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  1. #1
    Newbie z1701's Avatar
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    Question Merchant Money
    Ok, I've scanned through the posts in this forum and would like to confirm some things I've heard:
    1. Affiliate Networks are not the best way to attract affiliates
    2. Affiliate networks primariliy provide the structure for the merchant/affiliate relationship
    3. Many affiliates prefer and Indie (?) relationship to a netowrk relationship with a merchant
    4. Commission Junction is the most expensive and least trusted network by affiliates?
    5. Is there a source to help with attracting affiliates?
    If I wanted to have 1000 affiliates marketing my product by Feb 1st, Where would I go for help?

    DF

  2. #2
    Resident Genius and Staunch Capitalist Leader's Avatar
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    >>1. Affiliate Networks are not the best way to attract affiliates
    I disagree. It's only logical that the best way to attract affiliates is to put your program where lots of affiliates already are looking--in some network's list of active programs.

    >>2. Affiliate networks primarily provide the structure for the merchant/affiliate relationship

    They also make you more findable (see above), let affs know you're not just some schmuck who stuck up an "affiliate program" page, and if the network is SAS, there's an escrow backing up your promises to pay.

    >>3. Many affiliates prefer and Indie (?) relationship to a netowrk relationship with a merchant
    SOME do, but I really don't think it's "many." Personally I AVOID indies in 99% of circumstances.

    >>4. Commission Junction is the most expensive and least trusted network by affiliates?

    I think LinkShare is likely the Least Trusted 3rd Party, but I suppose that running an anonymous poll would give more definitive results. People are *louder* about CJ, and the posts about them are more numerous, but maybe that's because more people have money at stake there?

    As for cost, I think the difference between CJ and LS isn't all that great. Both strike me as charging an arm and a leg. CJ may want an extra 1/2 an arm. Big deal...

    >>5. Is there a source to help with attracting affiliates?

    You're on it (ABW)...

    >>If I wanted to have 1000 affiliates marketing my product by Feb 1st, Where would I go for help?

    1000 affs is quite a lot; I'm not sure if that'd happen by Feb 1st no matter where you went! That's only a couple of weeks from now! But I'd say CJ, if quantity is what you're after (even though they may not send 1000 affs in 2 weeks). Remember the 80/20 rule will be in effect there just like at any place (or indie). Also you'll need to do manual approval if you want to keep the parasites out, since CJ won't ban 'em for you.

  3. #3
    AM Navigator Geno Prussakov's Avatar
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    Quote Originally Posted by Leader
    Remember the 80/20 rule will be in effect there just like at any place (or indie)...
    The "80/20 rule"?

    Is it about what I was just going to add about quantity-based approach? Namely, that once you've had your 1000 affiliates on the list, be ready to face the fact that only about 10-12% of them will be the active ones (linking to you and sending your traffic+sales).

    Geno

  4. #4
    Resident Genius and Staunch Capitalist Leader's Avatar
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    Exactly Geno. The "80/20 Rule" states that 80% of your results will come from 20% of your affs. As you noted, it's generally an optimistic estimate.

    The 80/20 Rule has also been applied to other things which involve diverse groups of people: Customers (80% of the profit/20% of the customers) and Employees (80% of productivity/20% of the workers) come to mind offhand. Merchants also seem to fit the same general pattern, with me.
    There is no knowledge that is not power. ~Hemingway

  5. #5
    AM Navigator Geno Prussakov's Avatar
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    Okay. Okay. The Pareto Principle.

    Geno

  6. #6
    Newbie z1701's Avatar
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    I've been in business for 25 years...its really the 90/10 rule.

    If you do not mind, a couple more questions:
    1. What's a parasite?
    2. I have a business system that appeals to
    A. small to medium sized business
    B. People Who want to make money - opportunity seekers.
    I am willing to pay for leads and sales we close from those leads.
    We do the selling, we are looking to affiliates to send us the right people.
    Our program is not up, but wil be by next week. We are looking at $50 a lead and $100 if we close them.

    In your opinion, would this generate interest in the Affiliate community?

    BTW, Geno, You site is awesome!

    DF

  7. #7
    AM Navigator Geno Prussakov's Avatar
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    Thanks for the compliments, DF.

    On parasites: http://forum.abestweb.com/forumdisplay.php?f=158

    Geno

  8. #8
    Resident Genius and Staunch Capitalist Leader's Avatar
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    Quote Originally Posted by Geno - RussianLegacy
    Okay. Okay. The Pareto Principle.

    Geno
    Yep, now that you say that name, it rang a bell. When I checked, I found it has a couple of other names, too:
    80-20 rule, the law of the vital few, and the principle of factor sparsity~http://en.wikipedia.org/wiki/Pareto_principle

    Quote Originally Posted by z1701
    1. What's a parasite?
    2. I have a business system that appeals to
    A. small to medium sized business
    B. People Who want to make money - opportunity seekers.
    I am willing to pay for leads and sales we close from those leads.
    We do the selling, we are looking to affiliates to send us the right people.
    Our program is not up, but wil be by next week. We are looking at $50 a lead and $100 if we close them.

    In your opinion, would this generate interest in the Affiliate community?
    A parasite is any of a number of softwares or affiliates which use various tricks to steal commissions they're not entitled to. Often it takes the form of a software that overwrites the cookie of the actual deserving affiliate, but there are other, low-tech, ways of doing the same thing. Check out the ABW Parasiteware forum as well as other posts here on the subject for more details, or maybe someone will come into this thread with more.

    As for the interest potential: With those commission rates, some are almost certain to love the idea Also, there are some affs who specialize in lead generation, so you'll have their attention. (There are also some who specialize in selling hard goods [plain per-sale affs], like me, but I think that the lead-lovers would be interested.)
    There is no knowledge that is not power. ~Hemingway

  9. #9
    Newbie z1701's Avatar
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    Thank you. That is helpful.

    Sorry for so many question, but as you can see we want to get this done right and I trust those doing the work more than others selling their services.

    1. You mentioned that this board is the best place to find people. Where do you look for new merchants?

    2. I am not a big fan of banner ads, but I noticed there is a newsletter and email Opt-in lists on this site. Would you suggest any of these?

    3. Sounds like for us it would be good to get started with ShareaSale as well, then branch off as need to others. Would you agree?

    4. I've seen about 6 other networks mentioned on this site. Any value in signing up for multiple? I remember one post that says you will be found on one by most affiliates by signing up with Shareasale...which would seem to indicate that "active" affiliates scan these sites for new opportunities?

    Thanks again...I think I'm running out of questions... :-)

    df

  10. #10
    Moderator MichaelColey's Avatar
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    Quote Originally Posted by z1701
    Ok, I've scanned through the posts in this forum and would like to confirm some things I've heard:
    1. Affiliate Networks are not the best way to attract affiliates
    The larger Affiliate Networks (LinkShare and CJ) will attract many affiliates (500-1,000 per month, or perhaps more or less depending on your name recognition, commissions, and EPC). ABW is also a good place to find affiliates. You probably also want to bid in Google on "[category] affiliate" for the categories of products you sell, as well as variations like associate, affiliate program, etc. But building affiliates is a long-term process no matter what you do.
    Quote Originally Posted by z1701
    2. Affiliate networks primariliy provide the structure for the merchant/affiliate relationship
    They also provide consolidated checks (usually), exposure to affiliates, and much more.
    Quote Originally Posted by z1701
    3. Many affiliates prefer and Indie (?) relationship to a netowrk relationship with a merchant
    Some do, some don't. I tend to prefer networks because I get consolidated checks, direct deposits, and some degree of assurance that I don't have to spend us much time monitoring for tracking problems or slow payments. If an affiliate deals with lots of merchants, indies can be really time-consuming to stay on top of.
    Quote Originally Posted by z1701
    4. Commission Junction is the most expensive and least trusted network by affiliates?
    As far as expense goes, that depends on your commission rate and how much affiliate business you'll be doing. The networks have minimum monthly fees, so that's why the volume comes into play. CJ charges a network fee of 30% of commissions. LinkShare charges a network fee of 2-3% of sales. As a result (ignoring minimums and other fees), LinkShare is more expensive for low commission merchants (<10%) and CJ is more expensive for high commission merchants (>10%).

    As for trust, neither LinkShare nor CJ are very well trusted by most affiliates here. They both appear to be in bed with the parasites, don't appear to monitor merchant tracking as well as they should, and don't appear to take affiliate concerns seriously. I think a large part of this is just perception rather than reality, but perception is important.
    Quote Originally Posted by z1701
    5. Is there a source to help with attracting affiliates?
    If I wanted to have 1000 affiliates marketing my product by Feb 1st, Where would I go for help?

    DF
    It's not the 80/20 rule. It's not the 90/10 rule. It's more like the 95/5 rule. For most programs, 5% of affiliates generate 95% of the sales. 50% will probably never put a link up. 80% will probably never make a sale. 90% won't make a sale per month. And you won't be able to tell until they join and time has passed. If you want 1000 affiliates marketing your product, you're going to need to find 50,000 affiliates. Sorry, but that's going to take years, not days.
    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

  11. #11
    Newbie ynab's Avatar
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    I'm noticing that exact thing w/ my new affiliate program I'm launching. Almost one hundred affiliates, and about five have actualy made consistent sales since we began (a month ago).

  12. #12
    AM Navigator Geno Prussakov's Avatar
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    5% is not much, but 10% to 12% is what you'll keep seeing throughout the life of your aff. program, I'm afraid... Am I wrong? Anyone else wants to comment on this?

    Geno

  13. #13
    Full Member asr_guy's Avatar
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    DF - spend some time reading the forums and getting up to speed. If you charge ahead and sign up "a raging army of salespeople" willy nilly without good research you are in for a poor ROI and will be just another merchant unfairly disillusioned with affiliate marketing.

    In the offline world if you were to hire 1000 screened, motivated, and trained sales agents by Feb. think of all the things you would need to do...

    Also contact Haiko who runs this site and he can help you with options re announcing your program etc.

    Regards,
    Peter
    [URL=http://www.typoassassin.com/?utm_source=abestweb&utm_medium=forum&utm_content=p&utm_campaign=sig]Are these affiliates stealing from you?[/URL]

  14. #14
    Full Member asr_guy's Avatar
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    Re parasites they tend to hide under high volume products. If you are looking at business opp. / leads then the risk could be low that they target you.

    -Peter
    [URL=http://www.typoassassin.com/?utm_source=abestweb&utm_medium=forum&utm_content=p&utm_campaign=sig]Are these affiliates stealing from you?[/URL]

  15. #15
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    I've managed programs for three Top 100 Internet companies. It was almost always 95/5.

    Todd
    Last edited by loxly; January 26th, 2007 at 11:41 PM. Reason: removed manual sig

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