affiliate networks

Networks and Marketers May Profit From Google Affiliate Network Shutdown.

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Google's exit could be good news for competitive affiliate networks and affiliate program management companies.

The closure of Google Affiliate Network (GAN) will create a lot of work for affiliate marketers. But Google's exit is good news for competitive affiliate networks and affiliate program management companies, which have leapt to snap up the business dropped by Googliath. Ultimately, getting kicked off GAN may be better for affiliates, too.

The Google Affiliate Network let advertisers buy and track affiliate ads on a cost-per-conversion basis. Publishers could quickly post the ads and get paid via AdSense when a user clicked through and converted. On Tuesday, Google announced it would wind down the network over the next few months. In a blog post, J.J. Hirschle, head of Google Affiliate Network, cited the rapid evolution of CPA advertising and said the company would focus on newer CPA tools like Product Listing Ads, remarketing, and Conversion Optimizer. Google did not make an executive available for comment.

Businesses that depend on affiliates to drive traffic and sales will need to first find a new network to manage their accounts and then notify affiliates of the new network, so that affiliates can sign up. Affiliates, for their part, will need to keep track of where their merchants have moved, sign up, and then replace all the affiliate links in their sites.

Says Tricia Meyer, who operates 12 affiliate sites including SunshineRewards.com, and averages $25 million in annual sales, says that while larger affiliate sites may be run off a database and need to replace a single link per merchant in that database, "If you're a blogger, every time you write a blog post about a merchant, you pull a link from Google. So you might have to replace every link in five years of blog posts."

Acceleration Partners is one of the many affiliate program management companies that has offered free evaluations and help in migrating from GAN. "A lot of people want to look at their programs, but it's a lot of work to change. It's a good time [for a merchant] to look at the whole affiliate program, like clearing house before you move," says Bob Glazer, co-founder and managing director. "Google is encouraging everyone to get off the network quickly, and we think we'll benefit from people seeking strategic advice."

GAN was likely not a priority for Google, according to Glazer. "It was something they inherited through their acquisition of DoubleClick, and it doesn't fit into their model," he says.

A June 2012 report by Forrester for affiliate marketing platform Rakuten LinkShare found that affiliates are profitable for advertisers, drawing new customers, often triggering reconsideration and closing the sale. Moreover, affiliates attract consumers who tend to spend more than the average online shopper.

By 2016, affiliate marketing will represent slightly less than 16 percent of the total spent on paid search, Forrester said, while total affiliate spending will reach $4,474 million that year.

More important was channel conflict, as Google began to compete directly with affiliate marketers via its product listings, which usually appear at the top of product search results.

Glazer said that many in the affiliate marketing industry still need to fear Google, despite its shutdown of GAN."What is Google's take on affiliate marketing?" he asks. "Will they make it harder for other people to operate in it? Some fear they will potentially impose their will to make it easier to do advertising directly with Google. With Google getting out of conflict of interest with the affiliate industry, they may be looking to direct more advertising dollars to their other platforms."

Google Product Listings not only compete with affiliate marketers, they will continue to take a bite out of affiliates' profits, says Meyer. But those who suffer worst will be those who relied on Google for their traffic. "It depends on how you do your own marketing," Meyer says. Affiliates with loyalists who come to them directly, and those who market directly to those loyalists via email, Facebook, and other channels will likely see little effect, she thinks. "But if you rely on search engines to drive affiliate traffic, you will be hurt by it."

In fact, Meyer says, the closing of the Google Affiliate Network could be the best thing that happened to the latter group. They may have begun with GAN because it's a well-known brand and never looked at the offerings of other affiliate networks that have more robust technologies, will bells and whistles like widgets and pay-per-call.

"When these merchants actually start looking at different networks," Meyer says, "they'll realize that they're getting networks that are actually better. They think Google does everything right, but it didn't do affiliate marketing that well."

Affiliate marketing

Affiliate marketing is a type of performance-based marketing in which a business rewards one or more affiliates for each visitor or customer brought about by the affiliate's own marketing efforts. The industry has four core players: the merchant (also known as 'retailer' or 'brand'), the network (that contains offers for the affiliate to choose from and also takes care of the payments), the publisher (also known as 'the affiliate'), and the customer. The market has grown in complexity to warrant a secondary tier of players, including affiliate management agencies, super-affiliates and specialized third party vendors.

Affiliate marketing overlaps with other Internet marketing methods to some degree, because affiliates often use regular advertising methods. Those methods include organic search engine optimization (SEO), paid search engine marketing (PPC - Pay Per Click), e-mail marketing, and in some sense display advertising. On the other hand, affiliates sometimes use less orthodox techniques, such as publishing fake reviews of products or services offered by a partner.

Affiliate marketing is commonly confused with referral marketing, as both forms of marketing use third parties to drive sales to the retailer.^[1] However, both are distinct forms of marketing and the main difference between them is that affiliate marketing relies purely on financial motivations to drive sales while referral marketing relies on trust and personal relationships to drive sales.^[1]

Affiliate marketing is frequently overlooked by advertisers.^[2] While search engines, e-mail, and website syndication capture much of the attention of online retailers, affiliate marketing carries a much lower profile. Still, affiliates continue to play a significant role in e-retailers' marketing strategies.

Affiliate programs

Affiliate programs

Our Webmaster Guidelines advise you to create websites with original content that adds value for users. This is particularly important for sites that participate in affiliate programs. Typically, affiliate websites feature product descriptions that appear on sites across that affiliate network. As a result, sites featuring mainly content from affiliate networks can suffer in Google's search rankings, because they do not have unique content that differentiates them from other sites on the web.

Google believes that pure affiliate websites do not provide additional value for web users, especially if they are part of a program that distributes its content to several hundred affiliates. Because a search result could return multiple sites, all with the same content, they create a frustrating user experience.

If you participate in an affiliate program, there are a number of steps you can take to help your site stand out and to help improve your rankings.

• Affiliate program content should form only a small part of the content of your site.
• When selecting an affiliate program, choose a product category appropriate for your intended audience. The more targeted the affiliate program is to your site's content, the more value it will add and the more likely you will be to rank better in Google's search results and make money from the program. For example, a well-maintained site about hiking in the Alps could consider an affiliate partnership with a supplier who sells hiking books rather than office supplies.
• Use your website to build community among your users. This will help build a loyal readership, and can also create a source of information on the subject you are writing about. For example, discussion forums, user reviews, and blogs all offer unique content and provide value to users.
• Keep your content updated and relevant. Fresh, on-topic information increases the likelihood that your content will be crawled by Google bot and clicked on by users.

Pure affiliate sites consisting of content that appears in many other places on the web is unlikely to perform well in Google search results and can cause your site to be negatively perceived by search engines. Unique, relevant content provides value to users and distinguishes your site from other affiliates, making it more likely to rank well in Google search result pages.