Linda Woods, CEO of PartnerCentric, an outsourced affiliate program management group, says that affiliate recruitment is the hardest thing affiliate managers have to do.

“There is no software that spits the names of affiliates out,” she says, adding that there is no easy way around the arduous process of finding, meeting and building a relationship with the appropriate affiliates.

The process is time-consuming and multifaceted, and the AffStat 2007 Report confirms that recruiting is definitely an issue for affiliate managers. Nearly one-third of respondents said their biggest challenge is recruiting new affiliates. And even when affiliate managers do find the right affiliates, it does not mean they will join or implement the program actively.

When researching affiliates for their programs, managers should apply common sense regarding the products’ audience and industry. For example, Woods says that an affiliate manager for a high-fashion merchant should not look for coupon or discount affiliates (because they can cheapen the brand). Instead she suggests they look to loyalty/incentive sites, such as MyPoints or UPromise, which do well with big brands.

However, loyalty affiliates are a hotly debated topic in the industry. While some affiliate managers find them useful in helping with repeat customers, others question some of their practices. Many claim they often override or subvert other affiliates’ IDs, which results in affiliates not being credited for sales, commissions and leads.

The conventional wisdom behind recruiting affiliates has been that merchants should focus on the top-performing affiliates that fall within three concentrated categories: incentive/loyalty shopping, coupon/deal sites and search. For this reason, there are top-heavy programs, with a small group of affiliates representing a huge majority of traffic.

Unconventional Wisdom

But David Delisle, principal of The Partner Maker, a contact management and recruitment system developed specifically for the online marketing community, believes the “focus on the top affiliates” approach has done more harm than good for affiliate marketing. That’s because top producers are continuing to break away from being compensated as CPA affiliates (on pure revenue share). These affiliates are compensated for access to their audience, which consists mostly of repeat customers.

The result is that affiliates like eBates, Upromise and MyPoints look and act more like media companies than affiliates, Delisle explains. If merchants are interested in new-customer acquisition, they should be weary of these types of affiliates.

Delisle points out that when merchants focus only on the top-producing affiliates, they are ignoring the rest of the Web, and recommends marketers shift gears and pursue smaller affiliates in order to tap into the long tail.

The amount of smaller affiliates is positioned to grow, because today virtually anyone who uses the Web has a means to become an affiliate, with tools like PopShops – a product catalog “research tool” where affiliates can find relevant products to their niche. It allows an element of discovery based more on relevant inventory to an affiliate’s niche and less on criteria such as commission structure.

Angel Djambazov, marketing and business development manager of PopShops, says that an affiliate manager can use their PopShops product catalog as a recruitment tool to gain new niche affiliates by seeing the activity within the tool set among certain products.

The emergence of social networks offers another way for affiliate managers to recruit affiliates who are ambassadors of their brand. CEO of Molander & Associates Jeff Molander says This- Next and Stylehive are social networks that focus on the discovery and sharing of new items and offer marketers an upside that is “tremendous and untapped.”

Molander says marketers need to understand some products work better than others for social media strategies because they are natural fits for the “word of mouth” or “wisdom of crowds” models. For example, Wine.com’s community site works well because people buy wine using recommendations, and Patagonia’s community site is effective for its “highly conscious” consumers. But for a retailer like Gap, a social networking model could be less compelling, Molander explains.

Networks as Necessity

Another way to find affiliates for a program is through networks such as Commission Junction, LinkShare and ShareASale, because the networks can offer exposure to lots of affiliates and provide a wide reach.

But PartnerCentric’s Woods points out that “reach” is a misleading word – “what they have is a pool of affiliates, which is better than nothing.” Woods says most inexperienced managers rely on networks to find affiliates, but there are problems with this strategy. For one, some networks only promote new programs in front of affiliates one time, such as in a newsletter mention. The rest of the time the program is simply listed as a text link within a category.

Another problem is that networks list programs by performance – so a new program is ranked at the bottom because there is no performance data, such as the earnings per click (EPC), until the data shows up, which can take up to three months. If an affiliate is choosing a new program from a category, they will select the one that offers the most potential.

Linda Buquet, president of 5 Star Affiliates, an affiliate marketing consultancy, says another consideration is the 95/5 rule, which means that only 5 percent of the affiliates pulled from a network will be productive and active. And once these affiliates are recruited, to a large degree, they still require hands-on personal contact.

Affiliate managers cannot be dependent on networks, and Molander warns that affiliate managers cannot recruit affiliates by plugging into a network and walking away, because that strategy leaves money (affiliates) on the table.

Although networks are not in Roger Snow’s top three ways to go about finding affiliates, the director of marketing at Snow Consulting, says there are advantages. Networks are beneficial because they allow managers to use keywords to target specific affiliates as well as for starting programs because they announce the program to all affiliates.

Once affiliate managers launch their programs, they have the challenge of proactively building and retaining their publisher base. Networks can help affiliate managers who do not possess the business development and affiliate marketing skills necessary with these early recruitment tasks.

Depending on their vertical and brand, merchants must understand the overall online marketing landscape and whether or not a performance-based relationship will result in sales/leads. Kerri Pollard, general manager of Commission Junction, explains that Commission Junction has built a successful publisher sales team and sales engine that helps with this time-consuming work.

Another reason to work with networks is they can provide an affiliate manager with background regarding the ranking and quality assessment of a publisher. Pollard explains that Commission Junction designates qualified top performers as CJ Performers – noting that such insight isn’t available when managing an in-house program.

Most of the networks hold events with the core objective of getting merchants and affiliates together so productive networking can occur. LinkShare has its Partnership Summit and Symposium; ShareASale’s annual meeting is ThinkTank; DoubleClick Performics has its annual Client Summit; and Commission Junction puts on its annual Commission Junction University (CJU).

Research and Relationships

For finding affiliates, there is also good old-fashioned search engine research. A good way to find potential affiliates is to type the keywords pertaining to a product into Google and check out the results on the first few pages of natural search results. Snow says one of the ways he finds affiliates for his client, DiscountWa

tch- Store, is to Google terms like “watch review sites” to fi nd highly ranked and highly trafficked sites regarding watches.

Snow also looks for affiliates who use PPC as means to drive targeted traffic to their site because it shows they are actively marketing their site.

Woods agrees managers need to look for sites that come up in a search for particular keywords – “if they are advertising your competitors, reach out with your affiliate plan.” Woods also recommends finding affiliates through software tools such as Syntryx, which show sites that are linked to your competition.

But the easiest way for managers to recruit affiliates is to tap into the relationships that they already have established. Woods explains it’s important to have an experienced full-time manager who knows people in the industry because affiliates enjoy working with people they know. To foster the relationship, managers need to recognize affiliates who do well by giving them kudos, like financial rewards or tickets to a sporting event.

According to Snow, one of the ways affiliate managers can get to know affiliates is to join communities where the best players are – and recommends that managers become vocal participants in a large online marketing forum such as ABestWeb.com, where lots of savvy affiliates participate in discussions.

Affi liates are more eager to join programs they trust, according to Haiko de Poel, Jr., president of online affiliate marketing forum ABestWeb.com, which has more than 39,000 members.

de Poel says ABestWeb is an excellent recruiting medium because it is in almost real time and there are no spam filters. He also says that trust is a big issue in recruiting and ABestWeb works hard to overcome that challenge. According to de Poel, a couple of years ago some affiliate managers did not give out their real names on ABestWeb and the community reacted negatively. Now affiliate managers post on ABestWeb with their real first and last names. de Poel says that sometimes affiliate managers will come into a forum to ask a question and the community won’t talk to them until they state their real name.

There is an accountability factor when an affiliate manager reveals their name and the company they represent. “There is a trust that is built and affiliates feel like they are partners and not just affiliates,” he says.

Once a user gets involved and posts regularly, others see where that person stands on issues. He says this translates well to the real world because once they meet in person, there is instant credibility and a symbiotic relationship.

Many use forums and blogs to recruit affiliates. Buquet, who was an outsource affiliate manager but now specializes in recruitment and promotion, explains that word of mouth is instrumental to her success for finding affiliates – she recruits through her blog, her forum, her main site and through affiliate and online marketing forums.

By only representing tried-and-proven affiliate programs that have been tested, Buquet says she has earned a loyal following of affiliates and a good reputation. She says she turns down 99 percent of merchants that want her help recruiting affiliates because she’s looking for programs that have high payouts, long cookies, good conversions and high-integrity marketing practices.

There are outsource affiliate program management companies that can offer marketers access to top affiliates – companies like PartnerCentric, GTO Management, NETexponent and AMWSO.

Chris Sanderson, director of AMWSO, uses The Partner Maker, a contact management and recruitment system. He says the system allows him to build his own affiliate base so that when he launches a new program, he can review the affiliates in the system and contact those partners that would be a good fit. And because he can store multiple sites and marketing profiles for each partner, it also means he can contact the correct partner and not send a generic email.

Cold Contacting

The most popular methods for cold-contacting affiliates are email and the telephone.

Snow says he thinks most affiliates don’t want phone calls, and suggests sending emails that won’t be perceived as spam. “Don’t send them 4,000 words – just point out the benefits of the package [like commission, cookie duration, product data feed]. You only have one or two seconds – it’s just like selling door-to-door.”

The AffStat report showed that 30 percent of respondents believe email is the most effective method for recruiting affiliates, and 18 percent believe it is through the phone.

Affiliate Summit co-founder and affiliate program manager Shawn Collins says if sites don’t include an email on their contact page, affiliate managers can get the email addresses by looking up the WHOIS record for the domain.

Top affiliate Scott Hazard says that as a high-profile affiliate, he receives multiple emails per day from affiliate managers who want to recruit him – about half are personalized emails and about half are bulk emails. Hazard says some ask him what it would take to get them into the program – they try to find his pain point.

Make an Impression

To stand out, affiliate manager Collins has found fun items to send affiliates. In the past, he’s mailed postcards and has had good results with “Send a Ball,” which is an alternative to a greeting card. The ball is delivered via the USPS with the address, postage and personalized message right on the ball.

PartnerCentric’s Woods says face-to-face contact is essential for meeting new affiliates. She suggests affiliate managers get out to events and conferences like the two-yearly Affiliate Summit and Webmaster World. “If you sell lawn chairs, you need to go and meet the top home and garden sites,” she says.

When attempting to attract affiliates to a program, most experts agree money is a big motivator, although Woods claims it is not always the most important factor. The commission has to be at least as good as what the competition is offering, but affiliates look for programs that offer a variety of elements.

For one, a program needs to be well-managed because it’s important that affiliates are serviced and have their commissions paid. “The bane of affiliates’ existence is to have to chase down their commissions,” Woods says.

Often affiliates join programs because they trust the manager and they know the program won’t become “stale” – meaning that applications will be approved, new links will be put up and there will be email communication back and forth as needed, according to Snow.

Based on feedback received at ShareASale’s ThinkTank conference in October 2006, shoe retailer Chinese Laundry made changes to its affiliate program, including better ways to link, promotional banners and affiliate specific coupons. Chinese Laundry’s CIO, David Wright, says they starting seeing improvements right away and their conversion rate went up 600 percent – “from a couple of affiliate sales a month to 15 in one day.”

The conversion rate has to be good because many top affiliates are constantly evaluating the real estate on their site. Snow explains “it’s all about conversion,” and top affiliates do a lot of research because it is their livelihood.

Affiliate Hazard is a firm believer in doing extensive research before joining a program. For programs in the ShareASale network, he can look up the EPC and the average commission and then figure out the conversion rates. He also notes that it’s important for affiliates to try out the buying process before they start promoting a program. If the merchants make the buyer enter personal information before they state the shipping charge, if the production descriptions are poor or if things are hard to navigate, the chance of sales abandonment increases, which can ruin affiliates’ commissions and reputation.

To help merchants understand problems with their site from an affiliate perspective, Hazard recently began offering a site evaluation service to merchants. He looks for hiccups in the checkout process and analyzes the c

ommission structure to see if a competitor pays more. When joining a new program, Hazard’s most important criterion is a very unique product line – something not readily available at other sites. He also looks for programs that fit into his themed websites.

With new offerings for connecting affiliates and merchants, and new tools that make it easier for publishers to become affiliates, in some ways affiliate recruitment is becoming easier.

Collins thinks recruitment is easier today than when he started 10 years ago. At that time, every person he approached had to be sold on the overall concept of affiliate marketing. He says, “it’s just a matter of breaking through the clutter and selling the reasons why the affiliate program is best.”

Still, Collins says it’s the activation and retention of affiliates – not the recruitment – that is the hardest part of being an affiliate manager. He says he believes that because most affiliates don’t focus on activation and retention, they “think” recruiting is the hardest task. But according to Collins, once you’ve got the affiliate, you have to know how to keep them and ensure they are productive.