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A visitor of my site who read some of my product data feed resources contacted me with an interesting question about how to deal with availability and SEO issues when you are utilizing merchant product feeds.

If I build a website with an affiliate data feed of an example: 10,000 different digital camera products. How would anyone but myself know that these products are available on my website?

My idea is a simple PHP script site with a CSV data feed file dynamically loaded. Because there won’t be any static pages built, how will the search engines see them?

If your pages URLs change all the time (as in appear and disappear = 404 error), you will have a hard time to get pages indexed by search engines. In order to be able to generate the same page for the same product over and over again is it necessary to have an unique product identifier, which could be the merchant SKU or in the case of digital cameras the UPC or EAN (I would use the EAN if you have that).

You don’t have to delete pages if a product is out of stock. You could (and probably should) keep the page and indicate that it is out of stock. You have one problem though. You need to know when a product is out of inventory and discontinued (= it will never come with new inventory in a future data feed file). There are three 1/2 options, which all involve the merchant (more or less)

Option 1) The merchant provides ALL products in the feed that he is selling, even the out of inventory one, but indicates the inventory level in a column of the data feed (absolute number or just an indicator e.g. available/out of stock or out-of-stock/back-order/low/available etc.

Option 2) The Merchant has a product status that indicate which item is an active SKU that will be replenished or if it is a “discontinued” item. A column for product status would do the trick, like “A” for active and “D” for discontinued.

f a SKU that was in status “D” is not included in the next feed, then you have to delete it, but you keep all products that are in status “A” and just show “out of stock” for them and wait for a future feed with new inventory again.

Option 3) and 1/2 If you don’t get any of the above, you can’t automate the update properly and should keep the product in the DB until you remove it manually. You either have to check yourself, ask the merchant or the merchant comes and asks for the removal (if he complains, explain to him what the problem is and what he can do about it).

In the case of cameras does it probably make sense to check once or twice a year if old models are still manufactured or not. Call it inventory cleaning day or spring cleaning / preparing for the holidays.

Dynamic Scripts and Search Engines

Now some general notes to the use of Product Data Feeds to generate content pages in an automated fashion.

I did a lot with data feeds in the past and know that they can be a pain in the neck sometimes.

While the technology behind it isn’t rocket science, did affiliate networks and merchant manage to screw up pretty much everything there is in the process, leaving it up to the affiliate to deal with those problems. You can’t assume anything and should always expect the worse. It does not only sound like a lot of work, it actually is.

I don’t want to discourage you, but I want to make sure that your expectations and goals are realistic and that you are ready and willing to spend the time and energy necessary to reach them.

I spent a lot of time to collect and write up resources and information to make it easier for other affiliates to deal with the subject. I also talked to several of the networks about the issues. Most listen, but only few are actually doing something about it.

Data Feed Resources / Suggested Reading

I suggest checking out the entry page on my site that is dedicated to affiliate data feeds.

My posts in this forum thread talk about the requirements and skills needed that are necessary to deal with data feeds from a technical point of view. It also mentions alternatives to the use of raw data feeds that should always be considered. I planed to write something up based on those posts, but did not get around it yet.

I created a write-up that is a good 101 for merchants and affiliates to the subject. It was also based on a forum thread at ABestWeb actually. I strongly suggest to you to read it.

Then I have documentations for the individual networks that provide data feeds. There is no standard, which means that it is up to you to either create a flexible solution and/or you chose to work with data feeds from one source (network in most cases) only.

Regarding SEO and the use of automated scripts to process feeds

Read this article of mine. It’s about web templates, but mentions data feed sites as well.

If your goal is to create sites based solely on data feeds and nothing else and expect them to rank anywhere in the search engines and make money off them, look for something else to do.

It is not 2001-2003 anymore. Google caused virtually a genocide among data feed affiliates with their “Florida” update in Fall 2003. Webmerge was the tool of the trade to create those sites (its still available, see my data feed page).

The sites that were build a bit more cleverly were mostly killed off by their “Jagger” update at the end of 2005, followed by their “BigDaddy” infrastructure update in early 2006. My largest data feed based site was among those. I was not doing much SEO at that time anymore, which was part of the reason why I could not prevent the site to get almost entirely washed out of Google’s index. There are only a few hundred pages left today, most of them are supplemental.

Making a Data Feed based Site Work Today

You have to add value for the user and content for the search engines in order to make it work. What you also need are a lot of inbound links to your site to be able to keep thousands of pages in the search engine index. This means that some word of mouth and social media marketing should be part of your business plan. It can be done, but it is much harder today than it was back then.

I suggest to concentrate on building a socially friendly site that does not rely as much on search engines and do the SEO work on the side and see the results of it as a nice added bonus, but not an essential part of your business.

You can do what you want. My tips are only well intended to save yourself a lot of time by learning it yourself the hard way and make mistakes that others already did before you.

Cheers!

Carsten Cumbrowski
Cumbrowski.com

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SEO Concerns and Product Update Issues with Affiliate Product Data Feeds

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I was updating and expanding my affiliate product data feeds and APIs resources at Cumbrowski.com, in particular the resources to the product feeds and store builder feature provided by the PepperJam affiliate network, which was launched about one year ago.

I liked what I saw overall, although some items were IMO a great idea, but then implemented half way only, probably without intending it.

Free? Hurray!

Product data are available to any affiliate without any cost directly via the PepperJam Network web interface. There is also a coupon feed available, in delimited format and RSS format (using some custom tags outside the RSS definition). They also have a tool called “store builder” (product show-case creator), which is similar to the tools available through third party tools providers like PopShops.com, GoldenCan.com, DataFeedFile.com or FeedShare.com.

Data Delivery via HTTP

Providing the feeds directly via HTTP, accessible via any web browser is a smart, efficient and cost effective solution. There is no need to charge any fee for setup or maintenance, because there is really nothing to setup. Via a, what you could call, “special page” are the product data rendered into the web browser in simple delimited text format, without HTML tags or anything like that. This is close to the format how the networks developer gets the same information out of their product catalog database, without the need for the developer to write a fancy, functional and error free user interface to browse the products.

The product information can be pulled and rendered into the browser in real-time.

Large Feeds

Since no FTP account needs to be created and no static product feed files created to be picked up by the affiliate via FTP client software, a whole new set of options become available and possible. No disk space is wasted on files that are not being picked up and no server CPU is spending a single cycle of processing power on it, until the affiliate publisher actually requests it.

True, there are some challenges, if you use HTTP as delivery method, if the amount of product s requested and downloaded is very large. However, 99% of all merchant product feeds do not fall into this category and even the merchants who have such large feeds (e.g. Buy.com, Overstock.com or Walmart.com) learned that it makes sense to break up their huge 1 million+ products big data feeds into smaller chunks, because it is never an easy undertaking to process over 1 million product records all at once, regardless if you download them via FTP or not.

Since HTTP requests can be handled and processed in real-time, the option to provide filters to reduce the amount of data returned, is now suddenly also (or should be) of the interest of the network.

It used to be an interest of the affiliates only (for the most part). I remember the time when I downloaded gigabytes of junk data every day, because there was only the choice between “everything” and “nothing”. Well, nothing was really an option, so you had to deal with all the overhead that you did not need.

Imagine the Possibilities

The real-time factor does allow the setup of virtually an unlimited number of filters. It is sad that affiliate networks who utilize HTTP for product data delivery are not making much use of this. A filter by product category, advertiser and keyword should only be the very least at the beginning.

When I was an affiliate manager in 2003 for a retailer who had the affiliate program with Commission Junction, the first thing I did was the creation of an affiliate intranet where publishers could create an account and pull product information and more. The intranet was initially created to solve the issues of not having contact information of any publisher (a CJ “feature”) , avoiding the $750 setup fee for the product catalog at CJ itself and the up to $250 setup fee for each publisher in our program that did not qualify for the free access to product feeds through CJ.

The intranet required a second registration, which is tough. We had to offer an incentive to do this. That was when we came up with features that were impossible to provide via the traditional network and the way how they did (and to some degree still do) things. For example it was possible to pull the top XXX number of best-selling products for the whole site or specific categories only and also the time-frame of the sales, ranging from “this month” to “all-time”. This enables the discovery of seasonal trends or sudden “hot” items that are new in the product catalog.

Those are only a few examples. Use your imagination and I am sure that the possible opportunities that come out as a consequence of it would be great, if at least some of the ideas will be implemented.

Web Services instead of Delimited Text via HTTP?

You might say that all this is what the new hot feature “web services” is supposed to be doing.

Yes and No. The border between web services and delimited feeds with several filter options provided via HTTP gets blurry, no doubt about that, but the technical details how similar they might appear are still different. The question whether to use a delimited feed or a web service (if available) still remains to be answered on a case-by-case basis. In some cases a combination of both does make sense.

Btw. as with web services, providing other data via HTTP beyond product and coupon data makes sense also, including reporting data or general program information about active or possible merchant/advertising partners.

One thing that PepperJam forgot over the nice and easy access to the product data via HTTP is the need for automated access to the data. HTTP is great and the link provided, updated based on my selections even better, but all this is of no use for many affiliates, if they have to be logged-in to the networks web interface in order to use the URL provided to them.

If I log-off and try the feed URL, no records are returned. Not good!

Automated Access without Login

PepperJam were not the first nor last who made this mistake. I remember LinkConnector.com having the same problem. I contacted them a while ago, suggesting to them to remedy this short-coming. I need to check, if they actually did anything or not. I could not send them sample source code as I did with Kolimbo (MyAffiliateProgram), where I could tell that they are using Microsoft Active Server Pages, where I am familiar with.

The affiliate network AvantLink.com did it right from the start. I wrote about it, when they launched, what they called their “AvantLink API Module“. Well, AvantLink had and has the reputation to be very knowledgeable about the subject of feeds and APIs.

You can have a look at their solution to see how they made it possible to provide access to the data in an automated fashion but at the same time doing it in a controlled manner without the option for anonymous access to the content.

If you do not want or like to see what another affiliate network is doing, fine, how about Google?

If you used the Google Calendar, you probably noticed the feature to pull your private events as a feed via an obscure URL provided by Google with the note that you must not give the URL to anybody, because it would give that person access to your feed as well. The protection is the obscure code in the URL that is virtually impossible to guess by anybody.

In the case that you think that the URL did leak out somehow, the option is available to render that URL invalid and generate a new unique and private URL for the same content.

I think you got the idea behind this.

PepperJam Sample Source Codes

Oh, btw the coupon feed provided by PepperJam Network does not require to be logged in to pull it. The lack of tags for start and end date of a promotion in the RSS version of the feed limits its possible uses, but I provided an example with source code for how to use it.

I also put the source code of a Visual Basic Script on my website that works around the problem of the need to be logged in to the web interface in order to pull the product feeds. I added a bunch of command line options to make it as flexible as possible for the use by affiliates to automate the pickup of product data from PepperJam.

Documentation? Configuration?

Last but not least. Is it really that hard to provide some notes about the general structure of the delimited feed (column and row separators, first row having column names or not, escaping of content that contains column or row delimiter) and to each column in the file about its use, possible values and format, which columns are required and always must have appropriate data provided by the merchant (and verified by you, the network)? Since the output data are generated on the fly, how about letting the publisher choose the format himself? We did that at our affiliate intranet too. The feed format preferences were simply stored with the affiliates intranet account. Some folks prefer tab-delimited, others pipe and there are even folks who like to deal with the mess that a CSV feed can create, if created improperly. The Linux guys prefer a simple Line-Feed after each record, the Windows guys a carriage-return plus a line-feed and the Mac guys just a carriage-return. Let each have it the way they like it.

I did as in almost every case educated guesses again by looking at actual product feed data from various selected merchants. But why should I do the guessing, if you are in the know and just forgot to write it down and share with your publisher base? “Should” and “Seems Obvious” is not good enough here. Once you automated the download, import, processing and publishing of a feed, having guessed wrong becomes more than a minor inconvenience, especially if it would have been easily avoidable early on.

Cheers

Carsten Cumbrowski
Internet Marketer, Blogger and Entrepreneur

Cumbrowski.com, the resources portal for internet marketers. The content is free, no strings attached.

The rest is here:
Affiliate Data Feed Delivery via HTTP

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Somebody contacted me recently with some very specific questions about affiliate product data feeds.

“I have an Affiliate company with 1 other person and right now we have a little over 1000 SEO-based sites. We want to add product data from different Affiliate NW’s, particularly CJ, ShareASale and Pepperjam. We’re looking for a tool/application that will allow us to perform ‘Keyword Product Searches’ from these various Affiliate NW’s.

We want to store the product results in our database as we already have an infrastructure for basically everything, with the exception of adding these additional NW’s.I could take the time and write this code myself (I’m a Classic ASP developer) but we’d rather buy a tool, or pay a consultant to customize an existing tool, write something from scratch, etc.

The requirements are pretty basic although I would formally document them if/when needed: query the available APIs (starting with CJ’s Product Search API) and perform some straightforward logic processing (i.e. add new products if not in our DB, update for price changes/out of stock, etc)”

The question is very specific already, but I decided to generalize my answer a little bit to show also other options that this person might not considered yet, because he didn’t know that the options exist. I also address the advantages of the options that I do not recommend for this particular case, but which are relevant for other cases, where I would make a very different recommendation.

I hope that my response will also be useful for other folks with similar issues and questions.

I will not highlight or promote any particular service or network out there. Some were mentioned in the original question, which I did not remove. Another exception is also my notes for one case-scenario, where I don’t know of many examples myself, which is sad.

If you know about others, please feel free to tell me about them in the comments section of this post after the main article.

Here is my original response to the person via email.

There are multiple options. You can find examples and more info’s for each of those options here.
…. And also the subsequent pages it refers to of course.

Option 1 (not recommended)

This one works not very well for SEO though, at least not without some programming on your end. Third party providers (under “Affiliate Product Data feeds Tools and Services”) offer widgets and JS code snippets that return product search results for specified keywords.

Option 2 (recommended)

However, most of those providers also offer APIs (sometimes free, sometimes for a fee) to pull data from their huge and normalized data bases. You would have to write the API call and the rendering of the results yourself. Sample source code is also sometimes provided by those services.

For SEO purposes would this be the option to go.

I talked to some of them and they said that they also offer custom feeds to clients who are willing to pay for them. Just contact them. This would be the best option, if you have the resources to maintain your own product database server to feed data to your web sites. You must already have one, because I don’t think that you maintain your 1000+ websites all by hand vs. a centralized DB driven content management system.

Option 3 (recommended only if the limitations are not a problem)

Several affiliate networks provide access to product data of their Advertisers via web services APIs. However, you are often limited to only be able to search products for an individual merchant and not across the products of all your merchant partners. This could defeat the purpose if this feature is what you need for your Website.

Like for option 3. Programming on your part is required. I saw some networks providing “widgets” that render real HTML results, but none of those tools convinced me yet. Those are still in “beta” IMO.

Option 4 (not recommended, unless you have resources to spare)

Trust me when I say that you do not want to go with this one, unless you have the necessary one-time (and ongoing) resources available to do it. The lack of standards and the poor quality and errors in the available feeds are just a nightmare and the reason for the third party providers from options 1 and 2 to exist.

You can download the individual data feeds provided by advertisers yourself, normalize them and dump into your own product database. Then you can use those product data on your websites as you see fit.

This option gives you the most control and flexibility regarding the available product data. However, this flexibility comes at a cost that is in many cases to high for what it’s worth, but it does make sense for some folks.

Keep in mind that this option requires more than a one-time implementation. Feeds break, new feeds should be checked first (by hand), before plugged-into your system. There are some out of the box tools and scripts available that can help you with this task though.

Now some notes to elaborate the options and explain where the three options that I did not recommend for this particular publisher, would make sense for another publisher with different needs and premises.

Notes:

When I say that it is required to program stuff yourself, I don’t mean that YOU have to do it yourself literally, of course. As with many things in affiliate marketing, as an affiliate marketing who works on his own, outsourcing is important and almost impossible to avoid at some point, because nobody is good at everything and the idea of compensating the lack of skills with spending more time to get okay results (if that), becomes more and more unrealistic and unreasonable as your business matures and suddenly time will be the one resource that you will be on short supply on all the time.

I spent the time to collect resources and services to outsourcing. Sorry, but here went the “but how?”, “where?”, “who?” excuses for not doing it. hehe

Now some notes to the options that I did not recommend for the specific case from the email that I got, which could certainly become the right and recommended options for somebody else.

Option 1 is something that I would recommend to affiliate publishers that are looking for an easy way to get product data on to their websites or blogs and do not worry much about the lack of SEO (search engine optimization) benefits.

Those 3rd party providers often offer additional stuff, beyond product data, such as coupons and promotional offers available from your active merchant partners.

Option 4 is the option that I choose several years back, because there was no other option available. If I would have to make the decision again, I’d go with the extended version of Option 2 and pay a monthly fee to the 3rd party tools providers to give me access to a single, normalized and clean product feed for all my merchant partners who offer a product data feed.

Since those 3rd party providers are already doing what would be the most time consuming and on-going support requiring part of the whole thing, I’d rather pay them a monthly fee that I don’t have to do this dirty work myself.

The possible shortcomings are that the provider might not include columns that are special and something that I would really need or that they don’t have a particular advertiser included in their system yet. However, if you are a paying customer and your request is reasonable, making sense to the 3rd party provider etc, chances are good that this shortcoming will be eliminated by the provider, may be even free of charge, worst case, you have to cover the cost to implement what you need.

Option 3 has limitations, but the advantage that you are not required to store any (or only little, if you are doing some caching for performance reasons) product data on your own servers. You basically request information on-demand, when the user loads one of your web pages where you want to show this product information.

Another advantage is that the information are much more likely to be current than what you would have in your database, if you pull entire product feeds.

You cannot pull feeds all the time, because of the time and resources it takes to load and process them. A web service call to the source provides information as current and up-to-date as you are able to get.

More up-to-date could only be a web service call provided by the merchant himself (outside the affiliate network), but most advertisers do not have that. Exceptions that I know about are advertisers with an in-house affiliate program, like the Amazon.com or eBay.com affiliate programs.

Cheers!

Carsten Cumbrowski

Other affiliate and internet marketing resources in general that go beyond product data feeds can be found at my website Cumbrowski.com as well, resources like tools/services, books, podcasts, blogs, videos etc. to subjects SEO, SEM, eMail Marketing, Web Analytics, Copywriting, Domaining, Public Relations, Outsourcing, Legal Issues, Web Development, Industry Events, Database Development / Administration and much more. Access to the resources is free, no sign-up or membership is required.

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Options for Using Affiliate Product Data Feeds as an Affiliate Publisher

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When all is said and done, the so-called Amazon Tax that has everyone so concerned about old-style affiliate marketing’s future spells nothing but opportunity to those (like Brad) who think outside of the box. The old affiliate model’s walls are crumbling and have been for years now. Yes, many will fight this misguided tax — and I believe they SHOULD fight it — but the tax is just speeding up something inevitable: Change. It’s just another sign of the times.

So what’s next? I believe there are a bevy of options for CPA-lovin’ publishers that are being overlooked. Let’s have a look…

First, the facts:

1. Affiliate networks are buying up publishers/affiliates, lead generation companies, advertisers (Valueclick+eBablyon) etc.
2. Large publishers themselves (think Fatwallet and eBates) are working directly with advertisers to wrap value-added services (non-CPA media placements, creative support, etc.) around their valued communities of buyers — bypassing networks. I say again, bypassing networks. Hence, #1.
3. Search Engines: Yahoo and Google are distributing deals & coupons (moving in on CPA affiliates and affiliate networks’ turf) and MSN is buying up performance-based innovators (publishers like Jellyfish.com). Are companies like Linkshare standing idly by? Hell no! They’re getting in bed with Redmond. But wait… MSN is stepping up the pace on competing dead-on with traditional affiliates and networks. I find this to be of more danger to networks, NOT affiliates who maintain user loyalty.
4. Advertisers (note: Amazon is not one of them) are cutting and running from affiliate programs… rather than face a more complicated tax scheme. This is reflective of their overall mood/attitude and value perceptions of their affiliates. Write or wrong, knee-jerk or not, some marketers who have pre-conceived notions and/or legitimate concerns about affiliate programs are bailing. Bad in every way for “affiliate marketing” — once again.

Regarding this new “Amazon tax” law…

“The law also states that a merchant needs to have $10,000 a year in affiliate sales from NYS affiliates to NYS customers,” says Deborah Carney of Team Loxley.

“Networks can’t provide this information without breaking privacy rules, so how will this be enforced? Plus networks don’t collect location information from the sales themselves. ”

It’s enough to make your head spin and these are just a few examples! What’s going on here? What’s next? Where’s the good news? A sense of stability?

We’ve been hearing about mobile and video for years now. I’ve been scouring the globe for good examples of innovation in this space — BEYOND NEW TOOLS (ie. ROI experienced by marketers). Where’s the beef on that front?

Affiliate 1.0
Despite what Michael Singer and a good number of my colleagues say (and they make some seriously unsubstantiated claims) about how Web 2.0 is super-charging affiliate marketing there is virtually no evidence that CPA affiliates are monetizing social spaces. It’s a lot of fun to talk about but it’s flatly not happening to the degree that it registers a revenue blip rivaling the status quo.

“Affiliate marketing has evolved and it’s difficult for newcomers to jump in without any capital and start making money,” says Chris Finken, of affiliate marketer OrangeSoda.com.

“Blogs remain a popular tool for affiliate marketing ‘on the cheap,’ but successful affiliates are still making great money without experimenting with video and mobile.”

Humph. ‘Nuf said perhaps. Finken also believes many marketers are turning backs on affiliates, viewing them as expendable. He warns that this practice may bite them in the rump. He believes some marketers will be back when they miss risk-averse affiliates who tend to pioneer (as they did in paid/PPC search).

“It’s hard to go back to the affiliates you’ve dismissed and say ‘Please be innovative and if it works I promise we’ll pay you’,” he says.

So what’s next?

Drop Shipping
Although the sector also (like affiliate marketing) suffers from an image problem, drop-shipping models are beginning to come back. Remember NexChange, ePods and the like of the dot-bomb days? Drop shipping (where the “affiliate” is actually a “retailer”) is a great idea but was a premature one. It was too early and affiliate marketing was just too easy for publishers and advertisers to implement back in the late ’90s. Aaah, yes… the Golden Age of media arbitrage.

Specifically, affiliates didn’t want or need “storefronts” or stores to succeed. They also didn’t need the headaches that go along with being the retailer (”merchant of record”). They didn’t need or want to facilitate the transaction nor handle customer service or shipping.

More importantly, the middle-men involved didn’t have the reputation piece figured out… that is, the reliability of drop-ship product suppliers. Would they actually ship? On time? Handle back-orders and returned items well enough to satisfy customers? The answer was no — but that was then. Today, companies like Shopster.com have emerged as leaders in the field of full service drop-ship solutions for advertisers.

These providers give publishers everything from storefront creation to managing suppliers, returns/cancels, back orders, etc. They do the heavy lifting involved in retailing so publisher’s can focus on what they do best — acquire traffic/visitors. More importantly these companies are negotiating product discounts on behalf of retailers (many of whom are old-style “affiliates”) and allowing them to set their own profit margins. Not at all like affiliate marketing of old days. Yes, supplier reputation is still a sticky subject and is difficult to manage — just ask eBay. That stated, drop shipping is catching on and is a viable option for publishers with valuable traffic.

Widgets, 2.0 Media, Affiliate Education & Subsidies!
Now before you roll your eyes, please hear me out. There IS progress being made on monetizing via widgets. As I said, it’s no way rivaling traditional CPA affiliate revenue generation and it isn’t worth the hype it’s getting at conferences. BUT… pay close attention to Facebook’s Radical Buy program. The program turns Facebook-ers into eBay style affiliates.

“… I think the Radical Buy application on Facebook is one of the most sophisticated application online. It also serves a very practical purpose — helping people sell their unwanted stuff and make a few bucks along the way.” says Rodney Rumford of FaceReviews.com.

“The one radical concept worth mentioning again here is that users can make a ‘commission’ by selling other peoples stuff simply by listing it on their profile page.”

Radical! What’s more, this isn’t just about one area of potential monetization. Facebook is expanding the program — with hopes of growing it outside of Facebook.com proper. Now THAT’S radical for sure.

Also… I’ve discovered serious investments being made both here in the States and overseas that aim to super-charge traditional (ie. search marketing) — and other innovative, 2.0 type monetization — by publishers:

1. Investments are being made by marketers themselves. Companies like Insurance.com are subsidizing affiliate /publisher education and even their search marketing costs. That’s right — marketers are funding affiliates’ marketing efforts and successfully so!
2. European networks and advertisers are banding together to invest in affiliate/publisher education (I’ll be traveling to London next month to participate in one such University for a large media company)
3. Overseas affiliate marketing networks like Zanox are making tremendous investments in “going open” (read more about Zanox GAP Campus) — what about U.S. based networks?!

I’ve given the community quite a bit to chew on here… so what say you?!

See the original post here:
Affiliate 2.0: Fact, Fiction & New Innovators

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When all is said and done, the so-called Amazon Tax that has everyone so concerned about old-style affiliate marketing’s future spells nothing but opportunity to those (like Brad) who think outside of the box. The old affiliate model’s walls are crumbling and have been for years now. Yes, many will fight this misguided tax — and I believe they SHOULD fight it — but the tax is just speeding up something inevitable: Change. It’s just another sign of the times.

So what’s next? I believe there are a bevy of options for CPA-lovin’ publishers that are being overlooked. Let’s have a look…

First, the facts:

1. Affiliate networks are buying up publishers/affiliates, lead generation companies, advertisers (Valueclick+eBablyon) etc.
2. Large publishers themselves (think Fatwallet and eBates) are working directly with advertisers to wrap value-added services (non-CPA media placements, creative support, etc.) around their valued communities of buyers — bypassing networks. I say again, bypassing networks. Hence, #1.
3. Search Engines: Yahoo and Google are distributing deals & coupons (moving in on CPA affiliates and affiliate networks’ turf) and MSN is buying up performance-based innovators (publishers like Jellyfish.com). Are companies like Linkshare standing idly by? Hell no! They’re getting in bed with Redmond. But wait… MSN is stepping up the pace on competing dead-on with traditional affiliates and networks. I find this to be of more danger to networks, NOT affiliates who maintain user loyalty.
4. Advertisers (note: Amazon is not one of them) are cutting and running from affiliate programs… rather than face a more complicated tax scheme. This is reflective of their overall mood/attitude and value perceptions of their affiliates. Write or wrong, knee-jerk or not, some marketers who have pre-conceived notions and/or legitimate concerns about affiliate programs are bailing. Bad in every way for “affiliate marketing” — once again.

Regarding this new “Amazon tax” law…

“The law also states that a merchant needs to have $10,000 a year in affiliate sales from NYS affiliates to NYS customers,” says Deborah Carney of Team Loxley.

“Networks can’t provide this information without breaking privacy rules, so how will this be enforced? Plus networks don’t collect location information from the sales themselves. ”

It’s enough to make your head spin and these are just a few examples! What’s going on here? What’s next? Where’s the good news? A sense of stability?

We’ve been hearing about mobile and video for years now. I’ve been scouring the globe for good examples of innovation in this space — BEYOND NEW TOOLS (ie. ROI experienced by marketers). Where’s the beef on that front?

Affiliate 1.0
Despite what Michael Singer and a good number of my colleagues say (and they make some seriously unsubstantiated claims) about how Web 2.0 is super-charging affiliate marketing there is virtually no evidence that CPA affiliates are monetizing social spaces. It’s a lot of fun to talk about but it’s flatly not happening to the degree that it registers a revenue blip rivaling the status quo.

“Affiliate marketing has evolved and it’s difficult for newcomers to jump in without any capital and start making money,” says Chris Finken, of affiliate marketer OrangeSoda.com.

“Blogs remain a popular tool for affiliate marketing ‘on the cheap,’ but successful affiliates are still making great money without experimenting with video and mobile.”

Humph. ‘Nuf said perhaps. Finken also believes many marketers are turning backs on affiliates, viewing them as expendable. He warns that this practice may bite them in the rump. He believes some marketers will be back when they miss risk-averse affiliates who tend to pioneer (as they did in paid/PPC search).

“It’s hard to go back to the affiliates you’ve dismissed and say ‘Please be innovative and if it works I promise we’ll pay you’,” he says.

So what’s next?

Drop Shipping
Although the sector also (like affiliate marketing) suffers from an image problem, drop-shipping models are beginning to come back. Remember NexChange, ePods and the like of the dot-bomb days? Drop shipping (where the “affiliate” is actually a “retailer”) is a great idea but was a premature one. It was too early and affiliate marketing was just too easy for publishers and advertisers to implement back in the late ’90s. Aaah, yes… the Golden Age of media arbitrage.

Specifically, affiliates didn’t want or need “storefronts” or stores to succeed. They also didn’t need the headaches that go along with being the retailer (”merchant of record”). They didn’t need or want to facilitate the transaction nor handle customer service or shipping.

More importantly, the middle-men involved didn’t have the reputation piece figured out… that is, the reliability of drop-ship product suppliers. Would they actually ship? On time? Handle back-orders and returned items well enough to satisfy customers? The answer was no — but that was then. Today, companies like Shopster.com have emerged as leaders in the field of full service drop-ship solutions for advertisers.

These providers give publishers everything from storefront creation to managing suppliers, returns/cancels, back orders, etc. They do the heavy lifting involved in retailing so publisher’s can focus on what they do best — acquire traffic/visitors. More importantly these companies are negotiating product discounts on behalf of retailers (many of whom are old-style “affiliates”) and allowing them to set their own profit margins. Not at all like affiliate marketing of old days. Yes, supplier reputation is still a sticky subject and is difficult to manage — just ask eBay. That stated, drop shipping is catching on and is a viable option for publishers with valuable traffic.

Widgets, 2.0 Media, Affiliate Education & Subsidies!
Now before you roll your eyes, please hear me out. There IS progress being made on monetizing via widgets. As I said, it’s no way rivaling traditional CPA affiliate revenue generation and it isn’t worth the hype it’s getting at conferences. BUT… pay close attention to Facebook’s Radical Buy program. The program turns Facebook-ers into eBay style affiliates.

“… I think the Radical Buy application on Facebook is one of the most sophisticated application online. It also serves a very practical purpose — helping people sell their unwanted stuff and make a few bucks along the way.” says Rodney Rumford of FaceReviews.com.

“The one radical concept worth mentioning again here is that users can make a ‘commission’ by selling other peoples stuff simply by listing it on their profile page.”

Radical! What’s more, this isn’t just about one area of potential monetization. Facebook is expanding the program — with hopes of growing it outside of Facebook.com proper. Now THAT’S radical for sure.

Also… I’ve discovered serious investments being made both here in the States and overseas that aim to super-charge traditional (ie. search marketing) — and other innovative, 2.0 type monetization — by publishers:

1. Investments are being made by marketers themselves. Companies like Insurance.com are subsidizing affiliate /publisher education and even their search marketing costs. That’s right — marketers are funding affiliates’ marketing efforts and successfully so!
2. European networks and advertisers are banding together to invest in affiliate/publisher education (I’ll be traveling to London next month to participate in one such University for a large media company)
3. Overseas affiliate marketing networks like Zanox are making tremendous investments in “going open” (read more about Zanox GAP Campus) — what about U.S. based networks?!

I’ve given the community quite a bit to chew on here… so what say you?!

More:
Affiliate 2.0: Fact, Fiction & New Innovators

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