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  1. #1
    ABW Ambassador mailman's Avatar
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    Can someone tell me what the differance is between advertising on the internet and all the other advertising mediums?
    Can a merchant go to his local TV station and say,I want a commercial and will pay you only if I sell something?,likewise radio.
    Can a merchant go to a printer and say,I want 50 thousand flyers printed and delivered .I will pay you if I sell some products! Can a merchant go to his local newspaper and ask for the same deal?
    Here is an example.The professor had 7,200 impressions with over 1800 click thru's for
    Tiger Direct.Results-no sales-cost 75.00.
    Is that fair? A fair deal would be,ppc less commissions on sales generated.So if the Professor had 1880 click thrus at 3 cents he would get $54.00. If he happened to generate $60.00 in commissions he would that and not the $54.00. The merchants are getting free advertising from all affiliates based on the
    the theory that someone will buy.I think our exposures are worth something!
    That's my 2cents.
    Gerry

  2. #2
    ABW Founder Haiko de Poel, Jr.'s Avatar
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    Gerry,

    We have to understand that UNPROVEN mediums (via our sites) we get CPA deals .... prove yourself / site you'll even get slotting fees (per offer). The proven media have thier rates for the reach and results (that is why they [merchants] publish ads / and or catalogs!

    The bottom line is that with the cut throat BS affiliates out there (AHEM Yeah we have them!) and that are out there are all Shoot till they produce ... when they do ... they will get the special deals!

    Haiko

    [ 03-08-2002: Message edited by: Haiko ]

  3. #3
    ABW Ambassador mailman's Avatar
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    I don't think it is the affilates cheating as much as reversals and scumware. Merchants also have the choice of what affiliate sites they wish to advertise on. Right now the winners are the merchants and the THRUSTED third parties.
    Gerry

  4. #4
    ABW Founder Haiko de Poel, Jr.'s Avatar
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    Gerry,

    This business is still in it's infancy ... and has many infantile people in it!

    I have heard MANY horror stories from REAL merchants and as to why they don't cut a check (direct) for under $50! I agree with them!

    The winners are the ones who do clean business ... merchants, affiliates and Ad Networks alike! The BSers, and ASSh*les who TRY to take advantage of real work will be long gone! It is a weeding out process within the growth.

    This business is profitable! ... just get some wipers for your goggles ... you'll do just fine!

    Haiko

  5. #5
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    <BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR>Can someone tell me what the differance is between advertising on the internet and all the other advertising mediums? Can a merchant go to his local TV station and say,I want a commercial and will pay you only if I sell something?<HR></BLOCKQUOTE>You answered the first question with the second one. They can't do it, end of story.

    On the web they can.

    The other side of the story is that I don't have a TV show nor the capital to finance one. But I can pay the bills with what I make on the web and I've only been doing CPA since late October. I've had a content site with tons of traffic sine 1998 -- the CPM deals for that site paid the cost of running the site and just a tidge more.

    If you're pitching merchants that are eating up impressions and clicks with no sales, that's your problem, not the merchant's.

    There are CPM deals out there and good ones (over $35CPM -- I know, I bought them as late as March 2001). Problem is, you have to have a site the likes of the Seinfeld show to get them -- not just lots of traffic but very targeted traffic with extensive demographics.

    TV stations and radio stations have a LOT more to offer than the average web site.

  6. #6
    Resident Genius and Staunch Capitalist Leader's Avatar
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    "Can someone tell me what the differance is between advertising on the internet and all the other advertising mediums?
    Can a merchant go to his local TV station and say,I want a commercial and will pay you only if I sell something?~Mailman"

    The problem seems to be that you (and many others) are comparing us to the TV station, which in fact we are NOTHING like!

    I see it more like this:
    Think of a Real Estate salesperson. S/he takes on the assignment of selling a house. S/he then goes to the papers in the area and places advertisements to sell the house, along with other means of advertising. If the house doesn't sell, it's too bad! The ads still cost him/her the same thing as if it DID sell!

    Yet the OWNER of the house risks absolutely nothing in terms of promotional cost if the house doesn't sell. He or she is not charged one thin dime for all those ads, flyers, etc. bought by the realtor, nor for all the time spent showing the house to potential buyers. The realtor only gets paid--COMMISSION--when and IF the house sells! But that COMMISSION, when it comes in, is greater than the price of all that time and advertising, and then some. A growing area can have many VERY well-to-do real estate people living in it.

    We are middlepeople just like realtors--therefore the risk is on us! On the other hand, the PROFIT POTENTIAL is great--for us!

    [ 03-08-2002: Message edited by: Leader ]

  7. #7
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    Leader:

    The real estate analogy has some holes.
    There is only one house on that lot.
    The agent, in 90% of the cases, has an exclusive listing which is enforceable in court.

    We do take on the RISK when promoting on the WWW.
    We can minimize that risk by knowing in advance what the profit per visitor will be.
    We must ask experienced affiliates [plural] what they have experienced on a program.
    Never take the "merchants" word for anything - they lie.

    Being selective is the key to success and dramatically reduces the need to RANK in fora.

    imo
    [sp error]

    [ 03-08-2002: Message edited by: Adam Ward ]

  8. #8
    Resident Genius and Staunch Capitalist Leader's Avatar
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    Adam,

    True, there's holes--but no analogy is airtight. And I do think we're a lot more like realtors than TV stations.

    You can't always take a homeowner's word for things, either... their "beautiful house" may really be falling apart!

    "We can minimize that risk by knowing in advance what the profit per visitor will be.~Adam Ward"

    Being hobbled by a set price per visitor only limits the upward potential. With a per-click, it doesn't matter what the person buys. A book? You get peanuts. A piece of diamond jewelry? Peanuts again. A new CAR? Still peanuts!

    Give me a decent percentage-based program any day!!

    Also, like in most forms of investment, the most potential is not in the low-low risk investments--as the risk increases, so do the potential (NOT guaranteed) rewards. Personally I try to stay somewhere more toward the middle--I try to avoid the DUD merchants (the "junk bonds") while also skipping the per-click peanut vendors (low-interest certificates of deposit).

    I will agree, being selective is the key to success. Although I don't see what that has to do with ranking in fora...

  9. #9
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    <BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR>Here is an example.The professor had 7,200 impressions with over 1800 click thru's for Tiger Direct.Results-no sales-cost 75.00. Is that fair? <HR></BLOCKQUOTE>

    Hmm.. Yes, No, maybe so.. You choose which merchants you wish to promote.. If I send through 1800 click thru's, I'd get an average return over $500. As you choose the merchants you wish to promote, it's also up to you to do your research first and ensure a suitable return. It's also your responsibility to ensure you have a market who is interested in purchasing the merchants products.

    <BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR>So if the Professor had 1880 click thrus at 3 cents he would get $54.00. <HR></BLOCKQUOTE>

    If this were the case, anyone could send through all sorts of BS traffic to a merchant and expect a return. I'd rather the merchants didn't pay out for BS traffic and just raise the commish for those who send through quality traffic.

    Regards,
    TK

  10. #10
    ABW Adviser Panel Dynamoo's Avatar
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    Cedric:
    <BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR>You answered the first question with the second one. They can't do it, end of story.
    On the web they can.<HR></BLOCKQUOTE>

    Exactly.. if TV ads and printed media could operate in a Pay For Perfomance style you can betcha that's how it would be done.

  11. #11
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    NO NO NO NO NO NO and NO!

    McDonalds advertises every minute on TV and Radio and Print for a reason. Branding and Reminding. The subconscious mind is affected by this bombardment of advertising and affects your purchasing decisions.

    It works. And it always will.

  12. #12
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    <BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR>Is that fair? A fair deal would be...<HR></BLOCKQUOTE>

    In most cases, "Fair" doesn't apply to business. It's not what is fair, it's whatever is agreed upon. This is business. If you think in terms of what is fair instead of what is profitable, affordable and good for business in the long run, I think you set yourself up for disappointment.

    Ray

  13. #13
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    >Being hobbled by a set price per visitor only limits the upward potential.

    I wrote known PROFIT per visitor

    >Give me a decent percentage-based program any day!!

    And that is just what I sell + it's residual

  14. #14
    Resident Genius and Staunch Capitalist Leader's Avatar
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    "I wrote known PROFIT per visitor~Adam"

    True, but without a set price, how can you REALLY know the profit per visitor?

    CJ's EPC, for example, gives an average, but the actual figure can vary widely depending on the individual site. Same with any kind of figures that use an average of the performance of a pool of people.

    Eventually the profit per visitor can become known for individual cases, but I don't see a way to know IN ADVANCE what the profit will be, without a set price to calculate from.

    So how is the profit per visitor going to be known in advance WITHOUT a set click fee per visitor?

  15. #15
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    If an advertiser spent money on traditional media advertising and it did not produce enough new sales to at least pay for itself, sooner or later the advertiser would figure out that something wasn't working and change their ad strategy.

    The tracking methods are seldom as precise as they can be on the internet, but in the long even traditional advertising has to deliver performance too. It usually takes longer to tell what's working, and costs are allocated differently along the way, but ultimately that radio station or magazine or whatever has to deliver a sustainable return on the advertiser's investment or their repeat business will dry up -- unless they lower their prices.

    Gerry, the reason Fred's traffic wasn't worth very much in the example you cited is because traffic that is random (or nearly so) simply doesn't buy as much as traffic that is well targeted. Simply having a page with some hype about computers at the end of a chain of otherwise random surfing events does NOT produce well targeted traffic.

    Elisabeth Archambault

  16. #16
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    >how can you REALLY know the profit per visitor?
    You can't REALLY know but you can get in the ballpark - imho

    If you know & trust the affiliate marketer you are talking to, you can use his/her historical data to get in the ballpark. $0.40 ppv for program #1 vs $0.07 ppv for program #2

    I agree that ppv will vary from site to site but it should be close to the range if both sites are targeted at the same product / service.

    I'll use this example:
    Site sells STUFF in 5 sizes = 5 different prices
    Visitors come in and buy x% of this and x% of that
    Only say 10% of visitors buy anything at all
    At the end of the day/month/year there is a gross profit of Y
    and a calculation can be made to determine ppv

    If you have set a target of $0.40 ppv and don't get there, you work on the site until you do get there OR results do vary depending on what search engine or directory your traffic is coming from vs the other guy/gal.

    If your average bid on PPC is $0.30, how is it you knew you can bid that high?
    You must have made some calculation in advance based on some historical data from somewhere. I think...........

  17. #17
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    <BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR>If an advertiser spent money on traditional media advertising and it did not produce enough new sales to at least pay for itself, sooner or later the advertiser would figure out that something wasn't working and change their ad strategy.<HR></BLOCKQUOTE>

    It is only that simple for a simple mom-and-pop store in a small community. In the advertising world, it's much more complicated than this. The logic you are applying is general business logic; if you spend a buck to make more than a buck. You need to see the "Big Picture" through the eyes of advertising logic to understand how advertising money is spent.

    This discussion has only been about advertising that is sales oriented. What about advertising that is geared towards public relations, image building/branding, and market awareness? We tend not to think in those terms because all we care about is turning a profit. Although it might not make any sense in oridnary business logic, the real marketing wizards are more concerned about getting their name and branding label out in front of their target market as much as possible. They follow the philosophy "create the exposure and the sales will eventually follow".

    Try putting yourself in a reputable merchant's shoes and apply this logic. It might give a better perspective to help understanding why, where and when they spend or don't spend their advertising budgets.

  18. #18
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    <BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR>They follow the philosophy "create the exposure and the sales will eventually follow". <HR></BLOCKQUOTE> I agree that's their logic, but if the sales that " will eventually follow" are tooooo slow in coming, the company will run out of resources.

    The time frame for that may vary considerably, depending on the depth of their pockets, but ultimately there is no escape from economic reality: "eventually" your income has to be greater than your outgo, or the outcome will be disaster.

    Canadians need only think of Eaton's. I'm sure folks in other countries could name major, well-branded businesses that went under because "eventually" the sales just weren't there.

    Some wealthy business man (sorry, can't remember who) once said that half his advertising dollars were a waste of money, and he knew it. The trouble was, he didn't know which half.

    On the Internet he could have tracked it almost down to the penny.

    Elisabeth Archambault

  19. #19
    2005 Linkshare Golden Link Award Winner  ecomcity's Avatar
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    I promote over 300 merchants for over 4 years at Ecomcity by basically offering my shoppers viable ( as in trusted) choices for 5 million products. Not one complaint ever that an EcomCity shopper got stiffed at the end of a click I put up. I do not send traffic to anyone who might spam my customers hoping they can entice them by mass mailings into some "no value" trap.

    90% of those same merchants do not produce income for me because they couldn't convert my shoppers. Until they produce a few sales I do not showcase them period. Why? Because my shoppers over time saw no spendable value at their sites. If a merchant shoots themselves in the foot by hiding sales or not paying up without begging they get less traffic. 18% of my daily vistors come from bookmarks on about 10 entry pages. These same 10 pages produce 90% of my affiliate checks. http://www.ecomcity.com/holdup.htm averages 110+ pages views ..generates 35+ clicks and generates 9 sales per day for Holdup Suspender Company. Obviously it deserves a bookmark,or my shoppers there are in the mood for suspenders. Sal ran a program promoting www.suspenders.com for 2 years at CJ ( before EPC) and closed 1 in every 15 clicks for his affiliates. His problem was getting good affiliates since 80% only generated a few clicks a month. Now he's content to use PPC and SE listings or bookmarks for buyers.

  20. #20
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    We are talking apples and oranges.

    Working on commission is a legitimate business. XYZ will pay you some % to sell their product.

    So you go out and try to generate customers.
    You target to sell ONE type of item or ONE brand. If you sell it you make x amount less what it costs you to get the sale.

    The merchant wants you to make the sale, he/she provides you with brochures, catalogs,
    price lists etc. The equivalent of a website, more or less.

    However, the brick and mortar stuff almost never has ads for a hundred other merchants,
    800# for which I will not get credited, etc.

    CPA works wonders on the net selling ONE item or a couple of items within a similar category with ad spin detailing all the benefits of owning it and the features.

    But as soon as you ad more items, talk about
    mission statement, have anything to do with branding - YOU ARE ADVERTISING NOT SELLING.

    As soon as you ask me to send people to XYZ business to pick and choose a product, I am no longer a SALESMAN, I'm a form of advertising media.

    If you want to pay me to sell products and services online make ONE page per product, write it up as an infomercial and then I will get traffic to view the page and they will buy it.

    In the real world it's called DIRECT MAIL or DIRECT SELLING.

    However, if you want me to send people to a page just listing a list of items people can buy, they you had better pay me in advance for the eyeballs because what you want is advertising/branding person not a SALESMAN.

    And the reason merchants can get away with it on the net and not in the real world - is
    most people are ignorant about business and think that 'gee all I have to do is send 10 people to Walmart's Website and I will make
    10 sales and an extra $10.'

    Walmart figures 'hmmmmmm if I promise people to pay them if they send traffic to our website and get 10,000 people to do that and they send 10 people per day each on average - we got a 100,000 more potential customers everyday FOR free until we have to pay a few.
    But hey if we have zero return days we probably won't have to pay more than a couple of people. So in a month we get 3,000,000 potential customers and maybe we pay out $3000 max. What's it cost for a TV ad to 3 million? $30,000 minimum to make the ad and another $30,000 per ad shown. Hmmn, we get the same number of eyeballs for more than 90% less. Let's do it.

    CPA used to advertise. 99% of Affiliates get
    screwed because they are being used to brand while they thought they were helping Walmart sell.

    Now if Walmart said we have a super widget and we'll pay you 5% and you send people ONLY to that page we'll pay you if they buy today if they come back in 45 days to buy one or a dozen and we'll have our copywriters write great selling spiel - then Walmart would be paying affiliates to SELL.

    CPA used to sell. I'm in let's do it.

    That's the difference.

  21. #21
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    Bucky,

    Better the merchants run out of money than me.

    But if advertising isn't working - change the advertising and the mix...it's not always
    the quality of the traffic or the affilites fault things do not sell.

    I have know and done marketing for hundreds of companies where the guys running the company had never ever read a book on marketing or even advertising. They figured hey you just put up an ad and go to the bank.

  22. #22
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    Bingo!

  23. #23
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    As I see it, survival/success in just about anything can be boiled down to two things:

    1) Learn what works (for you), and keep on doing it.
    2) Learn what doesn't work, and either change it or stop doing it.

    In my experience, the biggest difference between the winners and the whiners is whether they can do #2.

  24. #24
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    I can do #2 [img]/infopop/emoticons/icon_biggrin.gif[/img]

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