Affiliate Marketing is the oldest, most original form of performance based advertising. It goes way back to the days before the internet. The evolution of the internet and related technologies has helped propel this marketing mechanism to the forefront of online marketing opportunities today.

More advertisers are beginning to realize the importance of this channel due to increasing competition in the search engine marketing spectrum. As a result, some heavy hitters are making a bullish effort to capitalize on its popularity. In addition to the “big guys,” small CPA (cost per acquisition) networks are popping up all over the place.

If you haven’t been in a hole for the past few months, you’re aware of the Google/Double Click deal. Double Click owns Performics which is a search engine marketing company as well as an affiliate network. In early March, the deal received approval from the Federal Trade Commission and the EU. The deal quickly drew enormous amounts of scrutiny as many saw this as a conflict of interest for Google. Finally on April 4, Google announced it would go through with the acquisition but would sell off the search engine marketing side of the business. Google made it clear however, that they would in fact retain the affiliate marketing division of Double Click/ Performics.

Another big player to join the Affiliate Marketing arena is AOL. AOL recognized this as an important online marketing sector that is growing at a rapid pace; and this past February acquired buy.at. Buy.at is a large affiliate network which was started in 2002.

The emergence of these large companies joining this channel along with the startup of many smaller CPA networks; has helped propel this marketing technique. With the forecasted spends for online advertising, it appears that this method is poised to grow impressively. It should be exciting to see what these new players will bring to the table.

Stay tuned…

As I was watching TV over the weekend and reading the top headlines at various news websites, it occurred to me how exciting the time is right now. Political leanings notwithstanding, the race for the Democratic nomination has been extremely entertaining. Regardless of who wins the Democratic nomination, we are assured to have a first in our country, a woman or an African American winning the nomination for President for the Democratic Party. To see it unfold right before our eyes is something we will always remember. The best stories my grandfather ever told me were the ones where he could say at the end, “and I was there when it first happened”.

The same can be said for the current situation with Microsoft and Yahoo. I am not realistically trying to draw a comparison between the two politicians and the two companies, but the stories have one thing in common…they are entertaining. I find myself looking forward to reading about the next development in the story regarding the proposed acquisition of Yahoo by Microsoft. The battle between the companies has kept many a blogger up at night typing away on their keyboards. Microsoft recently drew a line in the sand over the weekend with its threat of a proxy fight which could lead to a takeover price lower than their current offer. Yahoo maintains their company is being undervalued by Microsoft and continues to hold firm in rejecting the offer.

How these two stories will play out is still anyone’s guess. I guess it all depends on whose side you are on. I’m sure the supporters of Hillary Clinton and Barack Obama feel their candidate has the greater vision and is best for their party’s nomination. The same could be said for those who support Microsoft’s acquisition of Yahoo at its current proposal, versus those who feel the offer is not enough. No one seems to be backing down, company or politician alike, the battles continue and it is fascinating to watch. We are truly living in extraordinary times!

When Google announced their plans in 2007 to buy DoubleClick, which included the purchase of Performics, several people within the industry considered it to be a conflict of interest. Performics is a division of DoubleClick that offers SEO, SEM, affiliate marketing, etc. With Google purchasing DoubleClick and acquiring Performics through the deal, it was sketchy how “fair” it would be to have an SEO/SEM agency be a part of the world’s most popular search engine.

One of the main concerns in the SEO area was that Performics might get special treatment and access to inside information about Google’s search-engine algorithms, something that all companies would love better understand. Performics’ SEO services also put Google in the business of taking money from clients in exchange for helping them rank better in search-engine results, which is something Google has said they will never do. On the other side of the spectrum, there was concern that Google would push the Performics SEM services at discounted prices. There was some concern that they would even be free. This would of course be unfair to other companies and agencies that are paying a premium CPC to participate within the sponsored listings on Google. Last, Performics also provides paid inclusion services into search engines that offer this type of practice. Paid Inclusion is when a company pays a search engine to include its website within its Natural listings. Google has always been highly critical of paid inclusion services, and does not offer them.

At the time of the acquisition, an article on Searchrank.com quoted Google stating that, “Performics is part of DoubleClick, and we are acquiring it as part of the transaction. We have no plans to dispose of it at this time”.

It seems that Google has changed course. On April 2, 2008, Google announced that they are splitting Performics into two separate companies: affiliate marketing and search marketing. More importantly, they are selling the search marketing business to a third party. On their official GoogleBlog, Google stated that, “It’s clear to us that we do not want to be in the search engine marketing business. Maintaining objectivity in both search and advertising is paramount to Google’s mission and core to the trust we ask from our users. For this reason, we plan to sell the Performics search marketing business to a third party. We believe this will allow us to maintain objectivity and the search marketing business to continue to grow and innovate and serve its customers. While we have not yet identified a buyer, we’ve received preliminary interest from a number of our current partners. Search Marketing will continue to run as a separate entity until the division is sold.” I am fairly confident that it will not take very long to sell the search marketing business to a third party. However, it remains to be seen who that will be. I am anxious to find out.

It seems that Google has stepped up and maintained their reputation as the search engine that everyone loves, respects, and wants to be a part of. I am not surprised that Google is selling Performics. It needed to happen in order to cease the controversy that made its way throughout the online marketing industry.