affiliate marketing: a better alternative?

16
filiate Marketing: A Better Alternative Content Revenue Strategies NY November 5 th , 2009 Moderator: Steve Schaffer

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In today’s economy, everyone is looking for new sources of revenue and new ways to grow. For mid-long tail publishers, affiliate marketing could be the perfect fit. In 2007, web proprietors paid out several billions of dollars to affiliates globally, yet that’s only the tip of the iceberg for this widely untapped medium. As the recession squeezes ad and marketing budgets, many businesses are committing more resources to performance-based programs like affiliate marketing, making this an opportune time for savvy publishers to join the game. At the same time, consumers are spending more time online researching products and pricing, growing savvy to ignoring the often questionable network ads shown to them on their favorite blogs. This leaves the door wide open for high-quality publishers to better engage and inspire trust in their customers through affiliate marketing. On this panel, experienced affiliates and advertisers will discuss the ins and outs of affiliate marketing, highlight the key areas of opportunity and offer tips and best practices to help new affiliates achieve maximum ROI.MODERATOR:• Steve Schaffer, Founder and CEO, Offers.comPANELISTS:• Will Martin-Gill, Director, eBay Partner Network• Peter Bordes, CEO, MediaTrust• Shawn Collins, Affiliate, Blogger and Co-Founder, Affiliate Summit• Brook Schaaf, Affiliate and CEO, Schaaf Consulting • Gil Abir, VP, Corporate Partnerships, Payoneer, Inc.

TRANSCRIPT

Page 1: Affiliate Marketing: A Better Alternative?

Affiliate Marketing: A Better Alternative?

Content Revenue Strategies NYNovember 5th, 2009

Moderator: Steve Schaffer

Page 2: Affiliate Marketing: A Better Alternative?

Session Agenda

• Questions About the Audience

• Panel Introductions

• Performance Marketing Overview

• Panel Discussion -- I will Ask the First Few Questions

• Questions From the Audience

• Panel Discussion – Questions of each other

211/5/2009

Page 3: Affiliate Marketing: A Better Alternative?

Our Panel

Steve SchafferFounder of Vertive and publisher of Offers.com@SteveSchaffer

Brook SchaafFounder of Schaaf Consulting@BrookSchaaf

Shawn CollinsCo-Founder of Affiliate Summit@AffiliateTip

Peter BordesCEO of MediaTrust@MediaTrustPete

Will Martin-GillDirector, Internet Marketing at eBay, Inc.@eBay_affiliates

311/5/2009

Gil AbirVP, Corporate Partnerships, Payoneer, Inc.

Page 4: Affiliate Marketing: A Better Alternative?

What is Affiliate Marketing?

• Three primary forms of online marketing – Pay per impression– Pay per click– Pay for performance (sales or leads)

• For this panel we are focusing on Pay for Performance– Also called Performance Marketing or Affiliate

Marketing411/5/2009

Page 5: Affiliate Marketing: A Better Alternative?

Publisher Business Models

• Direct-linking affiliates (Search & Ad Networks)

• Niche sites and blogs

• Coupon and deal sites

• Cash back or points

511/5/2009

Page 6: Affiliate Marketing: A Better Alternative?

Three Main Types of Actions

Merchant pays ~$25 for a customer who is worth ~$50

Per lead feeForm or applicationLoans, insurance, car, free trial

Lead

Merchant pays a commission on the transaction (~3-10%)

Percent of the sale (commission)

Retail/ServiceGifts, shoes, electronics, travel

Sale

Merchant pays a percent of the value of initial sale

orPays a predetermined bounty often based on the estimated lifetime value

Pay-per-sale or revenue share

Account/Subscription Credit cards, subscriptions, membershipsNew Customer

Payment DetailsPayment MethodTypes of Offers Transaction Type

611/5/2009

Page 7: Affiliate Marketing: A Better Alternative?

How Big is the Industry? According to one source:

Source: Forrester Research, Inc.711/5/2009

Page 8: Affiliate Marketing: A Better Alternative?

U.S. Affiliate Landscape

This is just 25% of ONE network’s (LinkShare) affiliate universe!811/5/2009

Page 9: Affiliate Marketing: A Better Alternative?

Why Such Rapid Growth?

Measurable, Performance-based

Spend

Revenue

ROI+ for merchants, $$$ for publishers

More consumers looking online for info, deals

New tools are making it easier to implement

911/5/2009

Page 10: Affiliate Marketing: A Better Alternative?

Why Publishers Like Affiliate Marketing• Performance model pays publishers for

the quality of their work

•More flexibility for ad integration, adding to a publisher’s content

• Connect directly with top-tier advertisers, no insertion orders required

•More control over the ads displayed

1011/5/2009

Page 11: Affiliate Marketing: A Better Alternative?

What We Hear

1111/5/2009

“Many publishers are reporting between a 10 to 12% increase in payouts on select non-premium inventory when using affiliate marketing vs. CPC. CPM-based publishers are reporting similar increases on the same type of inventory.”

--Mike Oulette, Director, Publisher Development, Commission Junction

Page 12: Affiliate Marketing: A Better Alternative?

Example: Spadout.com

1211/5/2009

The keyword “gloves” takes the reader to a page featuring gloves on sale – each glove listing is an affiliate link

“Our audience leaves Spadout knowing exactly what they want to buy, where they want to buy it, and confident they are getting a fair price. This creates high converting traffic that can out-perform other websites’ revenue.”

Mark Silliman, Spadout.com

“Since we became free of untargeted advertising, our revenue has increased and we're 100% on mission: take readers and make high, fast converting shoppers."

Page 13: Affiliate Marketing: A Better Alternative?

Example: ShopWiki.com

11/5/2009 13

“Performance based advertising allowed us to take on the appropriate risk (instead of our advertisers), so we could find innovative ways of putting information on our site that would optimize our yield and still deliver high quality traffic.”

James Keating, ShopWiki.com

“With performance based advertising, consumers vote with their dollars as to how much they like a merchant. We can put those advertisers at the top of the list so consumers find them faster and they convert faster. “

A click on the “shoes” link takes the consumer to a buying guide -

ShopWiki is educating the consumer and moving them closer to a sale.

Clicking on “boots” reveals boots on sale from popular merchants that have affiliate relationships with

ShopWiki

A click on the “shoes” link takes the consumer to a buying guide -

ShopWiki is educating the consumer and moving them closer to a sale.

Clicking on “boots” reveals boots on sale from popular merchants that have affiliate relationships with

ShopWiki

Page 14: Affiliate Marketing: A Better Alternative?

Example: TopDatingTips.com

11/5/2009 14

Content site uses both contextual ads

and affiliate links

Content site uses both contextual ads

and affiliate links

Page 15: Affiliate Marketing: A Better Alternative?

Where Can I Learn More?

1511/5/2009

Page 16: Affiliate Marketing: A Better Alternative?

Questions for Panel

1611/5/2009