E-commerce Link: Generate Traffic Without Getting Run Over
10 Steps to Reduce Risk in Online Affiliate and Pay-for-Performance Relationships.
For the past few years, there’s been an ongoing battle over which path marketers should take when seeking to acquire customers online. In the beginning, marketing departments told CEOs that online advertising was the golden goose, citing the millions of eyeballs ready and waiting for their company’s message. That goose never laid a golden egg, and those eyeballs certainly weren’t always translating into open wallets.
In the late 1990s, a new generation of online marketing that “made sense” emerged: Direct marketers took hold of the power of the Internet, and “affiliate marketing” and “pay-for-performance” deal structures were born. How perfect: Pay only for marketing units that led to an action—a click, an order, a subscription, a lead, etc.—and share the bounty with the publisher who allowed an advertiser to market to its readers. The real golden goose! But trouble came quickly to paradise as certain risks became evident.
Often, online marketers are too focused on acquiring customers as cheaply as possible. They fail to realize this mentality leaves them open to the risk of damaging their brand as a result of the behind-the-scenes marketing improprieties of unscrupulous Web site publishers and affiliates. This is more prevalent than one would think. There are many hidden risks, obstacles and safety issues endemic in the implementation of pay-for-performance online advertising and affiliate marketing campaigns.
The top three types of risk for this marketing channel are:
• Fraudulent activity delivered to boost the performance-based income of publishers. Suppose an advertiser is looking to pay $5 per lead. Disingenuous publishers working with this advertiser can write a devious little program that automatically will fill in these lead forms to get the $5 commission. They even can go so far as to spread out volume so that no spikes occur, and mix in real leads so that not all the orders are fraudulent. Before the advertiser realizes what is going on, he may have paid out several thousand dollars ... or more.