Shawn Collins' Blog

Affiliate marketing and other stuff from Shawn Collins, co-founder of Affiliate Summit.

Archives for April 2005

Ask Shawn Collins: Best Resources for Affiliate Managers

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Q: If I have $300 to spend on learning materials for how to run an effective affiliate program, where should I spend it?

Shawn CollinsA: Let me preface this by saying that I am not the most objective person to answer this question, since I produce learning materials for affiliate managers.

That said, here is a breakdown of how I would suggest spending $300 to assist your efforts in running a quality affiliate program.

First, pick up a copy of my book, Successful Affiliate Marketing for Merchants. It’s a how-to launch and manage an affiliate program guide. You can get it in paperback or digital format for less than $20 on Amazon.

Next up, get yourself a subscription to Revenue magazine. The one year subscription will cost $20.

Another useful magazine is Internet Retailer. You can get a free subscription to this great, monthly magazine at internetretailer.com

Then there is Dr. Ralph F. Wilson’s Report on Affiliate Management Software, which was updated recently. The report details the many options out there for affiliate tracking and reporting, and makes some suggestions, depending on your business. This sells for a little more than $20.

One thing I would suggest, in order for you to develop into a more efficient and well versed affiliate manager is to become an affiliae yourself. So pick up a domain (less than $10) and a one year economy hosting plan ($60) from GoDaddy.com, and start up your own site.

The last purchase I’d suggest would be my AffStat 2005 Report. More than one-hundred and thirty affiliate managers from a cross-section of the industry were surveyed on their overall statistics, as well as a number of issues about their affiliate marketing channels, such as staffing, recruiting, and management for this report. This report costs $130.

Also, be sure to invest time in the affiliate marketing message boards. They can be great places to learn and ask questions.

So you’ve spent the following:

  • Successful Affiliate Marketing book – $20
  • Revenue magazine subscription – $20/year
  • Ralph Wilson’s report – $20
  • Domain name – $10/year
  • Web site hosting – $60/year
  • AffStat 2005 Report – $130

Total – $260

Spend the balance on pay per click search engines to recruit new affiliates for your affiliate program. Be sure to constantly test and tweak for best results.

Ask Shawn Collins: What’s a VIP Commission?

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Q: Recruiting good affiliates will be essential to our success, and we’d love to reward steady producers. What’s a VIP commission and is that something you manage through your affiliate network?

Shawn CollinsA: The technical definition for a VIP commission is that it’s a necessary evil. Basically, it’s a level of commission above the public offer to affiliates that is paid to the top performers.

This can take the form of a set increase by percentage or dollar amount, or it can come in tiers.

The topic of the VIP commission is a stumbling block for many affiliate programs. The reason is that they simply do not know it exists.

So they set about to project the costs of an affiliate program strictly on commission payouts at the base commission.

The result is that either you will have difficulty recruiting the big players (if you do not offer VIP commissions) or you will have thinner margins (if you didn’t bake the VIP commissions into your original numbers.

As far as expectations from affiliates, last year I asked over 140 affiliates, “Have you successfully requested an increase in commission from an affiliate manager?”

The result was that 40% said yes, they have gotten a raise in commission from an affiliate manager.

And now that the other 60% know it’s possible, you can count on them to start asking, too. 😉

Adware Firm WhenU Wins Funding

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Adware purveyor WhenU raised $20 million in private equity through ABS Capital Partners, according to Red Herring. The firm said it would use the moneys to flesh out its marketing and distribution efforts, an effort it already had underway as part of its effort to distinguish itself from spyware companies.

The $20 million may be short of its initial funding ambitions. A little less than a year ago, WhenU publicly sought financing of about $50 million, most of which would have gone as a payout to company founders, with $20 million going to fund operations.

WhenU has been aggressively moving more toward the mainstream of advertising since it hired former About.com CEO Bill Day in September. These efforts have been noticed prominently since.

Complete article at http://www.marketingvox.com/archives/2005/04/27/adware_firm_whenu_wins_funding/

Should Affiliate Links Point to the Merchant’s Domain?

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Dr. Ralph F. Wilson, Wilson Internet Rocklin, CA

Editor: I’ve long encouraged merchants to have affiliate links point to their domains to raise PageRank for the site. But the situation isn’t so clear these days. Here is an excerpt from my Report on Affiliate Management Software 2005. You’ll see the complexity – some of this is quite technical. But it is vitally important for merchants using affiliate programs to understand it. More detail is found in the Report itself.

In the last several years merchants have become savvy about search engine optimization (SEO). A site’s rank in the search engines — for a small company site, at least — can be significantly elevated by obtaining more incoming links to the website. An affiliate program is an effective way to do this — but only if the affiliate links themselves actually point to your domain.

Article continued at http://www.wilsonweb.com/art/ads/affiliate_links.htm

Experian Interactive Acquires Affiliate Fuel

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COSTA MESA, Calif., April 25 — Experian® today announced that it has acquired Thermo Media, LLC, also known as Affiliate Fuel, through Experian Interactive(SM), the new name for the organization comprised of Experian Consumer Direct(SM) and MetaReward. Affiliate Fuel is a leading pay-for-performance advertising network and will add complementary products and services to Experian Interactive’s other businesses.

Affiliate Fuel caters to the needs of hundreds of advertisers and Web site properties on the Internet. The company works with more than 1,500 high-quality publishers to provide advertisers’ products and services to consumers. Through Affiliate Fuel’s network, advertisers gain access to a wide consumer audience and benefit from the low cost per acquisition of new customers. The majority of Affiliate Fuel’s advertisers are educational institutions.

“Affiliate Fuel is a natural fit as Experian Interactive continues to focus on becoming the market leader in multiple vertical sectors associated with large-scale financial transactions and attendant life events such as buying a car or home, obtaining a credit card, protecting family and assets, and saving money,” said Ed Ojdana, group president of Experian Interactive. “Experian Interactive will assimilate new acquisitions and leverage marketing channels, customers and technology. Experian Interactive empowers consumer choice by helping them gain the products and services they desire by building successful long-term relationships with our clients.”

“By joining Experian Interactive, we will be able to expand our network and strengthen Experian’s existing consumer product offerings,” said Matt Simpson, managing partner of Affiliate Fuel. “Furthering their education is a critical life event for most consumers and our education offering helps them find a degree program that fits their needs. We are excited to support Experian’s dedication to helping consumers find the resources they desire at certain points in their lives.”

All employees and management for Affiliate Fuel will be retained. Affiliate Fuel was founded in 2001 and is located in Marina Del Rey, Calif.

The acquisition is consistent with Experian’s global strategy of acquiring complementary businesses that provide new products, new data or entry into new vertical or regional markets, while leveraging the core assets of Experian.

About Experian

Experian is a global leader in providing information solutions to organizations and consumers. It helps organizations find, develop and manage profitable customer relationships by providing information, decision-making solutions and processing services. It empowers consumers to understand, manage and protect their personal information and assets. Experian works with more than 50,000 clients across diverse industries, including financial services, telecommunications, health care, insurance, retail and catalog, automotive, manufacturing, leisure, utilities, e-commerce, property and government. Experian is a subsidiary of GUS plc and has headquarters in Nottingham, UK, and Costa Mesa, Calif. Its 12,000 people in 27 countries support clients in more than 60 countries. Annual sales exceed $2.5 billion.

For more information, visit the company’s Web site at www.Experian.com.

Corporate Announcement: Hellman & Friedman Agree to Acquire DoubleClick

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Some news from Performics today…

Dear Valued Partner,

As you may be aware, several months ago Performics’ parent company, DoubleClick, began exploring strategic options to maximize shareholder value. Today we are pleased to announce that the Company has entered into a definitive agreement in which Hellman & Friedman LLC will acquire DoubleClick in an all cash merger. The transaction is expected to close in the third quarter.

Based in San Francisco, Hellman & Friedman is a leading private equity firm that has raised and managed over $8 billion and invested in approximately 50 companies during its 20+ year history. Hellman & Friedman shares DoubleClick’s vision and understands our industry. Hellman & Friedman has a significant focus on the marketing services and software industries, and has previously invested in companies such as Digitas, Inc. (DTAS), and Young & Rubicam.

The new ownership structure will be a very positive development for partners and employees. In essence, the new structure will separate DoubleClick into two units, online marketing and catalog data. Performics is a part of the online marketing unit. Hellman & Friedman appreciates the potential of our industry and is committed to ensuring that each business unit has the necessary tools and resources to be successful.

It has been an exciting year. Everyone at Performics appreciates your continued support during our recent corporate transitions. If you have any questions, please do not hesitate to contact your Performics representative.

Sincerely,

Stuart Frankel
Sr. Vice President, DoubleClick and
General Manager, Performics

The AffiliateManager.net Forum is Back

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Last week, some hacker snuck in a back door of the AffiliateManager.net forum and deleted everything.

The bad news is that neither my host nor I had a backup of the forum activity. That means nearly two years of valuable conversations among hundreds of affiliate managers are now gone for good.

On the other hand, I’ve abandoned the old software for something more fortified and rich in features. And the AffiliateManager.net Forum lives again.

While the past messages were all vaporized, the accounts were still in tact. So anybody that was active in the old forum can login to their account at http://www.affiliatemanager.net/forums/

And I encourage affiliate managers that wish to participate for the first time to join us.

Let’s talk about the future of affiliate marketing, not the past.

I invite everybody to ask any questions they have about affiliate marketing, so we can start to build a whole new archive of useful information.

As Oscar Wilde once said, “The only duty we owe to history is to rewrite it.”

Ask Shawn Collins: Effective Affiliate Contests

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Q: In your experience do affiliate contest work? If so, what are some examples of the types of contest and prizes offered?

Shawn CollinsA: The well executed affiliate contest can definitely work, but there are many factors that will impact how well the contest comes off.

If you are going to have a contest based on total volume of sales, biggest increase from month to month, or something similar that relies on performance, you may well see a spike from your top performers.

But the bulk of affiliates will probably know they don’t have a chance, and their usual behavior won’t change.

Alternately, I would suggest a contest where all affiliates have a fair chance to win. Something along the lines of soliciting suggestons for how you could improve your program.

You could consider each entry equal or select one as the winner based on a previously determined set of parameters.

This can not only increase your mindshare with active and inactive affiliates alike, but it can also provide you with some great ideas that make your program more attractive to affiliates.

Some methods for making the contest attractive and accessible are an entry without barriers and a contest length that’s long enough for everybody to hear about it.

Rather than ask the affiliates to send entries by email, which can be time consuming to tally, I’d sugest using a service like Survey Monkey, where you can set up surveys (contest entry forms) quick and easy.

Survey Monkey enables you to collect all of the entries online and then export them to a CSV file.

As far as lenth, try something like 4 or 6 weeks. This way, you can plus the contest in one or more affiliate newsletters, and maybe send a solo email about it, too.

The prize is going to be a big key in the success.

I’ve run a bunch of contests, and there are two types that have been the most successful: cash (either a lump sum or a significant commission increase that doesn’t expire) or when there’s a prize for all who participate (magazine subscription or corporate schwag).

When you are giving a bigger prize vs. something to all, I’ve generally seen much better results when I give away ten $100 widgets vs. one $1,000 widget.

Bear in mind, different types of affiliates want different things – try asking your affiliates what they want as a contest prize and giving it to them (within reason).

Ask Shawn Collins: The Story Behind CPA Networks

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Q: With minimal research, I found 10 firms who offer to promote my site to thousands of publishers on a cost per sale basis. So what am I missing? It seems like they can deliver this new merchant to paradise. What gives?

Shawn CollinsA: Those are CPA networks, and while some have the potential to drive a large volume of leads or sales for you, they also require a higher commission for their efforts.

The reason for this is that they want to be able to pay their affiliates the same as you are paying your affiliates, so you’ve got to pay the standard commission for each transaction they refer, which is passed on to one of their affiliates, plus a vig to them for facilitating the transaction.

One bit of functionality you will need to work with the CPA networks is sub-ID tracking. The reason for this is that they need to be able to identify which of their affiliates referred a transaction, so they can compensate that affiliate.

So for some extra money per transaction, you magically have legions of affiliates running your offer, and you don’t have to hassle with recruiting and managing affiliates.

Not so fast – there is a catch here. While it’s helpful to have somebody else take care of the recruitment and management of the people that promote you, it also puts you in a position where you don’t know who is promoting you and how they are doing it.

So these affiliates never agree to your terms, and it’s wishful thinking to assume they will adhere to your terms. Some CPA networks police the activity of their affiliates, and some do not.

And since you can’t spot check the affiliates in this relationship, since you are not privy to their identities, they may be writing poor, or worse yet, deceitful copy about your offer.

If you forbid trademark bidding, adware, email, etc., it’s a lot more difficult to monitor when you don’t know whom to look after.

It’s got definite benefits and risks – caveat emptor.

The Hacker that Knocked Out My Affiliate Manager Forum and the Bounty I Have on Them

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So I was just wrapping up some work at about one this morning, and I get an email notifying me of a reply to a thread on my AffiliateManager.net forum.

It was weird – these emails are supposed to come from me, but this one was from an odd address. I clicked the link to see what was going on and found out I’d been hacked.

Two years of affiliate manager discussions deleted by some random, faceless person.

I scrambled around, but the archives were all gone. The best I could do was to lock down the site, so the hacker and his/her cronies could no longer make inflammatory posts on the board.

I’m working on getting things back on track – not quite sure yet what, if anything, can be recovered.

For now, it’s an empty shell. But not for long. It takes more than some script kiddies to wipe out a community. Somebody tried to take it down, and I am in the process of rebuilding it.

They might take it down again. I’ll rebuild again. Over and over again.

I really appreciate the outpouring of support. But please, don’t feel sorry for me. Pity the lost soul that finds satisfaction in tearing down the work of others, rather than building something of their own.

By the way, if anybody knows anything about who did this, I’ll pay a $5,000 reward for information leading to the conviction of the perpetrator.

How’s that for a CPA?!