Biggest threat to affiliate income

[drivetowin]

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Welcome as the revitalised debate on spyware is, I just wondered what others feel is the biggest threat to affiliate income in the year to come.

I know my feelings (you'll get a hint from the order of options in the poll but it would be interesting to see what the general concensus is:

[Malcolm Cowley]

Hi Mate

One that isnt on the poll that I think is a big threat to some affiliates is other larger affiliate outfits.

As the budgets from large brand advertisers in certain sectors increase so does the competiveness of the affiliates in that vertical.

Naturally the strong survive and push out the weak as they move to own a larger share of their vertical.

Like porn and hard gambling - broadband , mobiles , finance and travel budgets are getting on the largish side. The more money , the more interest and competition. The more competition the more likelyhood of the strong pushing out the week to take a vertical.

I can remember seeing once the top 30 or so natural listings for a high traffic gambling term all belonging to the same affiliate - this has got to be a sobering thought in terms of threats to affiliates.

The industry is moving on and so many people now employ staff some even more than the networks they use.

Those who are aware of whats going on around them who act now to position themselves well will see huge growth over the next year or so. Those who don't will be confined to the niches - as the net grows those niches could end up not being so niche as more webmasters come into the space looking for gold.

As always those who can add some extra value or a piece of themselves into their sites will ride the wave better as larger affiliates seek to exert their dominance in the more profitable sectors.

Sleep tight

Mal

[Bob Saver]

Seems to be close to solved now, but certainly in the short/medium term it will continue to be a big issue for affiliate rev stream?

Here's another "Google Policy Changes" - all ads leading to predominantly affiliate content could go overnight if Google decides to scrub it's Adwords clean. This would be in line with it's new policy of targetting Top 500 companies rather than small players.

[KieronD]

On a similar note to Mal's post I think a major threat is the fact that according to a report the other week, for the first time ever Internet advertising overtake Radio advertising in terms of cash spent on that sector.

For any affiliate who does a lot of ppc and has to ensure a return on every penny spent this can't be good news. The fact that major blue chip brands are now allocating more and more budget to online advertising - usually just for branding purposes, has got to hit us hard. I've already seen this in lots of sectors whereby brands are buying up high traffic ppc keywords and paying ridiculous prices. It makes it nearly impossible to compete.

[Dynamoo]

Here's another "Google Policy Changes" - all ads leading to predominantly affiliate content could go overnight if Google decides to scrub it's Adwords clean. This would be in line with it's new policy of targetting Top 500 companies rather than small players.

I guess that could be called "doing an Overture" when they've hammered affiliates in the past. Since Google is basically crap at natural search results at the moment, PPC is the only reliable thing.

However, that's a BIG income stream for Google. They'd be stupid to cut it off.

[charlie_uk]

Seems to be close to solved now, but certainly in the short/medium term it will continue to be a big issue for affiliate rev stream?

Here's another "Google Policy Changes" - all ads leading to predominantly affiliate content could go overnight if Google decides to scrub it's Adwords clean. This would be in line with it's new policy of targetting Top 500 companies rather than small players.

i'd second this one - google basically control the internet currently, some competition would be nice but at the moment what they say goes and they're too big to consider the small players opinions. Undoubtedly any changes will benefit the larger outfits and associated partners and probably wipe out people like me.

I'm sure there will be alternatives, i suppose its our ability to change and adapt is the only thing that will ensure a steady income

All thats theory i don’t make anything yet

[pistol101]

I think the biggest danger is affiliates, merchants and agencies not understanding the ROI of programmes.

There are many many different examples (i've made up the numbers!!):

Brand name PPC is a good example. Merchant x pays 10%(plus programme costs) commission on their affiliate programme, however if the merchant does the ppc himself it'll cost him 2%. You can see why merchants don't want affiliates bidding on their main terms.

With advertising space becoming more competitive merchants are paying more on customer aquisition than a % of sale. Merchants know that on average a customer will shop 4 or 5 times with a merchant so they push the commissions up. However some affiliates skew the figures. Without meaning to pick on cashback sites, a customer is more likely to come back through this affiliate than average.

Obviously merchants are missing sales if they decide to stop brand name bidding or stop cashback sites. For example a cashback is going to push his members to shop at a different.

Affiliates and merchants need to spend more time communicating the ROI and understand their business models. Sometimes the fit just isn't going to work, but it's better that 1 or 2 partnerships are ended than the whole programme. Markets change and you'll never know when you need the relationship back.

[drivetowin]

Affiliates and merchants need to spend more time communicating the ROI and understand their business models. Sometimes the fit just isn't going to work, but it's better that 1 or 2 partnerships are ended than the whole programme. Markets change and you'll never know when you need the relationship back.

Too true - but then some networks are keen on allowing affiliates and merchants to communicate

[harris1]

I see agencies as a big problem but this has been the case for a while.

More than ever it’s about volume. Unfortunately I can see a time when the smaller players will be squeezed out altogether.

[Paul Wright]

I'm with "Larger Affiliate Outfits" and by outfits i'm referring to corporation type set ups. It'll only take a few big companies to wake up and realize that that customer database they've been building up for decades and pushing leaflets too could also be shopping through affilaite links via thier own portal in a similar manner to the Mutual, Greasy Palm et al but on a larger scale.

[smn2]

I voted for Google (froggle et al.) as the biggest threat.

I guess Google could (potentially) be considered one of
the (very) large affiliate threats, also.

Mal (Perfiliate)'s thoughts don't make cheery reading,
but I agree with them.

Steve

[Supercod]

The Tax man, if Affiliates who are not setup as a company (sole trader/partnership/limited or whatever) are not paying taxes on the income they earn. The Tax man might if it’s widespread tell all networks to hold a percentage of income from all non-companies until they can prove tax status. They might even force Networks to pay back tax for Affiliates that have been cheating the system. It happens in other sectors, and when they come a looking they will crack down hard on an Affiliates skipping the system.

[zaq]

The Tax man, if Affiliates who are not setup as a company (sole trader/partnership/limited or whatever) are not paying taxes on the income they earn. The Tax man might if it’s widespread tell all networks to hold a percentage of income from all non-companies until they can prove tax status. They might even force Networks to pay back tax for Affiliates that have been cheating the system. It happens in other sectors, and when they come a looking they will crack down hard on an Affiliates skipping the system.

How big companies cheat on their taxes:

http://money.msn.co.uk/investing/Ins...ks/default.asp

[Itchy]

erm if this poll is closed then why make it a sticky?
as it dosent show a representation of affiliates just the opinions of 101 ppl

[Flightmapping]

From a few of the conversations I've been having with fellow affiliates, I'd place another important issue very high up the list, and this would apply to any business which has a heavy dependency on a single (or only) member of staff - and that is the personal health and/or circumstances of the individual who runs it.

I certainly don't like the ups and downs of Google's SERPs, but this is just one factor making this an increasingly stressful business. I'm not sure if I would have been so well equipped to have dealt with the SEO rollercoaster a year ago, and would still like a bit more security in this. But I think a great deal of us can put our hands up to being overworked, and to constantly thinking about a million and one things we must do to our site to keep the punters and/or the bank manager happy. It's very easy to say we can't afford the time to build in some recreation, eat properly and do a bit more exercise, but then again, can we afford not to?