This has been a pretty tough year for our economy.  It seems that every headline is worse than the last and every industry is asking us, yes us, to bail them out.  I’ve met, and know, so many in my area that are effected by the slumping economy, either with jobs lost or just general business downturn, it can be tough to swallow.

As we get geared up this week for Black Friday, Cyber Monday and the beginning of the Christmas and holiday shopping season, I wanted to dive into consumers’ behavior and how it is changing over this difficult time.  My thought was that more consumers are, and will be, shopping with coupons and more and more web traffic is going to these type of sites, the coupon and discount shopping affiliates.  What I learned, the more I researched, was that consumers are doing just that.  They continue to spend, but not without researching their purchase through coupon sites.  They want to make sure they get a deal.

I have broken my findings into three posts this week in hopes to get you all ready for Friday.  The first post, today’s, is reporting what I was able to dig up on consumer’s behavior.  The second will be published tomorrow and discusses the trend of of increased traffic to online coupon sites and gives some ideas for unique couponing strategies.  The third will release some data from a survey I conducted by polling the top coupon affiliate sites on the net and provides some of my recommendations for merchants.  Coupon sites will be more important to your online distribution the farther down our economy goes and I hope you get a lot out of this series.  So let’s dive in…

Consumer’s Changing Behavior

As recently as a few days ago, Anne D’Innocenzo, an AP retail writer, reported this:  “Americans have slammed their wallets shut since the financial meltdown, and the future is looking downright scary for stores across the country and the whole U.S. economy.” Some more less than encouraging statements:

“The recent data has been startling: For the third quarter, consumer spending fell 3.1 percent, the worst performance in 28 years. Sales at established stores for October were the worst since at least 1969. The slump is continuing into November: Macy’s says it expects a decline of at least 10 percent this month.  Even those with appetites for Prada and Gucci aren’t immune. Among the hardest hit are luxury stores. Saks Inc. and Nordstrom Inc. reported same- store sales fell at least 10 percent. At Neiman Marcus Group Inc., the drop was nearly 27 percent.” But how is this effecting coupon use and what changes are consumers making to combat this downturn?

According to the Wall Street Journal, this year was the first year coupon redemption did not decline.  For the last 15 years coupon redemption has fallen each year.  As our economy prospered, less and less coupons were redeemed.  But not anymore.  Last year it held steady.  Does this show a general trend in purchasing behavior?  How does this relate to online retail?

RetailMeNot commissioned Harris Interactive in March of this year, prior to the economy really taking a downturn, to conduct a survey on consumers’ shopping habits during a recession.  In that survey they found that 54% of adults would decrease discretionary income during a recession and 63% of consumers WILL NOT make a purchase if they cannot find a deal.  From their press release: “Coupons are a household staple for many Americans–the survey found that the vast majority of adults (86%) have used coupons and/or discount codes while shopping. However, this figure may soon rise as the economic slowdown prompts many consumers to reevaluate spending behaviors and place a higher priority on budgeting and deal-seeking. More than one in three adults (37%) said that, during a recession, they would increase the use of coupons and/or discount codes; among women, the figure was even higher at 43% (vs. 31% of men). Retailers have an opportunity to bolster sales and preserve customer loyalty by rewarding savvy shoppers with discounted merchandise.”

In another survey done by Principal Financial, and reported by Inc.com, more than half of the respondents said they were cutting back on spending due to the economic environment.  That was in June, it’s only gotten worse since.  “That has many Americans eating out less, relying on generic brands and clipping coupons in efforts to save, the survey found.”

RetailMeNot again worked with Harris Interactive in October to release this report.  In it they confirm their first results (since we are arguably in the first quarter of a recession): “nearly half of online adults (45%) plan to spend less money on gifts this holiday season compared to last year given the current state of the economy and one in five plan to spend significantly less.“  They also reported that 19% will shop during Black Friday deals, 44% will shop at discount stores, and 37% will shop online to save gas.

The Washington Post reported that coupons are now coming back in favor.  “With wages not rising as quickly as the cost of basic necessities, coupons are back in favor after many years of steadily declining popularity, experts said.“  … “Were we not in this economy, we probably would be looking at a slight decrease again,’’ said Matthew Tilley, co-chairman of the Promotion Marketing Association’s Coupon Council and director of marketing for CMS. “There’s definitely an increased interest to use coupons for savings by consumers.’’

It’s being widely reported that consumers are shifting their buying habits.  As the articles I referenced above point out, more and more consumers are no longer purchasing a product without researching to ensure they have the best deal.  They are using coupons in larger numbers, purchasing items without them less frequently and generally planning for a prolonged downturn in the US and global economies.  But consumers continue to shop, that is the good thing.  They continue to plan to spend money this Christmas, but are doing it more wisely and making sure they have a discount prior to making that purchase.

But how does that relate to online coupon sites and merchants’ participation there?  I’ll explore how traffic to these sites has been increasing dramatically and how merchants can, and should be leveraging this shift to weather the storm in my next post tomorrow.

2nd post in series - Consumers flocking to coupon sites.

In October I was fortunate enough to attend one of the most informative and fun conferences I have been to in several years - BlogWorld.  The conference overall was fantastic. They had an affiliate track for the first time and it was very well attended.  Many of us in the affiliate community noticed that “affiliate marketing” was relatively new to this audience of bloggers.  Some even said that 90% of the attendees had no idea what affiliate marketing is and how to get involved, let alone that they can use these relationships to monitize their blogs.

Because of this, I wanted to put together a very top level run down of what it is and how they can get started.  NOTE: if you are a seasoned affiliate marketer, then you won’t get much from this article.  This is intended for those that are completely new to this area of performance marketing.  It is meant as a primer into the world of affiliate marketing and doesn’t demonstrate any advanced practices.

Ok, now that that is out of the way, let’s get going.  I’ll start at the beginning.  Wikipedia definition: “Affiliate marketing is an Internet-based marketing practice in which a business rewards one or more affiliates for each visitor or customer brought about by the affiliate’s marketing efforts.”

Here is my definition:  Affiliate marketing is an internet-based marketing practice where businesses reward partners for a required action.  These actions may be clicks, impressions, sales, email signups, lead form completions, RSS subscriptions and more.  It is a performanced based relationship, the business only pays when something is performed.

Retailers typically reward affiliates for a sale.  For example:  Customer John Doe comes to your blog and reads your newest post.  You have a banner (ad) on your website for Zappos.com Shoes.  John clicks on that banner, goes to Zappos and purchases a $100 pair of shoes.  Zappos then rewards you a % of that $100 for referring that sale.  Most retailers work that way.

Mortgage companies, debt consolidation and other types of companies offer a bounty for referring someone who becomes a lead.  That typically means they fill out a form to get more information, sign up for the site, become a member of a site or other lead generation activities.  The bounties can range from $1 to $300 depending on the industry and the company offering it.

Make sense?  It’s pretty simple, instead of paying for impressions up front, the affiliate (you) doesn’t get paid until something happens (a purchase, signup, click). At first you may be thinking, well I won’t get paid unless something happens, but that is out of my control.  Correct, but after doing this for 10 years and managing over 35 programs, I can tell you that many affiliates make hundreds of thousands of dollars through affiliate programs.  The money is there and it the opportunity can be much higher with affiliate programs if you are able to match the affiliate program with what your users are looking for.

Why is this so much easier, at times, then finding your own advertisers?

Affiliate Networks.

Companies such as Commission Junction, Linkshare, Google Affiliate Network, Share A Sale and AvantLink provide a marketplace where affiliates (bloggers, content developers, web site creators) can partner with many different businesses (merchants).  These networks also provide a method to track any transactions that may result from you working with a merchant.

Basically, here is how it works:

You join the network, apply to the programs you think will be successful on your site, and then grab some links.  You will be able to grab banners and text links and many merchants and networks provide some advanced linking that I will talk about in another post in this series.  The code you grab for your banners or links contains all the necessary tracking information to associate that user to your account.  Any purchases that user makes will be registered into your account.

That is basically it.

Here are some things to look at when you are evaluating an affiliate program:

• Commission Rate - each network will allow you to see the commission rates for similar programs.  Use this as one way to evaluate the programs you want to work with.
• EPC - this is earnings per one hundred clicks and reflects the amount you can expect to earn from a program for each set of 100 clicks you send.  This is a good way to see how they are converting, but not all merchants show this.
• Tools - look at the set of distribution tools they offer.  Do they offer a datafeed, any contextual tools?
• Return Days/Cookie Days - The more of these the better.  These are the number of days from the initial visit to the merchant’s site from yours, that you will get credit if that user makes a purchase.  Wow, a mouthful huh? For example, John from our previous example, clicks on a Zappos.com (a new client of JEBCommerce ), on Monday.  Zappos.com, for this example, has a cookie day of 3.  John doesn’t purchase until Wednesday.  Because they offer 3 cookie days, you will get credit for that sale

There are many other things you need to look at when evaluating a partner to work with and promote through their affiliate program.  I want to take a more in depth look into each affiliate network.  I’ll do that in my second post of this series.

Don’t forget to subscribe to our feed!

Read more in #2 of our Series - The Affiliate Networks.

We at JEBCommerce are extremely excited to be working with Zappos and assisting such a dynamic and incredible company with their affiliate program.  Starting on November 13th, we are working closely with the Zappos affiliate manager, Ned Farra, and the rest of the Zappos team to help identify and reach out to new affiliates that are not yet promoting Zappos.  So, if you are not working with this top online retailer yet, you should be!  Just contact me at jamie@jebcommerce.com to get started.

I had an opportunity to meet Ned, Matt, their CEO Tony and what seemed to be the entire company in Vegas this week prior to attending pubcon.  I was extremely impressed with every single person I met and the company as a whole.  I’m sure you have read about their corporate culture, how they take care of their employees and how much of a family it is there.  It’s something that you can’t really get a feel for through a news article or blog, but I can attest that this is one of the most amazing and unique companies I have ever visited.  Every single person I met was extremely polite and truly seemed to love to work at Zappos.  This is one of the reasons we are truly proud to be working with this company.  Great products, amazing service and a family atmosphere.  We are so glad to be recruiting for the Zappos program.

My visit to their headquarters started with one of the most unique and fun company tours I have ever been on.  I was able to bring this picture home with me to remind me how much fun I did have.

So, if you are not working with Zappos, let’s get started today!  Here is what you do, you can email me, with your CJ PID at jamie@jebcommerce.com.  I’ll extend an offer to you through CJ and Ned and I will do all we can to make sure you are successful this holiday season.

If you have any questions or need any other help, just give me a call at 208-635-5164.

Yesterday I had the good fortune to chat with Gary Marcoccia from AvantLink, a new-ish affiliate network that has come on the scene in the last year or so.  Being in this industry for about ten years, I have pretty specific ideas for what I’d like to see the main affiliate networks add or change to help both managers and affiliates, so I was excited to chat with Gary and see what a startup network was up to.

Gary walked me through the entire network and I have to say that I was very impressed.  It was clean, easy to understand and included all the basic functions that one needs to run an affiliate program.  There were also some very cool advanced features, such as the Advanced Link Encoder.  You tend to see big jumps in innovation from start up companies, and this tool is no different.

From their release on October 30th:

“Yesterday we rolled out the Affiliate Link Encoder (ALE), yet another innovative tool that offers Affiliates the option of direct linking to their AvantLink merchant partners in the context of articles, blog posts, forum threads or anywhere else for that matter! A simple JavaScript we provide takes direct merchant links and appends Affiliate tracking details so credit will be applied for all customer referrals, not just those referrals that click through configured tracking links from the network.”

This tool provides the affiliates with a small bit of java script code that they place in the header or footer of their site so it populates on every page.  It then will take predetermined links to a specific merchant and make them a trackable link!  This is outstanding for forums and blogs, especially if you have a lot of legacy content.

Gary told me of an affiliate that has been blogging for years.  He installed the ALE in his footer and within a few days he saw an 80% increase in affiliate commissions.  What an amazing time saver and commission optimization tool.  Imagine if you have a forum - now any mentions of specific brands are turned into trackable links.  I don’t know of any other network that provides something like this.

I was concerned about this tool interferring with the display of the page, but I can attest to seeing this in action and it did not slow down the page one bit.  When you hover over a link you see the trackable AvantLink link, but in the source code you can see that it is a direct link.

And there is the second benefit for affiliates, and merchants.  Since the affiliate can use a direct link, they can then pass their link juice to the merchant.  I have been told of affiliates that were able to acquire a few more points on commission in turn for using the ALE exclusively and direct linking to a specific merchant.  More power to the affiliates here, and an added benefit for merchants.

They released Version 2.0 on the 10th.  Read more about it here.  The most exciting change is the ability to designate any words, not just links, to be overwritten with a trackable link to a merchant.  For instance, you can designate every mention of the word “ski” as a trackable link to a ski gear site available through AvantLink.  Now that is powerful.

Now I just need a new client to really try this network out.  Thanks Gary for spending the time to walk me through it yesterday.

Last week I wrote about affiliate applications and what managers often see that keep affiliates out of  programs.  One of the things I see most often and I alluded to in those earlier posts, is the lack of affiliate contact info shared to the merchants.  It is more frustrating when working with CJ programs as CJ is the only major network, that I am aware of, that does not share all the contact information of the affiliate with the affiliate manager.  Cj, I implore you, please change this policy.

Years ago, getting into affiliate marketing had a very low barrier to entry.  If you saw someone’s good idea and you knew what they were doing, you could replicate it with a little time, html knowledge and some cash.  That being the case, many affiliates did not want to share any information whatsoever, including contact info.  Affiliates also received, I’ve been told, countless spam emails and phone calls pitching products and programs that clearly do not fit with them.  Inexperienced affiliate managers with bad pitches and horrible programs innundated them, and some still do.  These two things, and I’m sure there are others, have combined to get us to a point where there is not full disclosure.  A quick note - I’ve been guilty of this as well so a big apology to those that received those calls.

Recently I had a discussion with my fellow panelists on our Pubcon panel and this issue was brought up.  One thing we all agreed on, and I want to stress here is that our top producing affiliates, overwhelmingly, are those that we have long standing relationships with.  Those that we know their phone numbers, their emails, their IM’s.  This is from a group of individuals that I would say have experience managing over 100 programs (total guess, I know I’ve managed over 35 myself).

Affiliates, what is your reason for not sharing your contact info?  Let’s talk it out
My reasons for asking that you do share are really for your success.  When I see an application or a new affiliate pops up in my top performers list, but I don’t know them…  I immediately suspect something if I am unable to see email addresses, urls and contact info.  Why you ask?  After 9 years of doing this on over 35 different programs, one thing that most fraudulent affiliates have in common is a need to not share any contact info at all.  The the most common characteristic of affiliates that do not intend on abiding by your terms and conditions is withholding contact info and not responding to emails.  So great affiliates doing great work are not getting a fair look when you don’t foster a relationship with your manager.

This industry is about relationships.  Sales is about relationships and that is what this is all about.  The affiliates that are open to communication often receive the best information.  They get product lists quicker, custom creative, VIP commissions, search data and even product samples and gifts.

Thoughts?

Last week I wrote about affiliate applications and tried to identify some things that affiliates need to avoid. I also tried to lay out some things that, as an affiliate, you should do in your account and your application to ensure the best chance of receiving a “your approved” email. I received some amazing great comments and really appreciate everyone’s input.

Scott Jangro commented from the affiliate perspective: “I’m a pretty successful affiliate, fall into zero of the categories you list, and do all of the things that you said I should. I still get rejected all the time. And many times don’t respond to emails. I don’t blame the AM. I know as well as anybody how tough it is to weed through all the noise to find the good guys. The application process that the networks offer needs a complete overhaul. A great start would be if they all offer a simple cover letter type field for the affiliate to explain themselves. We’ve got so much going on that the fields in the application process can’t possibly cover it.”

That got me thinking about all the modifications the networks could make to the affiliate application process and approval queue.  At the end of the day, the better and more efficient this process, the more likely the networks are to generate increased revenue.  I’m sure they are missing out on commission just in Scott’s case as I know he is top performer.

Overall, Scott’s recommendation is spot on.  Networks, if you are listening, an easy and major improvement to the application process would be to allow the affiliate applying to the program to include a note to the affiliate manager.  For example, I know that if I received an application from a site that was under construction, but it included a note from the affiliate that we met at the affiliate summit last year and their plans are XX, XX and XX, I would approve that application and the relationship would grow from there.  I know that allowing a note like that would do a lot to explain what the affiliate is, their plans and other information that AM’s would benefit from knowing and are not easily explained in the standard application and account info areas.

On the other side of that fence, ya know what I would love?  While I am approving affiliate applications, I would love the option of having several text or html email templates loaded in my merchant account that I could simply choose to send from the application queue itself.  AM’s, how many times have you reviewed an application and wanted to send an email asking for an explanation, more information, contact info, or a url, but either didn’t have the contact info or it simply got lost in the process?  I’d love to have the ability to load several different text or html templates into the account and have the option of sending one of those emails to that parcticular applicant.

Let’s get a little more specific to a  few of the networks.

Commission Junction:  While the overall process is pretty good, there still is a lot of room for improvement.

• Accept/Deny - One of the more frustrating aspects of the approval process is the inability to check an application as Approved or Denied.  You have to first go through the list and check all that you want to either approve or deny.  Then you click on approve or deny.  You then go through the list and check the others and do the opposite, deny or approve.  It would save, at least me, a lot of time if I didn’t have to add that step.
• Include their primary url in the application queue.  Every time I have to click adds time to the process and reduces the amount of time I am able to evaluate each application.  Being able to see the main url on the same page where you see all the applications, their EPC’s, Date Applied and more would reduce time spent on each application and increase the likelihood that each applicant would get the consideration they need.
• Contact info - I know this has been discussed in depth and to the point of exhaustion, but CJ, please consider allowing affiliates to show all their contact info to the merchants.  Phone numbers, emails, IM’s even Twitter accounts would help us all out.  Affiliates - if you don’t want to share your contact info, are you really a partner at all (that is an entire post itself)
• Include Make Offer an option for each and every applicant.

Linkshare:  I like their approval process as it allows you to designate each application indivudually as accepted or denied.  But there is still some room:

• include the url in the application queue.  Again, the less time we have to click around the more time we can spend growing the program.
• Comments - is anyone sure what that does anyway?  Does it send a comment to the affiliate?  Does it file the comment for later?
• As I stated above, allow us to email the affiliate right from there with several templates.
• An option to extend them an offer from this page would be great.

Overall, I think there are a lot of areas where we could make this more efficient and more effective.  The more time your affiliate managers and OPM’s are able to spend on growing the program and not trying to figure out who the applicant is or what they are going do to will lead to more sales and more commissions for all.

But I’ve only really touched on the affiliate manager side.  What changes would you affiliates like to see?

With the launch of any new affiliate program you get inundated with affiliate applications in the first week.  It is both one of the most exciting times for an affiliate manager as well as a frustrating time.  It’s exciting to watch outstanding affiliates that you know join the program but it is frustrating when you wake up to 200 applications on a Monday morning.

Along with the known affiliates applying to your program, there are hundreds and thousands of applications that come through that are either suspect, fraudulent or simply incomplete.  If you are an affiliate manager reading this, you’ll probably be nodding your head and maybe even have a chuckle.  If you are an affiliate that seems to receive more denials than approvals when you apply to programs, this article is just for you.  I’d like to highlight some of the things that managers see every day that you may be doing and need to avoid in order to get your applications approved.  So let’s get started…

• “Make A Million” Shopping Malls - These are sites that someone purchases from companies that supply them an entire mall that will make them millions of dollars.  These sites are relatively cheap to buy and provide the purchaser with a complete website, they only need to reach out and join affiliate programs.  While these sites look good, I have never seen one of these make any sales for any of the programs I have run and I have managed over 35 across industries.  Most program managers recognize these with very little effort and deny these applications.  Like all things, successful endeavors take, hard work and initiative.  These sites sound too good to be true because they are.  My advice to anyone who has purchased this already, find a niche you know a lot about and start over.  I’ll write more about this in a future post.
• Blogs with no content - This is a sure way to get your application rejected.  I am sure that your new blog and your new theme hold within them your hopes and dreams, but having not one single post on your site does nothing to show affiliate managers who you are and what your site is about.  My recommendation - get ten posts on your blog, fill that first page.  After you have that done, I would make sure any customization or unique plugins that you plan to use are on the site.  Make it look unique.  We see hundreds of applications with the Wordpress default theme and no content.  Many times fraudulent affiliates use this method to get approved without raising flags.  Post your content, design it then apply to the affiliate programs.
• Different language sites - I see 20 or so applications a week for sites that are in Japaneze or other languages.  I am sure that they are great sites, but with no description in english I am not able to effectively review the site.  Most affiliate programs are no longer accept everyone and anyone, if it is too hard to evaluate your application it just gets denied.  In your affiliate account, be sure to outline your site and how you plan to promote merchants as thoroughly as possible.
• Geocities and other free sites - Sites that are hosted at Geocities, Tripod, Members.AOL.com or Freewebs will undoubtedly be denied in many programs.  Why?  Well, first off, I can’t remember when one of these sites generated any sales for any program and I can’t recall any of my colleagues saying that either.  Secondly, if an affiliate isn’t serious enough to register a domain name aren’t going to be serious enough to become a successful partner.  Some may not like me saying that, but it’s true.
• Modeling and Real Estate Sites - This seems like a pretty odd combination, but I have seen more applications from these two categories than any other.  If you are planning to do something outside of these areas but use those sites in your application, I would make sure the affiliate manager knows about it.
• No URLs - When your application shows no urls in your account, affiliate managers have no way at all to eveluate your application.  Merchants are getting much more sensitive to who they partner with, and not knowing who you are will surely lead to a rejection in quality programs.
• Google Adwords - Applications that list Adwords as the url for the applicant and only that url can be tough to approve for programs that do not allow paid search.  So if you do something else, make sure you list that too.
• Under Construction  and Parked pages - If your site is still under construction, that is a tough sell.  Merchants don’t want to partner with someone when they don’t know what their site will look like.  Maybe I have said that already :).  I have seen affiliates post a simple htlm page on their new domain that addressed the affiliate managers directly and gave a brief description of what they were doing.  I highly recommend this and I believe I have approved everyone of those applications.  The more we know, the more likely we’ll approve you.
• Banner Farms - These are almost 100% rejected.  What is a banner farm?  These are sites that have, pretty much, only affiliate banners.  They have no other content and no real benefit to the user other than a list of ads for merchants.  These are rarely approved and rarely generate sales for merchants’ programs.  They offer very little in terms of value add to the merchant as well as the consumer.  My recommendation is to spend more time developing your idea.  What consumer target are you trying to reach?  What value are you going to add to their shopping journey?  What are you going to offer that no one else does?  Answer those question then find a designer that can work with you.
• Get Rich Quick Sites - The same way you feel as a consumer when you see these sites are they same way affiliate managers do as well.  I haven’t seen these perform well.
• International Applications - This probably only goes for programs that is 99% domestic traffic.  Applications from third world countries, some Asian countries, Nigeria and some eastern block countries are suspect.  Why?  Past behavior and experience.  Many of the fraudulent affiliates have, in the past, originated from these countries.  If you are a legitimate affiliate, and don’t get me wrong, there are many from those countries, you may experience more rejections because of your location.  But  don’t fret too much.  You may be getting refused by a lot of affiliate programs but there are ways to get noticed.  You need to show affiliate managers that you aren’t interested in scamming, fraudulent behavior or abusing the program.  You have to establish trust as much as you can from your application.  Here are a few things you can do:  1.  Use your company name, if you don’t have one create one. 2.  Email the manager of the program you just applied to and let them know who you are and what your plans are.  3.  Use an email account associated with your website.  Don’t use yahoo.com, gmail, hotmail or other free services.  Having a email@yourwebsite.com email address is typical of legitimate affiliates and will help you get approved.

By no means is that list 100% complete, but it gives you a good idea of things to avoid in your applications and a few reasons why your applications would be rejected. Let me share some things I recommend that you do do in order to get approved (I included some of them above):

1. Complete Account Information - don’t leave any fields blank in CJ, LS, ShareASale, Google and others.  Fill out all the information.  The more complete the application, the more likely you’ll get approved.  Just the effort involved in filling out all the fields shows you are serious.
2. Contact Info - A little contact info goes a long way.  Include your email address and your phone number when possible.  Affiliate programs view affiliates as partners, if you can’t contact your partner, they aren’t really a partner are they?
3. Email the manager - You’d be surprised, but one of the number one things managers wish they got more of was contact from their affiliates. If you are really interested in working with someone, reach out to them, share your ideas and your plans and include your contact info.
4. Good Site Design - this goes a long long way.  With themes and Wordpress anyone can put together a pretty decent site.  Here are some themes I would look into:  One Theme, Woo Themes, Citrus Themes, Revolution.  Getting a good designer involved will lead to sales, but those themes and Wordpress will get you started with little cost.  If you need design let us know, we can help.
5. If your site is under construction, put up a simple html page that says what you are planning to do.  Affiliate managers love this and it will help you get approved and get insight and advice on your new idea.

Hope that helps!  What do you think?  Affiliate managers, did I miss anything.  Do you think I’m off on any of these items?  I’d love to hear what you have to say.

A few days ago a colleague of mine, Ed Reese of SixthManMarketing, a Spokane SEO firm, Washington, wrote a recap of a session at SMX East.  Engineers from Google, Yahoo and Microsoft were on the panel and shared some very interesting bits of information.

From Ed’s SEO Blog:

“For quite a while now I’ve held the belief that affiliate links were viewed no differently than paid links in the eyes of the search engines. Sure, there are countless affiliate links that pass link juice (just like many paid links). It’s just that I assumed this was a little loophole that would be closed any minute now and considered risky behavior.”

I think we all have really held that belief.  Paid links need nofollow tags and affiliate links are no longer helping web sites in their natural search rankings, or at least we thought.  The nofollow debate has been lengthy and healthy, but here is what the panel participants had to say, again from Ed’s blog:

“Shockingly, when asked point blank if affiliate programs that employed juice-passing links (those not using nofollow) were against guidelines or if they would be discounted, the engineers all agreed with the position taken by Sean Suchter of Yahoo!. He said, in no uncertain terms, that if affiliate links came from valuable, relevant, trust-worthy sources - bloggers endorsing a product, affiliates of high quality, etc. - they would be counted in link algorithms. Aaron from Google and Nathan from Microsoft both agreed that good affiliate links would be counted by their engines and that it was not necessary to mark these with a nofollow or other method of blocking link value.”

“Good affiliates links will be counted by their engines and that it was not necessary to mark these with a nofollow or other method of blocking link value” - Did you read that?  I think this is pretty big news for the industry.  Some affiliates can provide link value.  I’m sure merchants running affiliate programs will be very glad to hear this.  But it brings with it many questions:

• What do the search engines consider “valuable, relevant, trust-worthy sources” and affiliates of high quality?
• Do affiliate program managers start request  “nofollow” links on some affiliates sites and not others?
• How will affiliates change the way they do business?  Valuable and high quality affiliates’ links are now worth more than just the sale, right?
• Are affiliates using nofollow?  If so will that change?
• Will affiliates require more from a merchant to remove a nofollow link?

I always felt that just because a link is a paid link it shouldn’t be discounted on that fact alone.  There are very high quality affiliates out there and their links should be taken into account in the search algorithms.  I’ve also heard affiliates upset that they are not compensated for those links outside of a pay per sales arrangement, and maybe now that we have confirmation that those links, or some of them, are valued, affiliates will and should get some additional compensation.  But by getting additional compensation will they devalue their links?  It’s always great to hear from the search engines on things like this.  Laying out for us how affiliate links, or some affiliate links are judged in their eyes helps all of us.

What do you think?

Is your affiliate program as effective and efficient as possible? Is it as successful as you hoped it would be? Most programs are not and in most cases, an audit of your program, your promotions, your communications and your competitors allows you to see opportunities to increase the performance of your program.  Our Affiliate Program Audit will take your affiliate program to the next level.

On October 5th, the organizers of the Affiliate Summit will be hosting a Social Media Conference in NYC.    Don Crowther is delivering the keynote.  Tickets are $399 and $499 at the door.  Check out the agenda here.