'Net Features : performance marketing

Fraud Fears Loom, but Performance Marketing Booms

Pete Prestipino — Mon, 06 May 2013 14:31:00 GMT

The affiliate/performance marketing space has always been one that the entire Web seems to look down its virtual nose at – and sometimes for good reason.

While the vast majority of affiliate marketers seem to be fine, upstanding Internet professionals, there remain a few that continue to abuse the model. Two well-known affiliates (Shawn Hogan and Brian Dunning), who eBay is claiming bilked them of millions of dollars using nefarious tactics such as cookie stuffing, are the latest accused perpetrators of fraud in the affiliate space.

Hogan and Dunning are far from your normal affiliates, but companies which still engage in the performance marketing practice (Internet retailers and online advertisers) likely won’t be dissuaded by this event or any event of that nature in the future. Why? Well, it works really well from a performance standpoint – particularly for those with limited budgets or those that are fed up with CPC and display advertising, social media and email. And the affiliate marketing space is booming.

Performance marketing agency Experience Advertising released an infographic recently which highlighted the popularity of this particular tactic over the years and what advertisers and merchants should expect in the future.

The infographic revealed that affiliate marketing spending in the U.S. increased by 256% in 7 years (according to the U.S. Affiliate Marketing Forecast (2009-2014) by Forrester Research) growing from $1.6 billion in 2007 to $4.1 billion (estimated) in 2014. And according to the IAB Affiliate Marketing Council, 77% of advertisers increased their affiliate marketing spend this year, while 71% expect to grow their spend in the future. And this growth occurred despite pervasive fears of fraud.

Interested in learning more about the digital world of affiliate marketing? Check out Website Magazine's Affiliate 360 book, a practical guide to ethical performance marketing for brands both large and small.

Don't Just Play Around with Online Gaming

Michael Garrity — Thu, 16 Aug 2012 17:30:00 GMT

Playing games can be fun, but playing games and making money is even more fun. Thanks to performance marketing solutions provider Direct Response Technologies, those in the online gaming industry can do more of the latter thanks to the recent release of the DirectTrack Performance Gaming Platform.

This enhanced solution will give users a consolidated access point for flexible commission solutions, tracking and real-time analytics, all of which are designed to help gaming developers and networks maximize player acquisition and improve their return on investment (ROI) figures.

The DirectTrack Performance Gaming Platform is chock-full of custom features and solutions, including:

- In-game (or in-app) ad optimization and targeting that lets clients customize fixed, variable and demographic settings to ensure that players see the advertisements that are most relevant and enticing to them

- A platform that tracks mobile transactions and application installs in a pure mobile browsing environment using a wide range of mobile tracking, targeting and ad serving capabilities that allows DirectTrack to accurately follow a player’s life cycle from their initial click on a mobile device through a successful installation using real-time reporting

- Support for all currencies and languages that allows DirectTrack clients to build multiple affiliate interfaces and quickly expand into any market

- Revenue-share commission models that expand affiliate revenue opportunities beyond the initial sign up and pay affiliates for extra actions like buying in-game upgrades, initiating new level purchases or exchanging virtual currency

Create a Social Referral Program with Refer.ly

Pete Prestipino — Tue, 24 Jul 2012 23:30:00 GMT

Why more merchants aren’t taking advantage of performance marketing remains a mystery – at least to me. Fortunately, there are some exciting startups emerging which can make short work of the challenges presented by affiliate marketing. Case in point, Refer.ly.

The platform, which enables consumers to earn rewards for recommending products to their networks, has just released an API which will help merchants (or anyone with a website) create an incentivized referral program to drive new business. In my experience, consumers aren’t really designed to drive any substantial amount of traffic on their own, but for merchants this may make a lot of sense as all those shares add up over time.

This “distribution hack” and “customer acquisition model” as Refer.ly refers to it lets merchants enter how much they’d be willing to pay to get a customer or a sale, and pay out that reward to those that make it happen.

The service is open to all merchants, but expect those in the software-as-a-service business and others to explore the options more closely in the future.

Is There Value in Affiliate Marketing?

Pete Prestipino — Tue, 03 Jul 2012 16:15:00 GMT

Affiliate marketing continues to be an effective practice for advertisers/merchants, but how much value is really brought by performance-based marketers (affiliates)?

A recent survey from the Rakuten-Linkshare affiliate network indicates that despite the well publicized challenges, affiliate marketing spend is on the rise and is forecasted to keep pace with other areas of digital spend through 2016.

According to the study the affiliate channel is best for producing "new-to-file" or previously unknown customers and generating incremental customer acquisition. The customers acquired through performance marketing also tend to spend more than the average online shopper and are ultimately profitable for advertisers. Perhaps the most important revelation was that promotions in the affiliate channel have a positive impact on an advertiser’s brand reputation and loyalty.

Forrester, which conducted the study, forecasts U.S. affiliate marketing spending will increase by a compounded annual growth rate of nearly 17 percent between 2011 and 2016, growing to $4.5 billion.

Tracking Multiple SubIDs for Mobile Marketing

Pete Prestipino — Mon, 04 Jun 2012 18:30:00 GMT

Performance marketing company Neverblue just announced a new feature that provides mobile publishers and advertisers the ability to identify different traffic quality characteristics and adjust their digital strategies accordingly.

The new Multiple SubID tracking and support enables Neverblue clients to capture up to five traffic-specific parameters to track mobile information such as device, carrier, mobile site, or app. Advertisers are also able to identify traffic quality characteristics, providing publishers an opportunity to expand traffic in areas that match that of advertisers' interest.

“Running effective mobile marketing campaigns requires tracking and analyzing much more data than traditional internet campaigns,” notes Gregg Stewart, vice president of new media platforms at Neverblue.

“Advertisers, media buyers and publishers who use our flexible multiple SubID tracking system can track the information elements that are the most important drivers of mobile campaign performance in conjunction with our mobile analytics tools to quickly and cost-effectively optimize their campaigns for volume and quality metrics."

PMA Sues Illinois over Affiliate Nexus Law

Pete Prestipino — Wed, 01 Jun 2011 18:25:00 GMT

The Performance Marketing Association (PMA) filed a lawsuit against the Illinois Department of Revenue today, challenging the constitutionality of its recently passed law which aims to extend the state’s tax nexus to include a retailers affiliates (publishers) should there be no physical presence for the retailer in that state.

The law (often called the Amazon Tax or the Mainstreet Fairness Bill) requires out-of-state retailers who use Internet-based performance marketing (affiliate marketing), but not other forms of advertising, to collect Illinois state sales and use tax. The result in Illinois has been well publicized – losing a few high profile web properties to neighboring Wisconsin. The PMA’s complaint aims to demonstrate how the Illinois law discriminates against Internet-based performance marketing, in violation of the federal Internet Tax Freedom Act.

“HB 3659 is a calculated assault on the burgeoning performance marketing industry and a misguided attempt by the state legislature and Governor Quinn to shore up the state’s budget deficit on the backs of small business,” said Rebecca Madigan, Executive Director of the PMA. “We’re striking back at a law that not only unfairly targets our industry but also would arbitrarily broaden the state’s definition of nexus. That’s a direct violation of the Commerce Clause and flies in the face of decisions already established by the Supreme Court.”

According to the PMA, Illinois-based affiliates number at least 9,000. In 2010 these affiliates generated $744 million in advertising revenue. The PMA is arguing that if HB 3659 takes effect on July 1 as scheduled, Illinois affiliates will be in jeopardy, as will the $22 million in state income tax they generate annually.

The reason is that out-of-state retailers may avoid the new affiliate nexus tax by terminating their relationships with affiliates. In fact, since the law was enacted in March, many retailers, including Amazon.com and Overstock.com have already severed their relationships.

LinkShare Reports Record Growth During Cyber Week

Affiliate Insider : feature — Wed, 15 Dec 2010 09:53:00 GMT

Performance marketing leader LinkShare has reported record year-over-year growth during the Thanksgiving holiday shopping period with same store sales increasing more than 50 percent on Black Friday and more than 45 percent on Cyber Monday. Strong growth...(read more)

Internet Tax Battle Continues

Pete Prestipino — Wed, 09 Sep 2009 17:11:00 GMT

The Performance Marketing Alliance today announced the filing of a motion seeking leave to submit an amicus brief in support of Amazon's appeal, which argues that the law requiring Amazon and other Internet retailers to collect use taxes on sales in New York (N.Y. Tax Law § 1101) based on their relationship with affiliate marketers is unconstitutional under the Commerce Clause of the U.S. Constitution (U.S. Constit., Art. I, § 8).

Editorial Note: Last month, Website Magazine professional-level monthly edition featured an article from Geno Prussakov on the affiliate/Amazon tax. Upgrade your account today to view the digital version of that article.

The PMA is taking issue with the New York law’s classification of affiliates as creating a “physical presence” in the state for online retailers like Amazon, requiring retailers to collect use taxes on sales made through the advertising displayed on affiliate Web sites. Affiliates are individuals and businesses who agree to display advertisements on their Web sites for a given online merchant. They are paid when users click on those advertisements and take an agreed-upon action, such as a registration or a purchase

The brief explains that affiliates provide a form of Internet-based advertising that is closely analogous to traditional print advertisements distributed by a catalog retailer, and do not constitute a physical presence for an ecommerce merchant in any state. Affiliates sell no products, collect no payments from buyers and make no deliveries. They have no further involvement in the sales and marketing process beyond posting the advertisement.

“Since its creation, the PMA has spearheaded efforts to persuade state legislatures not to adopt statutes like this discriminatory New York law, which threatens the livelihood of thousands of individuals and small business owners and has the potential to strangle ecommerce with invalid regulation,” said PMA director Rebecca Madigan.

The brief maintains that the statute harms the public interest by punishing performance marketing, a highly efficient approach to advertising which has allowed thousands to make a living through electronic advertising on the Internet. Further, the revenue stream generated from performance marketing has allowed many small businesses and individuals to accelerate the development of their Web sites, facilitating the more rapid diffusion of free information to the public that is the hallmark of the Internet.

Performance Marketing: Travel & Home

Pete Prestipino — Fri, 12 Jun 2009 15:15:00 GMT

The U.S. economy has yet to really turn around. Whether the bottom in site or not, one thing is for certain - consumers are spending less and that isn't good news for performance marketers.

Performics released the second month’s consumer behavior findings from its “2009 Online Buyer Economic Trend Study” and the results are for all intents and purposes - depressing.

Family vacations and home improvements - two popular summer pastimes – are those industries feeling the greatest direct heat as a result of the economic downturn. According to the survey results, nearly 50 percent of respondents say they plan on spending less money than they normally do on home improvements this spring or summer. Similarly, nearly one out of five respondents cancelled summer vacation plans due to the economy. Twenty to 34 percent of consumers scaled back vacation plans since 2008 in terms of amount of money spent (33 percent decrease), number of trips being taken (32 percent decrease), length of stay (25 percent decrease), distance traveled (20 percent decrease), and number of trips involving air travel (34 percent decrease).

Should you scale back your marketing or ad spending in the home and travel areas?
While some consumers may cut back on spending, many plan to maintain their past spending levels. For example, 43 percent of consumers plan to spend the same as they normally do on home improvements. The May study also asked about the recent Mother’s Day holiday; although 40 percent of respondents spent less money on mom in 2009 than they normally do, more than half said they spent the same this year as last year.

“From a low-key Mother’s Day to cutbacks on summer travel and home improvement, it’s clear consumers continue to tighten their belts and be more selective with their spending,” notes Michael Kahn, SVP of Marketing at Performics. “Advertisers across the board, especially in highly affected segments like travel and home improvement, must acknowledge these behaviors and find creative ways to engage their consumer audience online and stay competitive.”

LinkShare Adds 74 Advertisers in Q3

Pete Prestipino — Mon, 03 Nov 2008 19:07:00 GMT

Online advertising and affiliate network LinkShare announced the addition of 74 new advertisers to its network for the third-quarter of 2008. This doesn't surprise me. In tough economic times, advertisers always look towards performance marketing to get the most out of their promotional budgets and as I have said before - nothing works better than recruiting qualified publishers to do the selling for you (even if you have to give them a cut).

"Now more than ever companies are looking for measurable return on investment from their marketing dollars," said Yasuhisa "Yaz" Iida, Co-President, LinkShare Corporation. "We are pleased to see these new customers joining LinkShare's network for performance-based marketing solutions. For all of our customers -- both existing and new -- LinkShare consistently strives to provide excellent services while developing new and relevant technologies that support the specific and evolving needs of today's online marketers."

Third-quarter additions to LinkShare's network include 42 small-and-medium-sized companies.