BACKGROUND

Affiliate Marketing started to emerge in 1997 when Amazon started to build its first affiliate network program. Affiliate Marketing is the relationship between website owners (Publishers) and merchants (Advertisers) whereby the merchant offers the website owner (Publishers) commission for the performance of his/her site as a result of linking and sending traffic to the merchant site (Advertisers). The affiliate is rewarded each time a visitor traffic traversing from the affiliate site to the merchant site converts to either a sale (cost per acquisition/CPA) or a quality lead (CPL) or per click (CPC).

IMPLEMENTATION

Initial Knowledge on Tracking
After doing some research these are the solutions that can be used by companies in Bali, not every ASP (application/Affiliate service provider) provide each of these solutions.

1. Cookie Tracking
   Using a script like code and interaction codes, it involves planting a cookie that gives a lot of information about the affiliate’s visitors. This is the most commonly used, used by ASP commission Junction. It could track banners and leads after the first session (if the visitor comes back next time and being a member instead of at that moment). Cookie tracking can have problems if the cookie option is turned off in the computer. It is also does not have any Link popularity of SEO ranking benefits.
   
2. Simple Direct URL Links
   This method is suggested by Kowabunga or Linkshare which is what I recommend to use. This method involves a code placed at the affiliate’s website and with this code, another similar code is constructed on the website that would identify which traffic is coming for which particular affiliate site. This is limited to only tracking leads conversion on that particular session. This method could not track banner performance of affiliates on second and third sessions like the cookie way. However it is very strong for the benefit of Search Engine popularity and increasing the ranking and as strong for first time visit sales.
   
3. URL Query String Tracking
   URL Tracking is a relatively effective, yet programmatically involved, tracking method that passes the affiliate ID throughout the merchant's entire website, e.g. xxxx.com?AffiliateID=007. It is not intended for Link popularity of SEO ranking. Moreover, under heavy traffic, the script can become a "bottleneck" to the website and if the script ever fails, then the websites affiliate system will fail.
   
4. Self Replicated Pages.
   This is the RSS (Really simple syndication) type of affiliate marketing. This is currently the worst method of affiliating in terms of Search Engine ranking since it is assumed that Google is penalizing sites for replicating identical content, and whose site gets penalized between Squidinkjets.com and its Affiliate sites?
   1st Conclusion
   Suggestion to use the simple direct URL link tracking method if possible a combination of the directlink and cookie handling affiliate software. The only problem by using this method is the client website cannot determine banner analysis from its affiliate partner sites because the link pointing to the web site does not carry parameter values. The trade of is the link popularity will be higher and would possibly effect the search engine ranking.

PLAN OF ATTACK

There are two options for the client to do its affiliate marketing (AM).

1. In terms of Affiliate Marketing Application
2. In terms of the Affiliate Marketing Process

The client could use an already existing internationally acclaimed affiliate application Solution & its networks such as Commission Junction, Linkshare and Kowabunga OR the client could also start its own Affiliate marketing by purchasing an affiliate marketing application that could be run off from its own server integrated to the website ( such as buying a third party application)– (just purchasing the application and not the complete solution). The benefits of this include the enormous cost savings due to the one time cost of the application but the trade off is the hidden headache and possibly costs as a result. My suggestion is the client should use a tertiary affiliate solution simply because the client is a start up business which will not have a lot of experience in the “8 Cs” of affiliate marketing (commission structure, contract (experience in contract making), customer service, content, credibility, copy writing, community and communication – ability in how to relate to each affiliate partners/possibly assigning an account manager)

Obvious weak points

1. We must manage the affiliate program our self and integrating it our selves without expert advices this is dangerous.
2. We will not be able to automatically have immediate pool of affiliates to quickly acquire, and requires extensive experience affiliate search to succeed.

Conclusion

The client should use one of the ASP complete solutions that is already available, gain experience from using it and in the long run (possibly 1 year) expand in using its own purchased Affiliate application.

From the several days of analyzing these are the top most affiliate solutions
Please review the table below for ASP affiliates possibilities, based in USA and have a pool of affiliate partners which almost all have USA targeted traffic.

AFFILIATE STRATEGY

Processes

The integration in using the one of the above application involves several steps in which the client have to think about before deciding to initiate an affiliate marketing implementation.

1. Making the deal with the solution provider above.
2. Determining Blax box (the fraud detection measurements) and direct linking, look and feel of the application.
3. Integrating the ASP application to the clients website (so its best that the website and its fulfillment strategy has to be complete and solid first and that the business has been running for a few months)
4. Training and developing affiliate acquisition & retention strategies and policies for the clients online business by its online marketing people.
5. Execute the affiliate program launch and marketing.

MY RECOMMENDATION

We should not rush into doing affiliate marketing until we have a solid website and system. We should use the time that we have from now till that time when we are ready to search for a more affordable solutions but still professional besides from the list of big ASP names in the table above.

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