The Truth About Affiliate Marketing and CPA Offers

The truth about affiliate marketing and CPA offers. While I won’t call everyone who runs an affiliate program a crook let me share some of the results we have seen in testing with one of our other business associates. Before I do that let me tell you this. Most affiliate companies do not want to pay you a commission. Why? because it eats away at their margins plain and simple.

For the past 90 days we’ve been testing several affiliate offers with one or peers in the industry. We both started with the same offer. Their first month, generated over $50k and we hit $6k. For both of us it represented about a 25% conversion rate on our click throughs to the same offer. During the 2nd month both of our conversions dropped to 15% and now in our 3rd month of testing we are at 10% conversions.

We tested another affiliate offer and saw the same exact results. First month conversions are high and then subsequent months slowly deteriorate.

Affiliate marketing can be lucrative and there is certainly money to be made, just be aware of this. Affiliate and CPA offer providers are always looking for ways to reduce payouts. I’ll even throw this out into the blogosphere as an open challenge for someone to prove me wrong.

So what do the heavy hitters do? The heavy hitters in online marketing have direct marketing contracts with product and service providers. They get paid on a percentage of the overall sales. No affiliate links or affiliate IDs to mess with.

As you look at affiliate offers, don’t get hung up on a specific product, brand or payout. The bottom line is conversion rates and how much your affiliate check is each month. Some offers may pay less, but have a higher conversion rate than offers with high pay outs.

Monitor and track your conversion rates every month. If an offer starts to drop find something else.

Look for more updates to come on this fun and sometimes frustrating area of opportunity.

Pitfalls of YouTube Video Sharing

This article is not a recant of my previous position on third party video hosting or video sharing such as YouTube, Revver, Google video, etc., but it is a modification on how third party video should be used. With that being said, third party video will almost always reach a larger audience than video that you host on your own server / website.

Here’s why I’ve modified my position slightly on third party video; The other day I received a call from a customer in shock when the office manager looked at the video for the first time. When the YouTube video completed it displayed some “similar or relevant” videos at the bottom of the clip. One clip was some guy zoomed in on his arm-pit trying to simulate someone sticking a finger in a rectum. They were mortified as a medical practice that a potential patient or client would see something completely unrelated to their practice.

While YouTube does allow you to turn this feature off, it doesn’t hide unrelated video content if the person clicks through to YouTube. Third party video does have a place, but I’m not sure the best place is on a website where you are trying to control what your visitor may or may not see.

Negative Factors – Video Sharing Services:

  • No control over what other videos your visitor or potential customer might see
  • Third party video gives your visitor an opportunity  to click off of your website
  • Potential loss of a customer due to click throughs.
  • Potentially exposing your customer(s) to illicit, provocative, racial, or insulting types of video content.

Unless YouTube, Revver, or some of the other major third party video hosting sites can better control the definition of “relevant videos” and what a user might be exposed to, I would say that each business needs to evaluate how it uses third party video hosting and whether or not the video placement is the right option for your specific website.

For my customer in particular I will end up making the video self hosted.

What negative experiences has your business experienced by using third party video hosting such as YouTube, Google video, Revver, BrightCove, DailyMotion, MySpace, Vimeo, etc? Share your opinion with our visitors.