Affiliate marketing is a method of crowd sourcing, where a business rewards an external entity for any conversions brought about by their marketing efforts.
Businesses often turn to affiliate marketing because it is primarily a performance-based model in which affiliate commissions are only paid when a sale or other agreed action takes place. Thus it is relatively low risk.
Techniques used by affiliate marketers cover most of the major elements of the online marketing mix: paid search (PPC), search engine optimization (SEO) and latterly social media optimization (SMO). Many affiliates also use emailing and viral marketing techniques.
Whilst such strategies may seem rather more invasive than standard marketing methods, they have nevertheless proved to be effective over the last decade or so.
The key to success for any affiliate is to maximize the level of affiliate software automation employed. An entire sub-sector of the software industry has thus emerged in providing affiliates with support across all elements of the online marketing mix.
There are now numerous established PPC bid management technologies, used by affiliates and merchants alike in controlling paid search campaigns across multiple PPC search providers including Google and YSM (Yahoo Search Marketing).
Tracking Sales And Responses
Historically, the majority of affiliate commissions were generated on a pay-per-click (PPC) basis, but as the industry has gravitated towards performance-based models, most affiliate programs are now operated on a cost-per-action (CPA) basis as a more viable arrangement for both parties.
Payment to the affiliate occurs only when a predefined action is completed by the visitor and may be the completion of a response form, a survey, or of course a purchase.
Affiliate software automation which has the ability to track clicks and sales has evolved to accommodate the greater diversity of payment models and the complexities of managing an ever more sophisticated affiliate base. For those merchants considering a direct program (versus utilizing the software provided by the major affiliate networks), there is now a good range of competitive offerings.
These include iDevAffiliate which is available in both owned and provider-hosted forms and has been on the market since 1999; AllAffiliatePro which supports multi-level affiliates using a down-line approach; Affiliate Trail which is, again, available in licensed or hosted form; and many other reputable providers, in such a competitive space, industry-specific and country-specific functionality is the key and you should look for testimonials from others in your industry and geography, together with strong support.
Most of the solutions now offer core functionality within the affiliate automation software, in addition to tracking and reporting visits and commissions, commission reversals and so forth, you should expect good graphical statistics for both affiliate and merchant alike.
Using Data Feed Management
As the industry evolves, more and more businesses are taking advantage of data feeds through affiliate software automation. Merchants find them invaluable in communicating up to date product information to their affiliates. Affiliates also value them as a means by which to manage large volumes of product information and shorten the sales cycle with deep links direct to product pages.
However, from an affiliate perspective, managing data feeds for thousands or even hundreds of thousands of products from multiple affiliate networks and merchants can be a real headache. Merchants are notoriously inaccurate with data feeds plus the formats and standards used vary enormously. As a merchant, creating and managing product feeds, potentially in multiple formats, may also be problematic.
Once again, the software industry has not ignored this opportunity. A range of applications are now available to address these issues head-on. Affiliate Feed Generator, as the name suggests, is designed to convert any merchant`s CSV data to an RSS Feed with options to generate further site elements from it.
Quote Media provides a wide range of data feed management and syndication applications; whilst there are a wide range of feed management services and aggregators such as Onefeed (Based in The UK)providing a combination of services and technology to address the issues in this space.
FeedBlitz is now one of the preferred feed aggregators now being used by most influential bloggers to send out information and also to replace FeedBurner. FeedBlitz is a service that monitors blogs, RSS feeds and Web URLs to provide greater reach for feed publishers. This service also enables end users to monitor any feed or blog, anonymously if they wish, regardless of whether the publisher of that feed is using FeedBlitz
Ultimately, the range of software available to both merchants and affiliates is extremely broad with some items being essential, while others might be better left until “post-graduate” phase. Any affiliate planning to use paid search will want to consider the range of tools designed to allow the management of multiple campaigns across multiple paid search providers. In constructing a site, the applications are almost limitless with a huge set of site generators and individual optimization tools.
Here it is essential that the `template` effect be considered as the search engines are known to be less than keen on thousands of sites with overly similar structure. That said, decent content could well differentiate an individual site and offset any limitations. Thus these solutions, along with industry standard technologies such as WordPress or Joomla could be an ideal solution for those without web development skills.
The affiliate networks also provide extensive applications to both merchants and affiliates to facilitate tracking and analysis of traffic, revenue and so forth. There are even technologies that will allow an affiliate to aggregate the information from multiple affiliate networks, a popular example being Affmeter.
Finally, other key tools include site optimization, rank checking (be careful not to over-use as many are in breach of the search engines` terms of service); together with a still broader set of email marketing and subscriber management technologies; automated tools that address specific social media sites (an entire industry has emerged, marketing Twitter related tools); reputation monitoring and so forth.
For those looking at the affiliate industry as a money-making opportunity, the list really is endless!