Are there too many merchants or not enough quaility ones?

[Qui Gon Jinn]

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Are there too many merchants or not enough quaility ones?

It is subjective..personally i think there are enough quality ones..and the selection process requires a bit of cherry picking & experimentation to find the surprise packages which is not proportional to the size of the brand.

But considering how many monthly cheques are cut by a network, circa 3500, and how many affiliates earn over a grand a month, circa 150. And then the serious money earners, circa 50-60.

Is it possible there are not really enough proactive affiliates to meet the demand of the number of merchants available?

I just feel it will come to a stage, if not already, where merchants will start being disheartened about affiliate marketing and more will leave than stay...not the golden goose they were led to believe

Granted there will always be albout 2000+ to choose from for a while at least...but more affiliates jump on the big brands rather than the smaller ones, consequently the smaller merchants loose out.

[Red]

Granted there will always be albout 2000+ to choose from for a while at least...but more affiliates jump on the big brands rather than the smaller ones, consequently the smaller merchants loose out.

Is this not a problem with the Internet overall? A lot of people thought that as the internet lowered barriers to market entry, that there would be loads of new etailers starting up, challenging the larger brands with an offline presence.
However, a large proportion of the population still have issues with buying on the web and buying from brand that they do not know.

So my point is it isn't necessarily affiliates jumping on bigger brands - it's the fact that these bigger brands sell well and it is actualy internet usage that's driving the behaviour.

[Spreader]

Hi Paul,

Good thread this - hope you don't mind me putting my two penneths in!

I tend to agree that you are right on both points.

My experience is obviously from the merchant side, and I'd say that there are plenty of good proactive merchants who are keen to work with affiliates and push their programmes forward. Equally there are a number of merchants who just expect it to happen for them.

This doesn't always go hand in hand with the size of the company. In fact, I'd probably argue that the smaller companies put more into affiliate marketing because:

a) they havn't got a huge budget to pay for "up front" marketing.
b) affiliate marketing makes up a larger % of their acutal sales turnover.

I feel that if you compared the programmes of many of the smaller proactive merchants they will more than stand up agains those of much bigger companies in terms of data provision, creative, commission, EPC, inginuity etc.

I also feel that you have a point with regards to the number of good quality affiliates who generate sales for merchants.

The amount of affiliates who generate multiple sales for us on a monthly basis is less than 5% of our total number of affiliates. In some ways this is good because it enables us to push forward with our proactive affiliates and try and enhance the programmes of our "non active" affiliates. However it does get frustrating to see (in effect) 95% of our affiliates not working for us.

I've actually put this point to the networks and asked

"why don't they introduce the pro-active merchants and pro-active affiliates to one another?".

Surely this would be a win-win situation for everyone. More sales would be generated for the merchants and affiliates and the Network would gain a bigger override from the merchants for the added sales.

They always seem to be a little retiscent to do this for "data protection" reasons!! I have to say this is a bug bear of mine...

Right. That's me off my soapbox!

Cheers,


Zak.

[Mogga]

If someone tells me a merchant converts then I'll give it a go - perhaps this is something that needs to be put onto the other pre-launch list?

Ok, so it'd only be valid for existing sites not ones which have been set up soleyl for an affiliate program, or ones which are very new.

The more data networks show for companies the better imo.

If site owners know that their sales are dependent on certain things or even if they have restrictions (Like only taking paypal or something like that) then this affects perfomance - but if we know in advance we can pre-sell to customers and make more sales by more accurately directing customers to the places they will buy.

[Lee_Owen]

Would you mind if I post a really long reply?

[Lee_Owen]

Are there too many merchants or not enough quaility ones?

But considering how many monthly cheques are cut by a network, circa 3500, and how many affiliates earn over a grand a month, circa 150. And then the serious money earners, circa 50-60.

Are those figures just a guess or fact? I find it hard to believe there's only 150 earning over a grand, wouldn't ten times that amount be nearer the mark for the UK market, if not more? latter numbers acknowledged.

Now I'm lazy, and in part it's more to do with me spending too much on social activites and also awaiting projects to be realised but I expect to be doing a lot better by the end of the year.

And in tandem with the above, I expect to be promoting a hell of a lot more merchants properly and in an organised fashion. I'm signed up to hundreds and I'm on several different networks, I receive hundreds of e-mails a month about products.

The merchants available are from far reaching categories from travel to groceries and homewares to lifestyle, so in that respect there can never be too many on the whole but in certain categories maybe, like electrical goods, but variety can be good, especially if you're dealing in price comparison. I'm even with stand alone merchants, earning money, most not yet.

On to merchants being impatient, how can they afford to be? I see merchants that sign up to a network as being in it for the long term, they really have to look at being in it for at least two/three years I think to even judge what can happen, because of the actual time it takes for an affiliate to get off the ground, regardless of who's in the game at that moment in time. Quite right they're spending and networks have targets, but if a merchant is being promised the earth or they expect too much then they need to get closer to reality.

Some affiliates may have financial backing, go to the bank and get funds, but in the main I think many just start out learning and grow steadily their ideas. In turn they start off with one or two merchants and the few who's ideas make it or start with a hundred and find out what works for them, continue to build and use more merchants. Money funds money funds money. If you're talking PPC and merchants wanting that across the board, then even two years from affiliate SEO and general site hobby is going to take a while to build up.

I think rather than there being too many merchants, there's an adequate amount for newbies and current to find their related interest to earn from, but even today because of a product someone has that I want to sell, I've referred them. Looking at a recent network posting about merchants and the one's affiliates want aboard, tells us that they too are looking for more merchants to increase their base, offering and turnover, is it because they're letting their current merchants down or because they have a very decent workable partnership with their core base?

As more affiliates come along with their interests and ideas, more and more merchants will be selected in differing categories. As an affiliate grows in strength and knowledge, again more merchants across the board will be promoted. It's far easier for a merchant to just sign up to a network and say here I am, than it is for an affiliate to sign up to a network and promote them.

Pro active merchants see results, pro active affiliates see results, merchant telling it how it is equals affiliate showing interest. I know it's monkey see monkey do, but even when I do look through programs on a network I think "loans, what do I do with them?", "bottles of beer" what do I do with them?" that's where I as an affiliate needs to approach the affiliate manager and ask them, how can we make money together? but most of the time you've got to go through the network or hope some dozy bugger on customer services at the merchant end doesn't just bin your email. Thankfully networks are putting this right now. And believe it or not, I have the finance and beer domains, well someone 'search snapped' the top level finance from me.

One problem I find is there isn't enough active affiliate managers, one's that can inspire you to promote their product or offering, I think that is part of the problem, not enough affiliate managers are sales people. Now I'm a sales person, although transferring that skill to the web is very hard but if a merchant comes up to me and says "this product is selling, this program can earn you money if you work with me." Then what am I going to do? It's obvious.

Now I'm not expecting an Affiliate Manager to do the work for me or to tell me what to do, but to provide as much info as possible so as I can promote them as much as possible. There's probably an affiliate out there right now that has a great interest in fruit flavoured monkey's, who's selling them? who's matched them up. Did the affiliate try, did the merchant try, what about the network?

I had an email from sport-e the other week (I think), here's our top ten, sell these, I know the geezer so I thought I'd give him a shot. So I did my usual lazy stride and made a sale. He was right, it sold. Top ten's, regular brief but informative e-mails, active affiliate managers posting on here. Now compare smaller electrical company with big electrical company, difference in buying power but also a difference in affiliate managers, comparing Dixons group.... Some merchants may even warrant their own message board, what better way to attract more affiliates.

Matt at Jamster shortly after I joined and us swapping ideas and me asking so many questions I probably bored him to death, like I am to you in this post... asked if I thought a message board would be a good idea for the program. My answer was probably in the negative and stick with A4U as that's where everyone is. Now I think the program does warrant its own forum, however look at how many additional affiliates Jamster has brought on board because of open discussion and debate on here and partly me blagging it back in the New Year when I should have kept stchum.

Merchants need to be patient if they do enter the scene, but they also have to be proactive. When affiliates enter the arena, they're individuals motivated by a variety of things, part time, simply extra income, a few quid on their hobby, trying it out or serious wanna get to the top people. Each will be motivated by different things but a merchant is only interested in one thing, sales and increased one's at that.

There will be a saturation point at some point I'm sure, but now isn't the time but networks would know more on that, even though big stores like Asda and Tesco put Smith's Chemist on the village green out of business, the internet should be alive and well for Smith's Chemist types, the more the merrier! They just need to be more pro active.

What I find amazing about networks is the inabilty to incororporate a dating site. A who's who, a what's what. Which is where A4U comes in, the only place I know that sees active affiliate managers promoting their stuff properly and active affiliates seeking out the product to sell, hopefully waking up dormant affiliates and managers. Now the trick is to get current signed up affiliates and merchants to go about it in a similar fashion. If I didn't use A4U I wouldn't know of ???? or his ?????? program or ??????? over at ??????? or even ???????, a competitor in the field. It's all helped.

In short, there's not too many merchants no matter the quality, well known or not, in my view. The amount of new sign ups to this forum alone recently tells a story of growth and interest, the merchant simply has to be pro active as does all involved, get that part time affiliate to be interested in full time, throw some fireworks into the room, invigorate all sides but also be patient, I was never going to gross £100,000 last year but I should have made it this year but being lazy and spending money on football and others things... blah blah. Like wise one merchant was never going to see all 2000 affiliates that signed up to his program in the first month, do equal sales, promote them heavily and make that company unbelievable profit.

Affiliate marketing isn't for eveybody, affiliates and merchants included but if a merchant hasn't sent an email with top products recently, posted on here lately, got a 728 x 90 banner in their program, banners that are updated within the last month or an affiliate that hasn't browsed this forum or posted, who hasn't touched one of their sites or monitored it in the last thirty days, has never searched a network for products and after going "what's that" not emailed a merchant to tell them "I'm yours for the next 15 minutes." then it's time for them to think about what they're missing out on.

I'm missing out because I'm lazy, give me another product to sell, PM me. I'm not kidding. Now I've posted enough already, doubt you even got this far, but what a unique offering for A4U, a merchant & affiliate dating directory. "Hi my name's Susan, I'm looking for a nice niche merchant, big margins, a great product, know what I mean and a lot of care and attention." "Hi Susan, I'm Geoff, I've got big margins hehe, I'm exactly what you're looking for, let's make sweet sweet profit together...." Ah happiness.

[aly]

In answer to the question "Are there too many merchants or not enough quaility ones?"

From an affiliates view I think there are nowhere near enough merchants, quality or otherwise.
I don't touch niche stuff much but even on mainstream things I can fail to find enough merchants to give a selection of choices to the customer. When it comes to niche there are so many areas that don't even have any merchants yet. Also with the niche areas it's easier to make money even if the merchant is poor quality - by poor quality I mean poor website because if it's the only place you can buy the stuff then people don't have an option no matter what colour or design the thing is.
I think networks have to try and be more realistical though, explain to customers what they have to do themselves (eg: be proactive) and the time factor involved and also the networks themselves spending more time with the merchants - it's called speculate to accumulate and it's a business stratagy that has been around for rather a long time, because it works!

Cheers
Aly
ps: Good post Lee

[NetNeo]

Interesting thread...
I agree totaly with Lee Owens long (but worth reading) post.
I myself are new to this forum, and in the few weks I have been here have had my eyes opened.
I though, when logging into my network accounts, some of these small guys are really worth me bothering about.
I instinctively hit the big names, but now I am learning that all merchants are as important as each other.
I don't think there are too many merchants, in fact I would say I would like to see even more. But I for one agee with Lee opinion that the smaller merchants need to talk to affs directly. I for one are going out right now to be pro active and contact a merchant who I am interested in promoting and see how (and if) they can help me.

[John Jupp]

Each merchant has their own unique brand so there can never be enough merchants. There can be too many merchants in particular sectors and that is obviously where a good affiliate manager comes in offering a decent datafeed. On the subject of feeds it would be nice if there was an industry standard and that the feeds actually worked properly.

I don't promote hard because if I did for everyone I'd be bankrupt in next to no time. I promote just a very very few which seem to have cornered a niche of their own. Those merchants convert very well indeed even without feeds.

I started out just with simple banners and text links. My main portal is still like that but it will be changed to include feeds. I operate other sites solely for single merchants. My best performing merchant isn't yet on a stand alone site because they don't supply a feed or offer private label yet their products are in high demand and this is reflected in my regular sales for them.

Sure I could do more to promote merchants but I'm looking at their products and what converts for me. Some merchants will get a sale once in a blue moon but every sale is just that...a sale and a sale can only help their balance sheet.

[puccipetwear]

Hi everyone,
The idea of some kind of a match making facility is a good one. That way affiliates with an interest in sport/gadgets/designer clothing/gardening equipment can post their interests or search specifically for merchants with current promotions or offers or perhaps unique products that will inspire some enthusiasm and creative marketing.

I also agree that working a niche has to be the best way forward. Pucci Petwear's upmarket fashionable collars, leads and clothing for dogs are certainly niche and we see really consistent sales and success from affiliates over an extended period of months.

I can't speak for other merchants and affiliates, but we absolutely love what we do, we are totally passionate about our products and we believe in their potential. Because of this we promote them whole heartedly and enjoy good feedback and a busy order book. Any positive affiliate with the same drive and enthusiasm would without doubt enjoy success with Pucci Petwear.

Kind regards,

Karen

PS. Please do take a look at our latest products if you haven't seen the site already www.puccipetwear.com - you could find just what you're looking for!

[Brains]

I have affiliates converting really well....others (95% or so) doing nothing.

www.drawme.co.uk
The affiliate sites doing really well have a full text intro with plenty of opportunity to clickthrough to the site. Figures are around 10 click throughs to a sale. Some have taken copy directly from the site as well as images and used these to promote effectively. Others are using the likes of Google.

Those using just a banner link are around 50 clicks per sale.

Average affiliate commission per sale is £6.21 to date.

www.automart.co.uk
We have exceptional conversion rates via our own PPC.
Commissions are set at 20%. Top package brings in £9.80 commission.
We also have click payment at 2p just to help affiliates along who are using PPC.

Very few affiliates that we know of use text links. With over 800 sites displaying our adverts, £50 cashback via vouchers, newletter advertising, full page adverts, upto 10 photos, etc we have one of the best promotional packages available.

I'll happily chat with any affiliate who wants to promote the products and give advice accordingly. I'm on MSN, Skype etc

We've grown by over 400% in the past few months, sales are up each and every month, we have VERY low overheads and are willing to pay affiliates well but need advice ourselves on the best way forward for the programmes.

Anyone can have a look and feel free to PM me with how we can best help you. We are in this for the long term and feel the programmes could be doing better with a bit of tweaking.

BRAINS

[Qui Gon Jinn]

A number, probably most, of affiliate programs are thrown onto the market without the necessary gestation period of maybe at least several months.

Whereby, the network & merchant work within close proximity prior to any general launch of the program, particularly ascertaining the conversion rate of the merchant based on various prescribed important factors.

During this 4 month period basic things like functionality, site aesthetics, userability & shopping cart procedure can all be fine tuned before going on general release onto the network and onto affiliates.

The matching up of affiliates & merchant should also happen in this gestation period which will act as a catalyst to ski ramp program on launch.

Then and only then, both merchant & network can have the confidence they have a program which converts at a satisfactory rate..in fact more than satisfactory rate. Then there can be considerably less reasons about poor converting merchants.

Releasing a program too soon only suggests, the network is too keen to display the merchant as part of its portfolio and/or collect management fees.

Also affiliates shouldn't be used as guinea pigs, once an affiliate ascertains it's a duffer or a jaffa, it's unlikely they will return to the program and the word circulates around. Consequently the program gains a poor reputation in the community, a confidence & trust which is difficult to regain.

This is only part of the problem, but preparation before launch is essential.

Then we get into the nuturing period...

[ridleyjones]

Interesting thread. We missed a lot of you at the last get2gether in london unfortunately, but we're always open to any comments/feedback/ideas/etc to our affiliate programme. we're currently with TD and AW. We pay 10% commission - but up to 13% this month for high achievers. Plus a 20% off to the consumer to introduce our new look website and new summer collection. Please do take a look when you get 5 mins at http://www.cotswoldco.com - any advice is GREATLY appreciated.
Steph, The Cotswold Co

[kathymoger]

Great thread this!

I like the idea of a matching site for merchants and affiliates too. A step in the right direction for affiliates to found out about products/merchants and networks is Welcome to AffiliateBounty that skywalker has produced out of the frustration of finding out about merchants and their products. Perhaps he could be persuaded to enhance it?

With regards to the affiliates who don't perform very well for a merchant, I think it would be very short-sighted to discount any of them as the vast majority of them may be new to affiliate marketing and have therefore not had the time to establish themselves properly to get the results yet. However, many of them could be your future potential big affiliates. If in time they don't get any results, they will probably move away of their own accord.
I'm a newbie to the field myself but have years of experience of search engine optimization in my business. My interest in affiliate marketing is to learn about it to enable some of my customers to start becoming merchants. I feel it is important to know things from both sides to ensure that they become good merchants. However, I know that it will take time for any of my affiliate websites to become established and therefore to start directing traffic to my chosen merchants. Whilst my motivation is primarily to learn, I will be very keen to earn a decent income from this as well as it will only add to my credibility to my customers.

So I guess I'm saying to all merchants "Don't dismiss an affiliate because they aren't performing well for you at the moment. It takes time (many start in their spare time whilst working full-time at day job) and affiliates come to merchants for varied reasons but they all want to make money from the marriage".

[kathymoger]

Hi Steph,

I'll be keen to take a look at your site as you are one of my potential merchants! I'm just finishing off my website at the moment so I'd be interested in finding out if there is anything I need to do at the design stage to make referrals easier. I'll certainly give you some feedback and perhaps later you could reciprocate on my website and whether it meets your needs as a merchant?
Regards,
Kathy