Does google pose a serious threat to affiliates

[Dazza30]

With google being the most effect route to market for affiliates, does its recent actions against affiliate sites running adwords campagains pose a threat to the future of affiliate marketing?

[Leeky]

As soon as Google have enough data on how much affiliates are wlling to spend on keywords to still make a profit, then Google could easily do without affiliates spending on PPC and be the affiliate themselves.

This way they could make 100% of the commission for each product sold instead of the 50%+ they get of the affiliates commissions by charging for keywords.

When Google are this masive affiliate they could then demand more commisson from merchants.

Thats my theory anyway.. I said the exact same about 2 year ago.

Lee

[Qui Gon Jinn]

There are a couple of things Google hasn't thought off and are not that obvious, when they do this will really obliterate the affiliate industry.

But one thing we can do is its seen Google is keen to keep search on it's own site, a couple of years ago it was suggested that if most affiliate sites had search functionality on their site ie Organic Search, I don't mean just for products on their site. Then it will give less reason for visitors to leave & use other search engines. It won't be much of a dent initially, but will depend how well you market it & how good the results are.

Lee, I just want to verbally back what you are saying re a possible route they could adopt.

[Shane]

Google will evolve to be an affiliate - at some stage IMO

I'm still stuprised that google hasn't gone percentage of basket value on their pay per action option (PPA), their current £x per sale is too inflexible for most merchants with variably priced product ranges, but I am sure percentage of sale will come at some stage, effectively meaning they are the affiliate and merchants tell them how much commission percentage they are willing to pay per sale made.

Google have millions on impressions for blank inventory each day and could seriously fill that out with relevant PPA ads (using google automatic matching !? lol) on a percentage of spend basis whilst still maintaining the user experience and maximising their CPM income.

On the plus side for affilaites, google is so greedy that they'll end up setting minimum commission percentages for certain sectors that will make most merchants cry, so I am sure that content affiliates will be ok in the long run (unless google bins those sites in time too), probably mainly just the ppc ones that are going to get squeezed ever harder.

G$$gle will do as it sees fit to maximise revenue from it's traffic, the recent embeded search boxes being one thing to monetise traffic that used to just leave google without earning them a dime, but now anyone typing into the box is served ads around a site search...millions of extra impressions on major brand sites (at the moment) at the expense of those brands page hits.

It's hard to think how google will be in a few years, one thing is for sure though affiliates are going to be pushed out of it more and more each year so yes it does pose a serious threat to affiliates, so we all need to innovate and keep ahead of the game.

[Leeky]

if anyone wants to see this search box in action just search for HALFORDS

Lee

[crazihos]

As soon as Google have enough data on how much affiliates are wlling to spend on keywords to still make a profit

I agree, but what happens when a totally new product come out and they have no data on it and no keywords to target - their going to damage the quality of their listings unless their careful.

Removing affiliates works in some respects but in the same way that kelkoo make their money i'd expect google to get a number of ppc clicks for every affiliate sale so in some cases they may actually be worse off in many cases by removing the affiliates from the ppc lists.

I just hope that if they do try they make a hash of it as they have done with things in the past..they should stick to what there best and leave the affiliating to the affiliates!

ps...that halfords things bad - its very misleading. Would the OFT not moan about that (along with halfords)?

[tonyr]

I think that Google poses a threat to some affiliates but certainly not all. Everybody has their strengths and Google is the world's best search engine but it is not the be all and end all of everything on the Internet.

The large high quality affiliates are safe from Google, the likes of moneysupermarket, gocompare, tripadvisor, moneysavingexpert, holidaywatchdog etc.

The big sites spend a fortune on Google PPC but they also advertise elsewhere and they have a recognised brand name and they are not totally dependent on Google. The expertise that they have in their industry and the systems that they have developed over the years, Google can't compete with that and I don't think they will try. They will just carry on taking the PPC money.

The same goes for the large content sites / user review sites. Google crawls information but they do not create content. They need to show these sites in their SERPs because their search engine would look bad if they didn't.

Small affiliates are both helped by and threatened by Google at the same time because Google holds so much power over them. The small affiliate can create something like say, a 50 page site with useful, detailed information around a single product. This would be unique and should do well at SEO and have a good quality score at PPC, and there the problems start.

They have no control over search engine results and can drop out at any time. They better have other sources of traffic to survive. PPC can work until the quality score axe falls. Because they are not a "premium" affiliate site with an account manager and spending 1 million pounds a month on PPC their protests will receive standard responses.

So, I think that Google is a not threat to specialist, high quality affiliates above a certain size, everybody else - be careful!

[john-pp]

To me it's quite obvious that the way Google has been so pro-active and manipulative in this area of late that they are already planning a move to monetise their potential in the affiliate market.

The way you have to look at this is that they are a conglomerate that has taken full advantage of their dominant position in order to swamp every other connected area they have moved into - the next logical step is the affiliate market. It's there for the taking. They have the technology, knowhow and muscle to be able to pull it off.

Answers? I don't have them! But one thing affiliates can do to lessen the effects is to diversify their broadcasting ie make use of as many of the Google alternatives and the many other streams of potential traffic as you can. The sooner this is done the more established your set up will be when it happens.

--
john-pp GF

[Leeky]

Google will find another way, or already have another way of getting money from ex-affiliates instead of PPC.

There will be no affiliates, no networks and no ppc ads to merchants..

Googles will still have organic listings for non merchant websites (to keep the traffic) but all merchants will be a priority in the listings if someone types in a product name, brand or merchant brand name, these links will then be tracked through Googles networks which will bill the participating merchant.

If a merchant is not part of googles network they will not take automatic priority in the listings and rely on organic results to get free unaffiliated traffic.

Affiliates will get commission if they send traffic via googles network to merchants, affiliates will only get traffic via organic listings... so needing (being forced) to have original content in order for any chance of making money.

Affiliate marketing for affiliates will be like it was before PPC but working with and competing against google at the same time.

D'ya want fries with that?

Lee

[befuddle]

Yes Google is a threat. My traffic from Google organic search decreased by 89% overnight this week.

Without that traffic my site would make in a year what it would usually make in a month.

So, it's at this point that I'd have to consider PPC to drive traffic to make revenue to justify the amount of time I spend updating the site.

However, with minimum clicks at ridiculous prices, that would lead to a loss. And I'd be paying the company for traffic which I once received for free.

From where I'm at it's a shame that you can only drive traffic and commissions if you do well in Google. The other search engines don't have much to offer and only account for 12% of my search engine referrals.

From my last 625 visitors, 550 were from Google, 44 from Yahoo!, 22 from AOL and 9 from Windows Live.

[Qui Gon Jinn]

- Affiliates develope their own search engine & market themselves? I hear affiliates are quite good at this thing called marketing

- Affiliates start having web search on their sites to keep users within site.

- Affiliates in different niches combine content or different verticals for one super site

- Affiliates start planting the seed to users of other search engines apart from Google

[Leeky]

Yeah.. like pagerank10.co.uk and pricesuk.net

Lee

[crazihos]

Lets not get too doom and gloom, if they cut out affiliates from ppc and only show merchants that can afford their prices then I think googles results will be pretty poor and users would turn to other search engines.

I'd hope so anyway

[Dazza30]

I use adcenter, yahoo and google but does the search engine market need microsoft to get there hands on yahoo?
if so would this create something that could compete with google or is it too late?

[buspassjohn]

Don't like to say I told you so, but this is from April last year, with Amazon now going into PPC in the states, it's inevitable that Google will respond in some way, possibly by turning Google Checkout and Google Products into one big find it and buy it site, charging merchants a similar commision rate to that now paid to affiliates?
Google Checkout & Affiliate Marketing