engines generate, which much lower in absolute terms, is certainly not insignificant to be ignored.

When one talks of the major engines, we limit the discussion to Google, Yahoo & MSN. But this study pointed out that Ask (formerly AskJeeves.com) had a higher proportion of users than MSN. The obvious implication- don’t ignore this engine.

All studies into search user behaviour so far seem to indicate that the two reasons why a user clicks into a particular search result (pure common sense, if you think about it!) are that:

• the site is ranked high on the search results page and so users presume the result to be relevant to their needs (there’s an implicit vote of confidence to the search engine)
• the description that shows up in the search results seems relevant.

Search engine marketers have partial control of both these aspects at their end, though the attempt to gain total control (a losing battle?) fuels the multi-billion dollar search engine optimization industry.

What we are learning by the day, I think, is that we are best served in focusing on controlling those aspects that we as search engine marketers can at our end. The rest may just be a futile misadventure.

The Search Engine Watch forum reports on a recent enhancement to Google Adwords (I get the impression that it is being selectively rolled out), which will enable AdWords advertisers to indicate the position where they would like their ads to be displayed. Of course, there is no guarantee that just indicating their preferred option will generate ad impressions for them, as the AdRank criteria still apply. The position targeting is mainly an opt-out mechanism for advertisers, to put into use some of the information they gather from their campaign reports and fine tune their campaigns.

Using position targeting will mean that the number of impressions will be reduced and consequently the number of clicks will also affected. So, advertisers have to be cautious about the positioning strategy they use and decide how specific they wish to get with it.

From a bigger picture standpoint, how could this impact Google’s revenues? If more advertisers opt for very specific positions, such that they get bidded out from a position continuously, it will definitely have an impact on Google’s revenues. Likewise, there may be an impact on the AdSense publisher revenues (which ultimately has an impact on the Google top line).

The other way of looking at it is that it could raise the bid prices as advertisers target specific positions; certainly not good news for advertisers, but a potential boost to Big G’s revenues.

Which way will it pan out?

The bright minds at Google Labs have dished out another offering for web publishers: Google Related Links. The concept is very much like AdSense, with two key differences: instead of ads, other contextual content will be displayed such as links to related news, related web pages etc., and probably more importantly, the publisher does not get paid (at this point)when someone clicks through to the related link.

Google’s pitch to publishers is that they have an opportunity to display dynamic and highly relevant content on their sites. But question is, would publishers be sold on that pitch?

Afterall, why would a publisher give up real estate on a site to display content that does not generate any revenues while at the same time leading the user away from the site? What kind of competitive filters would be available —- for example, an affiliate site wouldn’t really want to see links from competing affiliates and even the merchant site that could take away their potential earnings?

Do users stand to gain? Only if the links that are generated are extremely relevant to the context of their visit to the site, which as usual may be an extremely tricky and challenging task.

Organisations or websites that get listed in the relevant links will obviously benefit as a result of added distribution, but that is subject to getting a critical mass of distribution partners. Back to square one — why should distribution partners really really want to sign up?

I suspect that if this offering takes off, it could add a completely new dimension to the organic search engine optimization of sites and how SEM firms would attempt to tackle it.

The other wild hunch I have is that this development may well have something to do with the future of the AdSense program, particularly with the noise regarding click fraud becoming louder and louder. I’m not sure what it is, but I can’t help thinking that there is/ will be some connection…

eMarketer reports that a recent study by the UK Interactive Advertising Bureau (UK IAB) (conducted in association with PriceWaterhouseCoopers and the WorldAdvertising Research Center) shows that the online advertising spend in the UK reached £1.4 billion in 2005, registering a 65% growth over 2004 figures. What’s more, this figure could cross the £2 billion mark this year , according to a PwC Director.

Interestingly, the IAB seems to believe that online advertising could overtake press advertising within this year, even though the former currently accounts for only about 8% of total advertising spend. There’s so much market share for online advertising to gain that it augurs extremely well for publishers.

While the above numbers seem to take into account search advertising figures, it is not clear whether advertising with the affiliate networks is included in this spend. Pity….

Nevertheless, if advertisers are shelling out more money on online advertising, I wonder if affiliates who swear by the pay-for-performance mantra should take advantage of the pay-for-display approach that most traditional publishers thrive on. Affiliate publishers who have built great content and community with reasonable traffic could certainly offer greater value for the advertisers, particularly if they were to offer advertising rates that are lower than what the traditional CPM-model publishers charge.

No doubt, there are a few issues with moving towards this approach– one could question the shift in focus, the infrastructure related matters, and what not. All I’m saying is, if a slight change in strategy helps one take advantage of the opportunities presented by the macro environment with no negative impact in the value provided to advertisers, then why not?

The buzz in the European affiliate marketing industry seems to be getting louder. Close on the heels of TradeDoubler’s acquisition of a contextual advertising firm comes the announcement that buy.at has secured GBP7.3 million funding from Cazenove Private Equity (CPE). In a very short time since its inception in 2002, buy.at has achieved a reputation as the fastest growing player in the very hot UK affiliate marketing industry. As a valued partner, we wholeheartedly welcome this latest development and certainly wish the company grows from strength to strength. (Next step: a public listing in the UK within the next 2 years?!)

With the financial muscle to invest in its product and technology development and marketing, we will hopefully see an expansion of the company’s network and the addition of some great merchants with exciting programs. Buy.at also gets the expertise of Bruce McLaren, formerly of Advertising.com before it was successfully sold to AOL Time Warner, who will now chair the company.

More details about the announcement are available here.

Meanwhile, last month zanox was recognized for its zanox XS solution and its rapid international growth in 2005 last year which saw the company make forays into the US and China markets. At the CeBit show in Hanover, zanox was awarded the Platinum European Seal of Excellence in multimedia “for its innovative marketing solutions”. The award is open to companies worldwide with an excellent record in “innovation marketing”.

Way to go!