Following last week’s analysis of different sectors you may consider for your affiliate business, we’ll appraise the most common strategies employed to attract visitors and then send them on to merchants to make money.

Four of the most common tactics are explored in detail followed by a summary of other methods.

Content Based Websites

A content-rich website or blog can be about anything under the sun. The aim is to pull in visitors based on the content or tools provided on a property and then, using some technique or other, forward the traffic to an advertiser.

Traffic can be had for free if you provide something that people want, whether it is content, resources, tools or software. This encourages people to tell others about your website and for it to get visitors from the organic (free) listings in search engines and directories.

Affiliates will commonly surround their content with advertising and thereby be remunerated and make a profit for their endeavors.

EXAMPLE: UKHotMovies.com is a website with movie reviews and trailers. Revenue is made via affiliate links and contextual advertising selling DVDs etc.

PROS: Possible to gain significant amounts of traffic for free.

CONS: Creating high quality original content is not easy and surfers are usually more interested in benefiting from the resource rather than making a purchase.

"I’d advise somebody looking to start out as an affiliate to choose a subject they like and build a top notch content site around it. Concentrate on quality relevant link building before banging up a load of ads and trying to monetize the site. PPC and SEO are both getting tougher and so make sure you learn as much as possible at sites like webmasterworld.com when you start out." Keith Bond, Affiliate, keithbond.co.uk

 

Datafeed Driven Websites

A large number of affiliates scrape content from merchants’ websites, present it in a different way, and publish it on their own pages. They employ either custom built or third party software to accomplish the task and it is possible to create hundreds of thousands of pages using tools.

They then use their wiles to try to get search engines to list their pages. It requires real skill because most search engines will not give prominence to rehashed content.

There are a huge number of shopping and price comparison sites which use product feeds to generate their content.

EXAMPLE: Let’s Play Chess has search engine friendly URLs and meta-tags and was created using a free NetShops affiliate datafeed site script. You can see the script here.

PROS: If done proficiently, it’s possible to get a staggering number of pages listed in search engines. No need to create your own content

CONS: Requires ingenuity to get past search engines’ duplicate content filters. Many affiliate programs provide less-than-perfect datafeeds and it can be a nightmare to get things set up.

Incentive-based Websites

With some search engines like Google making a concerted effort to filter out affiliate websites and ads, over the last few years some entrepreneurs have realized that being over-dependent on the likes of Google for traffic could be dangerous. So they have set up incentive or ‘cashback’ websites which attempt to provide a reason for surfers to bookmark them and return directly from time to time.

Cashback websites refund a percentage of their affiliate commission to shoppers. If, for example, American Express is paying $40 for every bona fide person an affiliate sends to them who signs up for a credit card, the affiliate may split the referral fee half and half with his site’s visitors.

EXAMPLE: Cashback Outlet is a long standing shopping portal which encourages consumers to shop via their affiliate links by offering incentive rewards.

PROS: If you build up a significant member base, you will not need to depend on increasingly affiliate-unfriendly search engines to send you traffic.

CONS: Fiercely-competitive market and colossal amount of administration involved (because tracking is often unreliable in affiliate marketing, affiliates are often not informed or paid commission for sales generated via their links. Consumers complain about not being paid the promised reward for going via the affiliate’s site).

Pay Per Click Arbitrage

When search engines started giving prominence to paid adverts in the early noughties, some affiliates decided to do away with having to create websites entirely and decided to seek an income from PPC arbitrage.

The way it works is an affiliate will pay for an advert on Google, Yahoo or another search engine. He may pay 15 cents for a click on that advert. The surfer will be sent directly to a merchant’s site or via a landing page. The aim will be to make at least 15 cents to cover the cost of attracting the surfer and then anything above that amount is a profit.

Many experts believe that PPC has had its heyday with merchants setting up ever-increasing restrictions to deter affiliates from carrying out paid search advertising on their behalf, with Google’s disdain for affiliate sites, and the need to now bid huge amounts of money to get anywhere near the top for most popular search terms. Others believe that, with a bit of ingenuity and graft, it’s still possible to make serious money with PPC arbitrage.

EXAMPLE: When we did a search for “cheap phones” in Google, one of the PPC adverts directed us to this page. Whenever anybody clicks on any link on that page, the website owner earns money (the ads are from Yahoo Search Marketing).

PROS: If you can do PPC amount, it is possible to earn unbelievable amounts of money. Top PPCers can make millions of dollars a year.

CONS: Many merchants now put restrictions on PPC adverts placed on their behalf. Campaigns require constant monitoring because of the fluctuating requirements of search engines and increasingly-ruthless competition.

Other Common Ways of Pulling in the Punters

Topsite Website – lists sites within a category or categories based on how much traffic they send to the ‘topsite’.

Discussion Forums – bulletin boards can generate a huge number of page views. The hard part is to get your users to notice the ads rather than engage in discourse!

Ebook Marketing – make money by either writing and selling an ebook, or give it away and upsell related products and services.

Email Marketing –build or buy a mailing list and generate income by emailing subscribers with deals.

Domain Names – certain types of domain names will attract ‘type in’ traffic. These could be common words or spelling mistakes. It is possible to monetize the traffic by encouraging people to follow CPC and CPA ads.

Step by step, you are learning what you need to know to create a thriving affiliate business. Keep attending The Weekly Q’s Master Classes and, you too, may become one of the world’s biggest affiliate marketing whores!

 

Nadeem Azam, PrimeQ
Public Relations Manager
nazam@primeq.co.uk

 

AOL's TradeDoubler Bid Rejected by Alecta

US Internet giant AOL’s bid for Sweden-based affiliate network TradeDoubler, in a cash offer worth 6.332 billion kronor has been rejected by Alecta, the Swedish company's largest shareholder. They said the bid was too low.

TradeDoubler, with operations across Europe, has made its name as one of the world's largest providers of Internet advertising.
AOL is a subsidiary of Time Warner Inc. and the latter’s Chief Operating Officer said, "We're pleased to make such an appealing offer to TradeDoubler shareholders. Not only does our offer provide an attractive premium valuation, but it also will enable TradeDoubler to play a key role in our strategic focus on growing our online advertising business in Europe. With AOL and Advertising.com, we have built a robust online advertising business in Europe, and TradeDoubler will help us accelerate the growth of this business."

AOL made a bid of 215 kronor per share, valuing the company at 6.223 billion kronor or US $900 million, an offer that the company's board unanimously recommended to shareholders, according to a statement from AOL.

Shareholders representing 20 percent of the shares in the company have already accepted the bid, and TradeDoubler's board has recommended acceptance of the offer.

But pensions company Alecta, the largest shareholder in the Swedish company, has said the offer is too low. On January 15, Alecta bought 683,300 shares, giving it just over 10 percent of votes and capital. As AOL's bid is conditional upon it getting more than 90 percent of capital, this gave Alecta the power to block the deal.

"We consider that the bid of 215 kronor per share does not reflect the value and growth potential we predict for the future," said Alecta's Peter van Berlekom in a press release.

AMF Pension and AMF Pension Fondförvaltning have also increased their stakes in TradeDoubler. They now own a combined 5.17 percent of the company.

"From an industrial perspective it's a really good match, with few overlapping operations, and I believe that AOL is a good buyer for TradeDoubler," said Mats Bergström, analyst at Nordea.

But Bergström said he was not surprised by Alecta's refusal of the bid. "It makes commercial sense, but it is too low. It would not surprise me if more shareholders turn down the bid," he predicted. He said he believed that AOL would raise its bid.

The bid was formally made by Goldcup, an indirectly-owned subsidiary of AOL, which has now changed its name to AOLS Holdings. The bid represents a premium of 20 percent compared with the recent average TradeDoubler share price.

"After carefully evaluating the Offer and considering the future prospects of TradeDoubler, it is the Board's assessment that the transaction is in the shareholders' best interest," said TradeDoubler chairman Kjell Duveblad in a statement.

The bid will remain on the table until 19th February. Many analysts expect TradeDoubler to receive a higher bid. Over the last few days the company's share price rose has rocketed to 230 kronor, 15 kronor over the price offered by AOL (see chart).

Shares in Affiliate Future (IBG), a predominantly UK affiliate network, have also experienced a dramatic boost by the news.

Affiliate Marketing Forum Allegedly Receives $16 Million Offer

The owner of Wickedfire.com, an affiliate marketing/webmaster discussion board, has claimed to receive a $16 million offer to buy his fledgling forum.

What is amazing is the forum has been in existence for less than a year and earns zero revenue.

It was set up by a ‘super affiliate’ called Jon F. from the USA who was fed up of over zealous moderators from other web forums stifling conversation.

Although only in his mid-twenties, Jon has been an affiliate for 12 years. Infamous for posting $80,000 screenshots of his earnings on SitePoint.com, he had announced at the start of January on his blog that he’d be stepping down from affiliate marketing.

Jon explains that he wouldn’t have taken the offer seriously were it not that the buyer was “reputable” and well-known.

The offer was supposedly $16 million over three years or $11 million at one shot. Jon, a multi-millionaire, turned down the bid.

With 4,000 members and over 100,000 posts, WickedFire has rapidly become one of the most popular affiliate marketing/webmaster forums around, but the offer has stunned a lot of people… and led to some questioning whether the offer was even made or not.

 

It’s your publication, so let us know and we’ll try to steer The Weekly Q in the direction you would like. Email nazam@primeq.co.uk with your feedback.

 

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