 | Super Affiliates vs The Networks |
Spotted a little snippet of an article over at NMA today. According to ’sector specialists’ “affiliate networks are under threat from the emergence of super-affiliates” who “now have the finances, staff and experience to operate as mini-networks themselves”.
To access the full article you need to be a subscriber, so whether there’s any substance to the report is unknown. However, it’s not exactly a surprise and doesn’t take a rocket scientist to realise how flimsy things can be for the networks.
If Super Affiliate A is spending thousands of pounds a month on PPC for Merchant X relying on Network Z’s system. Merchant X is paying for that service, and Super Affiliate A is essentially giving override to the network for free - therefore lost profits. Cut out the middle man, and there’s more money to share between the two.
If you then consider that perhaps Merchant X doesn’t have many other sales from other affiliates and/or Network Z relies on a small number of PPC Super Affiliates for big profits, as opposed to maintaining long term relationships with regular affiliates - the balance of power lies quite strongly with the Super Affiliate.
But can Super Affiliate power lead to corruption?
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on February 16, 2007 at 12:17 pm Clarke wrote:
If a Merchant wants to cut off PPC as part of there over all Affiliate program strategy in favour of one Affiliate, they will soon find the other PPC Affiliates will be promoting there competition to ensure there decision is proven a wrong and costly one.
PPC is part of the picture, the issue is that SEO Affiliates due to the nature of the beast take a lot longer to kick in and generally there are little rewards or encouragement for SEO guys as the PPC “instant kick-in†get many of the bonuses.
PPC and SEO are a part of your over all Affiliate strategy, and today’s top Affiliate is not the guy who will necessary be your top Affiliate in 3 months, 6 months or a years time.
One thing many an article overlooks is that would the Affiliates now pimping direct deals to squeeze out fellow Affiliate competition have known about, been able to contact and be working with the Merchants that they are now conspiring to remove Networks from the deal they initially setup. Networks are not a free introduction agency, would any of these companies hire a management consultancy service who place a person in there company to do a job then offer the guy a job direct to cut the company that placed them out of the deal? Of course they would not as they know they need to pay a finders and release fee, so maybe more Networks may need to introduce a finder’s fee element for the Affiliate going direct scenario to make it less attractive to Merchant fly-by-nights.
It is not so great that a few guys are getting to cream off the money in direct deals, it is after all at the expense of the Network and the other Affiliates promoting that Merchant and believe me if that starts in full swing it will see the end of many small to medium Affiliates who add value both in more brand exposure and money, collectively as a group, 10 medium Affiliates could match the sales of one super Affiliate so why cut them out.
Please note I am not against Affiliate freedom of movement, if you want to change the Network your working with in favour of another then so be it. But the argument Networks do nothing for the override I am afraid is not true, as I recently point out to an Affiliate would you be making £70k a year commission from a Merchant if I never told you about the hot product, to this they replied, yeah I see you point.
I am dead against the Merchant prostitute who simply slags themselves about Networks to find out who all the good Affiliates are in order to invite them in to there own private deal, these people are the scum of the industry and are only out to damage it, and if you support them then well done, you just put another nail in the coffin and be ready to pat yourself in the back when you can no longer find other Merchants to make an income from.
on February 16, 2007 at 10:20 pm Jeff Molander wrote:
Jason:
Great observation that few (if any) have made although it stares us in the face. Indeed, the battle is in many ways OVER. In some ways affiliates that are now CPA networks have beaten the networks that helped create them. They maintain much higher profit margins and are flush with cash to the point where they pay their affiliates in advance.
My take on it here.
on March 2, 2007 at 10:31 am Should A Network Compete With Their Affiliates? - Fraser’s Affiliate Marketing Blog wrote:
[…] from affiliates? In some ways it’s not a surprise because if certain affiliates are becoming bigger than the networks then it’s not a shock that the networks want their slice of the pie […]