The 5 Myths of the Networks and the 5 Truths
It has been particularly interesting to watch our affiliate marketing niche over the past few months. Commission Junction in particular, has been providing much of the fodder for the rumor mills, what with their pricing changes, Open Marketplace, semantic label changes for their customers, and massive lay offs. BeFree and Linkshare have also been in the news often facing problems like, negative PR about their payments, outdated reporting, resistance to high prices and their once sacred exclusivity clauses are being widely ignored. Other companies outside of the "Big 3 Networks" are quickly moving to achieve market share, like Performics, Quinstreet and MyAffiliateProgram by Kowabunga.
So, what does it all mean? What are the myths and the facts? I'm going to reveal the 5 Main Myths that have grown up around the Big 3 Networks' primary marketing promises and my "Truths" about these issues.
Myth # 1
In order to get a good tracking system plus stats, tools and resources, you'll need to make a significant investment with a big name network in order to be able to implement a successful Affiliate Marketing Program.
Truth
Frankly, the networks are quickly pricing themselves out of the market. They all provide a comprehensive tracking solution, and in some cases, automated payments and stats. That's it, just a tool. Nothing more. The real "magic" of a program is the effort involved in making the program successful. Ain't none of them gonna help you with that. You have to do it yourself. There is absolutely no need to sink from $1300 to $10,000+ for up front costs plus sizeable monthly per transaction fees into a network that has very little to do with making you successful at affiliate marketing. There are less expensive and just as feature packed software options at every price level to do the job. It's not the software which makes you successful, it's the expertise you have in implementing this sales channel.
Myth # 2
We have a trusted "3rd party status" with your affiliates.
Truth
This has really become a joke. There is a huge amount of distrust by both merchants and affiliates about the fairness and reliability of their network. Some like Linkshare and BeFree offer virtually no assistance in helping affiliates get paid by unscrupulous or dead merchants. Steve Messer of Linkshare recently assured concerned affiliates that they are implementing improvements that will help get affiliates paid. That's great but I'm sure that's no solace to the thousands who have already been screwed by non-payment. Not getting paid tends to undermine trust. CJ does aggregate commissions earned and will pay affiliates even if the merchant is questionable, but with the exodus of over 700 merchants in the past few months, there will be plenty of disputes over what commissions were earned before a merchant was deactivated. Plus, what kind of trust can you have if you have no idea from day to day whether or not the merchants you have selected will even be in the program tomorrow? If affiliates basically feel like there's no reason to trust any network when it comes to getting paid - then why rely on that system at all.
My point is as an affiliate you must select your merchant partners carefully, ask them detailed questions about their programs and financial health and form a personal relationship. Don't just stick up a banner. Become a valued salesperson, not just another URL on a list of statistics. That makes you easy to forget, screw or cheat.
Myth # 3
Our Free Check Writing or Payment Facilitation Option is a huge time saver and benefit to your company.
Truth
Sure it's nice when any company offers to do work for you. But, what is it really worth to your bottom line? Those of you with thousands of affiliates - how many checks are you really cutting? Is it worth giving up control of the accounting and the delays in accounting as another layer sorts out the "approved" payments? Is it really worth the extra fees LS charges? Is it worth the extra 30% per transaction that CJ is charging you to have this included? Why not use a direct deposit service like PayPal and import the accounting directly from your tracking solution into your main accounting program (like Quickbooks). Plus, one more added benefit when you write and send your own checks; you get to give your affiliate a personal message (thanks, incentive, sales, promotion, whatever) while they are holding MONEY in their hands. It's a pretty compelling way to make them remember you.
Myth # 4
We have hundreds of thousands of affiliates just waiting to join your program and make lots of money for you.
Truth
This is the biggest MYTH of them all. Just because you join a network and get thousands of affiliates in a few weeks is absolutely NO guarantee that you will ever make a sale. I hear it over and over again; "I've gotten 5000 affiliates since I joined CJ, but I've only made 4 sales." Or, "I have over 10,000 affiliates, but we write only about about 50 checks a month." Listen to me! It is far more powerful and profitable to exert considerable effort in locating and recruiting the kinds of sites that are most likely to be able to send you qualified, highly targeted prospects and then compensate that site lavishly than to join a network; than to sit back and wait for sales from the 1% of sites that join your program. I'd rather have 20 to 50 active, sales or lead producing affiliate partners over 10,000 primarily non-productive affiliates anyday.
Myth # 5
We have great Customer Service to help you with your program and succeed.
Truth
Most of the account reps at the networks are not really very expert at what makes an affiliate marketing program successful. They know what their program does (most of the time), but few of them have ever managed a program and many of them aren't even that expert at how their own programs operate. The worst offense is that because of the staffing cutbacks that all of the networks have made, unless you are one of their Top 10 clients, forget about getting a phone call or email returned. They point you to their FAQ's, or their Resource areas for help, but they often do not really KNOW what would help your program succeed. And, unless you pay exorbitant monthly fees, you don't even have a dedicated Account Rep to turn to when you have questions. Even this high priced help isn't even very helpful. None of the networks give adequate training in how to use their interfaces. So, you get this fancy system and have to basically figure it out for yourself.
But remember, the real work of affiliate marketing will always be on the shoulders of the business person to manage and market and innovate using the best tools, not reliance on a 3rd party network.
So, what's a company to do?
I have been studying and analyzing the major solutions providers for some time now and I have decided to throw my support and my recommendation behind primarily one company, MyAffiliateProgram by Kowabunga! They offer an in-house, live 24/7 software solutions that can handle the technical requirements and marketing requirements at a reasonable cost for ANY size company. I am impressed with their friendly and knowledgeable staff and their bright, charismatic, humble and hardworking CEO, Todd Farmer. Here are the main benefits of utilizing MYAP and how they relate to the "Truths" above.
Truth # 1
Price - MYAP offers a package for every size business, with an array of cutting edge features, at every price from $99 to $4,000. With their set monthly pricing levels, a company can project completely accurately what their real costs will be of running the program. With no transaction fees, a merchant can afford to pay affiliates more, making more loyal and harder working affiliates. They have a reliable tracking system for the smallest of merchants AND the most advanced set of tracking and marketing tools in the marketplace today, PLUS adequate server bandwidth and technical capabilities for even the most sophisticated multi-million impression sites, that offer thousands of products and have thousands of affiliates.
Truth # 2
Trust - MYAP offers a fully brandable, technically accurate tracking solution that becomes an in-house system for any company. They contend (and I agree) that trust is something to be developed between partners, not between partners and their tracking solution.
Truth # 3
Payments - While MYAP doesn't offer a check writing module, they believe that companies are better off keeping control of this crucial accounting feature themselves. They also contend that having fewer but more productive affiliates means fewer but larger checks, thus justifying whatever minimal costs may be associated with check writing. They have also partnered with PayPal for easy automated electronic payments, and Quickbooks and other major accounting software for the simple importation of payments to be made directly into your existing check cutting system.
Truth # 4
Thousands of Affiliates - Since MYAP isn't a network they don't offer this, but they also don't want to. It is not their business to provide you with the most effective affiliates for your business. That is like asking your fulfillment company to select your customers. However, recognizing the crucial importance of good affiliates, MYAP offers great tools and resources for helping you locate and recruit the best affiliates for you, and has partnerships pending to introduce their merchants to potential super affiliates.
Truth # 5
Customer Service and Training - You will get a real person on the phone when you call MYAP. You will get courteous, helpful, knowledgeable agents to help you by phone, email, online or in person at their office or conferences. You will also soon get AffiliateGoddess as your in house consultant when you select any of the Consulting Packages that will be offered in the next couple weeks to all MYAP clients. Other well known experts will also be available as Outside Consultants and will be matched to your specific business plan to best suit your needs.
I will be taking on occasional outside consulting projects as they come up, but for the most part, I will be working exclusively for awhile with the folks at Kowabunga as a consultant to help them get out the word about their outstanding product and service. I'm staking my reputation on them I am so convinced that their model is so much more effective than the Big 3 networks. I look forward to talking with my clients about my choices and why it's a good fit for most merchants at this time.
Those of you that I consult with who have other solution providers, don't worry, I'll still be here to help you. And, I intend to stay "up" on all the innovations of them all.
That's all for this time folks!
So, what does it all mean? What are the myths and the facts? I'm going to reveal the 5 Main Myths that have grown up around the Big 3 Networks' primary marketing promises and my "Truths" about these issues.
Myth # 1
In order to get a good tracking system plus stats, tools and resources, you'll need to make a significant investment with a big name network in order to be able to implement a successful Affiliate Marketing Program.
Truth
Frankly, the networks are quickly pricing themselves out of the market. They all provide a comprehensive tracking solution, and in some cases, automated payments and stats. That's it, just a tool. Nothing more. The real "magic" of a program is the effort involved in making the program successful. Ain't none of them gonna help you with that. You have to do it yourself. There is absolutely no need to sink from $1300 to $10,000+ for up front costs plus sizeable monthly per transaction fees into a network that has very little to do with making you successful at affiliate marketing. There are less expensive and just as feature packed software options at every price level to do the job. It's not the software which makes you successful, it's the expertise you have in implementing this sales channel.
Myth # 2
We have a trusted "3rd party status" with your affiliates.
Truth
This has really become a joke. There is a huge amount of distrust by both merchants and affiliates about the fairness and reliability of their network. Some like Linkshare and BeFree offer virtually no assistance in helping affiliates get paid by unscrupulous or dead merchants. Steve Messer of Linkshare recently assured concerned affiliates that they are implementing improvements that will help get affiliates paid. That's great but I'm sure that's no solace to the thousands who have already been screwed by non-payment. Not getting paid tends to undermine trust. CJ does aggregate commissions earned and will pay affiliates even if the merchant is questionable, but with the exodus of over 700 merchants in the past few months, there will be plenty of disputes over what commissions were earned before a merchant was deactivated. Plus, what kind of trust can you have if you have no idea from day to day whether or not the merchants you have selected will even be in the program tomorrow? If affiliates basically feel like there's no reason to trust any network when it comes to getting paid - then why rely on that system at all.
My point is as an affiliate you must select your merchant partners carefully, ask them detailed questions about their programs and financial health and form a personal relationship. Don't just stick up a banner. Become a valued salesperson, not just another URL on a list of statistics. That makes you easy to forget, screw or cheat.
Myth # 3
Our Free Check Writing or Payment Facilitation Option is a huge time saver and benefit to your company.
Truth
Sure it's nice when any company offers to do work for you. But, what is it really worth to your bottom line? Those of you with thousands of affiliates - how many checks are you really cutting? Is it worth giving up control of the accounting and the delays in accounting as another layer sorts out the "approved" payments? Is it really worth the extra fees LS charges? Is it worth the extra 30% per transaction that CJ is charging you to have this included? Why not use a direct deposit service like PayPal and import the accounting directly from your tracking solution into your main accounting program (like Quickbooks). Plus, one more added benefit when you write and send your own checks; you get to give your affiliate a personal message (thanks, incentive, sales, promotion, whatever) while they are holding MONEY in their hands. It's a pretty compelling way to make them remember you.
Myth # 4
We have hundreds of thousands of affiliates just waiting to join your program and make lots of money for you.
Truth
This is the biggest MYTH of them all. Just because you join a network and get thousands of affiliates in a few weeks is absolutely NO guarantee that you will ever make a sale. I hear it over and over again; "I've gotten 5000 affiliates since I joined CJ, but I've only made 4 sales." Or, "I have over 10,000 affiliates, but we write only about about 50 checks a month." Listen to me! It is far more powerful and profitable to exert considerable effort in locating and recruiting the kinds of sites that are most likely to be able to send you qualified, highly targeted prospects and then compensate that site lavishly than to join a network; than to sit back and wait for sales from the 1% of sites that join your program. I'd rather have 20 to 50 active, sales or lead producing affiliate partners over 10,000 primarily non-productive affiliates anyday.
Myth # 5
We have great Customer Service to help you with your program and succeed.
Truth
Most of the account reps at the networks are not really very expert at what makes an affiliate marketing program successful. They know what their program does (most of the time), but few of them have ever managed a program and many of them aren't even that expert at how their own programs operate. The worst offense is that because of the staffing cutbacks that all of the networks have made, unless you are one of their Top 10 clients, forget about getting a phone call or email returned. They point you to their FAQ's, or their Resource areas for help, but they often do not really KNOW what would help your program succeed. And, unless you pay exorbitant monthly fees, you don't even have a dedicated Account Rep to turn to when you have questions. Even this high priced help isn't even very helpful. None of the networks give adequate training in how to use their interfaces. So, you get this fancy system and have to basically figure it out for yourself.
But remember, the real work of affiliate marketing will always be on the shoulders of the business person to manage and market and innovate using the best tools, not reliance on a 3rd party network.
So, what's a company to do?
I have been studying and analyzing the major solutions providers for some time now and I have decided to throw my support and my recommendation behind primarily one company, MyAffiliateProgram by Kowabunga! They offer an in-house, live 24/7 software solutions that can handle the technical requirements and marketing requirements at a reasonable cost for ANY size company. I am impressed with their friendly and knowledgeable staff and their bright, charismatic, humble and hardworking CEO, Todd Farmer. Here are the main benefits of utilizing MYAP and how they relate to the "Truths" above.
Truth # 1
Price - MYAP offers a package for every size business, with an array of cutting edge features, at every price from $99 to $4,000. With their set monthly pricing levels, a company can project completely accurately what their real costs will be of running the program. With no transaction fees, a merchant can afford to pay affiliates more, making more loyal and harder working affiliates. They have a reliable tracking system for the smallest of merchants AND the most advanced set of tracking and marketing tools in the marketplace today, PLUS adequate server bandwidth and technical capabilities for even the most sophisticated multi-million impression sites, that offer thousands of products and have thousands of affiliates.
Truth # 2
Trust - MYAP offers a fully brandable, technically accurate tracking solution that becomes an in-house system for any company. They contend (and I agree) that trust is something to be developed between partners, not between partners and their tracking solution.
Truth # 3
Payments - While MYAP doesn't offer a check writing module, they believe that companies are better off keeping control of this crucial accounting feature themselves. They also contend that having fewer but more productive affiliates means fewer but larger checks, thus justifying whatever minimal costs may be associated with check writing. They have also partnered with PayPal for easy automated electronic payments, and Quickbooks and other major accounting software for the simple importation of payments to be made directly into your existing check cutting system.
Truth # 4
Thousands of Affiliates - Since MYAP isn't a network they don't offer this, but they also don't want to. It is not their business to provide you with the most effective affiliates for your business. That is like asking your fulfillment company to select your customers. However, recognizing the crucial importance of good affiliates, MYAP offers great tools and resources for helping you locate and recruit the best affiliates for you, and has partnerships pending to introduce their merchants to potential super affiliates.
Truth # 5
Customer Service and Training - You will get a real person on the phone when you call MYAP. You will get courteous, helpful, knowledgeable agents to help you by phone, email, online or in person at their office or conferences. You will also soon get AffiliateGoddess as your in house consultant when you select any of the Consulting Packages that will be offered in the next couple weeks to all MYAP clients. Other well known experts will also be available as Outside Consultants and will be matched to your specific business plan to best suit your needs.
I will be taking on occasional outside consulting projects as they come up, but for the most part, I will be working exclusively for awhile with the folks at Kowabunga as a consultant to help them get out the word about their outstanding product and service. I'm staking my reputation on them I am so convinced that their model is so much more effective than the Big 3 networks. I look forward to talking with my clients about my choices and why it's a good fit for most merchants at this time.
Those of you that I consult with who have other solution providers, don't worry, I'll still be here to help you. And, I intend to stay "up" on all the innovations of them all.
That's all for this time folks!
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