DM University: Publisher vs. Advertiser

Advertiser

In regards to online advertising, an advertiser is any person or organization, typically a website that sells a product or service, accepts payments, and fulfills orders. In general, an advertiser places ads on other websites (a.k.a. publishers) that are regularly visited by the advertiser’s target market. These ads link to a destination designated by the advertiser, typically a website or webpage that showcases and allows visitors to purchase the advertiser’s products and services. The advertiser will pay the publisher a fee or commission for impressions, click-thrus, leads or sales that originate from their website. While most online ads serve commercial purposes, non-profit organizations also engage in online advertising, primarily to endorse an idea or message. An advertiser can also be referred to as a merchant, retailer, e-retailer, or online retailer.

Publisher

An independent party or website that promotes the products or services of an advertiser in exchange for a fee or commission on impressions, click-thrus, leads or sales. The publisher displays the advertiser’s ads, banners, text links, or product links on its website, in email campaigns, or in search listings and typically charges the advertiser whenever a visitor takes a specific action, such as completing an online form or making a purchase. A publisher can also be referred to as an affiliate, associate, partner, reseller, content site, email marketer, or search marketer.

Advertisers & Publishers (in the context of Affiliate Marketing)

In an affiliate marketing program, a publisher earns a commission from an advertiser for generating a transaction for the advertiser, such as a lead or sale. Typically, the advertiser provides its ads to publishers and allots a commission for any action it seeks to accomplish, whether it be filling out a couple fields in an online form or completing an offer. Publishers can place ads on their websites, in their email campaigns, or even in their search listings. To track each transaction, in which a visitor or customer uses these ads to generate an action on the advertiser’s site, the publisher places a tracking code within all the ads on their properties. Thus, publishers are rewarded for each action they provide to their advertisers. For instance, when a product or service is purchased, the customer pays the advertiser directly and the publisher is paid a commission for that transaction. An affiliate marketing program can also be referred to as affiliate marketing, advertising, performance marketing, partner marketing, CPA, or Associate Program.

Working Direct vs. Working via Aggregators (brokers and networks)

The affiliate marketing space can be very incestuous at times. Often times a publisher generating leads for an advertiser may actually be an aggregator (brokers and networks), brokering it out to other smaller publishers that do not have the advertising contacts. Depending on the resources available to your company, here is a quick break down of some basic pros and cons from each perspective:

Working direct with an advertiser as a publisher:

Pros:
– Building rapport and long term relationships directly with advertisers may open up more opportunities such as getting exclusives, being one of the first publishers to find out about and capitalize on new offers, or even being allowed to customize existing offers.
– Direct contact with advertisers reduces communication failures between passing of information about the offer, such as when lead caps are about to be hit, technical issues with the offer, etc.
– Limits the number of redirects the user must go through before reaching the landing page, which translates to lesser drop offs before handoff.

Cons:
– May not get the highest payouts if your lead volume is not large enough to reach top tiers.
– If your lead quality is not up to the advertiser’s standards, you may not be able to run the offer, or your payout will be lowered.

Working direct with a publisher as an advertiser:

Pros:
– More control over how your offer is distributed and/or promoted.
– More transparency into how your offer is being distributed and/or promoted.
– Payouts are not artificially increased from aggregators that utilize their networks to drive large volumes of leads and reach top tiers. By working with multiple publishers on an individual basis, advertisers are saved from having to dole out higher payouts that are typically warranted for aggregators who command such huge volume.
– Diversity in affiliate base reduces your dependency on any one publisher.

Cons:
– Working with several publishers, as opposed to an aggregator requires more maintenance. You will need more account managers to manage the larger number of affiliates, which may be difficult or unfeasible if your resources are low.
– Working with several publishers, instead of with an aggregator can also result in less distribution. Aggregators may have more reach with publishers that you either have no relationship with or do not even know about.
– Aggregators may have a deeper relationship with certain publishers that may be reluctant to try out your offer without first having the rapport or affiliation.

Working through aggregators as a publisher:

Pros:
– You may gain better rates from aggregators that reach higher payout tiers with advertisers.
– If your lead quality is not good, you can hide behind the aggregate of all leads generated by the various publishers within the network.
– Information about an advertisers offer is shared within the aggregators network, for example if a new offer is tested with some publishers and does not perform well, you benefit from that information without having to risk your inventory in testing the offer.
– Payments for offers from a variety of advertisers are consolidated.

Cons:
– Compared to working directly with the advertiser, communicating with the advertiser is generally a much more limited or slower process when going through an intermediary.
– You build no rapport with the direct advertiser, which often limits opportunities such as getting exclusives, being the first to know about a new offer, or even being able to customize existing offers.

Working through aggregators as an advertiser:

Pros:
– Working with an aggregator, as opposed to several publishers on an individual basis requires less maintenance. Aggregators effectively act as an outsourced client services group, reducing the amount of resources you need to devote to managing a greater number of affiliates.
– Aggregators may offer more distribution. Aggregators may have more reach with publishers that you either have no relationship with or do not even know about.
– Aggregators may have a deeper relationship with certain publishers that may be reluctant to try your offer without first having the rapport or affiliation.

Cons:
– Payouts can be artificially increased or inflated. Aggregators reach higher payout tiers, thus artificially inflating the market CPA for your offer.
– Less visibility and control into how your offer is distributed / promoted.
– Your dependency on a more dispersed and smaller number of affiliates to promote your offer increases.
– Less optimization. The quality of all leads is hidden within the aggregators network. Deserving affiliates may not be getting as high of a payout as they should, which would reduce your volume of high quality leads. At the same time, undeserving affiliates may be getting higher than necessary payouts, increasing your volume of low quality leads.