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  1. #1
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    Opt-In Boxes and affiliates
    Hello,

    I am just about to launch my first digital product and am in the final stages of creating the sales page.

    I intend to include an opt-in box in order to build my mailing list, however i'm relying primarily on affiliates to promote my product.

    My question is:

    Are potential affiliates of my product/website deterred from promoting due to the opt-in box which could potentially lose them the sale, as my follow up emails contain my product promotion with no affiliate link?

    Thanks in advance,

    Mike

  2. #2
    Moderator MichaelColey's Avatar
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    If a customer clicks through an affiliate link, signs up for your mailing list, then buys your product (perhaps through an email you sent) before the end of the cookie duration, does the affiliate get the commission?

    If so, I don't see a problem. If you have safeguards put in place so that the customer gets tied to the affiliate if the cookie is missing, even better.

    But if your emails override the affiliate cookies, that's a serious problem to affiliates.
    Michael Coley
    Amazing-Bargains.com
     Affiliate Tips | Merchant Best Practices | Affiliate Friendly? | Couponing | CPA Networks? | ABW Tips | Activating Affiliates
    "Education is the most powerful weapon which you can use to change the world." Nelson Mandela

  3. #3
    Moderator MichaelColey's Avatar
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    And on a separate note, "relying primarily on affiliates to promote [your] product" is widely considered a bad idea. You need to be promoting it yourself, finding ways to improve conversions, etc. Relying primarily on affiliates is a bad idea.
    Michael Coley
    Amazing-Bargains.com
     Affiliate Tips | Merchant Best Practices | Affiliate Friendly? | Couponing | CPA Networks? | ABW Tips | Activating Affiliates
    "Education is the most powerful weapon which you can use to change the world." Nelson Mandela

  4. #4
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    Thank you Michael,

    That is my question, I'm not sure how to ensure the affiliate stays tracked in future emails?

    The last thing I want is someone to sign-up and the affiliate not get future commission for the lead! Especially with a first product, building an affiliate network based on integrity is a primary aim

  5. #5
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    I will be promoting the product myself too, I take your advice. Cheers

  6. #6
    Moderator MichaelColey's Avatar
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    Quote Originally Posted by Moneill06 View Post
    That is my question, I'm not sure how to ensure the affiliate stays tracked in future emails?

    The last thing I want is someone to sign-up and the affiliate not get future commission for the lead! Especially with a first product, building an affiliate network based on integrity is a primary aim
    If you're building your own site and affiliate tracking software, this is basically how you would do it:

    1) When a prospective customer signs up for your newsletter, if there's an affiliate cookie set, save the affiliate ID and timestamp with the customer details.

    2) When a customer buys your product, if an affiliate cookie is set, record the sale for that affiliate. If there is no affiliate cookie, check to see if the customer had signed up for your newsletter through an affiliate and if it was within the cookie/tracking duration. If it was, credit the sale to that affiliate.

    If you're working through a network, you would need to check with them to see how to integrate something similar.

    A somewhat simpler (and much more common) solution, but one that's very prone to fraud, is to just pay a (smaller) "lead" fee for newsletter signups and not pay for sales. The problem with that is that some affiliates will send fraudulent leads and/or lower quality leads. Merchants typically respond by lowering commissions, which runs off the good affiliates. I'll post an example in a separate post.
    Michael Coley
    Amazing-Bargains.com
     Affiliate Tips | Merchant Best Practices | Affiliate Friendly? | Couponing | CPA Networks? | ABW Tips | Activating Affiliates
    "Education is the most powerful weapon which you can use to change the world." Nelson Mandela

  7. #7
    Moderator MichaelColey's Avatar
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    Here's an example of what could happen:

    Let's assume that the merchant has a product that has a $100 profit on a sale, that they're willing to share half of that with affiliates, and that 1 in 10 newsletter signups eventually purchase. 50% of 10% of $100 is $5, so the merchant sets their affiliate program up to pay $5 per lead.

    Over the course of 6 months, 100 good affiliates sign up. 50 of them add links. Between the 50 affiliates, they're generating about 20 leads a day. The traffic is converting pretty similar to the merchant's traffic. So the merchant is paying about $100/day and getting about $200/day in signups.

    In addition to the 100 good affiliates, 5 "less valuable" affiliates have also signed up. One placed a craigslist ad and paid someone from a third-world country $30 to sign up 10 customers a day. One has a "free $500 Walmart gift card" site and signing up for your newsletter becomes one of the requirements for getting the free gift card. You get 100 signups from this affiliate in one day, and none of them have any interest in your product. None convert. A third has an "email list" of 50 million email addresses. They push it out. About 50 sign up, but you get 5,000 spam complains and your ISP shuts your site down. A fourth is similar to the first one, except he does it himself, creating a few newsletter signups each day (about 100 per month, for $500!). A fifth affiliate uses a toolbar network to intercept customers who go to your site and redirect them through their affiliate link. Let's assume they intercept 10% of your sitewide traffic.

    So from the 5 bad affiliates, you may be getting another 40 signups a day, virtually none of them converting into sales. Let's say you catch half of the bad affiliates, remove them, and reverse their commissions. (They'll be back under other names.) So you're getting 20 legitimate signups a day and 20 bad ones. So your conversion ratio on affiliate traffic appears to have dropped in half, from 10% (on your traffic) to 5% (on affiliate traffic). You cut your commissions on leads from $5 to $2.50.

    Half of your good affiliates leave. Now you're getting 10 good leads and 20 bad ones every day. You catch more bad affiliates, but new ones (or more likely the same ones) keep coming back so it's a steady stream. And some go undetected. Now, you're affiliate conversion has dropped to 3%. You drop your lead payout to $1.50. You lose more affiliates.

    I honestly don't know how lead based programs survive. The bad affiliates eat their lunch (and ruin it for the good affiliates).

    If you can pay based on sales, you'll be in much better shape.
    Michael Coley
    Amazing-Bargains.com
     Affiliate Tips | Merchant Best Practices | Affiliate Friendly? | Couponing | CPA Networks? | ABW Tips | Activating Affiliates
    "Education is the most powerful weapon which you can use to change the world." Nelson Mandela


  8. #8
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    Thank you again, some very interesting advice.

    I will certainly be basing my commissions on sales after that explanation

  9. #9
    Super Dawg Member Phil Kaufman aka AffiliateHound's Avatar
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    Great analysis from Michael.

    I agree as to how difficult it is to understand how the majority of lead based programs do exist. It is so easy to manipulate the system, and it seems that for every bad guy that might be caught, two more pop up.

    At least in a network, there is some degree of monitoring, depending on the network.

    You can prohibit email promotion and have a more detailed sign-up system, but that is seldom practical for opting in to a mailing list as people won't want to provide more than their email and maybe a name, and you'd need many hours or a staff to handle the workload in verifying such information, plus there would be a cost for access to various databases.

    That sort of set-up is seldom practical outside of financial niches, such as for auto loans, payday, and other loans, in order to accept and pay out on leads.
    Since June 10, 2012 a vegan aarf but still writing the Hound Dawg Sports Blog
    "If you don't have time to do it right, when will you have time to do it over?" -John Wooden;
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