Affiliate Marketing

Let’s be frank. It’s been a while since anything interesting has turned up in the realm of online affiliate marketing. Yet that could change. And soon. We need to know how and when to exploit the next performance-based marketing opportunity. Rest assured, there are exciting new opportunities for catalogers big and small in affiliate marketing — but serious challenges also lie ahead. From managing the intersection of search and affiliate programs to diversifying the mix of distribution points, the key question multichannel merchants should ask is: How can affiliates be encouraged to send us more incremental sales or new customers? Affiliates: Friends

During a Direct Marketing Association seminar last week, marketers alike tried to wrap their arms around just what New York state’s new Internet tax law means for their businesses. Jerry Cerasale, the seminar’s host and senior vice president of government affairs for the DMA, and the organization’s tax counsel, George Isaacson, provided the 85 members in attendance with answers on what this development means for their industry. Here’s a sampling of some of the tips, thoughts and observations gleaned from the event: * “This is very aggressive, nexus-expanding legislation,” Isaacson said, referring to the law which requires out-of-state online retailers to collect sales (or

There’s that old Bob Dylan song about times a-changin’ that I won’t bother to quote further. But it seems to hold true moreso year after year, and 2008 is no exception. So while some of us continue to exchange “happy new year” greetings with one another, I’ll send along one last new year’s greeting with what I believe to be the top five actions you should act on, examine or just ponder to bring your catalog/multichannel business in sync with the times. 1. Get your matchback system working smoothly at once. Assign someone in either your marketing or operations departments to do nothing

Well into the second decade of the Internet, many of you reading this — if not all of you — have a pretty good recollection of the “Wild Wild West” days of the Internet early on. It actually still is the Wild West, but in a much different way. And, having sat in on a number of sessions at the e-Tail conference in Washington, D.C., earlier this month, I noticed the breadth of knowledge that’s permeated the catalog/multichannel community and helped give it an entirely different character than it had 10 years ago. For one, consider how the language has changed. In the mid-’90s, I

During a session at last week’s Internet Retailer Conference in San Jose, Calif., a panel of speakers explained the reasons why the following five attributes are myths of affiliate marketing: * Affiliate shoppers are undesirable. “Affiliate shoppers are wealthier, tend to have children in the home and skew older than the overall Internet shopping average,” said Stuart Frankel, president of Doubleclick Performics, an online advertising agency. He based his information on a recent Performics-sponsored affiliate insight study commissioned by ComScore Networks (see www.performics.com). * You can’t control your brand. “Affiliate marketing at its root has absolutely nothing to do with affiliates,” said

Catalogers and other search advertisers are justly concerned about click fraud. Click fraud is when a person (or computer) imitates a legitimate user clicking on a pay-per-click ad, without actual interest in the ad’s target. Like Justice Potter Stewart’s definition of pornography — “I know it when I see it” — click fraud escapes precise definition. To know when a click is fraudulent, one needs to know the clicker’s internal motivation for clicking or be able to prove the clicker was an automated ’bot. Most experts agree that few individual clicks are “good” or “bad.” Instead, investigators assign quality scores that indicate the probability

Customer referrals from online affiliates converted at 3.2 percent and 3.4 percent respectively in the first and second quarters of 2006, according to a survey of 63 online merchants conducted by Internet marketing firm Performics and research firm ComScore Networks. This compares to 4.3 percent and 4.4 percent conversion for direct traffic to merchant sites and 2.3 percent each quarter for other referrals, such as paid search and e-mail campaigns. Other data revealed by the survey: • 6.6 percent of affiliate shoppers have household incomes under $25,000; • 18.9 percent have household incomes between $25,000 and $50,000; • 27.4 percent have household incomes between $50,000 and $75,000; •

For smaller catalogers like Chinaberry, the Web can certainly be the great equalizer. Here are some tactics used by Chinaberry’s namesake children’s books and toys catalog and its spiritual gifts catalog Isabella. Search engine marketing: Both catalogs use Google AdWords for prospecting. “Google is the most compatible for us in sending us our types of prospects,” he explains. “MSN is starting to do well, and everyone is waiting for the Yahoo! paid search relaunch. We’ve had Yahoo! on hold for a few months until its ‘Project Panama’ has its full rollout.” Affiliate marketing program: Using Performics’ tracking system, Chinaberry can monitor the online relationships

For many catalogers, paid search will be the single most important channel for new customer acquisition this year. Here are what I believe to be the 12 best ways to do it. 1. Focus on Google. The reality is, Google controls more than two-thirds of the search market and is growing rapidly. Yahoo! continues to lose market share each quarter. MSN is a far distant third. Ask.com is even further back. Allocate your attention proportional to your ad spend. Don’t completely ignore Yahoo! or MSN, but invest the most love and attention in your Google campaigns. You’ll be rewarded with the largest return for your time.

The Web is an essential channel for catalogers. Customers expect catalog companies to have effective, well-designed e-commerce sites. The Internet is undergoing a period of rapid innovation, often labeled “Web 2.0.” It includes tagging, visual search, wikis and Ajax. Web 2.0 technologies will transform online retail over the next two years. Catalogers will need to upgrade their sites to remain competitive. I suggest you read this month’s column with a computer close by — as I’ll tour some Online Retail 2.0 ideas that will transform e-commerce. The first stop is del.icio.us, the social tagging site. (Go to del.icio.us/catalogsuccess, and you’ll find a