Performance Marketing Leadership Summit 2011 Recap
Once again, on the eve of ad:tech SF, OfferVault put on another afternoon Performance Marketing Leadership Summit. Last year’s topic was compliance, whereas this year’s summit focused on growth, transparency, and improving CPA networks everywhere. The 2011 summit was graciously sponsored by CPA Detective, LashBack, LinkTrust, EFFECTUS, & HasOffers.
While I didn’t explicitly learn much myself from this summit as it was definitely geared towards CPA networks, there was a lot of good information for those folks I’d like to share with you. Here are some highlights of information I took from the afternoon’s speakers:
Darin Namken
Founder & President of Bulldog Media Group, Inc.
- Why Diversify?
- Create value & enhance margins.
- Stability & structural positioning.
- Do you have the resources?
- Management.
- Technology (in house, other).
- Cash Flow.
- Infrastructure.
- You have to do something special in the market.
- You may need to diversify just to survive.
- Where to diversify?
- Verticals/products.
- Do you own your own products?
- Do you have your own technology?
- Internal development.
- Partnership.
- Strategic alliances.
- Joint ventures.
- Verticals/products.
- You’ve got to have a good database, not just emails but information about these people. That’s where the real value is.
- You’ve got to be able to work well with others.
- Reciprocating traffic works well.
- Pay day loans have higher traffic, as do prepaid cards and rewards programs.
- You must have a stable strategy to survive.
- What direction to diversify?
- Analyze, evaluate, and plan strategy.
- Future areas of diversification:
- Major players of influence (Google, Facebook, Apple, Groupon, others).
- What’s the next generation?
- What are the trends? (Chase them or plan for them).
- The economy has created more reasons to look farther into true performance. Who’s checking out your backside?
- Who’s aiming for what current teens will be looking for?
- Spending marketing dollars doesn’t mean a lot of you don’t know what the ROI on that money is.
Panel 1: Diversification Strategies
Darin Namken (Bulldog Media Group, Inc.), Chad French (PeerFly), James Murphy (BurstDirect), Bob Regular (Kitara Media), & Curtis Fullmer (AdKnowledge)
- Is it enough to just be a network?
- There’s not much barrier of entry.
- The relationships are what set the networks apart from each other.
- It’s more about conversion & yield than the type of offers. it starts with the offer but it can’t overcome traffic sources.
- It’ll be tough if you don’t have the right mix of affiliates and offers (e.g. Gaming affiliates but pet product offers).
- Understand where the publishers are getting their traffic from.
- Most networks don’t have a good handle of where the traffic is coming from. Which leads to the bigger question – as long as you’re not dealing with risque sites, does it even matter?
- Go with what you know. There’s no one path. Go from there and then expand.
- What are you solving? Are you solving anything? If you want to grow, you need to ask “What are you solving?” or are you just opportunistic? If you’re not solving something the relationship can’t last very long. It’s all a supporting mechanism to fixing the problem.
- Remember that you don’t have to be all things to all people. Build your identity and have a solid foundation to build it upon.
- Where is a bad idea to diversify into? Chasing trends too heavily is dangerous, like with re-bills. Focusing on a trend too much means you’ll go down when the trends go down. Don’t act like an affiliate. Haves multiple eggs in multiple baskets. Facebook fan page marketing is tricky these days, hard incentives tricky,
- What traffic is ok? All traffic is fine. You want everything in between. All traffic has a value, but it needs to be transparent. Understand the transparency of where your offers are running. If you know that, then you can calibrate your offer to suit the traffic being driven. Take those factors into consideration & you’ll get better yield. Bad traffic isn’t necessarily fraud, just mismatched traffic to the offer. There’s a place for incentives, but it takes focus, time and understanding. What you ultimately have is a user with no intent & no interest in your end offer. If you don’t understand how to create the intent, stay far far away.
- What do you need for resources & focus to pull a true diversification off? Make sure your core competency is solid to support the side stuff.
- How do you measure if something is worth getting into? In our industry you don’t have to be 1st, there’s still a lot of room. How does it fit into your core strategy? Evaluate what’s the dollar value you could potentially build that business or division to? I there a growing market there? If the answer to any of those things is no, consider moving on. Don’t chase, identify if it’ll help what you do. If you can’t do it very well & be superior at it, run away. Know when to cut your losses. (i.e. affilicert, affiliate certification that OfferVault was attempting to do). Be mature as a company & don’t look at it as a monetary thing.
- How do you diversify the traffic flow to different kinds of offers in one network? Make sure to understand the performance metrics, it becomes an education thing, be transparent, educate the affiliates on the performance of other offers. Just ask if they have traffic for those kinds of offers. How many times can you tell your publishers to “trust me!”? If they had an answer, they’d probably not share it lol. Get them to believe in the offer & why it’ll work for them. Look at the whole marketing funnel. Don’t kill your credibility by pushing something you’re not sure will work. Educate them that it’s in their best interest as well for them to diversify because advertisers can back out on offers in the blink of an eye for various reasons.
- Should you be a network without an in-house media team? It helps. The easiest way to get knowledge on traffic and performance is it do it yourself.
- Do you consider who your ultimate client is? Advertiser or publisher? Does that come into play on how you diversify? Consider the end user, if they don’t want to participate in these offers, the advertisers wont have the money to write the checks. There needs to be a balance. If you work direct with the merchants, you can look at things as more of a partnership with affiliates.
- Do you have issues where an advertiser is asking for full transparency (double verify) and how do you work with that? You give it to them. if they demand a certain quality and you want to work with them, you have to give it to them & meet that quality or the alarm bells start ringing. The money flows downhill. The increase in transparency is coming to more verticals and more industries. It goes back to relationships, if you build these good relationships then transparency is second nature. Why hide? It’s a two way street.
- Do many publishers say they won’t run 3rd party ad tags & want to hard code everything? If they’re that resistant, you have to ask yourself if they’re worth the time to work with or career to.
- International a great way to diversify? Is it? It’s key to future growth, but you’ve got to be prepared for the challenges of fraud, compliance, policy issues. Canada & UK fairly easy to get into, but do it in a very stepped, focused way. Consider your offers if they appropriate for international traffic as is, are there any TOAs that prohibit the international traffic, etc. Do you have the resources for that kind of expansion.
- What industry trend or issue keeps you up at night? There’s a constant battle with shady publishers & compliance. Regulation from the government. How are government departments interpreting the regulations. The government of Google & Facebook & their control over the Internet & their policy changes. The inability to integrate technologies & lack of standards.
Ryan Pamplin
CEO, Ryactive
- Patented technology, open sources, propriety
- Apparently affiliate marketing is patented (Patent# US 6804660) filed in 2001, granted in 2004. Probably without merit, companies getting sued. Mid level networks (ShareASale, Blue Phoenix).
- Going to trial 4/17/2012.
- ShareASale has filed a counter suit against essociates trying to invalidate the patent.
- In house, proprietary tracking solution instead of licensing direct track or LinkTrust or another vendor. All the networks mostly with propriety tech have much higher network revenue (i.e. Neverblue) They all started with their own solutions.
- Benefits of in house platform:
- Less reliance upon third party tech products.
- Increased value for investors and shareholders.
- Ability to quickly adapt to changes in the industry.
- Data portability and security.
- More control over your user experience.
- Differentiates your network from the thousands of other networks all using identical software.
- Benefits of an outsourced platform:
- Quick time to market with lower up front costs.
- Software that continues to be developed and improved on their dime.
- Predictable start-up and operating costs.
- Is Open Source the future?
- Tracking202/Prosper202 is open source, and became the industry standard tracking software for affiliates.
- WordPress is open sources and 13% of websites on the internet are powered by WordPress.
- Stop reinventing the wheel!
- Every network is reinventing or licensing the wheel.
- Instead, a group of networks could sponsor the creation of open source software.
- A network is more than software, it’s about people, offers, and relationships.
- Imagine if the resources going into development of the dozens of proprietary networks and the monthly fees for licensing were allocated to building a single universal platform.
- Noteworthy tech solutions:
- If you can reduce the size of your landing pages, offers and/or redirects you will make more money.
- Cloud is virtually infinite scalability.
- No need to overbuild gory intransigent with cloud.
- Software required to automatically scale.
- Pay just for what you use.
- Increases your risk of downturn, not necessarily so with applications that don’t need scalability.
- Dedicated, fine grain control over hardware.
- Dedicated server is likely to be more reliable.
- Model is proven and relied upon but 90% of Fortune 500 companies have it.
- Wouldn’t put whole business on cloud.
- ServerBeach (offshoot of rack space).
- Backup your servers everyday.
- Create scripts to automatically upload from your servers backups to your local FTP email you files, and/or another website.
- Your data is the core of your business, and if you’re not already you need to take measures to ensure you keep it safe.
- Auto backup with Tivoli.
- WordPress is free and open sources, with tens of thousands of templates available. It’s secured and trusted by millions with extreme flexibility. Websites can be developed in hours not weeks.
- Joomla powers 1 in 37 websites on the internet, not many of which are blogs. It’s slightly more complicated to learn, but great for split testing with thousands of themes available.
- Drupal powers millions of sites, including MTV, Lifetime Television, Yahoo, and more higher volume sites. It’s considered the best framework but is most complicated to learn of the open source CMS out there.
- Braintree is a great eCommerce solution that powers sites like LivingSocial, Bright Cove, 37 Signals, Open Table, and more. It’s easy to integrate.
- Visual website optimizer is $49 per month but worth it; it’s like Google Website Optimizer on steroids.
- Be sure to include trust symbols on your website – 100% satisfaction guaranteed logo, privacy seal, SSL certificate, Verisign, McAfee, etc. Avoid less trustworthy things, like GoDaddy right now.
Panel 2: Technology Insights
Ryan Pamplin (Ryactive), Matt Frary (SmarterChaos.com). Lucas Brown (HasOffers), Beto Paredes (Offered Launch Media, LLC), & Jay Moore (BigDeal.com)
- HasOffers goal is more people in the industry. They’re doing a lot to increase data redundancy.
- If you can build something better than anyone else, go for it, but if not, don’t bother. It’s not about if you do it in house or outsource it, it’s do I have go do it in house?
- How can you innovate on a closed platform if you can’t integrate a new technology? Open API is the suggested way.
- HasOffers rather on the spot.
- Innovation is driven by need.
- Cookies vs. Server side calls? You’ve got to make sure you don’t violate Apples rules. Cookies are becoming outdated. It’s inevitable that cookies will be going away. There’s also an element of educating people on the new tracking methods.
- Larger networks are also looking at the tracking solutions with the working group.
- The banks are guilty of screwing the whole merchant services thing up. A lot are just white label stuff.
- By removing inefficiencies, within the existing infrastructures, you’re going go make more money.
- You may find more of the advertisers having moe control on their programs mandated by the networks.
- Make sure your advertisers know how to do things, like tracking a sub ID. What’s lacking is a true integration. The education for the advertisers on the technology that’s available is also lacking.
- It’s not about the technology sometimes, it’s about the willingness to apply it.
- Its not unreasonable to want to know who you’re doing business with. The way things are with affiliates being in the dark is not going go persist. People are going to be changing the way things are done in favor of transparency.
- All industry panels lead to transparency. We all talk about it, but who does it? Advertisers do it, and unfortunately they’re going around the networks and collapsing the value chain. They’re the ones on the hook with the government.
- If the networks used their tech for good, instead of just protecting their own interests, then there’s more money for everyone.
- It’s the business ethics behind the technology that’s going go drive the industry.
- Any tech you’re excited about or think it’s a game changer? Blue Cava (allows you to ID a user all over the net without cookies or server side tracking, browser fingerprinting with ip). Any tech tracking people across devices or without cookies, across platforms, etc. Excited about online to offline to online tracking like pay per call. Anything that’s going go move towards a more sustainable affiliate marketing industry.
- Privacy is dead, if you’re putting all your info out there on Facebook & whatnot, FTC requires everyone offer a way to opt out. Overall it’s going to improve the consumer experience. Theres a lot of opportunities to give people a chance to opt in. The more important privacy issues surrounding ID theft are being addressed.
- Full transparency isn’t necessarily the way, but we want to know who the affiliate is generally speaking & have a way to contact them.
Performance Marketing Leadership Summit
On April 19th, the day before ad:tech SF 2010, OfferVault presented their Performance Marketing Leadership Summit, a half-day event featuring discussions on compliance, fraud, and transparency. This was one in a series of events presented by OfferVault focusing on improving the performance marketing industry. Big thanks to Jim Lilig and the folks at OfferValut for putting this event on for free, allowing anyone interested in joining the discussion to attend. This event was also co-sponsored by AffCon, OfferMobi, and DirectTrack.
I headed over to the city to go, and I’m glad I did. The afternoon was divided between two singular speakers and two panel discussions, end capped by lunch to start, drinks to end, and a break in the middle. Here are some highlights of information I took from the day’s thought leaders:
E.J Hilbert
President of Online Intelligence, Epic Advertising
- Compliance is a dirty word, some people think it always equals loss. Truth is, there is no true definition.
- Compliant traffic is actually a 15% increase in profit in the long run.
- Margins decrease initially because of the bad traffic.
- Whether or not we see what we do as spam, the rest of the world does – it’s due to a lack of understanding.
- Remember, to the general public, we’re guilty by association.
- Compliance seems to be a catch-all, referring to legal, network, advertiser, corporate, affiliates, etc. Perhaps it should just be legal and corporate and we can call everything else fraud.
- More traffic = more money.
- The most profitable cybercrime is spam.
- We can’t because they don’t – there’s not enough enforcement in the industry. We need to crack down.
- Many top media outlets are developing their own advertising platforms they can trust instead of utilizing the existing platforms we use.
- Partner with the advertisers, that’s where the money is, not with super affiliate A or B.
- There are 4 ways to deal with fraud: accept it, insure against it, mitigate against it, not accept it at all. We should not accept it at all.
- Top advertisers are the ones calling the shots, because they have the money.
- Watchdog groups are paying attention. If we don’t do something soon, others will. We don’t want that.
- Online advertising is mainstream.
- Sometimes the way we have to go isn’t the popular way, but it’s the right way.
Panel 1: What We Need To Do to Combat Fraud
Jason Spievak (RingRevenue), Brandon McDonald (Product2Web), Chris Graham (Atrinsic), Tom Cohn (Venable), & Carrie Birkner (Lashback)
- How often does a company do something when one of these outside agencies tells them about a problem? Fairly often, actually. They gets lots of flack from publishers if they don’t take action.
- A lot of the responsibility in combating fraud comes from the technologies, the networks.
- Many networks and managers are now taking the stance that if an affiliate isn’t going to be forthright about their methods, they’re out.
- In the industry, we don’t trust each other.
- Product2Web stops fraud at the cart level. Networks should force their advertisers to utilize this kind of tool.
- Longevity planning should be the new term for compliance.
- Most affiliates live in this world of cloak & dagger, so where’s the incentive to be transparent? They incentive should be in taking the high road.
- Part of a network or merchants positioning & branding should be that they watch things & enforce their guidelines.
- Affiliates are black hat or gray hat because it works. They’re looking at the short term money makers, not long term business planning.
Peter Borders
Founder & CEO, MediaTrust
- We have the chance to seize a tremendous long-term opportunity.
- Affiliate marketing harnesses the best of the best, and we continue to harness new channels.
- Direct response television (infomercial) industry is trying to get into affiliate marketing.
- Evolution from Mass Media to Me Media. The consumer used to be at the bottom of the funnel, and now they’re at the top.
- Consumer is king, and we need to empower them. The market should be driven by quality and lifetime value.
- Right now there is little innovation, minimal brand presence, and an “all for me, more for me” mentality. We need to evolve.
- What do we need to do? Share information and data, innovate, move up-market, and collaborate.
- We have to think holistically for the sake of the industry.
- We should help each other to set standards.
- We have to be an industry of problem solvers.
- If the whole industry goes up-market, we ALL win.
- It’s time to build collaboration and trust, and support agents of change.
Panel 2: The Road to Tier 1 Advertisers
Rebecca Madigan (Performance Marketing Association), Todd Crawford (Impact Radius), Theresa Farmer (UnsubCentral), Peter Klein (MediaWhiz), & Liz Wasserman (Mate 1)
- Big advertising agencies still don’t understand affiliate marketing.
- What do we need to do for tier 1? Educate – be transparent.
- Big brands, this should be sales. Agencies can’t guarantee the spend of budget in terms of performance marketing.
- It’s a much longer sales cycle with large agencies.
- People want stability and consistency, which is tricky with performance marketing.
- Is it possible, technologically’? There’s efficiencies when you automate that always allow you to make more money.
- Big brands don’t understand that with “performance” you’re getting branding for free.
- Brand reputation is a concern for big brands, so performance seems scary. But it goes both ways, you can also build a brand using performance marketing like Mate 1 did.
- We need to do a better job explaining the metrics to agencies. They need to understand that there’s two types of advertising – performance and branding. And often there is some overlap.
- There’s a kind of lethal nihilism. Outside impressions of the industry is that we’re “a little shady & quasi criminal” and people don’t want to get involved (great quote by Liz there!)
- This gets perpetuated by smaller, CPA type folks that are looking for short term gains and give the rest of us a bad rap.
- Self-regulating isn’t going to work because there’s always a few folks willing to break the rules for a quick buck.
- Advertisers worry about negative brand impact and are worried about consumer respect.
- We don’t bring the consumer into the equation enough.
- Merchants need to focus on moving up-stream.
- It should be a goal to really be able to understand the lifetime value of a customer.
Interview with Lisa Riolo of Impact Radius
A new kind of affiliate network was launched just a couple weeks ago – Impact Radius. They boast themselves as the first multi-channel performance marketing platform. Impact Radius links performance advertising to TV, radio, print and online distribution channels—delivering to advertisers and media partners opportunities for growth and profit. I’m happy to present you with an interview with one of the founders, Lisa Riolo.
What is the Twitter (~140 Character) Definition of Impact Radius?
Well, I’m going to cheat a little and send back-to-back tweets from @impactradius
- We’re the first multi-channel performance advertising platform. Emphasis on multi-channel.
- We feature an open directory for discovering partners, electronic insertion orders, comprehensive tracking, reporting and payout processing.
Are all the founders of Impact Radius from your days at Commission Junction?
Yes, we all met there in the early days. We’ve all worked for other companies or pursued other ventures in-between then and now.
Those other experiences apart provided tremendous value because it gave us all expanded perspectives. It’s like when everyone in a band goes off and does solo projects and experiments with new rhythms and different instruments. Later, the band reunites with transformed creativity and a familiar, but fresh sound.
How do you feel this will impact the industry in the short term? Long term?
We see the convergence of traditional and online media as a huge opportunity. Almost immediately, new partnerships that bridge traditional channels to online and vice-versa started forming. Relationships like these, before Impact Radius, were challenging. This makes us a catalyst for growth for the industry as a whole.
Do you foresee any hurdles since the nomenclature of performance marketing terms usually mean different things in different aspects of marketing?
One of the greatest opportunities about building this business was the chance to start with a completely clean slate. We re-visited everything about performance advertising. We asked questions like: What is fundamental to the relationships and what could benefit from a new approach? What business processes are counter to the way people actually work together? And even—is this the best descriptor to use?
So, yes, with respect to nomenclature, we have introduced changes that should minimize confusion and help bridge the differences in a way that creates opportunity. Let me give you an example: We don’t call “affiliates” Affiliates. We don’t call “affiliates” Publishers either. We say: Media Partners—which works for Internet marketers, broadcast TV networks, print publications etc.
Who do you feel this is a sure sell to? (i.e. Who are your primary demographic?)
The performance advertising industry, meaning the advertisers, the media partners, the agencies and services, and even the networks.
I know that answer sounds like we’re flying in the face of conventional wisdom—trying to do ‘everything’ for ‘everybody.’ We’re not, though, doing everything for everybody. We are a technology platform designed specifically for performance advertising. But we’re not also an agency and also a broker and also direct response product owners. We designed Impact Radius to serve the needs of many business models, including the one’s I just listed, as they manage their performance advertising efforts.
How does this integrate with the existing affiliate technologies out there?
Technology companies and solution providers alike can promote their services in our directory and interface with our technology platform through Web Services.
What are the questions you get asked the most about Impact Radius from affiliates? From merchants? From agencies?
How do I sign-up? Seriously.
There really isn’t a strong argument against doing some level of business with us. Even if it’s just to manage a few relationships on the platform or promote your services in the directory…
How about questions from the networks?
The initial response is congratulatory and supportive. Then comes the question: Should I consider you a competitor?
Our answer is: Not necessarily. Aspects of our functionality may overlap—but aspects may also be complementary. For example, a CPA network could promote their offers in our directory and use platform features like the electronic insertion orders or payout systems to efficiently manage certain relationships. Or, an affiliate network could refer one of their customers to Impact Radius to start managing their “offline” advertising on a performance basis.
The idea is to fuel performance advertising growth exponentially.
Lisa Riolo is an active, dedicated member of the performance advertising community and remains committed to its further growth and achievement. Prior to co-founding Impact Radius, Lisa consulted with high-growth businesses to develop online marketing programs and scale operations. Lisa’s previous experience includes serving as senior vice president of business development at Commission Junction, where she played an instrumental role in growing company revenue, and managerial roles at Peet’s Coffee & Tea and Bank of America.
Lisa holds a bachelor’s degree in psychology from Claremont McKenna College.
Read MoreGoing to ad:tech San Francisco?
I am! This will be my first ad:tech and I’m excited! I’ve got all my sessions picked out on the schedule and logged into trusty TripIt. Want to know where I’ll be? Check it out here. I plan on working the expo hall and sessions to the best of my advantage to pick up some helpful tools and meet some helpful people! Unfortunately I’m still without a permanent position, though I’ve had some promising conversations with a few people. Is it too much to hope that I’ll have a permanent job by then? It’s just a week away… so scoop me up while you can!
Some of the sessions I’m planning on attending look like great opportunities to learn more about spaces that I’m not too familiar with, Danny Sullivan’s SMX @ ad:tech sessions teaching the basics of search marketing. I’m still green on the intricacies of search marketing, although I know the basic concept. I need to get in there and dive into the deep end of the pool to really get a better grasp. Hopefully after this session I’ll feel a bit more comfortable to dive in and do some experimentation myself. There’s also one session sponsored by Media Trust on performance marketing, and a lot of the other session descriptions sound like they’ll be touching on various aspects of performance based marketing. So I can’t wait!
Speaking of conferences, I do have more notes to share with you from the Web 2.0 Expo, I’ve just been a tad slow to get them all banged out. Look for that coming up soon!
Read MoreOnline Marketing Glossary: Revenue-Sharing Program
Revenue-Sharing Program:
- A program that allows merchants and website owners to increase sales. The host site links to the merchant with a banner, button or text link, for a fee. The merchant pays the website owner for increased traffic, sales and leads from the host site.
This seems like the less guaranteed way to go about performance marketing. I don’t have a lot of experience with this either, so someone out there that does… school us in what the benefit of this would be over pay per impression (PPI) models?
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Glossary Definition From ABC’s of Online Marketing by Alexandra Wharton, Issue 22, Revenue Magazine
Cribbed Content for June 27th
Surprisingly enough, this week is flying by for me. It seems like a slow summer week, but at the same time I’ve been awfully busy with some new projects at work and some thoughts circling in my head about a new website I may tackle soon. The idea is all there, but I have to flesh it out and, really, decide if I have time to do it! Here are your links for this week – the word around the campfire in online business.
- Once again, the affiliate marketing industry attacked as douchebags. And by people who call themselves professionals, no less. Shawn Collins did all the lashing out necessary in his blog Consultants Can Fix Affiliate Marketing.
- Congratulations to Lisa Picarille & Revenue Magazine for winning the Performance Marketing’s Most Vocal Advocate Golden Link award at this week’s Linkshare Symposium. It was worth is for her to be able to say “Sorry, Jangro”. If you don’t get the reference, go to www.SorryJangro.com
- Just yesterday on the heels of Google partnering with Yahoo and more talk of a potential Microsoft bid on the company, Yahoo officially announced their reorganization plans. In laymens terms, they’re taking some time to get their shit together 🙂
- More confusion is being perpetrated about the PMA by Shoemoney. Try doing some research next time before declaring something is a scam with shady intentions. Affiliate Classroom is NOT running it, they’re just providing a website and vehicle for it. Other companies are providing resources as well.
