Plan your Internet Success – Part 21: Create Affiliate Accounts

21. Create Affiliate Accounts

At this juncture, you have learned how to spend money on Web design, ISP, advertising, directory listings, etc., so it is time to start learning how you can make money. Affiliate marketing is the easiest way to start understanding how you can create affiliations that will drive traffic from your Web site to an advertiser’s Web site and use someone’s else’s platform to track and account for each impressions, clicks and conversion and take care of paying you.

A short history lesson first: affiliate marketing started with Amazon in the mid ‘90s, when Amazon realized that many people could tell others about Web site purchasing books for cheap at the site. The great idea that Amazon had was to create a simple interface where people could come and grab a banner and code, put it on their Web page, tell others, and get a commission on the sales that were made by the people who were referred by these “affiliates’” Web sites. Barnes & Noble hired a company to do the same shortly after and the race was on.

In the late 90s, I was an executive with Commission Junction (CJ) and we launched the first ASP-based affiliate platform that offered both advertisers and publishers a place where they could exchange banners and get paid for traffic. I believe that one of the reasons for the success of CJ was that we were the first ASP affiliate marketing network, and, as a result, were able to offer much faster integration to merchants at very reasonable prices. The other critical factor to the success of CJ (and I believe it was even more important) was the perception by affiliates that CJ cared about them and that they would get paid for their work. Indeed this was, and to some degree continues to be, one of the most dismal aspects of this industry. Advertisers and merchants will try to avoid paying for leads or sales when they can or try to get away from their obligations by being dishonest with small (and not so small) affiliates.

Unfortunately, while advances in tracking have made things much better today, abuses by some advertisers and so-called brokers or merchants continues to be a real problem. At the same token, abuses by publishers also is flagrant and is estimated to be as high as 20-25 percent of all traffic generated by affiliates and search engines for their clients. I believe that anyone who is running a campaign on the search engines will attest to that fact.

With this in mind, it is critical for an affiliate to work with reputable companies. The good thing is that there are many these days with some of the biggest ones including the following networks:

Linkshare
Commission Junction (CJ)
Google Affiliate Network
Azoogle
Shareasale
Clickbank

There are a great number of affiliate networks, and I try to keep an up-to-date list at one of my Web sites, http://www.affiliate-marketing-solution.com. I invite you to check it out.

For the purpose of this example, I went to Azoogle to look at some of its most recent offers and came up with the following:

Several “Video Professor” offers ranging from $66-$72– Action requires a user to give personal information and provide a credit card.

A $72.00 offer from “Discover Card” – Action requires that a user complete required fields on an application page and successfully create a new credit card profile (in other word submit credit card information).

A “Snoring Solution” offered at $32 – Action requires user to enter valid credit card.

You probably see a pattern in these examples, and it shows that some kind of purchase must be made, or at the very minimum credit card information is to be added. However, Azoogle also offers “leads” deals paying from $1.25 to $10 per lead depending on the complexity of the lead that is required. For example, I selected the following:

An insurance company paying $4.25 per lead when a visitor provides information in five required fields on page one.

I also found a $1.25 or $1.64 for a “makeup survey” as well as a milk survey on page one or page two – submit, respectively.

What does this all mean? It means that all is not as cut and dry as some people would like you to think. It’s not because you have a site with some smart content and that you’ve managed to get some traffic that you will convert this traffic into buyers, leads or clicks, especially if your traffic is what I call transient traffic. In other words, traffic (or eyeballs as it used to be called) is made up of people who are reading something or looking at some pictures on your Web site and then move on. To really take advantage of traffic, you must find a way to have these visitors want to take an action. As a result, the question that you must ask yourself is: “Is my site geared to make visitors take action?” If you answer “Yes” then great. If you answer “No,” then you must ask yourself “What can I do to make visitors to my Web site want to take an action?”

Here is an example of someone who used his thinking cap, along with some basic math, and came up with a simple solution and made some money online.

This was a few years back when I was at CJ, and we were watching an entrepreneur in Asia whom I called “Hong Kong T”. Honk Kong T offered a free T-shirt to anyone coming to his site and registering with basic information including e-mail and physical address.

His traffic and conversions built up to something quite substantial within a very short time, and we decided to keep an eye on him, fearing that it was some kind of scam.

However, people who came to the Hong Kong T Web site and registered received their T-shirt (he may have charged a couple of dollars for shipping), but nothing fraudulent was going on and he kept his account in the black.

What we realized within a short amount of time is that Hong Kong T collected information from the people who came to his site to get a T-shirt (in order to qualify, one had to leave a first and last name, their e-mail and physical address, as well as a telephone number and other basic info). Equipped with this information Hong Kong T would promote advertisers’ offers to these people. The advertisers were from within the CJ pool and “Hong Kong T” would send offers to his T-shirt customers on a regular basis and generated revenues this way. I suspect that he also sent promotions via snail mail as well, since he had their address and provided these people’s telephone numbers to telemarketers. The numbers were not huge at the beginning, but slowly they grew into a sizable chunk of money and a very nice profit for Hong Kong T.

Furthermore, we figured that he must have done the same thing using offers from our competitors using Linkshare, Be-Free (defunct now as it was absorbed by CJ) as well as promoting other advertisers or merchants.

In short Hong Kong T found a way to acquire customers who gave him their information for the price of a T-shirt and a small commission to an affiliate along with the CJ’s fees (all combined these amounted to no more than $3-$4 per submission). In exchange Hong Kong T turned around and sold this information as leads or used them for his own mailings and e-mailing system and generated a minimum of $15-$20 per user, or a cool $12-$16 per customer. Not bad!

However, I also hope that, aside from the anecdote, you do see that this is very much the same principle as the example I gave you in the preceding chapter. If you recall, I was describing how I got users for $3.50-$4 per submission and finding offers to push to these people in order to generate revenues and cover the acquisition cost along with my overhead. Does that mean that giving away T-shirts for free is the solution? Maybe if you have the model to support it. What this example is set to illustrate is that using your imagination, you can find ways to create traction and action on your site and get people to do something and, as a result, general immediate or potential revenues for you.

Interestingly enough, the “game” has not changed much since what we did eight or nine years ago. What has changed, however, is the way we manage this information, the ease with which we can now program Web sites, optimize database, serve images. As a result, we must be smarter and much more sophisticated. A few Web pages with just text or lists won’t do anymore. You need to have something engaging that has the ability to optimize by user, IP, location, time or all the above.

Your can also download the complete “Plan Your Internet Success” manuscript at my personal Web-site http://www.jtouboul.com or at http://www.planyourinternetsuccess.com

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