Outsourced Affiliate Marketing
Affiliate Marketing is similar in many ways to Sponsored Search Marketing. Both are highly targeted, share a performance-based cost model, and direct shoppers to specifically engineered landing pages, rather than generic content. The differences between the two, though, are critical:
- Cost Model. Whereas Sponsored Search operates primarily on a Pay-Per-Click (PPC) basis, the standard for affiliate compensation is Pay-Per-Action (PPA) or Cost-Per-Acquisition (CPA) so profitability is guaranteed.
- Impression Model. In Sponsored Search, a machine decides when and where ads are displayed, based on a keyword bidding system. Meanwhile, affiliates are human beings who bring a degree of executive function to ad display decisions, and who can be influenced through performance incentives and other management efforts.
- Target Demographic. Sponsored Search primarily targets the general shopping population, which relies heavily on search to locate products. Because affiliate marketers tend to specialize in order to attract loyal followings in specific markets or special topic interests, affiliate shoppers tend to be special-interest groups or communities.
- Discount Shopping and Comparison Shopping, many affiliates cater to the discount shoppers. These websites offer product discounts, sales, coupons, and cash back or donation incentives. These portals are excellent for depletion of overstock items and items that carry higher profit margins. There is also a large online buying population who will only buy when a discount is available and while these people may not be loyal customers the opportunity for profitability or to rid yourself of excess inventory still exists.
- Sponsored Search Marketing. Many affiliates rely on their own sponsored search marketing efforts to drive traffic. Often affiliates can bid more effectively for keywords than an individual merchant because they have more product selection and thus higher conversion rates. Keyword bidding can be restricted and enforced. Profit Rank will work with you to determine the most effective affiliate marketing permissions and restrictions for your offer.
The bottom line is that Sponsored Search and Affiliate Marketing campaigns often complement one another in a useful fashion, since they can share resources like landing pages and ad creative while targeting fairly distinct shopping demographics.
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