Author Archive for marie@affinityclick.com

Affiliate Programs Defined

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marie@affinityclick.com
on August 17, 2010
in AffinityClick Blog Roll
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affiliate programsAffiliate Programs
The concept of an Affiliate Program is nothing new and the method of paying commission for referrals predates the emergence of the Internet. However the sheer speed of connections between potential consumer, affiliate and online vendor makes this space a valuable and lucrative marketing and income-generating resource to many. According to MarketingSherpa, in 2006 $6.5 billion US was earned online by affiliates across a broad variety of verticals worldwide.

Technically speaking, affiliate programs could include all of the below employed online advertising methods, as each pays a sum for referrals made. One main difference between the methods lie in where the revenue earned/paid is derived from. Depending on the method it could be a bulk payment per distribution, CPS (cost per sale) or a rev-share model, CPA (cost per action), CPC (cost per click) or CPM (cost per mille), among other lesser popular methods. Let’s talk a little about what these revenue sharing models look like.

Payment per distribution
In methods such as Email Marketing, E-Zine Marketing or sponsored articles, websites or preview pages, sometimes there is a bulk sponsorship payment requested by the distributor. Often depending on certain statistics such as page views or subscription/distribution list size and quality, a lump sum for one or multiple ad slots (via graphic banners, buttons, company descriptions or sponsored editorials or articles) is required prior to dissemination. The advantage to this type of method for the advertiser is that there is very little leg work or calculation required aside from content and graphic requirements and production. The advantage for the distributor/affiliate is that it’s a one-time action resulting in a bulk payment, not a result-driven revenue model. The disadvantages could involve the difficult to predict ad/editorial performance and ROI.

Cost Per Action (CPA, or Pay Per Action (PPA))
CPA is a broad term used to define when an advertiser compensates their ad host based on a particular action generated, such as a purchase, a subscription or a form submission. The advantage to advertisers here is that they only need to pay when their desired action has taken place, meaning they can define what is that they desire greatest to occur and set their budgets accordingly. For example, when an ad is hosted on a website CPA here could mean that the advertiser only pays when a sale has been completed via this specific ad. This is most effective when buying advertising.

Note: sometimes CPA is used to refer Cost Per Acquisition. In this sense, CPA means that the advertiser pays based on the desired acquisition being received, such as a form submission or sale. As at all times Cost Per Acquisition can fall under the definition of Cost Per Action, the opposite cannot be said to be true so it is important to understand the difference.

Cost Per Sale (CPS) / Revenue Sharing
One of the most popular methods of earning income online is via a rev-share model, or CPS. Here, online vendors pay their partners or affiliates a percentage of their revenue generated from sales in exchange for the original referral. This is a very simple and effective method as there is very little calculation involved aside from agreeing upon a fair compensation percentage.

Cost Per Click (CPC)
This is probably one of the most well-known revenue generating ad models. CPC refers to the amount of money paid by an advertiser to their ad host for the number of clicks generated by the hosted advertisement. As a whole, this method is referred to as a PPC model, or Pay Per Click, meaning the advertiser pays their ad host based on the number of clicks generated through the ad. This term is closely linked to search engine marketing, where advertisers bid on keyword phrases that closely match their target market. Here, often the CPC depends on the search network used and the amount of popularity/competition for the desired keyword phrase. However this changes outside of the search marketing world where the advertiser does not use a bidding model. The advantage here is that you have a targeted audience that is encouraged to click based on relevant environment with which they are surfing. Additionally, for the ad host the advantage is that they generate revenue whether or not an action other than the click is made.

Cost Per Mille (CPM)
As in Latin, “mille” means thousand, this term technically means cost per thousand. As such, CPM is a measurement used to quantify the value of 1000 impressions of an ad, and helps define the relative cost of an advertising campaign. So a set amount of money is paid per thousand of ad impressions shown. As with CPC, the advantage to the ad host is that they are paid whether or not a sale is generated.

Hope these quick and dirty definitions help clarify anything with those confusing and similar abbreviations. Anything to add? Or should I say… ATA? :)

The Traditional and the Social: Online Advertising Methods 101

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marie@affinityclick.com
on August 16, 2010
in AffinityClick Blog Roll
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Part of the goal of our blog here is to help educate and pass along helpful information and knowledge to those of you who are just getting started in the online advertising game or perhaps those looking for a little refresher along the way. So considering this, we thought we’d touch on a little of the basics of online advertising…a kind of 101 class, if you will. For those of you who are slightly more seasoned in terminology and methodology, please jump in! We’d love it if you could pass along some of your experiences and insights into these posts. It will help create a deep resource of “getting started”- and “what’s next”-type information that will only prove to help our community grow!

Online Advertising Methods For this first post, let’s talk a little bit about some popular methods found in online advertising and discuss a bit of shift in the ways in which these advertisements are viewed. In a follow-up post we can elaborate on these methods, their pros/cons and their respective effectiveness.

So, in my head at least, I organize methods of online advertising in terms of these categories: Traditional; and Social. I will admit that these are pretty broad categories so I’ll elaborate a little below.

Traditional Online Advertising Methods
Since the dawn of time…well, the dawn of the Internet anyway, entrepreneurs have been looking for new and improved ways to access and draw in a new and targeted audience and make more money online. As a result, there have been many methods tried and developed of promoting products or services (legitimate or not) online. These types of online advertisements are built to catch the user’s eye in the hopes that the content/imagery is enticing enough for the reader to click through to further information, pulling them deeper into the sales funnel. Sometimes, the goal of the methods employed to serve the ad is to increase the ad reach and other times it’s to increase the depth of reach, or in other words, to create a more targeted ad. Some of these seasoned and proven methods of online advertising include:

  • Affiliate Programs
  • Ad-exchanges
  • E-zine Marketing
  • Email Marketing
  • Pop-up advertising
  • Sponsored Articles/Websites, Sponsored Website Preview Pages
  • Search Engine Marketing (SEM)
  • Banner Advertisements; In-text Advertisements

All of these methods have their pros and cons, not to mention some of these methods proved to be greatly effective for a period of time but have seen their popularity decrease due simply to the evolution of Web usage. These techniques eventually became more intelligent (and at times, controversial) by employing behavioral and/or contextual targeting to help foster a greater ROI through access to a more targeted audience. However in recent years, we’ve seen an emergence of new and/or evolved online advertising methods that have one main difference than that of the Traditional type; interactivity. Read on.

Social Online Advertisement Methods
As the ways in which Internet users navigated the Web and interacted online shifted to a more social practice, thus spawned the emergence of Social Online Advertising. The goal of these new and improved social advertising methods is to provide the viewer with an ad experience that encourages them to want to share it with their own network of connections. Some of the ways in which this is done include:

  • Social Online Network Advertising, i.e.:
    • Directly: Facebook Ads, MySpace Ads, Sponsored Tweets, etc.
    • Indirectly: Branded Facebook Groups, Branded Facebook Fan Pages (a.k.a. “Likes”), Corporate/Brand Twitter Account
  • Corporate Blogs
  • YouTube Videos
  • Social, Interactive Banner Advertisements

Should the advertisement and channel with which is used to disseminate the ad is effective, enticing and engaging, then the ad reach takes care of itself aiding in the overall effectiveness of this method. However, the fact that a new group of educated consumers have emerged who enjoy voicing their satisfaction or a distaste for a particular product or service online – sometimes termed “Brand Ambassadors” when the message is positive, the ability for a company/individual to direct their own brand image online has proven to be more difficult than in previous years where open consumer engagement was non-existent. Now, online advertising also must employ a sort of “brand management” wherein much of the actual “advertising”, if meant in the sense of growth of brand awareness, is out of the control of the companies/individual themselves. Therefore an active presence in social networks is in almost all cases prudent for the company or individual as part of an effective online advertising strategy as they can employ proactive advertising measures to help with brand management and awareness, and when necessary, PR issues.

What remains to be seen, although already begun, is ways in which the Traditional methods of Advertising adapt to include a more Social component to continue to fit in with how users/consumers are playing online. How many of those methods on the Traditional list will soon be able to fit under the Social list in…let’s say…a year’s time? Any thoughts?

Joining The Conversation? It’s No Longer A Question.

Published
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marie@affinityclick.com
on June 25, 2010
in Marketing
. 1 Comment
Having trouble justifying participation in social networks? Know someone who is standing on the brink, but just can’t take the plunge?

Joining the Social Media ConversationI’m pretty sure we all know someone or some company that just can’t see the light at the end of the tunnel when it comes to a social media strategy and it’s impact on growth. I get the hesitation, I’ve seen and experienced first hand the delays and misplays by some companies avoiding joining the conversation (see my last post!), but more importantly, I also can understand why some folks would be bitter about the fact that now companies (or bloggers) are just going to have to suck it up, create and manage their presence in social media spaces. Why is this a fact? Conversations surrounding your brand, your area of expertise, and your audience is already happening online. And if you, companies (or bloggers) don’t join, you will only miss out on a tremendous opportunity that your competition will have already staked a claim in.

For that reason, I did a little research and found a great blog post by Augie Ray of Forrester, titled Seven Things Your Organization Must Do Because Of Social Media. I want to bring you the main points of this post and hopefully give you a quick synopsis of the things you just can’t ignore any longer if you are looking to grow your company, your audience or your readership. So let’s get started.

Ray starts his post by recalling the legacy question that companies post before the advent of social media impact. What once was “what can the Internet do for us” turned into “what can the Internet do to us”. What a great question. Think about that for a second. What is the difference between the two? Well, Ray cites the as being “…the difference between a false sense of security and a necessity for action.” Meaning, the Internet forced companies, business and publishers to have to make a move. Okay, got it; but what does this have to do with social media? Logically, he suggests to change the subject matter from ‘Internet’ to ‘Social Media’, and apply the same calculation. And in my opinion, that makes sense. So what comes next?

Well, he starts by giving two examples of what social media is doing to business and the impact it’s causing. He talks about the outcomes of the PR crises between Nestle vs. Greenpeace, and Dave Carroll vs. United Airlines. The crux of that message is that your customers can and will use social media as a soap box. And this forces you to have to react. These stories and the outcomes are great examples of what to do and what not to do when this happens.

As an aside, I’d definitely suggest reading about both these stories (you can do so in Ray’s post) and plan on touching more specifically on Dave Carroll and his YouTube sensation “United Breaks Guitars”. There are great lessons to be learned in that story.

Because of the fact that social media forces companies to have to do something because of the existence of social media, the wise choice is to be proactive and join the conversation before a crisis occurs. As such, Ray goes on to give seven specific examples of what smart business will do because of Sociall Media. Take a read, and see what you can take away from these suggestions and try to incorporate them into your social strategy, if you haven’t already. Do your friends a favor, pass this around, too.

1. You must be proactive.
“Every enterprise has some issues that are ticking time bombs waiting to explode in social media…You can no longer run and hide from these sorts of issues, but neither do you need to cave to pressures from the minority.  The key is to identify the issues that can explode in the future, engage proactively with a wide range of consumers, educate honestly, listen sincerely, change consumer perception when you can, and change your company when you can’t.“

2. You must improve customer support.
“For too long, companies have viewed customer support as a cost to be managed rather than as a strategic imperative that affects brand perception.  Today, consumer frustration over perceived service snafus can result in millions of negative impressions, and those impressions get more attention and are more believable to consumers than brand-sponsored advertising impressions.  Marketers must view their customer service organizations as a key component in brand-building efforts, and service leaders must prioritize advocacy measurements as equally or more important than cost metrics.”

3. You must listen.
“Consumer expectations around support are shifting rapidly.  Those who are more engaged (and influential) in social media no longer are opting to pick up the phone and wait on hold to receive the support they expect;  instead, they’re voicing concerns and complaints in open channels like Twitter and expecting companies will respond.  And if a brand fails to do so?  The complaints and negative impressions will only pile deeper.  This trend will accelerate as social media adoption continues to grow…Organizations must implement listening and plan for response or they will suffer the consequences that can come from hundreds of consumers telling thousands (or millions) of people that the company’s products don’t work and service is inferior.”

4. You must participate.
“…While it’s never pleasant to be taken off of message and forced to respond to a negative claim, what exactly is the alternative in our more social world?  Damage is being done to your brand whether consumers complain in your Facebook group or they do so across hundreds of Twitter accounts, blogs and YouTube channels.  And which PR fire would you rather fight—the big one happening in your Facebook group where you have a voice and fans or thousands of little PR blazes scattered across social media where your brand’s participation may not be welcome?  Brands cannot gain control of their brand messaging by failing to participate but instead earn the right to shepherd their brands through presence and engagement in consumers’ favored social channels.”

5. You must respond.
“…How can you ignore damaging accusations that accumulate within your own Facebook group?  You can’t; inaction breeds frustration, annoyance and distrust.  Responding doesn’t mean immediately doing whatever complainers want you to do;  instead the secret to social media success is to respond positively, discredit those who are simply wrong, migrate fuming consumers in need of support to private communication channels and engage openly on those issues about which consumers care deeply.”

6. You must move faster.
“…Many of us just got used to “Internet time,” but “social media time” moves even quicker.  In a world where marketers create five-year plans and dedicate months to developing ad campaigns, social media moves in real time.  Marketers who adopt adaptive marketing techniques will create an enormous competitive advantage over those who try to approach social media as ‘business as usual.’”

7. You must realize every employee is a marketer.
“…Your brand messaging will be delivered as much by employee messages in social media as by paid advertisements; marketers must train every employee about his or her vital role in crafting the brand through participation in social media.”

Ray closes of his post by stating that just like the Web changed everything from recruiting to employee relations, Social Media is doing much the same “with consumer adoption continuing and Facebook and Twitter extending their reach with new tools that enable the social web, we are nowhere near the end of the changes social media will bring to the business environment. Social Media will do much for brands, but it is how an organization anticipates and plans for what social media will do to brands that will create competitive advantages in our newly social world.” And this is exactly why it should no longer be a question of joining the social conversation. Join, before social media does something to you, instead of you letting it do something for you.

Considering Joining The Social Media Conversation? Here’s a Little On What NOT To Do.

Published
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marie@affinityclick.com
on June 22, 2010
in Marketing
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Easy Tone DebateSo, if you recall from my last post talking about the ongoing saga between athletic gear behemoth Nike versus the new trend in women’s athletic footwear, toning, Nike is doing themselves a clear disservice in their decision to ‘take a stand’ against the growing popularity of these Reebok “Easy Tone” sneakers (as well as Sketcher’s version) and not jump in to an ever growing niche in women’s athletic footwear. And in my opinion, its a clear example of when a company (possibly justifiably) sees risk in a particular movement, refuses to take action with their competition embraces innovation (at least so far) and is failing to tap into a niche with which a very lucrative section of their target demographic is already diving into. Take it one step further, it could be argued that Nike is in fact insulting this very same demographic by stating that consumers who buy toning footwear are “compromising” on certain elements Nike has decided are crucial to the integrity of women’s athletic footwear. And as I concluded in my last post, I cannot help but see parallels to this story in how some companies and businesses still fail to embrace social media as part of their marketing and community engagement strategy.

I take it something like this. I can understand how C-levels or business owners see the risk in engaging in social networks as part of an overall engagement or growth strategy. Heck, the same goes for bloggers who choose to focus their energies only in their blog, and not foster awareness or growth through other social online spaces. There is more often than not always going to be risk in trying exercises that are new, arguably unproven, and resource-exhaustive. But the folly is in the stall tactics or downright refusal to try. I hear so often the story of having to prove the value of integrating social media into a marketing mix, but in my opinion, there are some things you just have to take a shot in the dark at. Plus, you can’t argue with numbers. If the concern is that you simply do not know that your target audience, community, stakeholder group or demographic is participating in social media, just take a peek at this:

Given that the world’s population is currently 6,827,300,000;

LinkedIn has over 10 million registered users.
That’s approximately 1/680th of the world’s population.
Twitter has over 100 million registered accounts.
That’s approximately 1/68th of the world’s population.
Facebook currently has more than 400 million active users.
That’s approximately 1/17th of the world’s population!

Now obviously there are other considerations in these stats and calculations but the very simple point is clear; a portion of your target audience IS online in these social spaces. And if it isn’t where they exist all the time, in the least there is an opportunity for growth should you choose to at least place a presence in these social networks. Don’t be like Nike in this; don’t make up excuses and only see the risk in joining the conversation (or in their case, the risk in offering a certain in-demand product). Don’t fail to take action one way or another by either joining or providing viable reasons for why you’re not joining (in Nike’s case, they chose to instead insult their competition and their potential target market by claiming “toning” products were compromising in the integrity of athletic footwear). And most definitely, when you can see activity from your target market in social networks managed by or shared with your competition…don’t stick your head in the sand! Take action!

I’ll talk more about things you need to consider when joining and managing your social spaces in my next post.

Nike vs. The Toning Trend; A Little Misstep?

Published
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marie@affinityclick.com
on June 21, 2010
in Marketing
. 2 Comments
Advertising Misstep?I was reading the other day in an article by Advertising Age about how Nike, the unmistakable brand and once untouchable leader in sports apparel and footwear, is now…well…touchable. And interestingly enough, it’s my very own demographic which is the group that Nike is letting slip through their fingers. As I was reading the story, I couldn’t help but draw parallels to the stories of companies who either discredit the value of social media integration, or fail to harness the power of social media in their marketing, PR or crisis management strategies. Strange, I know. But stick with me.

So what’s going on in women’s footwear and how the heck does it have anything to do with social media? First of all, I can remember a few months ago, seeing what I seem to recall a television ad that, for lack of a better description, showed a woman walking around her bedroom in a pair of booty shorts (okay, underwear) and a pair of running shoes. And what caught my and other’s eyes is quite frankly, she had a fantastic rear end. Not to mention the commercial was bright, happy and inspiring and at the very end the call to action was to buy these revolutionary kicks, coined “Easy Tone”, that were built to tone legs and behinds by simply walking in them throughout the day. The end result of regular usage of these sneakers would be that women’s stems and trunks would look something like what that woman’s fabulous features looked like. And of course, they looked perfect. But I just couldn’t help but sit there and marvel at how unbelievably well targeted that ad campaign was! (As such is the plight of those of us working in the marketing and communications fields, we don’t see the ad for the product that’s being targeted, but more the effectiveness of the ad itself). And who put together this remarkable piece of advertising? Reebok.
Reebok? Really? Huh.
And so was the beginning of the end for Nike’s stranglehold on women’s athletic footwear. Why? Well, as I learned in this AdAge article, Nike refuses to dive into this “toning” revolution which interestingly enough isn’t just cornered by Reebok, but by Stetchers as well. Apparently, according to this article, these types of shoes “don’t fit with [Nike's] performance-obsessed brand”. Yikes. Well, I guess I should give the benefit of the doubt because there is a lot to be said about knowing your niche and staying the course, but at first glance this seems like a tremendous opportunity. In any case, here’s Nike’s explanation for not tapping into this market:

“Unlike today’s toning products, we won’t ask the consumer to compromise on stability, flexibility or any other key performance characteristics as they train,” a company spokesman said in a statement.

The spokesman added that the company has a range of new women’s training products set for fall and winter release. And, speaking to investors last month, CEO Mark Parker promised “more compelling presentations at retail” aimed at women, calling the category “a massive opportunity” for the company.

Okay, so they have conceded two things. First, that they have fallen short in their presentations at retail. No kidding, that new Reebok ad quite literally kicked their but whether or not Nike had a product to compete with against Reebok. Second, they recognize “a massive opportunity” with the working woman’s demographic. Again, umm…no kidding? When was the last time there was a memorable product or ad targeted at the career woman demographic since, well, that imaginary campaign put together for the Mel Gibson and Helen Hunt movie, What Women Want? There very well may be campaigns in existence, but truthfully, I can’t remember one. And for someone who’s a self-proclaimed athlete, that’s kind of big. [Scratch that, I just remembered when the Shox came out. But admittedly I don't remember any campaigning, that was more that I and my friends thought they looked cool]. Either way, it seems like this explanation is a bit loaded for my liking “we won’t ask the consumer to compromise…”? So what, are you saying all of those women already giving the product line a try ARE compromising? Ouch. Them’s fighting words.

So what else has Nike conceded in their pseudo-campaign against these “toning”-type footwear? Let’s look at the stats.

The footwear and apparel behemoth’s share of the U.S. women’s footwear market slipped to 29% last month, down from 36.5% in the year-earlier period, according to SportsOneSource. Its sales of women’s footwear, meanwhile, declined by mid-single digits even as the category grew in the teens.

It’s no mystery where they went: Sketchers and Reebok. Skechers tripled its share during the same period, climbing to 16.5% from 5.5%, and Reebok nearly did the same, jumping to 8% from 3.3%. Both of those marketers have invested heavily in the hugely popular segment of toning shoes, which artificially create additional resistance and turn a simple walk into more of a workout. Reebok is at work trying to widen its franchise with additional products including apparel under its Easy Tone brand.

NikeEnlarge
THE SALES RACE: Change in U.S. market share of women’s footwear among leading brands, 2010 vs. 2009.
“The explosion of growth in this space in such a short period of time eclipses nearly everything I have witnessed in the industry over the last 25 years,” said Herbert Hainer, CEO of Reebok parent Adidas. “We are well on track to selling at least 5 million pairs of toning footwear in the U.S. alone this year.”

Okay, I get it. If Nike doesn’t agree with this line of product and it (somehow) violates their mission statement, or core mantra, or whatever else it is that they’re leaning on, then cool. But their problem lies in that you CAN’T deny the fact that if your target market is embracing a particular product (service, whatever) within your area of expertise, then you’d be a fool to not in the least try to provide a product that either would a) help explain why your competition is doing that target market a disservice by offering and marketing their said product or b) act as a viable alternative to the demand that’s been created by they competition in the meantime.
In the very least, you can’t stick your head in the sand with a disclaimer that states that the product that’s being embraced is not good enough for that very same demographic that’s already embracing it. And then…do nothing. That message is way too little, and way too late. Nike knows well enough of the very clearly shift in demand and if they doesn’t make a move soon, they may as well kiss my demographic goodbye because they’ll most certainly be left in this Easy Tone dust. Innovate, or die… and in my opinion what Nike should do is just take a page out of their own book… and JUST DO IT.
So how does this relate to social media? If you haven’t already caught my drift, stick around. I’ll explain in my next post.