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March 9 2010

Why Are Online Affiliates Outselling Me?

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It’s happened time and time again. A company produces a product and pays online affiliates to sell their product with the promise that they will receive a commission.
The online affiliates begin to sell the product and end up selling more than the actual company. Then the age old question occurs, why are my online affiliates selling more than me? This seems to be a problem for ecommerce companies who sell their goods online and use online affiliates to help. There are many reason why online affiliates outsell company’s on their products, but the main two that we will focus on are price and incentives.

One of the primary drivers of consumer purchases is price. Everyone should know that consumers have become “shop around” savvy. It’s no longer the “buy because I want it and forget price.” Instead it has become “let’s shop around on the internet for the best price,” and this isn’t hard for consumers to do with shopping engines and comparison shopping sites springing up on the internet daily. If a company is selling a product online and they want it to generate more revenue than online affiliates, they need to make sure that they have the best price possible. A perfect example would be my recent purchase of a cell phone. I bought my cell phone from a third party vendor instead of my cell phone service provider. The third party vendor had a better price; they included a car charger, a leather carrying case, and didn’t require that I extend my cell phone contract. If I had bought my phone from my service provider I would have spent at least $40 to $60 more, plus I would have had to pay an upgrade fee. The third party vendor offered better incentives than my actual cell phone service provider.

Incentives to buy a product are also important factors to help a company outsell their affiliates. Let’s say that your company and your affiliates are selling product “x” for $40. This puts you on the same playing field as your affiliates, but what happens when your online affiliates adds incentives. The affiliates offer free shipping on orders over $25 for example. Guess who’s actually gaining a new customer? Correct, the affiliate. Incentives such as free shipping, a free gift, and discounts can influence consumers to buy from an online affiliate instead of the manufacturer. What’s the purpose of selling a product on your site if a consumer can go to reputable online affiliates and buy it cheaper, with better incentives?

Many online companies need to sit down and be honest with themselves about their online affiliate strategy. Online affiliates are supposed to increase company revenue not take away from it. If all of your customers are going to online affiliates, then you have to pay out more commissions. The whole purpose of online affiliates is to help your company generate more revenue by reaching consumers that normally wouldn’t know or come to your site. There’s a delicate balance that must be kept between online affiliates and companies, otherwise the online affiliate becomes a paid competitor.  If you’re going to sell your product online and use an online affiliate marketing program, make sure that your website has the best price and the best incentives. Otherwise, you should let the online affiliates sell the product and focus your attention elsewhere.

January 21 2010

View-Through Conversion Tracking an Advocate for Display Ads

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Some internet marketers would agree that display ads on the content network don’t receive the credit they deserve. Some feel that only certain industries can do well with display ads in the content network.  However, Google has created view-through conversion tracking to help show advertisers and companies that display ads in the content network are producing results. 

View-through conversion tracking is an advocate for display ads in the content network. According to Google Adwords, view-through conversion tracking “provides a measure of the number of online conversions that happened within 30 days after a user saw, but did not click, a display ad on one of the sites on the Google Content Network.” View-through conversion tracking shows who went back and converted even though they didn’t click on the ad.

View-through conversion tracking is a great feature because it proves that ads can be triggering conversions even though there were no clicks. Think about it, when display advertising came out, it was on a cpm or (cost per thousand impressions) basis. Some marketers felt that this metric wasn’t convincing enough. People saw the ad, but that didn’t mean they were converting. As time went on Google offered cpc or (cost per click) ads and some marketers felt they were missing out because there ads weren’t being clicked on by consumers. View-through conversion tracking solves the issue for both parties. Whether an advertiser does cpm or cpc for display ads, they can see conversions that occurred, simply because someone saw an ad.  

Internet marketers can prove that display ads in the content network are producing results with Google’s view-through conversion tracking. The results are coming in from view-through conversion tracking and some people will be surprised. There are conversions coming in without a single click being made. View-through conversion tracking is definitely an asset for any internet marketer running display ads.

November 30 2009

Search and Display- A Perfect Combination

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If I said peanut butter would you think of jelly? If I said Fred would you think of Ethel? If I said Batman would you think of Robin? What if I said search ads? What do you think of now? How about display ads. Display ads are a great compliment to search ads. Effectively using search and display ads together can improve click through rates and onsite interaction.

When most people think of internet advertising they think of just search ads. However, pairing search and display ads is highly underrated. Display ads add an extra boost to search ads. According to an article on Search Engine Land “display ads can have a major impact on search and consumer engagement.” The internet has many articles that support this fact. It goes back to a simple fact of traditional advertising; frequency. The more people see a product or service advertised, the more aware they become, and we all know a picture is worth a thousand words. By combining search and display ads, a consumer is being exposed to a product or service and therefore becoming more aware of it.

One important note when setting up display and search ads is to make sure they are consistent. If you’re advertising one message in search and another in display, you’re working against yourself. When your messages are cohesive, whether a consumer sees your search ads, display ads or both, the message is being reinforced. Even if a consumer doesn’t click on your display ad, they’re seeing the visual and if they are interested, they will come looking for you in the future. There have been many times, I’ve been reading an article and stopped to view a display ad. I didn’t click on it, but later on when I had free time I did a search for it. Don’t just go by my experience; let’s look at a client example.

We have a client that sells unique office chairs online. Their search campaigns were bringing in traffic but no conversions. I added a campaign for display ads and within a few days they received a conversion. Here’s the catch, they received a conversion from their paid search efforts. One might think the search ads paid off by themselves, however here’s where it get’s interesting. The next month their display ads were paused and the client only ran paid search ads. They didn’t get any conversions. At the beginning of the next month, the display ads were resumed and like clockwork the client received conversions for their paid search ads. The display ads haven’t received any conversions on their own yet, but whenever they are running, the paid search campaign receives conversions.

Search ads and display ads are the perfect combination, especially when they reinforce each other’s message. Display ads can help improve the results of paid search campaigns.
If you want a consumer to be more aware of your product or service, consider running display ads that are complimentary to your search ads. The results may be a nice surprise.

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