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  1. #1
    ABW Veteran Student Heyder's Avatar
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    Like a ton of bricks I was hit hard with the thought that my business had no future if it kept going the way it was. I was making good money and it had been increasing steadily for months but I realized that I was stuck in a no win situation as most of you are as well.

    No business can work forever if it doesn't have a way to not only aquire new customers but also keep old customers. The basic affiliate model is a failing business. You get new customers either from search engines or you buy them from other sources and then basically sell them to your merchants if they decide to buy within the limits of cookie durations and action occurances. You are always finding new customers just to keep your head above water. This means you end up depending on things out of your control such as the next google dance. Not a good way to run a business. I think you need to have membership websites in order to have a solid income which doesn't depend on outsiders.

    So I've decided to start a membership based website much like ebates minus the commission stealing software. I'm wondering how many of you have come to this conclusion already and have done something about it in your own way. Does anyone have any ideas that might be a workaround for this problem and who plans to head in this direction?

    "If you ever reach total enlightenment while drinking beer, I bet you could shoot beer out of you nose." Jack Handy

  2. #2
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    I have a shopping site. When i first started this, i studied what was to be my future competition. What i noticed is some of these sites, some even with staff, would carry deals for some merchants and not others. I would also notice them carrying expired links on their site. Noticed them posting codes that were expired or did not work. Plus i wanted to do a site i would actually use. So i figured thats where i can fit in. Carry merchants that my visitors like, not necessarily the ones i like, after all its about what your visitors want. I design my site to be SE friendly and people friendly. The plan being to get SE traffic and return customers and it seems to be working. Maintain a good mailing list and use it on a normal basis. Watch your competition and do better than them, thats how you survive. I still think this business is relatively young, some will fail, some will prosper. Not going to go the rebate route because you're going against a giant and i don't think its something you can do on your own. Plus looking at a site like Ebates, they miss a lot.

  3. #3
    ABW Ambassador Jane's Avatar
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    An affiliate is an advertiser. Your job is to aquire new customers for the merchant. Kind of like a magazine ad. The magazine doesn't ever make any money off the merchants customer. They are paid by the merchant. Difference is they get paid 1000's of dollars even if the ad brings no results. Affiliates only get paid for results.

    The merchant wants us to bring in new customers, not keep making money off the old. The affiliates customer is the merchant not the person making the purchase. If we do our job the merchant (customer) stays and we get new customers every time we sign up with a new merchant.

  4. #4
    ABW Veteran jc101's Avatar
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    I agree, you do have to have some kind of business strategy to have in order to be successful. Like ebates they are all of our competition because they pay cash back to there members and overwrite affiliate links which I feel is not fair, however I think we need to work together here at abestweb.com to make sure that merchants and affiliates have a good relationship and they pay us for our effort. Going into the rest of 2003 you really need to have a platform to gain return visitors. Like perhaps A newsletter or something and can't always focus on google, even though we all know the best way to get traffic is from google and yahoo Make sure you watch your competition as Trustno 1 said. I think we all really need to focus on what our objective is with affiliate marketing before we just start putting pages up. Like Haiko here at abestweb. He has a very powerful objective which will lead to the future of affiliate marketing and how this industry will change the world and the affiliate networks and merchants really need to have a recent appearence on this board in order to show us that they are serious about there partners. Andy from Tiger Direct and Chris from Mondera and others have shown as that they are serious about us and help us earn $ daily. My goal with affiliate marketing is to prove to everyone that it is possible to make more then your 9-5 job and can change the world.

    Okay, back to making pages online.

    xtremeshopping.org inc.
    Reaching a goal in affiliate marketing? View mine: http://www.xtremeshopping.org/mygoal.html

    Jason
    Santa Cruz

  5. #5
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    I agree.

    Starting your own rebate site. Hah. Good Luck.

  6. #6
    ABW Veteran Student Heyder's Avatar
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    jane,

    As you pointed out the affiliate has their place in the scheme of things but I'm not willing to play that loosing game. You can not win on a long term basis as a standard affiliate. You might make a few bucks or a great living for a while but it will not last. I could name a half dozen people who've gone from the bottom to the top and then got kicked back to the bottom again just because Yahoo or google or overture changed the way the do things. Some of us can adapt to these changes and some can't but no matter who you are aquiring new customers for every sale you make is a failing plan.

    "If you ever reach total enlightenment while drinking beer, I bet you could shoot beer out of you nose." Jack Handy

  7. #7
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    Well, there are always plenty of new customers. New customers shopping online for the first time every day. New merchants coming online every week, with new affiliate programs for affiliates. Also its a good idea to set you site up so those "new customers" will be return customers. Provide something they can't get on the merchant site: coupon codes

    "Nothing focuses the mind better than the constant sight of a competitor who wants to wipe you off the map."
    --Wayne Calloway

  8. #8
    ABW Veteran Student Heyder's Avatar
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    Yeah exactly,

    Coupon codes, rebates or anything that will bring them back to your site instead of just going straight to the merchant next time. My customers will always go through my links from now on. I won't have to worry about cookie durations and action occurances. I also have dependable tracking now because my customers will demand it. No way Zappos can reverse a sale if my customer is telling me they are due a rebate.

    "If you ever reach total enlightenment while drinking beer, I bet you could shoot beer out of you nose." Jack Handy

  9. #9
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    Rebates sites are a big headache. I don't think any 1 person can run a successful one on their own. Those types of sites require some help and i think someone already has that segment cornered.

    [This message was edited by TrustNo1® on May 15, 2003 at 08:01 PM.]

  10. #10
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    I dunno how anyone could say his rebate site will just fail. Give the guy a chance. It's not like he has to pay an office full of employees like ebates. If you have decent traffic and can introduce people who aren't bargain shoppers to rebate shopping you might very well have a good hook.

    Hell, even many of the coupon clipper types don't even know what ebates is. Ebates might have millions of users but it's still a small amount overall. Only about 20% of shoppers even consider themselves coupon clippers so I assume the same numbers may hold true on the internet.

    A question that should be answered is how long will merchants accept programs like ebates. If I were a merchant I'd be a little uneasy creating rebate zombies that expected a kickback everytime they bought something from my site.

  11. #11
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    It will fail.

    "Nothing focuses the mind better than the constant sight of a competitor who wants to wipe you off the map."
    --Wayne Calloway

  12. #12
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    When it comes to affiliate marketing, I basically agree with Jane. How many people who drink Diet Coke are also customers of Foote, Cone & Belding (the ad agency handling the latest Diet Coke campaign) or even know who the fudge FCB is? The only people who know about FCB are either in the ad business or they have something they want sold. If people start going around saying "Man, I have to see what Foote Cone's selling now!" something is wrong with the picture!

    (Rant) But affiliates have one difference from a standard ad agency: Lots of merchants only want to pay for NEW customers. This ridiculous merchant folly is causing a kink in the marketplace. I say it's "ridiculous" and "folly" because the same places will drop unimaginable amounts of money on bricks-and-mortar ads which blast the same message to people who've heard it 10,000 times before just to get them to keep on buying what they have been all along--in other words, to keep the products fresh in the minds of their CURRENT customers. They do NOT "just do that themselves" like they'd like us to believe... (/rant)

    As for my business strategy, I plan to keep doing the aff. marketing part like I have been. Even if the merchants are only paying for New customers, there's so many products and merchants out there (and more coming) that it'd take a long time to "run out", so to speak. Plus, people coming back to my site won't do me any more good than if they don't, if the merchants are only willing to pay once for each of them! When the pay stops, that's when my interest in having that visitor disappears. Currently that happens the instant they buy the item they want from the merchant I want them to get it from. If they want something else, they can find me again...

    As for rebates, that'll be a cold day! But that's my personal opinion. Ding-dang if I'm going to pay people to shop at my sites. If I do branding it certainly isn't going to be a "cash back" brand! Pay the full freight and mail or don't ride.

    But I am also about to roll with an idea I read in this ancient thread where TGO was asking for ideas on what to sell. Heyder (Millers to you Heyder ) suggested photographs...

    ~Revenue is King

  13. #13
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    I agree with the delima but thats why I don't waste time with clone sites and strive to give my users a reason to bookmark and come back to my site. I get around 4,000 bookmarks a month so that part is good.

    I'll repeat a concept I brought up a while back that garnered very little support but the idea is very sound and one that could benefit many affiliates.

    The idea is an affiliate co-op that offers rebates and it has a bho app. Hold on....

    Affiliates and merchants sign up to become part of the coop and only the people who sign up to it will have sales diverted from them. The co-op would return diverted comissions to the members it was diverted from.

    The advantages?

    1) It doesn't hurt to be stole from when I know the thief will return the stolen goods.
    2) My site remains a viable entity that can compete more fairly and I can promote the use of the co-op bho for my visitors to get cash back rebates.
    3) My site is an instant rebate site without having to make a change at all (the bho handles that part).
    4) Affiliates band together to form an elite group of sites where users get cash back incentives and we can limit the amount of thieving and prospering bho's are currently making that is destroying the business.
    5) As a co-op, with diverted sales funneled through a central group, higher commission rates are easily obtainable and affiliates have a united voice that they can speak through.

    Lots of other benefits and... plenty of issues getting it going but it seems a better alternative than doing nothing and letting the parasites kill us slowly which is surely happening on a broad scale.

  14. #14
    Resident Genius and Staunch Capitalist Leader's Avatar
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    That sounds commie...

    ~Revenue is King

  15. #15
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    I may be wrong and I hope I am but I just feel that some things are going to happen that make the process of connecting customers to merchant sites easier, whether it be Froogle, smarter customers (hah), an SE backlash against affiliate pure sales sites possibly due to the explosion of spam/datafeed sites, something different, or a combination of many things.

    I think without a very big community of regular visitors, the long term prospects of being an affiliate marketer are not there. But, I have been wrong before. I think the value lies in that critical mass of a community, so big and so loyal to that site that the merchants come to you wanting to work with you, wanting to tap that community....

  16. #16
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    <BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR>That sounds commie... <HR></BLOCKQUOTE>

    commie...
    commie...

    My dad's aunt has a niece who has a son that is a commie and he just hates being called that!

  17. #17
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    Heyder,

    <BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR>Like a ton of bricks I was hit hard with the thought that my business had no future if it kept going the way it was. I was making good money and it had been increasing steadily for months but I realized that I was stuck in a no win situation as most of you are as well.
    <HR></BLOCKQUOTE>

    Hooray! Someone here is looking ahead!! I just finished this conversation on another board- the importance of owning your customers and building your own brand.

    An affiliate can "own" customers by building community, or building a loyal list, or using incentive marketing...any number of ways. As long as you continue to get a customer to buy via your links you are winning.

    Of course most merchants don't want this at all. They think in terms of acquisition.

    <BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR> No business can work forever if it doesn't have a way to not only aquire new customers but also keep old customers. The basic affiliate model is a failing business. <HR></BLOCKQUOTE>

    I don't think it is failing, but I think true growth is limited.


    <BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR> Rebates sites are a big headache. I don't think any 1 person can run a successful one on their own. Those types of sites require some help and i think someone already has that segment cornered. <HR></BLOCKQUOTE>

    This is true. Rebate sites are tricky and require human resources and sophistication to adminster properly. Feel free to call us as we have a complete calculation engine and automated tools for running a loyalty site. (No it's not cheap)

    No segment of the web is ever cornered. While Ebates pioneered the model there are many sites coming into the loyalty game- like General Mills and Coca Cola.

    Keep in mind that shopping doesn't have to be just cash back (although cash is pretty compelling)- it can be a points system that they can redeem for merchandise or airline miles or anything that has value. Perceived value is better because margins don't become so thin.

    I will give a creative example- Imagine a ShopForDiamonds site. Use the loyalty mechanism to assign points to any purchase they make- strike a deal with a jewelry merchant (like Mondera perhaps) and feature a unique redemption catalogue for diamonds or gemstones.

    Honestly I am surprised more merchants don't do this- leverage other merchant's loyalty to retain customers.

    Good luck Heyder.

    best,
    Wayne

    Wayne Porter
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  18. #18
    Resident Genius and Staunch Capitalist Leader's Avatar
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    Poon--What can I say, if the shoe fits, it fits! In any case, I'm 100% Capitalist and co-ops and the like can keep their mitts off my commish. And the idea of blending a bunch of people into a nondistinct mash is of no appeal. (Fighting huge urge to go into ideological debate!) Did I calculate that right, though, that it's your dad that's a commUNIST?

    Wayne--you and Heyder, have fun making w*rk out of things...

    (Heyder can safely bet all of his sites, that I found a way to sell pix with no work...[well, technically it's "not much". Just like technically a desert isn't always dry!])
    ~Revenue is King

  19. #19
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    <BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR> Wayne--you and Heyder, have fun making w*rk out of things... <HR></BLOCKQUOTE>

    It's only work if you hate doing it.

    -wayne

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  20. #20
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    True, but cutting checks to rebate-greedy moochers, and doing customer service both fall squarely within your definition of work in my opinion.

    ~Revenue is King

  21. #21
    ABW Veteran Student Heyder's Avatar
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    Wayne thank you for the encouragement. Leader and all regarding the "work" I've got an easy fix for that. It's called automation. Every single task involved can and will be automated. I write the php scripts and the site runs itself. The work was in learning php and it will payout forever. Even check writting is easily automated right down to my signature.

    Also not trying to pick on you Leader it's just that your responses were more intelligent even though I dissagree.
    <BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR> How many people who drink Diet Coke are also customers of Foote, Cone & Belding (the ad agency handling the latest Diet Coke campaign) or even know who the fudge FCB is? <HR></BLOCKQUOTE>

    How many people buy their Coke from CocaCola? I buy mine at the grocery store or walmart. I don't look at myself as an affiliate really it's more like I'm a store and my merchants are vendors.

    [This message was edited by Heyder on May 16, 2003 at 01:46 AM.]

  22. #22
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    Enjoy working tickets/support emails/whatever from cheapasses whose .30 rebate on a $6 purchase didn't show up in their account after 2 weeks.


    Online stores are the same as B&M in that regard. Some are selling their own wares, some are selling other peoples. Who do you buy coke from online? Most likely not coca-cola either. I don't think your analogy holds up.

    I agree with your original message. I just think a rebate site (and to probably less degree, any incent site) is a whole lot of work, and, unlike leader I don't consider (a reasonable amount of) work a bad thing.

    ----
    -JM
    When you're down It's a long way up
    When you're up It's a long way down

  23. #23
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    <BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR>Wayne thank you for the encouragement. Leader and all regarding the "work" I've got an easy fix for that. It's called automation. Every single task involved can and will be automated. I write the php scripts and the site runs itself. The work was in learning php and it will payout forever. Even check writting is easily automated right down to my signature. <HR></BLOCKQUOTE>

    Leader,

    I know a guy who as a complete PHP-drive shopping property solution for affiliate deals/coupons for sale and probably fairly cheap. The actual source that is. PM me or email me at wayne@afftrack.com if interested and i'll introduce you.


    I agree with automation. I am not a programmer by trade, but I learned a long time ago that most programmers are not marketers and they need each other.

    Although I walk through the shadow of the valley of death, I walk with a programmer...

    best,
    Wayne

    Wayne Porter
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  24. #24
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    <BLOCKQUOTE class="ip-ubbcode-quote"><font size="-1">quote:</font><HR> True, but cutting checks to rebate-greedy moochers, and doing customer service both fall squarely within your definition of work in my opinion. <HR></BLOCKQUOTE>

    1) Automate the pay-cutting process.

    2) Find an entry level intern to do the customer service.

    It's not work unless you make it work. Any enterprise that is more complex and takes more risks often pays off bigger rewards.

    -w-

    Wayne Porter
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  25. #25
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    Hate to bring up the C word, but since most merchants do a terrible job of helping people decide what to buy...content.

    I have a site that basically explains the ins and outs of buying a certain product type. Everytime anyone wants to buy a new one, they come back to remind themselves of what they have to watch for. The site does the Googlian yo-yo trick all the time, one month no.1, one month no.40, but the commissions still keep coming in because of bookmarks. The site's CPM never drops below $50.

    And it's little work - pick the right product niche and you only have to put together a few pages of info that don't date.

    You don't have to be perfect, just do a better job of explaining than the merchants. And frankly, that's often not hard. Most merchants just have the sales copy they got given by the manufacturer/distributor, which doesn't help anyone actually make a purchase decision.

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