It’s time to admit the truth:

1. Dealing with Affiliates: Strategies for Search MarketersAnton E. KonikoffAcronym MediaDecember 6, 2006

2. It’s time to admit the truth: Hi. My name is Anton and I am a.. BIG fan of affiliate marketing!

3. $$$$$ -- New Affiliate Program! Big BuXX -- $$$$$ • Become an Acronym Media affiliate! • Refer enterprise-level SEM clients ($150K+/yr in agency revenue) • Let us deal with messy closing process.. • Get 15% commission – no questions asked Retire in a year!!!

4. Terms and Conditions on Use of Search Marketing • Cannot bid on brand terms, Anton Konikoff’s name (incl. misspellings), Empire State Building, 55th floor, New York City skyline, best place to work.. • Cannot bid more that $0.25 on award-winning SEO, SEM, Search Marketing and variations • Must build at least 20 page unique content-rich site about Acronym’s search brilliance, with its own domain name

5. No bids on current client names!!

6. Refer to full T&C on file with our office • Non-compliance will result in a forced exile to the coldest part of wherever in Russia Anton is from…

7. Affiliate programs can be very challenging for search marketers, but at the same time their value cannot be discounted. With firm ground rules, smart strategies, and well-executed monitoring, search marketers can find ways to operate successfully alongside affiliate programs.

8. Bad, bad affiliates!! • Affiliates can drive up bid prices • On Google, affiliates can effectively block your ads from showing up • In either case, they can cause a lower volume of traffic, higher costs per acquisition, and massive headaches! • Unfortunately, many clients are unwilling—or unable—to control their affiliates’ use of paid search

9. 7 of the top 10 results for “kids book club” on Yahoo are affiliates.

10. Getting Blocked In Google Who does Google favor? • Amount of historical data • Higher CTR – poorly regulated affiliates may get away with misleading copy, leading to a CTR advantage • Better Quality Score – more on this in a minute It can be near impossible to take back your spot once you’re knocked off — often $100 bids won’t even bring your ads back! Just because you’re the SEM agency of record doesn’t mean that AdWords will always favor your ad over affiliates’.

11. Some Good News From Google • Minimum bids are raised for poor quality landing pages • The biggest losers: affiliates that operate “doorway” pages, “MFA” (made for AdWords) sites and affiliates that provide a lower quality experience than direct advertisers. Google has recently made changes to the way it calculates the Quality Score which have made things less pleasant for many affiliates.

12. Case Study: Sirius Satellite Radio Affiliates used Sirius.com as their display URLs and “doorway” sites as their destinations Google: Display URL has to match destination! Last three months: as these changes went into effect, volume has increased by 15%, driven by higher CTRs and lower bid prices

13. Case Study: Scholastic Books Clubs Status Quo: • Stiff competition from affiliates • Affiliates running wild.. With few restrictions • Higher bid prices and CPA in Yahoo & MSN, causing higher CPAs and fewer subscriptions • Regularly shut out of Google for top-converting keywords Resolution: • Thorough analysis and presentation to the Client • Missed opportunities and what if analyses • The client gave their affiliates an ultimatum: play by the rules or lose the account.

14. Just Say NO? • No bidding on brand terms. • Limit the engines/channels affiliates can use • Unique offer for affiliates, different from paid search? • No brand name in ad copy! • Don’t let affiliates bid higher than the search vendor

16. From the creators of‘Google Bombing for Dummies’ 7 brilliant ideas on dealing with affiliates (intelligently)

17. IDEA 1: Ground Rules? Or Blue Sky Rules? • Fight reflex to restrict but make affiliates work for their search $$ • Revise inventory estimates with affiliates in the equation • Create a search revenue model for affiliates?? • Show the shortest path to long tail

18. IDEA 2. Learning From Affiliates (yes, learning!) • Closely examine affiliates that appear to be performing better than you (or that block you in Google) • Why are they beating you out?- Better landing pages? - Better ad copy? - Larger sample?- Test budgets?

19. IDEA 3. Reconnaissance Mission • Monitor top affiliates’ keywords, landing pages and ad copy for brand compliance • SEMs: offer affiliate monitoring as a stand-alone service • Automated tools can help harvest the data for analysis

20. IDEA 4. Are You Good at Sharing? • Build loyalty: give away select data on keywords, ad copy, and landing pages • In exchange, ask for affiliates’ search intelligence/learnings • ID 2-3 key affiliates and use them to complement your efforts • Develop metrics to report on affiliates’ search contribution.

21. IDEA 5: Battle for Search Domination • Use affiliates intelligently to own more SERP real estate (paid and organic) • Design search programs to boost awareness and trial • Quantify benefits using branding metrics • No love for non-exclusive affiliates!

22. IDEA 6: A Taste of Organic • Run ranking reports on affiliates • Educate affiliates on SEO best practices and potential pitfalls • Use them as a workaround if unable to affect Client’s site

23. IDEA 7: Advocating Your SEM Work • Success will require solid relationships — between SEM and the Client, SEM and other agencies, and between Client and affiliates • Create ‘what if’ scenarios showing opportunity costs and potential • Be vocal in advocating your own interests

24. Contact Information Questions?(or for a visit to the top of the Empire State Building): Anton Konikoff Acronym Media anton@acronym.comwww.acronym.com