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Posts Tagged ‘Affiliate Marketing’
Monday, July 26th, 2010
By Adam Ward
The term “affiliate marketing” conjures up a lot of images for different people. To some, it conjures up a work-from-home-in-your-undies picture. To others, it is synonymous with online fraud. Even to those who know it is used by legitimate businesses to make legitimate sales, they often think it somehow doesn’t have to follow the same discipline as traditional marketing.
Affiliate marketing is, after all, marketing. It is just a different flavor, just like TV ads and print ads are different flavors of advertising. Sure, one may use a different medium, and have different terminology, but both try to build brands and drive sales.
Sales don’t just happen. Businesses spend a lot of time and money figuring out who their customers are, how to most efficiently convince those customers they should be buying their products, and what the proper triggers are that will get them to actually buy. They then develop well-trained sales teams to implement their proven sales strategies.
So it strikes me as more than a little reckless when these same companies, thinking that an affiliate program can increase their online sales, decide to dabble in affiliate marketing without giving it the same consideration as their other marketing efforts. They might think that because they only pay when they see results, there is little harm if nothing comes of their testing the waters.
However, there is always a cost. Advertisers have to hire an affiliate manager to run their programs, re-task an existing employee to do it, or hire an outsourced program manager to run it for them. They need to buy tracking software, develop it in-house, or join an affiliate network. None of those options is cheap.
Based on the number of new advertisers joining networks (AffiliateTip reported that LinkShare has added nearly 200 advertisers so far this year), we’re going to see more and more advertisers jumping into affiliate marketing. So for those advertisers, here’s some advice: treat your affiliate marketing efforts the same as your other marketing efforts.
- Do your research. If you already know who your customers are, figure out where they are online. Just like you would be more likely to place print ads in magazines that cover your desired demographic, there will be some websites that are frequented by more of your customers than other sites. Do those sites run affiliate ads on their sites? If so, what networks do they belong to?
- If you don’t already know, figure out your margins. Online publishers (your affiliates), will not only want to run your ads if they think they’ll see a high conversion rate, but also if they think you’re generous in your commissions. Since you can’t be profitable paying more commissions than you can afford, figure out how much you can pay before you start your affiliate program.
- If your competitors are running affiliate programs, figure out what they are paying in commissions. Can you beat that? Are there websites running your competitors’ ads? If so, those websites might be more eager to run your ads than if you’re pushing an untested program.
- Be prepared to treat your affiliates well. You can think of them as special customers, crucial business partners, indispensible distributors, or whatever. But the fact is they will be pushing sales your way. They may even pay money out of their own pockets to drive traffic on behalf of your program. If you communicate well with them, are open and honest in your dealings, and take care of them, they will want to work with you, even if you may not pay as much as others. Remember that they have limited ad space on their sites, and possibly hundreds of advertisers wanting their ads in that space.
- Transfer the best practices you’ve established in your offline marketing to your online marketing efforts. Give your affiliate marketing team the tools they need to be successful in their jobs.
Although there is certainly a learning curve with affiliate marketing, if you view it as a legitimate source for new revenue, you’re much more likely to be satisfied with your results than if you just jump in to test the water.
Wednesday, July 7th, 2010
By Adam Ward
Most people are passionate about something. Call it a hobby, or an addiction, or whatever. But it is something they spend a lot of time, energy and money on. Think about your passion for a minute. Now wouldn’t it be nice for you to actually make a little money from your passion, to offset what you spend on it? Maybe you could even develop it into a full-time career. Although it will take a lot of work, there has never been a better time to make money from your passion, thanks to the abundance of free, easy-to-use tools on the Internet. Here are three steps to get you started.
First, start blogging about your passion. Think about it—where do you currently get information about your hobby? Probably the Internet. How many blogs do you read where you think, “I know more about this than the blogger does.”? Starting a blog is as easy as creating an account on Blogger.com or WordPress.com. You’ll want to make sure you have the flexibility of putting ads on your blog, though, so I suggest buying a domain (e.g. unicycleexpertadvice.com) and a hosting account from GoDaddy (less than $10 a month), and then installing WordPress from within GoDaddy (it is free and easy to do).
Second, once you’ve got some posts on your blog, put up some ads. This is easier than it sounds. Think about the companies that sell products you use, would recommend, or might be blogging about. Go to their websites and search for “affiliate.” A lot of times you’ll see a link at the bottom of the page called Affiliate Program. That refers to you joining their affiliate marketing program (i.e. you become their affiliate), which is just a funny way of saying you’ll run their ads on your blog. If they run an “in-house” program, you’ll need to submit your blog information with them so they can accept you into the program. If they run their program through an affiliate network, such as Commission Junction or Share a Sale, they’ll require you to submit your blog information to those networks. Either way, there will be no cost to you. Once you’ve signed up, you’ll be given some html code that you have to copy to your blog. That places the ad on your blog, and includes a script that tracks people clicking through your ad. Whether in-house or via a network, the program will track click-throughs and sales, so you get credit for (and paid a commission on) those sales.
Third, use CRM software to manage your efforts. CRM stands for customer relationship management, and is useful for recording contact information of people you are (or would like to be) doing business with, logging communications you have with them, and scheduling your tasks and follow-ups. There are a lot of CRM companies out there, but a few have a free tier, including freecrm.com, sugarcrm.com and esilverbullet.com, which is designed specifically for online publishers.
Before my dad retired, he sold pet food for his living. He once told me he knew more about dog food than anyone in our state. Had he been a blogger, you can imagine how useful his blog would have been for all the dog owners out there. And you can imagine how eager the dog-food companies would have been to place their ads on his blog. If you know more about something than most people do, you could create the same situation for yourself by blogging about it and placing relevant ads on your site.
Monday, June 21st, 2010
By Adam Ward
Businesses that sell products online live and die by the number of consumers they get to their sites. They spend lots of money on SEO, paid keyword searches and affiliate marketing to attract eyeballs. They speak of “driving traffic” to their sites, as though it flows in a single direction.
Traffic flows both ways, though, and by failing to think of the traffic leaving their sites, they may not be using their online marketing dollars as effectively as they could be.
A couple of months ago I attended a panel discussion where Tony Zito, CEO of MediaForge, said merchant webpage abandonment is 98 percent (i.e. only 2 percent of visitors buy anything) and shopping cart abandonment is 80 percent (which means only 20 percent of visitors who started pulling out their wallets finished the transaction). He said most of the people who get to a merchant’s website (the traffic that their SEO and keyword purchases bought) leave product pages to go out to blogs and social media sites to find reviews on those products. Can you imagine 80 percent of customers in a Target shopping center wheeling their carts to the checkout line, only to leave them there and walk out of the store to ask whoever is standing outside whether they should buy such-and-such a product? Crazy. And yet that is exactly what happens online.
Savvy merchants allow reviews of their products on their own sites, but people are naturally distrusting of those comments, even when written by consumers who probably have no financial tie to the company. The irony is that the “independent” bloggers who review that company’s products on an external site (the very blogs where potential customers land after leaving a product site looking for “unbiased” reviews) are probably getting compensated for writing those reviews. Although federal regulations now require bloggers to disclose financial compensation for products they review (see Jeremy Shoemaker’s disclaimer where he says he benefits “financially or otherwise from everything [readers] click on, read, or look at” on his site), many readers ignore those disclaimers.
I’m not saying it is wrong for bloggers to benefit financially from pushing merchants and products. Quite the contrary: right or wrong, consumers trust the bloggers, so the bloggers should be compensated for the value they bring. In fact, I am saying that online businesses should allocate even more money and resources to these bloggers and review sites. Since that usually comes in the form of affiliate marketing (i.e. the merchant creates an affiliate program for a product, a blogger joins the program by running trackable ads for that merchant on his or her blog, and gets compensated for each sale made thanks to the consumer clicking through the ad prior to the sale), these businesses should increase their affiliate-marketing efforts.
Merchants engaged in affiliate marketing often lump those dollars with expenses used for SEO and paid searches. Although affiliate marketing is great for driving new eyeballs to the merchant’s site (like SEO and searches), it is also a great tool for capitalizing on lost traffic. Regardless of how potential customers got to a merchant’s site, once they leave, it isn’t the SEO that is going to get them back. They’ll come back 1) if they find what they are looking for (i.e. a favorable review on the blog) and 2) if the blog they’re on makes it easy for them to get back. By merchants making sure they have an ad on that blog, they are increasing the chances that the consumer will get back to their site and finish their purchases.
To do this, merchants should put themselves in the shoes of their consumers. For each product they sell, they should do a search for that product and see what the top blogs or reviews for that product are. If there are negative reviews, that’s a separate product issue that they’ll need to deal with. But if there are favorable reviews, the merchant needs to make sure they have an ad on that site, ready to redirect the consumer back to their own site. By doing this, merchants are essentially using affiliate marketing programs to cast a wide safety net to catch potential consumers who stray from their site. Getting back to the Target example, that’s like anyone in the store’s parking lot telling the wayward shopper that not only are the items in the abandoned cart good, but also walking the shopper back to the front of the checkout line to finish buying the goods.
If just a small portion of the 80 percent of abandoned shopping carts come back to buy, that’s money well spent on bloggers.