Is your Affiliate Network Doomed?
Doomsday killed Superman and in the midst before his resurrection arose two new superheroes: Steel, a kind of iron man admirer of Superman and Superboy, an adolescent clone of Superman. Early affiliate networks experienced a death in fat profit margins as the competition in the brokering game became fierce. These companies are now resurrecting themselves as lead aggregators and backwards integrating as merchants who create their own unique CPA offers.
An affiliate network is basically a value-added intermediary providing services, including aggregation for affiliate merchants and affiliates. A network’s value-ads include: established contacts/relationships, aggregation of offers, and consolidated payments. In such a young industry, where many aspects of the business are still being ironed out and barriers to entry relatively low, it seems as though new affiliate networks are cropping up faster than you can say CPA. It’s tough to be a successful intermediary when competitors offer an equivalent value proposition– pushing the same, now almost commodity like offers as you.
When Google first began gaining consumer traction, the differentiating and superior value-add for end users was there, but the money wasn’t (until adwords). The problem is the exact opposite with many affiliate networks. The money is there, but the value-add pieces are still very much in the developmental stage. This will all change within the next 12 months as these affiliate networks begin to learn and define what the market needs. The engineering team is scrambling to build the best technology, the sales team is obsessed with making their publishers money, the client services team is out securing exclusive deals, while putting a new spin on existing ones and the marketing team is busy pumping out new promotions.
One of the main benefits of affiliate networks is that it is a hassle free testing bed for identifying the best performing offers. Why waste business development resources trying to go direct with each advertiser that could be a dud? You also benefit from the higher payouts that larger networks command by hitting volume tiers. The new breed of affiliate networks don’t just act as a convenient source for CPA offers, but work to develop their top affiliates into business development partners. Developing a business relationship begins with a foundation of proven performance and grows from there. After that foundation is established, an affiliate network, essentially, becomes your outsourced client services team– without the overhead.
Amidst all this talk of parity, the biggest value-add for any network in my opinion is the intangible human aspect. Ask yourself one simple question: Do you like the person you are doing business with? And not to shamelessly plug the company that I work for, but I can wholeheartedly say that you will love doing business with anyone at YFDirect.
Cheers to the best PEOPLE that I have ever worked with:
Scott Rewick
Raquel Guico
Marilyn DeJesus
Elizabeth Lloyd
Mariah Reilly
Stacy Khetsavanh
Jeff Okubo
Patrick Lundbom
