Category Archives: Affiliate Networks

Tracking for iPhone Application Downloads

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Long time no post on the affiliate tracking front. I just want to share some exciting news with you.

As you know for a while I’ve been working for Sponsormob, the CPA Network for the Mobile Internet. We’ve released our download and conversion tracking for iPhone applicatiions. This means we can track installations of mobile apps on the iPhone, iPod Touch and the iPad.

Ads will be placed within other applications or on the (mobile) web. This is a 100% in-house solution and proprietary technoloy. While most of the online marketing world is still struggling with non-web transactions we went the extra mile and made it happen. We’re going to expand this to other mobile device platforms as well.

Thanks to Shawn Collins of Affiliate Summit and James Coops of Mobyaffiliates for the buzz. You should check out their blogs as well:

Multi-Merchant Cookie Spamming

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German affiliate network SuperClix has openly rejected the use of post-view tracking. Marcus Lutz, the owner, even sent out t-shirts to make his point. Thanks for that.

Superclix Anti-Postview T-Shirt

I am not against post-view per se. I think this is a good approach to rewarding affiliates that provide advertising value even without producing clicks. But the way it is being conducted by most affiliates and networks these days is NOT how it was originally intended to be. Currently it does more harm than good. That’s why I support SuperClix fully in this regard.

In theory, post-view tracking is supposed to reward affiliates for sales that originated not in clicks but in impressions of creatives. For example, a user would see a banner and a couple hours later go to the merchant’s website because he remembered the ad. In this case it would be absolutely fair to pay that affiliate a commission for a sale because he contributed directly to the transaction.

In today’s practice however, I would say that there is little connection bewteen the impression of the ad and a post-view sale. Most transactions that are considered post-view sales are purely based on cookie-spamming. Why?

Post-view affiliates know that they can’t make money legitimately. That’s why they create multi-merchant banners, displaying say three ads (and dropping three cookies) at one time. And to make this even worse, these banners contain rotations, so that new ads are being shown every ten seconds (thus new cookies are being dropped). And the smaller the ads are the less likely they are going to create a real advertising effect.

So merchants, don’t get fooled by what networks, agencies and affiliates tell you. At this stage, post-view tracking is still a rip-off and a bunch of crap. There are no standards yet, it’s the wild west days. These days you will not make more money just because of post-view tracking. The opposite is true, you will end up spending more.

Superclix Anti-Postview T-Shirt

Affilinet Becoming an Affiliate Agency

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I’ve just heard the news about eBay pulling their affiliate programs in German-speaking countries out of Affilinet next month. eBay has done this in most countries before already. It makes total sense as they are now able to customize everything to their needs and switch to a performance-oriented click commission (away from pay-per-sale).

However, what struck me is the fact that Affilinet will continue to the following things for eBay here:

  • program management
  • affiliate scouting
  • program development

Now, isn’t this what we usually describe as “affiliate agency services” or “outsourced program management” (OPM)?

Granted, all networks are more than just technical solution providers. They try to push their affiliates into the most profitable programs, share data, and so on. Everyone is out there to get the most out of things.

However, networks must maintain a minimum level of neutrality. I think with Affilinet  openly providing full service to a single merchant they’ve lost their neutrality. I’m a strong believer in the separation of powers between merchants, affiliates, networks, and agencies. Fishy stuff will happen whenever you mix up the roles.

Ask yourself: If you were a merchant, would you run an affiliate program on a network which is also the full-service agency of your competitor?

Affiliate Networks vs. CPA Networks

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Lately I’ve checked out a number of (mostly American) CPA networks and realized how old-fashioned most affiliate networks turn out to be. Here is why I like CPA networks much better.

Programs vs. Offers

Affiliate networks are usually about merchants. Some of the programs bombard you with every possible banner, link and product feed they have and don’t really help you much in making a choice. CPA networks on the contrary are usually about landing pages. A CPA offer may have a couple of landing pages, but that’s it. Lately the affiliate networks have adopted the CPA trend and started what they call campaigns. They’re basically integrating landing-page-only programs into their portfolio.

Direct Relationship vs. Blind Network

In a traditional affiliate network the merchant (or the agency) has direct contact to the affiliate. In a CPA network the affiliate talks only to the network, not the merchant. Usually the merchant doesn’t know the identity of the affiliate either.

Approval Process vs. Instant Start

Most affiliate programs have an admission process, many of them approve affiliates manually. In a CPA network you have no direct relationship with the advertiser, so there is no approval process. Affiliates can start right away and pull their codes. Don’t you hate how long some affiliate managers sometimes take to approve you?

Open vs. Confirmed Transactions

Probably every affiliate network can assign leads and sales a certain status: unconfirmed, confirmed, denied. I can understand the point of the merchants as they only want to pay for transactions for which the customer has actually paid. But affiliates, especially those that do media buying, need to know their final revenue by the end of the day. They can’t do effective media buying if they don’t know much money they actually made the previous day. So it’s no surprise that most CPA networks don’t get into this. They solve this for example by paying for every transaction but with a lower payout.

Secrets vs. Transparency

There are still a number of affiliate networks that keep the performance of their programs secret. On the other hand, CPA networks are usually brutally honest and give you access to the metrics. Not only that you see the stuff in the interface. The other day I received an email from a CPA network with a list of all eCPCs for their search offers. I’ve never received this from any affiliate network before, even when I asked them for it.

Conclusion

Very simple. If you are a content publisher, stay with the good old-fashioned affiliate networks. They provide you with all the fancy ads that you can throw on your sites. Also, the really big brands want to be in control of their affiliates so you won’t find very many of them on CPA networks. However, if you are a media buyer who wants to drive hardcore sales, go for the CPA networks.

The Future of Affiliate Marketing in Germany

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Pascal Fantou is becoming one of my favorite bloggers. If you can read German you should check out his latest post on the future of the affiliate industry in Germany. I’m not 100% sure if things are going to change as drastically as predicted, but I can definitely see Pascal’s points. Here’s a short summary in my own words:

Advertisers usually group their online marketing teams mainly by traffic source: search marketing, display campaigns, affiliate marketing. Back in the dark ages affiliates were primarily web site owners who would place text links or banners on their own sites to make some extra cash. These days many affiliates have turned into full-time entrepreneurs who have expanded their dominance also to search engines and social media.

Pascal’s point is that the media agencies and not the affiliates will be the key players in the future. They’re in close contact with the advertisers, they administer the big budgets and they’re actually becoming better at what they do. At the same time, small- and medium-sized advertisers will run their activities more and more in-house instead of through an affiliate or search marketing agency.

So what will happen to affiliates? A lot of their territory will be taken away by large agencies or the advertiser itself. For example in search marketing, why should advertisers pay for the profit of the affiliates and the affiliate networks if they can pull the sales in themselves? In some cases that would lower the cost of acquisition by 50%. Same thing with Google. They’re going after affiliates big time these days because they want the other 50% of the advertiser’s budget.

With the redundance of traditiional affiliates, especially in search marketing, the traditional affiliate networks are going to be dinosaurs. If they’re not changing their role to a technical solution provider they’re likely to die out. The winners are going to be the media agencies. They can combine large budgets of several advertisers and that way pay a lot less for ad network traffic.

The key to survival and growth for affiliates is specialization. Affiliates need to find niches where they do not have to compete with large advertisers and agencies. How about mobile?

Large Affiliate Networks Getting Lazy

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In my previous post I wrote about how smaller affiliate networks drive innovation. They feel the need to grow everyday and the only way to do this properly is through innovation. This strategy is quite promising actually since I observe more and more established networks falling behind.

For example let’s have a look at zanox. They’ve come out with an application store that encourages affiliates to make their own tools available to other affiliates as well. At first this may sound like a great idea.

But when you really think about it you start to realize that they’re trying to fool us here. In my opinion this application store is nothing else but their attempt to lower the internal IT cost and create some extra PR buzz on the side.

The message that zanox is sending out is: “We don’t want to innovate internally anymore. Dear affiliates, do the dirty work for us, please. And no, we can’t guarantee you any revenue from sharing your work with your competitors. Go and figure it out yourself.”

Maybe I’m missing the bigger picture here, but I don’t understand why successful affiliates should make their self-made tools available to competitors in the form of other affiliates or merchants.

Small Networks Set The Standards

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Usually the larger an institution gets the less innovative it becomes. There are a few exceptions, but generally the big players of an industry don’t drive innovation.

After UK-based AffiliateFuture the German 2nd-tier affiliate network belboon has also introduced a tracking technology based on local shared objects, also widely known as “Flash cookies”. Back then AffiliateFuture observed a 7% increase in conversions. I’d be really interested to see belboon’s figures.

I haven’t heard of any large affiliate network implementing something similar. For example Commission Junction has become so slow over the years. I take these types of networks are going extinct like the dinosaurs at some point.

Flash cookies are somewhat similar to regular browser cookies. Essentially they are files stored on a user’s computer. The main differences are:

  1. Traditional browser cookies are stored in separate folders for different browsers. Flash cookies are always stored in the same folder, no matter which browser you’re using. That way the tracking works even if a user switches between browsers.
  2. The browsers can only delete the cookies in “their” folders. They don’t auto-delete the Flash cookies.
  3. Unless users block Flash elements, the tracking still works even if they run their browsers in a super-privacy mode.
  4. Traditional cookies follow an open standard. Flash cookies are controlled by one company: Adobe.

ShareASale 80′s party and Body English

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Ok, another video post on the nightlife around Affiliate Summit West 2009 in Las Vegas.

Hm, I really liked the ShareASale event in Boston. But their 80s party at the Rio reminded me more of a school dance:

So I followed the English crowd (Matt of Existem/a4uexpo, Pete of Affilinet and Matt of iLevel) to Body English, the club event at the Hard Rock Hotel. Thanks to Pete we could skip the crowd:

buy.at party at the Palms

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Everyone seems to be writing about the sessions so I decided to post a few videos taken at night time during Affiliate Summit West 2009.

The buy.at invitation-only party at the Palms Casino was the perfect beginning. Good people, loud music, free drinks and a stunning view. Thanks to Charlie Calabrese for extending the event until 3am.

Transparency in Affiliate Marketing

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German affiliate network belboon has made a move towards more transparency which I really appreciate. Well done guys. I think if other networks did the same thing they’d probably lose a good portion of their business.

With belboon affiliates and merchants can view the following details for each tracked lead or sale now:

  • the IP address and user agent (browser) of the customer
  • the referrering URL
  • the date/time of the initial view or click
  • the type of cookie used to trigger the transaction (click or post-view)

User identification

Using the IP address and user agent the merchant can check for multiple orders coming from the same person. Especially in lead generation campaigns this will be quite useful to prevent fraud. I just don’t like the fact that belboon is still relying heavily on cookies. There are more sophisticated ways to track already.

Publisher sites

I hate networks and programs that make publishers approve every single domain they’re using. It’s really a pain in the ass. Yes, merchants need to be concerned about their brand so they want to know where their ads show up. But please don’t make it so difficult to do business with you.

By examining the referring URL the merchant will finally be able to identify the publisher’s websites. In theory this allows the network to switch the burden of proof. If they really want to monitor where ads show they should run their own statistics on a regular basis but leave out the pre-approval process.

Time to conversion

Using the time of the initial view or click one can calculate the time between the display/click of the ad and the conversion. This allows the merchant to run statistics on the average time to conversion per affiliate. That way you can determine whether an affiliate is:

  • driving quality traffic (conversion within a day)
  • cookie-spamming (no conversions within the first weeks)
  • using cash-back or ripping you off (conversion within a minute)

Over the years I’ve seen many leads and sales with a conversion time of less than a minute. I’ve always been convinced that these ones are fishy. Especially on large e-commerce sites with complicated check-out processes it’s impossible to get a customer to purchase that quickly. These transactions must be fraud or cash-back (which is in my opinion a type of fraud too).