Social Meets Business

An affiliate marketing experiment used Twitter to connect the community at a recent show.

As an idea, Twitter is nothing new – a method of communication between various parties. However, as a real and practical application, Twitter is revolutionary. It has the potential to reinvent communication between affiliates, networks and merchants.

Twitter was a side project of Odeo in March of 2006 and is a part of San Francisco-based Obvious Corp. Users of this new social messaging service are able to post messages 145 characters in length to answer one basic question, "What are you doing?"

These short snippets can be sent to Twitter through the Web, via instant messaging (Jabber, Gmail’s chat service, and AIM) or through text messaging on a mobile phone. When people that you have added as your contacts on the service post messages, you can also receive their messages via those avenues.

Even for the non-bloggers and nonforum participants, this invitation to share details about daily life and experiences seems to be too much to resist. According to Twitter’s creator Jack Dorsey, the service currently has about 20,000 daily active users and is growing by over 1,000 new members a day. While small in some metrics, those active users include some of the most influential bloggers and businesspeople in the online marketing world.

Interestingly, Twitter is expanding our own notions of instant communication. Companies such as the BBC, CNN, Technorati, 30 Boxes, Microformats, Ma.gnolia and even the conference Macworld have all begun to make use of Twitter’s ability to reach people instantly and efficiently with important news or service updates, wherever they happen to be at the time. Highly influential websites such as Technorati have begun to send out alerts of service outages or upgrades that were once only issued on the company’s blog.

Affiliate marketers and affiliate networks are beginning to notice the benefit of the service as well. For example, Brian Littleton, founder and CEO of ShareASale, recently began a "Twitter experiment" with his affiliate network in an effort to judge Twitter’s ability to transform network-to-affiliate communication. Brian announced the experiment both on the ShareASale blog and on ABestWeb and offered affiliates a chance to join Twitter and receive instant updates from him regarding network offers, payouts and other news from his network.

The ShareASale team has attracted dozens of affiliates to its Twitter network since the middle of January. These affiliates are regularly posting and communicating about industry news, offers and their own lives and they have created quite a unique community in just a few short weeks.

Here’s what Littleton had to say about his Twitter experiment: "Improving communication between affiliate managers and affiliates benefits both parties, as well as ShareASale, who stands in the middle. We are constantly looking for new ways that we can facilitate good communication, on a level playing field. Affiliates don’t like to be constantly harassed, and merchants often don’t know to what extent they should extend their help."

With the Affiliate Summit upcoming, we felt it was a great opportunity to get both parties interested in a new tool that could become a new way for managers and affiliates to communicate. We’ll be illustrating some of the instant effect of Twitter communication by giving away time-sensitive prizes at our booth as well as updating attendees on the whereabouts of various ShareASale team members. I think by the time we are done with this experiment you’ll see quite a few affiliate managers setting up little Twitter networks for their programs," Littleton says.

His comments point to what was the true tipping point for Twitter’s early adoption in the affiliate world: Affiliate Summit West in Las Vegas on Jan. 21–23. By the end of the summit, Littleton had over 40 influential affiliates who had signed up for his updates on Twitter. Those affiliates included some of the best and brightest in the industry. From the Friday before the summit to the days following, these affiliates were using Twitter as a way to find each other for meals, locate each other at industry parties, share information of where to find tickets to the events at night, critique speakers on the various panels and share interesting schwag finds at the booths. Dozens of "twitters" poured in through cell phones and IM clients at all times of the day and night. The web of communication and information sharing created was impressive and a unique experience.

Industry conferences provide an excellent demonstration of Twitter’s potential. Network representatives, affiliates, merchants and press reporters are constantly (and sometimes hopelessly) attempting to reach one another in the vast sea of faces and booths. While the cell phone is a great aid, it is often difficult to contact someone on a call during the heat of battle on a conference floor. Using Twitter, an individual would be able to post their location, schedule or need and have that message sent out to either just one person or a marketing team, or even a large number of contacts.

As for the ShareASale experiment, the company was able to effectively drive the affiliates on their Twitter network to their booths for special giveaways, prizes and news by sending out certain announcements throughout the summit. Littleton also used the service to locate members of his own team and arrange meetings with affiliates and clients. As an instant information sharing platform, Twitter met all expectations at the summit, and in some ways exceeded them.

However, the implications for affiliate marketing don’t end with conferences. ShareASale’s experiment with Twitter is an interesting start to what could become a revolutionary platform for instant, yet nonintrusive communication regarding offer updates, new payout structures, new coupon codes and just about any type of update a network could make aimed at participating affiliates.

Email correspondences between networks and affiliates have been lagging in terms of deliverability and the many snares and traps that an HTML email must avoid in order to reach the intended recipient. Along with that, changes in Microsoft’s new Outlook in the Vista OS will considerably hamper the use of affiliate newsletters. Some merchants have moved to blogging and reaching affiliates through such means as RSS feeds. However, affiliate adoption of RSS has been slow, and only about 30 percent of merchants and networks are blogging (with a much smaller percentage regularly updating their blog).

As more affiliate networks discover the advantages of using this type of communication to augment their existing efforts through email or RSS, I expect adoption by affiliates to continue to rise. Social communication, which blurs the pre-existing line between personal and business communication, will be this year’s hot topic in reaching and activating affiliates. Keep an eye on the growing group of affiliates using Twitter for social and business communication.

 

SAM HARRELSON runs CostPerNews.com, a weblog about online marketing, specifically CPA offers, programs and networks. He has held positions at Rextopia Network, PrimeQ and Aluria Software.

Stop the Presses

Extra! Extra! (click here)Prepare the obituary: The era of the daily newspaper as the news source is over. The Daily Tribune, Inquirer and Journals of the world have been recycled, replaced by multi-platform (online and off-line) entities that engage readers and operate around the clock. This rebirth is good news for advertisers big and small who will be able to more effectively target a growing audience.

Newspapers have been increasing their online operations in the past few years in an effort to replace falling revenue from diminishing print subscriptions as more people turn to online news and bloggers for their daily digest. Now they are going on the offense to expand their audience and build loyalty.

Publishers have been hemorrhaging print advertising dollars as retailers have been moving online. Print advertising was down by more than $11 billion (2.6 percent) in the third quarter of 2006 from the previous year. While online advertising on newspaper sites grew by $638 million during the third quarter of 2006, that is less than 6 percent of the print deficit, so the pressure is on to grow online revenue to make up the difference.

Publishers see engaging their audience through community and social collaboration features – which are part of the so-called “Web 2.0” technology wave – as the keys to driving traffic and advertising revenue growth. By incorporating “community” aspects from blogs and websites such as Digg, MySpace, YouTube and del.icio.us, publishers hope to increase reader loyalty and become the epicenter of their online news activities.

COMMUNITY PAYBACK

The Washington Post Newsweek Interactive (WPNI) Company saw this change coming and started to incorporate community participation into its websites two years ago. The company saw online revenue jump 24 percent during the third quarter of 2006, and by more than 31 percent for the year.

WPNI vice president of marketing Tim Ruder says bringing readers into the news process can enhance readership as well as the quality of the editorial. “Publishing is no longer in the realm of the exalted few, and to ignore the potential [of reader contributions] is suicidal,” he says.

Because reporters are generalists it is difficult for them to match the expertise of individuals on all topics, according to Ruder. “There is somebody out there who knows more” about nearly every topic, he says, and publishers can profit from giving them a forum for participation.

During the first quarter of 2007 WashingtonPost.com will introduce social networking, Ruder says. Readers will be able to create personalized Web pages to link to, comment on and share content, including articles, images and video. These new features will enable errors to be corrected and generate comments and new story ideas that can be used in print, he says.

Ruder believes that adding social networking features will increase traffic and give the company more online inventory to monetize through advertising. While adding one social aspect “won’t make us a million dollars,” collectively creating a dialogue with readers “will separate us editorially from others” and greatly increase reader loyalty, Ruder says.

Austin, Texas-based Pluck enables publishers to add social media aspects to their website without requiring programming. Pluck’s “Sitelife,” service includes the ability to attach comments to articles, create forums and blogs, and enables readers to post photos, according to general manager Eric Newman.

Pluck hosts the social areas on its servers, but the content is thoroughly integrated, according to Newman. Social networking elements “promote additional discovery on the website, which equals reader loyalty and page views,” he says.

Brad King, assistant professor of media informatics at Northern Kentucky University, says publishers who create a community by allowing readers to contribute could see “astronomic” growth in Web traffic. King warns, however, that publishers must provide oversight of the comments and user contributions so that advertisers will feel comfortable in having their ads alongside the content.

Publisher Gannett, which prints 98 regional newspapers plus the national paper USA Today, is among the most aggressive when it comes to redesigning its editorial and sales process around its community of readers.

Michael Maness, vice president of strategic planning for Gannett, says all of its newsrooms are being transformed to “information centers” that operate around the clock and will heavily rely on user contributions. “The future is pro-am, as in professional- amateur,” Maness says. Readers are asked to provide assistance in obtaining documents and images relevant to investigations and videos of breaking news events.

Maness says the Ft. Myers, Fla., News- Press got readers involved in investigating sewer utility rates, and the “crowd-sourced” investigation resulted in uncovering price fixing. At Gannett’s NYK.com, readers in the Northern Kentucky metropolitan area post information about local events and community stories, enabling Gannett to connect with a younger demographic of readers who primarily go online for news, according to Maness.

While the morning paper and nightly television news used to be the dominant sources of news, the Internet is becoming the go-to place for news for many Americans. According to the Pew Internet & American Life Project, the majority of people with broadband say the Web is their first choice for science news.

Peter Negulescu serves a technology-savvy readership in his role as the vice president of digital media at the San Francisco Chronicle’s SFGate.com. Inviting readers to contribute will attract a desirable community of participants for advertisers and make the content more valuable, he says. “The role of the new media arm is to aggregate content to tell a more complete story.”

By recruiting “citizen journalists,” publishers can add to the breadth and depth of their content. Publishers most commonly offer fame as compensation, so the major cost is vetting all of the contributions to find those that are newsworthy.

By enticing readers to return to the website consistently and provide demographic information about themselves through the registration process, Negulescu says SFGate is increasing the ability to understand and deliver targeted advertising to its readers. “From a revenue perspective, adding social media engages readers more deeply,” he says.

At the end of 2006 SFGate launched Community Blogs, a section where a select group of readers write about topics of interest, and in early 2007 the website will allow readers to post comments to its news articles. Negulescu says adding reader input to the website “gives advertisers an opportunity to understand what people are talking about and how it fits with the marketing message.”

For example, an advertiser that is included in a restaurant guide or mentioned in a food review could respond to negative or positive comments. Negulescu does not expect that all marketers would want to advertise against user-generated content, so they will be able to specify the pages upon which they appear. Reader participation requires registering and providing some basic demographic information that can be used for target and email marketing.

What used to be considered newspaper websites can become information-based centers of community that provide unique value to advertisers, according to media consultant and blogger Susan Mernit. Readers/contributors can provide first-person accounts of unfolding events that will entice people to become loyal readers.

Posting reader commentary and images from the scene of a natural or man-made disaster can be more compelling than stories composed by professional journalists, Mernit says. Publishers could post pictures similar to the first images that were captured in the aftermath of the London subway bombing, says Mernit. “You want the equivalent of that picture for your audience.”

The plethora of choices for online content makes it a challenge for local advertisers to know where to go to reach potential customers, but newspaper sites are part of the daily reading regimen for many people with Internet access. Publishers that provide a community around local news can capture a loyal audience that makes for an attractive demographic. Adding user ratings of local businesses for entertainment events could enable news sites to best the local search sites such as directory services or CitySearch or Yahoo Local in capturing the community voice and attracting advertisers, according to Mernit.

HITTING LOCAL TARGETS

Advertising in print newspapers provides access to an audience that is generally located in limited geography, but online news sites can reach a wider swath of the population. Publishers that track where their audience lives can provide more targeted advertising to both local and national advertisers.

SFGate’s Negulescu says that 80 percent of his readers are in the Bay Area. The website’s servers automatically check the IP addresses of readers’ computers so that geotargeted ads can be delivered to either national or local audiences as requested by the advertiser, he says.

Gannett’s Maness says buying ads from newspaper publishers now resembles a TV purchase more than it does a print buy. “It used to be ‘How big of an ad do you want, and for how many days?’ Now it is all about audience reach.” Gannett has integrated its print and online sales so that the company can package a demographic of readers to meet advertiser needs. Advertisers who want a younger audience might spend more online, he says.

Now that Gannett has more demographic information in hand, the company can sell to smaller buyers, according to Maness. Local businesses that can’t afford to advertise on TV or radio can buy ads that will be delivered only to a specific demographic, such as middle-aged married women. Gannett uses cookies to track visits and anonymously collects data about who is reading articles about fashions or appliances, he says, and that data is used to deliver targeted ads.

AGGREGATE AND BE AGGREGATED

In addition to allowing readers to contribute on their websites, publishers should allow content to be shared and manipulated on other sites to expand the audience. Publishers can significantly increase traffic by adding tools to their website so that readers can add links to their articles on ratings sites such as Digg or Reddit.

People who add tags (categories used by specialty search engines) to news articles through social websites are enhancing the content with metadata, according to educator King. Readers who interact with news content in this way are assembling personalized archives that create a community that publishers should encourage. “At the end of the day, Web 2.0 is a platform for communication that allows people to build other things upon it,” says King.

Publishers who join with rather than fight against news aggregation sites such as Yahoo News or Topix.net can also expand their ad inventory. Late in 2006, seven publishers, including the Hearst Corporation and Cox Enterprises, agreed to share content, advertising and technology with Yahoo News, the largest news portal. Yahoo News, in partnership with Reuters, has also embraced citizen journalism by creating the You Witness News website that enables readers to post articles and images.

Topix.net, a news aggregation site that organizes news from around the Web by location or by category, has received funding from three publishers – Gannett, the Tribune Company and McClatchy. Topix.net uses an algorithm that identifies the news stories relevant to a region, according to Chris Toiles, vice president of marketing. The company currently places AdSense ads on most of its local pages, but it can offer national advertisers targeted buys based on geography, he says.

Topix.net blends both regional and statewide stories and combines blogs with news stories, according to Toiles. Readers add 18,000 comments per day to articles and then Topix.net funnels that traffic to news publishers, he notes.

Publishers can also enhance their traffic by displaying competing news sources along with their content. Websites including SFGate enable readers to personalize pages by mixing their content with that of other news sites through a custom RSS reader. Readers can add feeds to customize their news-reading experience by category, according to SFGate’s Negulescu. Readers who visit the newspaper site every day can read news from around the Web on a branded SFGate page, which builds loyalty and keeps them on his site longer, he says.

Publishers are also incorporating content from bloggers from around the Web to increase their traffic and stickiness. WashingtonPost.com and others have incorporated Pluck’s syndicated BlogBurst content. Publishers can choose the BlogBurst blogs from dozens of categories, and the advertising revenue is split between Pluck and the publisher. Bloggers get increased traffic from links, and those that generate the most revenue will receive bonuses, according to Pluck’s Newman.

Newspapers that implement “social Web” technologies can learn more about readers and use that information to provide relevant content and targeted advertising. News, and the advertising system that support it, has been irreversibly opened so that more people can participate, and that is good news for all.

JOHN GARTNER is a Portland, Ore.-based freelance writer who contributes to Wired News, Inc., MarketingShift, and is the Editor of Matter-mag.com.

Hire Up

Even the most traditional companies don’t need to be convinced anymore that Internet advertising and marketing is no longer optional. Today companies from the Fortune 1000 on down, which were reluctant to explore the Web in the late 1990s, are shifting their resources online.

The proven return on investment of Internet advertising is one reason; another is that user-generated content sites such as MySpace.com and YouTube.com offer new opportunities to reach customers more intimately and effectively.

Internet advertising growth has soared during the past three years due to improved advertising technologies and the spread of broadband Internet service. PricewaterhouseCoopers expects the Internet to receive 10 percent of total global advertising by 2010 compared with less than 3 percent in 2002.

Areas of Increased Spending in 2006 vs. 2007 eMarketer estimates that total U.S. Internet ad spend was $16.4 billion for 2006, a 30.8 percent gain over 2005’s $12.5 billion figure, and predicts that online ad spend will reach $23.8 billion by 2008.

EXPERIENCED EMPLOYEES ONLY

This drastic surge in online advertising has dramatically increased the need for skilled employees. Advertisers who have know-how selling and measuring online campaigns, and marketers who can create innovative Internet initiatives, are in high demand. And as companies understand the power of ROI-based online marketing efforts such as affiliate and search marketing, there has been a sharp increase in the demand to hire performance marketers.

Compounding this demand is the advent of Web 2.0 venues such as YouTube, Facebook and Second Life. Similar to the situation created by the late 1990s’ Internet boom, today there is a very small ready pool of experienced staff for the opportunities that Web 2.0 present because the venues are so new. Finding staff to manage the explosion in user-generated content, and leverage its marketing potential, is proving to be challenging.

This increased demand for qualified talent has recently been felt throughout the industry – from recruiters to employers to merchants. Smith McClure, division director of the Minneapolis branch of The Creative Group, is a recruiter for both traditional and online marketers. He says that demand is up and that the market for qualified talent for online marketing jobs is getting tighter.

Jane Paolucci, vice president of marketing for Coremetrics, a provider of on-demand Web analytics, agrees and says it is getting harder because business is growing at such a fast pace.

Todd Leeson, vice president of marketing for Jobster, says the number of searches for online marketing and online advertising jobs on the Jobster online recruiting site has increased threefold over one month – from October 2006 to November 2006.

During the fourth quarter of 2006, Sean Bisceglia, president of Aquent’s marketing staffing, a global marketing and creative services staffing firm, also noticed a major increase in the number of companies looking for online marketers. He says that 20 to 30 percent of his day-to-day job openings are for online marketing positions and that they are the hardest to fill because there are not enough specialized people.

In fact, an Aquent Marketing, Staffing and Spending survey found that the top three areas that corporate marketing departments planned to increase money for in 2005 were branding, Internet marketing and advertising. But in 2006, Internet marketing took the lead as the most sought-after position in the industry.

Two San Francisco Bay Area recruiters who are feeling the pinch are Sal Castillo, who owns his own group; and Marni Mires, a recruiter for the high tech executive search firm Quest Group. Mires says that Quest recently had candidates with multiple offers and that companies need to pull the trigger within two weeks or risk losing the candidate to another offer – a very different market than just a couple of years ago.

Castillo says that today’s online marketing jobs are very specialized: therefore, it is harder to find candidates that match all of the criteria: “Fifteen out of 100 resumes match the job skills that I am looking for.” Stephanie Schwab, vice president of marketing for Converseon, says “For every 100 resumes we get, there are about five or 10 that I’m interested in calling, and of those, about three to four that I want to meet.”

HIRING FOR SEARCH POSITIONS

According to Forrester Research’s report, The State of Retailing Online 2006, search marketing was responsible for 36 percent of new customers for online retailers in 2005. Search is the only advertising media where customers tell merchants what product they are looking for – and it is more effective than other advertising because the advertiser can tailor its targeting and message to each specific searcher’s need.

John Challenger, CEO of Challenger, Gray & Christmas, Inc., an international outplacement consulting firm, says “Companies cannot afford not to put their dollars in this area because it is so focused.”

FathomOnline’s CEO Dean DeBiase says, “If you’re not present in the search results, your competition will be.” This fear is causing companies to rush out and hire search marketers en masse.

Percent of New Online Customers for Online Retailers/Marketing Spend Mix (2005) Challenger says that SEO and search marketing are really hot markets for hiring. Jobster’s Leeson says they have seen an increase in the demand for search engine marketers by companies of all stripes “ever since Google revolutionized the way that people advertise through AdWords.” Quest’s Mires says that she gets a lot of requests for search marketers – especially for people who have established relationships with Yahoo, Google, MSN and have lots of online consumer experience.

Chris Raniere, CEO of Revcube, a software provider for multichannel online ad campaigns, says that the hardest job for him to fill is for search marketing. He says that anyone with more than six months of experience working with Google and running campaigns is very hard to find.

And recruiter McClure agrees: “People with big-scope experience from Yahoo and Google have their pick of positions because all of the Fortune 500 are doing search now.”

Coremetrics’ Paolucci says that experienced search people will get harder to find. A 2006 Coremetrics survey asked 120 marketing professionals in the U.S. and the U.K. about the methods they used to reach customers. It found that 31 percent of respondents think SEM is the most important skill in their current role and 60 percent of respondents feel that SEM skills have become more important over the past two months.

Data from MarketingSherpa’s Search Marketing 2007 Benchmark Guide finds that SEM professionals with zero to one year of experience can command $55,000 to $75,000 and those with three years of experience can get $80,000 to $100,000. Mid-level managers with SEM experience of just one year can fetch $85,000 to $100,000 and those with three years of experience can command $110,000 to $125,000.

Converseon’s Schwab says she can find junior-level people out of college with one year of Internet experience and hire them as account coordinators in their search group for approximately $40,000.

HIRING FOR AFFILIATE MANAGERS

Others say it’s much harder to hire affiliate managers. “Hiring for search employees is competitive but easier than hiring for affiliate managers,” Schwab says, explaining that it is the hardest position for them to fill because the skill set is so broad – including coding, graphics, communications and affiliate relations.

Three years ago, affiliate management was a one- or two-day-a-week job but today it’s a full-time job, according to consultant Shawn Collins, who does some outsourced affiliate program management. He says that hiring for affiliate managers “has been difficult for as long as I can remember” and says it is because the job requires experience and relationships, which take time to build.

Consultant Andy Rodriguez agrees that hiring an affiliate manager is challenging because the person has to wear many hats. He says that out of the 12 people he has hired, only two of them have worked out. “They were overwhelmed – it’s difficult – it is not a straightforward job,” he says. Rodriguez says that he spends 20 to 25 percent of his time reading during the week to keep up to speed on the industry.

LinkConnector’s CEO Choots Humphries says the qualities LinkConnector looks for in an affiliate manager include someone with a technical background so they can walk affiliates and merchants through code; the ability to communicate well in writing and speaking; strong analytical and problem-solving skills; and they must be smart enough to understand that the affiliate management industry is fluid and constantly changing and they have to want to keep up with it.

Humphries says being located in the highly educated population of Research Triangle has helped their hiring efforts. In addition to using staffing companies like Manpower and job sites like Monster, LinkConnector hired a full-time director (now LinkConnector’s COO) to be responsible for staffing their merchant and affiliate relations department. Humphries says this was key to their success in staffing because it is very difficult to convey the requirements of the job to someone outside the company – an in-house staffing person was “in a better position to know exactly what qualities would work well within our network and industry.”

Humphries says the company has hired 20 people and only two have not worked out because of the demanding and fast-paced nature of the industry.

Justin Johnson, affiliate manager at SierraTradingPost.com, looks for affiliate managers who have great communication skills, are enthusiastic and self-motivated. He says the technical aspects of the job can be learned. Johnson says his company has been able to find the majority of its personnel in the Cheyenne, Wyo. area, with some people willing to have a longer commute from Fort Collins, Colo., or Laramie, Wyo., which is 51 miles away.

Schwab notes that for senior-level people with affiliate experience, it is very hard for Converseon to hire because they have to compete in New York City where there are others like LinkShare and CPA organizations such as Azoogle and Neverblue, as well as tons of agencies and merchants.

One remedy for hiring affiliate managers is to outsource, a trend that consultant Collins anticipates will increase. Collins worked as an outsourced affiliate manager for Payless Shoes from 2001 to 2006 because of the limited pool of talent in Topeka, Kan., where Payless is based.

Most-visited Vertical Job Search Engine Websites A lot of the bigger brands outsource affiliate managers to agencies such as NETexponent, Converseon, PartnerCentric and Pepperjam. PartnerCentric’s CEO Linda Woods describes why outsourcing is popular: “Companies need an affiliate manager, so they run an ad on Monster.com. They can’t find talent in their town. They come to PartnerCentric. They don’t need to hire people, pay salaries, pay benefits or train people. We do it for them. The arrangement could go on for years.”

WORD OF MOUTH

It seems every company in this industry believes that word of mouth is the most powerful way to find top-shelf candidates.

Coremetrics’ Paolucci says, “The No. 1 way we find people is through referrals – there is a network out there.” PartnerCentric’s Woods adds that a lot of their employees encourage other people to join. Schwab says that Converseon’s best hires are always word of mouth and that the last senior-level affiliate they hired came through a referral.

In November 2006, The Conference Board, which follows business cycle indicators for the U.S. and eight other countries, found that almost half of all job seekers (49.2 percent) rely on word-of-mouth leads from friends, colleagues and other people in their personal network to find jobs. In fact, 27 percent of employers found their jobs from networking.

JOB SITES

Another method is the job boards, which are growing in popularity. In fact, in the first week of 2007, employment seekers increased job search Web traffic by 31 percent, according to market researcher Hitwise. Among the top employment sites for the first week of January were CareerBuilder with 13.73 percent; Monster with 11.51 percent and Yahoo HotJobs with 5.3 percent.

Schwab says Converseon has not found people through Monster or Yahoo because they are too broad, but do use MarketingSherpa, MediaPost, craigslist and Shawn Collins’ AffiliateManager.net for affiliate marketing positions, which PartnerCentric’s Woods uses as well.

Increasing in popularity is a number of niche job sites such as the aggregator site Indeed.com, Dice.com for technology jobs and some industry-specific sites such as OnlineMarketingJobs.com and its sister site JobsInSearch.com.

Hitwise reports significant increases in market share at vertical job search engine sites. Visits at Indeed zoomed 302 percent and Jobster’s share jumped 355 percent from July 2006 to January 2007.

Other sites that are changing the way people look for jobs are the social networking sites such as Jobster and LinkedIn. These sites enable companies to find passive candidates – those who aren’t looking for a job, but are interested in hearing about new opportunities.

Staffing firm Aquent uses Jobster to build online networks of contacts within the marketing community – it is a way for them to manage passive candidates and referrals. Jobster posts user-generated content by those who come to share their experiences – so employees reveal the real scoop on companies.

Many recruiters, such as Castillo, use LinkedIn on a daily basis because it is a good single resource. He says the personal information is updated and correct and consistent in quality across the board. Heidi Perry, vice president of marketing at gaming publisher PlayFirst, says her company found other candidates from LinkedIn and is trying it for an online marketing associate position because “online marketers tend to run in circles.”

LinkedIn’s subscriptions for accessing people outside of one’s personal network cost $20 per month. Big corporations, such as Microsoft and Salesforce, pay between $10,000 and $100,000 annually to let their internal recruiting staff use LinkedIn’s database for potential hires.

GOING VIRTUAL

Some companies are venturing into the virtual world of Second Life, which has grown explosively and is inhabited by more than 2.9 million people from around the globe. AKQA, a global marketing and technology services company, says that it will use Second Life as a hub for recruiting because they believe that the Second Life community is full of early adopters and trendsetters, which are the type of people they want to hire.

As the economy continues to bubble along and online marketing becomes ever more desirable, it will be important to watch if the supply of online marketers keep up with demand.

PartnerCentric’s Woods thinks it will: “There is more talent than there used to be. When I started my consultancy four years ago there were times when sales were exceeding the capacity to service them and it was quite a juggle finding experienced people.” But Woods says that is in the past. Now Woods thinks there are more affiliate marketers around in general, and because affiliate managers can work remotely there are more candidates to choose from nationwide.

Tracy Cote, executive director of human resources for the agency Organic, says that the market is hotter but they are receiving more applicants – she has seen a 65 percent increase in resumes from November 2005 to November 2006.

“Certainly more people are training as affiliate managers as more programs come online. But if the growth of programs continues, there will continue to be a shortage of qualified people. It’s a bit of a vicious cycle,” Converseon’s Schwab says.

One source of online marketers are the former Google employees who are reportedly leaving because they feel limited and restless in their jobs (and many received huge payouts and stock options when the company went public). This could be a tremendous source of talent although these smart people may start their own companies.

In just a few years, the face of the recruiting process has changed considerably. Niche and social networking job sites have dramatically altered how companies find talent – the pool of contacts has drastically widened and the days of reviewing resumes to learn an individual’s work history and level of education are disappearing. Today recruiters can “Google” an applicant’s name to find out if they are who they say they are and candidates can place on their resume a URL that links to campaign examples of their work.

Learning Outside the Box

Many of today’s online marketers have unrelated backgrounds and have learned their profession through on-the-job training and supplemental offerings.

The situation is similar to the first iteration of marketing on the Web in the 1990s. But unlike 10 years ago, there are more ways to learn and get information such as webinars and online courses; enrichment classes such as weekend training, conferences and boot camps; countless websites; and dozens of books and videos.

Because online marketing has become a bona fide career path, it seems reasonable to expect that university business schools would be offering undergraduate and graduate students a specific online marketing course or devoting a lot of time to its importance. But that’s not necessarily the case.

Over the last several years Choots Humphries, co-president of LinkConnector, an affiliate marketing network, has been a guest speaker at an M.B.A. program at a university on the East Coast where he addresses the incoming first-year grad students regarding online marketing. He has been “dumbfounded” at the lack of understanding of basic concepts. “They don’t know what AdWords is or what a merchant is,” Humphries says.

And he’s surprised that these new business school students know so little about such an important part of the economy. After all, according to Forrester Research, online retail commerce represents about 10 percent of total U.S. retail sales, and it is expected to grow to 13 percent by 2010. That begs the question: Are universities teaching the basics about such a vital aspect of commerce, or is online marketing still the domain of specialized education?

1. College 101

At the University of San Francisco’s Masagung Graduate School of Management, courses in finance, management and accounting all include readings and case studies that describe the impact of technology and online marketing in that discipline, according to Associate Dean Eugene Muscat. He believes the concepts of online marketing have achieved the same academic critical mass as the study of globalization and ethics and says that these three subjects should be included in each course of study as essential business literacy skills.

Muscat says USF does not teach a separate online marketing course because “to have a separate course in online marketing would run the risk of implying that the topic is only relevant to students majoring in marketing.”

Heidi Perry, vice president of marketing at gaming publisher PlayFirst, who graduated with an M.B.A. from Oxford University in 2004, says she took a marketing elective that had a section on online marketing. Perry thinks that certain graduate schools will eventually offer an online marketing course as an elective, but most schools will try to combine online marketing with other topics to give a candidate a more holistic view.

Although the University of Texas’ McCombs School of Business does not offer a specific online marketing course, Andrew Whinston, director of UT’s Center for Research in Electronics, says it makes more sense to teach entrepreneurship because the Web moves extremely fast.

“Think about how much the social networks have impacted online marketing just in the past year ” and if you look at some case studies of Internet companies from three years ago, it is like teaching history,” Whinston says.

However, there are many non-degree programs for learning about online marketing that are geared for people who want to enter the profession. Recruiters, such as The Creative Group, are encouraging traditional marketers who are trying to get into online marketing to take such courses to round out their skills and increase their marketability, according to Smith McClure, division director of the Minneapolis branch of the company.

NYU’s School of Continuing and Professional Studies (SCPS) offers dozens of non-degree marketing courses that can be applied toward a certificate in digital marketing. In the fall of 2006, consultant Shawn Collins was brought in to guest lecture at SCPS’s eight-week Strategic Search Engine Marketing class and gave a top-level overview of how affiliate managers should run programs. Ben Kirshner, founder of New York-based Elite SEM, taught the course and says that the students were extremely enthusiastic because they could apply the tactics they learned in an evening’s class to their jobs the next day.

Because Google sponsored the class, students were given a $50 credit to set up an AdWords account to learn how it worked, and were given the opportunity to take the Google AdWords professional exam for free, which is normally $50. Some of the students were able to put on their resumes that they passed the exam, a leg up for those who are applying for jobs at Google or Yahoo or an interactive agency. Kirshner says the class encompassed a mix of people – some were employees of companies who sent them there so they could better understand how to manage their online campaigns.

2. On the Company’s Dime

Many companies offer their employees online marketing training – through classes and in-house sessions – because of the shortage of qualified online marketers and because the industry changes so fast. Michael Taylor, founder of OnlineMarketingJobs.com, says companies hire people with existing account management skills and then train them for the online marketing techniques pertinent to their company.

So how do companies teach online marketing skills to their employees? PlayFirst’s Perry says that her company balances formal with informal training, and it does a lot of its training through group collaboration and brainstorming. The company also tries to send each marketing employee to the conference of their choice every year.

Dean DeBiase, CEO of Fathom Online, a search marketing and Web analytics company, says they are obsessed with training and view it as a strategic weapon to keep up with the constant changes made by Google, MSN, Yahoo, Ask.com and MIVA. Fathom Online offers two types of training – a 60-day, in-person training program for new recruits and ongoing training through modules to train employees on the latest topics such as analytics, in-game advertising and mobile search. This training is deployed through voice conferencing, video conferencing and WebEx.

Bob Chatham, senior vice president of education at WebSideStory, a provider of on-demand digital marketing applications, says that its employee and customer training program, Digital Marketing University, is a three-day course that teaches WebSideStory’s HBX analytics and Visual Site applications, which help marketers to optimize their search campaign by seeing how their paid and organic search terms are converting.

Chatham says he has seen courses relevant to digital marketing offered through e-commerce programs at schools including Babson College and Northeastern University – both in the Boston area – but has not seen any semester-long Web analytics courses. He notes that there are strong professional training programs on the subject such as one at the University of British Columbia.

3. Learn From the Masters

Chatham stresses that a lot of the good practical expertise lives with the consultants, such as Jeff Eisenberg and Bryan Eisenberg from Future Now; Gary Angel from SEMphonic; and Jim Sterne, who created the Emetrics Summit. Chatham notes that these same experts who speak at the University of British Columbia’s programs also speak at WebSideStory’s Digital Marketing University and other industry conferences. “I think the best way to get up-to-date information and the best training is through industry expert workshops,” Chatham says.

Attempting to fill a knowledge gap, Aaron Kahlow, managing partner of Business OnLine, created the Online Marketing Summit, which was held in San Diego in February. “I have spoken at many conferences including Ad:Tech and the DMA Conference and I am always surprised at how little industry folks know.”

He says that other industry conferences do not offer training or improve attendees’ understanding. He says they are all “either too technical or all about the future and predictions. This is great for investors but how does that help a tactical day-to-day marketer?”

Kahlow says that the industry needs to focus on education. “We are just getting to a point where best practices are established and the amount of change is slowing,” he says, adding that the most popular sessions at his show include workshops on search engine marketing and performance metrics.

However, if you want to be an affiliate marketer, formalized educational avenues are very limited. Stephanie Schwab, vice president of marketing at Converseon, thinks professors are in their ivory towers and are not aware of affiliate marketing. Consultant Andy Rodriguez says that he is surprised to not find any colleges teaching affiliate marketing in southern Florida. Consultant Colin McDougall has had similar findings in his area of British Columbia. But Rosalind Gardner says she is aware of a professor who was using her book, The Super Affiliate Handbook, to teach affiliate marketing in his university class.

The most convenient and least expensive way for newcomers to get their feet wet is to read the many websites, blogs and forums (message boards) related to affiliate marketing. “The best place that I have learned about affiliate marketing is from the community at ABestWeb.com,” says Kristin Collier, founder of MadHatter Consulting.

Consultant and author James Martell cautions that those looking for information must rely on credible sources such as the websites of Commission Junction and LinkShare, along with forums including http://affiliate- blogs.5staraffiliateprograms.com/ and AffiliatePrograms.com. Martell warns that forums can be good and bad because “they can take you down the wrong path” and says it is important to follow a person who is an affiliate and not just a writer.

McDougall says that there is a ton of “how-to” books on the market for teaching affiliates how to earn a living but warns that many of the “silver bullet” books sold teach how to manipulate holes in the Google algorithm, which can quickly become out of date. For this reason, Gardner says that her book is updated almost monthly and “every so often I offer previous purchasers a totally updated version of the book at a steep discount.”

4. Mentoring

McDougall recommends that affiliates find a mentor; a practice that he believes will become more popular in the near future. He says there a re some Internet and phone-based seminars today, but very few provide individual attention, and explains that assisting an affiliate in devising an individual plan of attack is very helpful – “some people struggle with time management while others struggle with technical issues.” McDougall says that he provides some complimentary mentoring but mainly it’s a paid relationship. Gardner says she has never participated in a mentoring program although she has done telephone consultations, which she calls short-term coaching.

5. Podcasts, Training & DVDs, Oh My!

Podcasts are a good way for people who haven’t quit their day job yet to learn about affiliate marketing. And there are plenty to select from. On WebmasterRadio, there is Good Karma by Greg Niland; Affiliate Marketing Today by Jeremy Palmer and Robin Walsh; and Net Income by Jeremy Shoemaker. Affiliate Thing features Revenue’s Lisa Picarille and consultant Collins on WebMasterRadio.com.

For those who want more interaction, Martell recommends videos. He has an eight-video program that corresponds with the eight steps outlined in his book, Affiliate Marketers Handbook. Anik Singal’s The Affiliate Classroom is a Web-based step-by-step training program to help people launch and grow their own affiliate Internet business. It reaches over 35,000 active affiliate marketers through its magazine and newsletter and is in the business incubator program at the University of Maryland. Another popular training program, Stomper Net, is offered by Brad Fallon and Andy Jenkins, and comprises DVD training and an online forum.

Nearly all industry experts recommend attending as many conferences as possible such as the twice-yearly Affiliate Summit, WebMasterWorld and e-Tail; along with the invite-only network events such as CJU and the LinkShare Summit.

“Affiliate marketing is an extremely social industry and we learn from each other. It is good to sit down and have face-to-face conversations with affiliates, managers and merchants. The sessions can be valuable as well,” MadHatter Consulting’s Collier says.

6. Experience vs. Classroom

Affiliate manager jobs are in high demand – so how can they obtain the training they need to do the multifaceted duties required – everything from HTML to creative to sales? Most think it is a learn-by-doing job. For one reason, managers need to have established relationships. “It is not about an M.B.A., but a person who can pick up the phone and leverage their contacts,” says Shawn Collins. Also affiliate managers need to understand “in the trenches” challenges like how they stack up again their competitors in terms of metrics like conversion rates, average order sizes and earnings per click. And most employers want to hire managers with specialized skills – and techniques learned in formal training can be too broad. Moreover, Converseon’s Schwab says that many classes only teach strategy and not tactics and “we need to hire people who can do the job.”

However, a background in marketing is helpful and there are aspects that can be taught in a course such as how the networks operate and the fundamentals of how to recruit, how to activate and how to retain affiliates. Still, PartnerCentric’s Linda Woods says that there is no way she would hire an inexperienced affiliate manager: “I wouldn’t hire anyone just because they took a couple of courses on Internet marketing.” She believes managers need on-the-job training and the training that is offered through seminars.

7. Affiliate Management Seminars

Industry experts like Rosalind Gardner recommend attending conferences such as Andy Rodriguez’s Affiliate Manager Certification Seminar and Anik Singal’s Affiliate Manager Boot Camp to learn affiliate management skills.

Rodriguez’s program is a three-day course and attendees are certified upon completion. Rodriguez and guest speakers teach attendees about formulas that work and promotional ideas as well as warn them about potential pitfalls such as identifying spyware that could affect program performance.

In 2006, Singal had a four-hour, in-person boot camp the day after the Affiliate Summit and he plans more for the future. Like Rodriguez’s program, it was created in response to demand by merchants who needed managers for their programs. Singal says that the attendees include new merchants who are trying to get in the game, merchants who are trying to fix their programs, affiliates who want to be managers and managers who want to improve their abilities.

8. Looking Ahead

Currently there are many options to learn about online marketing that fit into everyone’s schedule: You could attend a weekend boot camp, listen to a podcast on the way home from work, pop in a video on Saturday morning, watch a webinar during your lunch break or find a mentor to walk you through a challenging process.

Most university programs only touch on online marketing as part of entrepreneurship but do not teach it as a separate course for several reasons. One is that the industry’s fast pace has challenged the development of an up-to-date curriculum, which is needed to add a course to a degree program.

Another is that the real industry knowledge lies with the experts, who are busy leading companies and are limited to speaking and teaching at conferences and workshops. Some think that college professors would have trouble keeping abreast of this constantly evolving industry; although if the changes slow down and best practices are established, this may change.

Perhaps most importantly, it is all about up-to-date training: Employers desire employees with tactical online marketing skills from real-world experience, and they would rather hire someone who was trained through last month’s professional training program than someone who studied affiliate management as part of an undergraduate degree in marketing three years ago.

It’s all about training and educating the future generation of online marketers so the space can continue to grow and flourish.

How Do Companies Train Affiliate Managers?

Converseon starts by having new employees review hundreds and sometimes thousands of affiliate sites for approvals because Converseon does not do auto-approvals. The new employees examine sites to determine if they are good – how they are designed, to whom they link and how they are promoting their competitors. Vice President Stephanie Schwab says they encourage their employees to read industry blogs as much as possible, like Scott Jangro’s, Shawn Collins’ and ABestWeb. She likes to send employees to conferences like the Affiliate Summit, so affiliate managers can understand the business from a macroview, and to webinars like eComXpo because of its convenience.

PartnerCentric’s Linda Woods says that they train their employees for PartnerCentric processes, reporting and practices through weekly telephone conference calls among the account managers and staff of approximately 25 people. “Once a month, we have a training call where they are learning something like a new way of reporting to a client, a new activation campaign idea or a new technical tool that we will be using.”

Kristin Collier, former director of marketing at Batteries.com, credits consultant Andy Rodriguez with helping her become a successful affiliate manager. She is now the owner of MadHatter Consulting.

Q: How did you meet your mentor, Andy Rodriguez?

A: I actually met Andy virtually at first on ABestWeb.com. Batteries.com had recently opened a program on ShareASale due to LMI (link management initiative) and I noticed a thread on ABW about newsletters on ShareASale. Andy was hinting at a hidden secret about how to make these newsletters powerful so I sent him an email and he passed me a little information.

This was shortly before the Orlando Affiliate Summit in 2006, which is where I met him in person for the first time. I spent some time with him and many others, and asked as many questions as I could and then he offered to mentor me. I learned a lot from him in a very short amount of time and we still trade emails.

Do you think mentoring is important to this industry and do you think it is common?

A: I think mentoring is somewhat common. I know a few affiliates that mentor other affiliates if they see the passion, drive and thirst for knowledge in them. Andy is not my only mentor – other affiliates mentor me so I can learn more about PPC or about being a manager. I also help other affiliates and merchants learn the skills of good affiliate marketing and online marketing.

Do you think mentoring is mostly unpaid or paid?

A: When I think of mentoring, paid is not something that comes to mind. I do teach my clients about affiliate marketing but I am not mentoring them, I am consulting with them. Mentoring to me is taking the time out of your day to help someone else who truly wants to learn something that you know well, just to help them succeed.

Fair Play: Q & A with Kellie Stevens

Kellie Stevens is the president of AffiliateFair-Play.com, which is committed to providing a better understanding and interpretation of the behaviors that impact the affiliate marketing space. Stevens’ goal is to create a fair and competitive marketplace, and she does this by focusing on the actual behaviors – not the technologies – leading to unfair competition and abuse in the marketplace. Her tireless efforts, which started in 2000, have won her the respect and affection of many in the industry as well as the ire of those who are looking to skirt ethical practices. Regardless, Stevens vows to continue her mission to provide the community with resources for striving toward fair practices in affiliate marketing.

Lisa Picarille: What motivates you to find out who is using adware or acting in an unethical manner?

Kellie Stevens: Many of the behaviors I research and document go beyond just ethics. They are behaviors which I strongly feel impact negatively on the affiliate marketing channel as a whole. Affiliates who are automatically redirecting the merchant’s own traffic (both organic and paid traffic) as their own commissionable traffic, devalue the channel overall. Affiliate links showing extensively in adware security companies have deemed that security risks have contributed to blocked affiliate links and tracking cookies flagged as security or privacy risks. This impacts on everyone. Those are just a couple of examples. It’s the overall impact on affiliate marketing, from a business perspective, that is my main motivation.

LP: How did you get started pursuing those exhibiting bad behavior?

KS: Back then there was very little information available. Security companies weren’t researching these adware companies and their software. You couldn’t go to a security site and search their database. Only a few people were even talking about how some affiliates were driving sales and revenue. So I installed a few applications to see for myself. I began talking about what I saw in the community. The day came when I had a couple of applications installed on my computer and I went to my e-commerce site checking on a customer issue. When I got to my shopping cart, I received a pop-up with a blatantly false message encouraging the customer to buy a product from the adware company. That was very personal. I contacted my State Attorney General’s office and found out they knew very little about adware, but they wanted to hear more. I talked with them about six months later and they had a much better understanding; they didn’t like the practices at all but felt there were no existing laws in place to prosecute. Things gradually evolved over time as I continued testing for myself to understand what was going on out on the Internet and reporting back to the community on a somewhat ad hoc basis.

LP: How much of your testing is done without being paid?

KS: When I first started, and for quite some time, it was all done for free. As the demand for the information and my expertise grew, I gradually increased the amount of time I spent doing research and reporting. I’m now doing this full time, so of course it’s not all for free now. I still try to balance my time, providing some amount of information for free because the issues are too important to the industry. I haven’t sat down to put numbers to how much of my activities are devoted to free content and revenue-generating information.

LP: How much is consulting? And do you work with the big networks? If so, how often?

KS: I do private consulting as well as the subscription service through AFP. But again, I haven’t sat down and put numbers to the time (hour-wise) I devote to each area. I know I put in a lot of hours each week because there is always something that needs addressing.

I don’t disclose my clients’ identities for confidential reasons. I will say that over the years I have had contact and dialogues with all the major affiliate networks to varying degrees, whether that contact was paid or otherwise. I always welcome the opportunity to discuss the issues facing the industry, whether I completely agree with the points of view or not. I have always appreciated when the networks have approached me asking, “Kellie, what do you think about”?” Dialogue is extremely important if constructive change is to happen in the industry.

LP: Why do you think that there are individuals like yourself who pursue adware folks, but that there are no formal entities to police these rogue behaviors?

KS: There are probably many reasons. The idea of some type of formal entity has been brought up several times. It’s something I’ve had requested of me on numerous occasions. In fact, I am continuously educating people that AFP doesn’t do any type of “certification.” The largest stumbling block to having some type of formal entity is probably the fact that as an industry we have yet to come to a universally (or close to universal) accepted agreement as to what behaviors are and are not acceptable. You have to define what you will be policing before you can police.

LP: You are performing a very valuable service for the industry, yet you seem to maintain a low profile. Why?

KS: I don’t think I maintain a particularly low profile. I am out and about in the community. I don’t use my research findings to just sensationalize and garner PR for myself. I think the information is too important to dilute with such tactics. And doing so marginalizes my ability to bring about change towards more fair business practices in the industry.

I have found that I have been more able to achieve change by working quietly “behind the scenes” when it comes to specific issues/incidents at times. My ultimate goal has always been, and remains: changes in certain policies and practices in the industry.

I am focusing more of my energies in 2007 towards educating the community on issues related to adware, so in that sense people will probably be “seeing” more of me.

LP: Are you ever worried that these adware firms will retaliate against you?

KS: Anyone doing this kind of work should be cognizant of such possibilities. I have spent quite a bit of time over the years cultivating the way I both approach my work and present the information to minimize those types of risks. Ultimately, I want to be spending my time doing my research and providing information to the community, not dealing with retaliation tactics, legal or otherwise.

LP: And how do you protect yourself from this potential pitfall?

KS: I try to use common sense along those lines. That means being able to support what I report and staying clear of approaching matters in a way that is viewed as just being inflammatory. My goal is to be able to provide people with objective data and information from my research. So far, this approach has served me well.

LP: What’s the best part of doing your job?

KS: I probably have to say, when I see positive change happen. When I see a merchant or network change their policies or implement internal mechanisms to better catch bad behavior. When I have an affiliate come back and tell me their conversions (and revenue) have significantly increased after they took action on information I provided them. Or when a merchant tells me they are showing higher growth and ROI/ROAS in their affiliate channel based on the information they received from me. At the end of the day, that’s what it is all really about and makes the hours in front of the test computer worthwhile.

LP: What’s the worst part?

KS: I don’t know if I would call them the worst part, but there are some things that I find frustrating.

I find there is still quite a bit of misinformation and old information out there. I see people making [what appears to be] business decisions based on the inaccurate information.

I become very frustrated whenever I hear people say, “I don’t like the practices, but there’s not anything I can do about it and it’s just a cost of doing business.” In my honest opinion, that kind of apathy just encourages the bad behavior. There are many things that could be done within our industry to combat the bad behavior. It’s a matter of being committed to doing what can be done. And to say it’s the cost of doing business is devaluing the affiliate channel.

I really become frustrated when I see companies using anti-parasite policies, compliance and fraud detection as primarily PR spin to market their business, when in reality they are eyeball-deep in the relationships. People shouldn’t believe everything they read, but rather, engage in due diligence in understanding the business models/practices of those they partner with.

LP: What’s the most misunderstood element of dealing with adware?

KS: That could probably be a full article by itself; there are so many. One is that it is easy to monitor all of the potential bad behavior out there. It isn’t by a long shot. Could the industry as a whole be doing better? Yes, but that doesn’t make it an easy task. I remember catching wind of a particular application that I wanted to test. It took me two years to finally track down a copy of the software to test. When I did, they were using quite a few techniques to hide the fact from networks and merchants that adware was involved. Programming has become much more sophisticated, allowing adware to “hide” itself more easily from the end user (that it is even installed). And distribution methods have become more stealthy and sneaky as well.

A more global, or big picture understanding of how adware is operating within online advertising as a whole is still not fully understood by many, nor are all the different ways it can impact upon online businesses and affiliate marketing in particular.

There are still many misconceptions about the very basics of how adware functions. I still hear people talking about adware replacing their affiliate links on their websites, and their implementing programming on their site to prevent this. But the majority of adware does not even do that. In fact, some of the “protective coding” they implement could actually put their traffic at higher risk for interception by certain types of adware.

LP:What percentage of commissions do you estimate are lost to the bad behavior of adware?

KS: Lost to who? Affiliates, merchants or networks? All three happen now. There are also many ways a commission can be “lost.” Some of those ways are very blatant and obvious, like the automatic overwriting of an affiliate link by adware. Other ways are less obvious, like lost traffic or redirection into another advertising channel.

I don’t think anyone knows the exact dollar amounts, in truth. I’ve heard speculation of anywhere from 5 percent to over 40 percent of revenue in the affiliate channel attributed to adware. I’ve seen reports which put total revenue for adware, which included all advertising channels and other means adware companies have of generating revenue, at anywhere from $2 billion to $20 billion a year.

The problem with coming up with hard data along these lines is knowing all the adware players and those using adware [i.e., third-party ad buys]. Security companies face an ongoing battle detecting adware applications on the end user’s computer. Most adware companies are privately held, so their financial information is not public knowledge. Others operate outside of the U.S. When you start factoring in very rogue players and the world of botnets, the picture becomes extremely cloudy.

I think most agree that there is a significant amount of online advertising dollars that end up flowing through adware coffers.

LP: What is the future of adware? Will it ever be wiped out?

KS: Adware is here to stay. You don’t put the technology genie back into the bottle. As with all things related to the Internet, what we will see is the way in which adware is behaving and playing on the Internet. This has been the case so far as well.

LP: Who should be responsible to help in this fight? The government? Merchants? The networks?

KS: I think everyone is responsible to varying degrees and in different ways: affiliates, merchants, networks, consumers, regulators and adware companies themselves. Whenever there is a lot of money up for grabs, as there is in online advertising, there will always be people out there who are willing to use unscrupulous tactics to get their hands on some of the dollars. It’s unfortunate that adware has become synonymous with such tactics. My dream is to see the industry become more proactive on addressing the issues surrounding adware and being less reactive primarily when the stuff starts hitting the fan.

More Ways to Search

Search powerhouse Google has ascended not only to the No. 1 starting place for most Web searches, but the name has become part of the popular consciousness, even spawning the use of its name as a verb. To Google is to discover the globe.

That’s all about to change and the world of search is about to bust wide open.

Not to say that the top three search engines – Google, Yahoo and MSN – will topple. Far from it. But there are search technologies that have recently launched and some just on the horizon that aim to give searchers new ways to find what they want, especially in niche areas.

The recent growing popularity of video search and search via mobile phones are just the beginning of innovations to come. Some predict that search by image, natural language search and search by speech are the next improvements to the search experience.

As sophisticated as Google is at what they do, it is still an engine that relies on text – text is matched with text and results come from weighing the quality of the potential matches with the text you submitted. And there is slowly growing dissatisfaction with the relevancy of search results. A survey by Outsell stated that “search failure due to irrelevant results” of Google users grew from 28 to 30 percent in the last two years.

Start-up companies have perceived an opportunity to look beyond text search. And some companies believe they have novel methods for using text search to get more specific results.

Beyond Text

Moving completely away from text, Riya – based in San Mateo, Calif. – recently launched Like.com, what it calls a visual shopping search engine. The engine recognizes likenesses – in faces and in clothes, shoes and jewelry – based solely on visual cues. “In some cases words work just fine for search,” says Riya CEO and co-founder Munjal Shah. “But take a tie or jewelry pattern. There are things [for which] words fail us. We introduce the photo as your search start.”

Riya isn’t just going to help you shop for clothes. Using their technology will help families with Flickr accounts organize their vast digital photo albums by allowing users to “train” the Riya system to get better at recognizing people photos and to know when similar faces do not belong with your albums.

Perhaps most importantly, Shah says they now have a business model to go along with the cool technology. “Look inside the photo search paradigm,” he says. “The way it makes money is questionable. Face recognition software isn’t going to make much money. But now we have CPA from some merchants and CPC from some merchants.”

Part of their push is to get merchants to upload high-resolution images since better-quality pictures allow Riya to better differentiate the details of a belt buckle taken from a full-body shot.

With this model, Shah says that he isn’t in the business of competing with Google, but rather any other visual search engine to come. “Our belief is that it is too hard to win [with text],” he says. “We want to think off the map. That big of a paradigm shift is needed.”

Right now Riya is sticking with soft goods – a $30 billion sector – but Shah doesn’t rule out furniture, garden or china patterns eventually. He’s decided soft goods are the “beachhead.” They also have a mobile application that is coming soon and right now people can search Flickr photos of people using Riya’s technology.

Shah is thrilled that the technology is regarded as cool, but is continuing to look for revenue streams. “I’ve changed strategies once; I’ll change it again,” he says.

No Searching in Tongues

Still in extreme beta but looking to launch a public beta in 2007, Powerset, based in Palo Alto, Calif., is a natural language search engine. Barney Pell, CEO, sets it up like this: If you put a stream of text into a search engine, the engine will only find the same characters, he says. “It forces people to do their work on the computer’s terms. You have to figure out what the right terms are for your search.” He says that you are out of luck if you use the words in the wrong way.

Pell says, “Natural search is a complete mess.” You spend a lot of time just trying not to be a spammer, he notes. “The sites that are winning are not the ones that have the best message or solution.” He says the Powerset engine reads all Web pages and matches all words for context, not just keywords. “It can tell the difference between optimized search engine babble and content,” he says. He adds that a ranking on Powerset will rise by focusing on the quality of your site.

Marketers, he says, will love it because advertisers won’t have to anticipate the words people will use. Pell says that for Hawaiian handbags, for example, a user may type in “Hawaiian bags” or “tropical bags” and still not find what they want. “There’s a whole industry around trying to guess the right words and at what price,” he says, adding that with Powerset, marketers won’t have to get up every morning and decide which words to buy that day.

Early adopters will get dramatically better results, he says, because the public beta will probably involve a tool where you can submit according to organized categories and submit to the engine in advance. This way, users can help define the context before the engine officially launches.

Making Search a Snap

While some technologies are focused on the back end, others want to change how the users view search results. Launched in the middle of 2006, Snap.com wants to take advantage of the pervasiveness of broadband to bring the user a more detailed search experience. The Snap.com search engine essentially gives users home page preview panes for the text results when they plug in a search term. Users can rate the relevancy of each result so that the engine gets to know how to better serve keyword results.

“Our search isn’t for everybody,” says Snap CEO Tom McGovern. “We’re not trying to out-Google Google or out-Yahoo Yahoo. Savvy users like the preview feature and it gives us recognition.”

The visual results are meant to make it easier and faster to get to the right information. McGovern says Snap offers a different kind of advertiser experience as well, with a “risk free” CPA pricing model. Advertisers pay only for a predetermined action such as a sale, a lead, a download or other user engagement. The advertiser dictates the desired action and agrees to pay either a fixed rate or a variable percentage. Advertisers also choose the landing page or creative so that they pay only when they get the action and not on clicks. Click fraud is reduced this way. McGovern says their CPA model will be the standard in five years.

When users enter a search word in the field, a list of popular search phrases using your term is already populated in a drop-down window. The preview home page images are not screenshots from last week, but fairly up-to-the-minute captures, which comes in handy when cruising for news sites or video sites (the images are about a quarter of your monitor’s screen – big enough to read larger newspaper-headline- style type but not much else).

Snap – owned by Idealab – has an image search function as well, which still relies on title tags and not visual similarity, but the results are presented in nice thumbnail sizes that scroll horizontally. The site has also launched its Preview Anywhere function that offers blog visitors a preview of hyperlinks.

Other interesting features include the ability to type “movies” with a colon and a search term and it finds that term on the Internet Movie Database. Also, “fact” plus colon and search term brings up Wikipedia, and “define” plus colon plus search term brings up the Dictionary. com definition. With slight variation these features are also in Google except for the Wikipedia element.

“We want to win with the end users,” McGovern says. “They come to us because they like the technology.” He says they know they are not going to displace Google. “We want to be the secondary search engine of choice.”

The Human Touch

Helping users find exactly the right thing from their search is what motivates all these start-ups. ChaCha.com, currently in beta, is no different, but it approaches the problem from a less-technological angle.

ChaCha.com uses human guides to help users find results. Search queries are sent to “a staff of experts” who then chat with the user to help narrow the search. Users do not have to use a guide. They can use the search field just like Google, but the results are custom- culled based on the index of questions that have been asked thus far, so the more questions the guides receive and the longer the search engine exists, the better it gets.

“The vast majority of people do not go past the third page of results,” says Scott Jones, founder and CEO of ChaCha.com. That means, “people never look past the top 30 results even though the top search engines are theoretically returning thousands or millions of results. Therefore ChaCha’s model of returning the very best results on the first page is vital. Users don’t really want millions of results in a split second. They want the answer as quickly as possible.”

There is still plenty of technology at work on the back end. In its first year, ChaCha.com filed 18 patents. Jones was also the brains behind Boston Technology, where he invented a voice mail system that is basically the telecommunications standard, and built Escient, now known as Gracenote, the music recognition software that is used by nearly every music-ripping program and MP3 player on the market.

ChaCha.com has grown its workforce to 25,000 in its first four months of operations, signaling that the company plans to play it big. “Obviously,” Jones says, “when a search company achieves a $100-plus billion market cap in less than a decade, it creates a lure for all those who think they can do it better,” referring to Google. However, he notes, competing with Google is probably not a smart move. “Actually, we consider ourselves a collaborator with Google,” he says. “We are happy to have them around. And we’re happy to have all the other thousands of deep repositories of information that Google doesn’t even know about.”

ChaCha is free and gets its advertising dollars no differently from first-generation search engines. Because of the “very targeted keyword handling,” advertisers, Jones says, can get much better bang for their buck. The site also has its ChaCha Underground, a kind of social site where users and guides can gather together. Targeted display ads go there. Also, it can show targeted video advertisements when searching with a guide.

A Slice of Google’s Pie

While every new search engine touts its originality, many seem to be trading in on the text search market that Google pretty much has cornered.

Some other interesting search variations include Trexy.com, which is a browser toolbar that saves a trail of where users searched and what they found along the way. Users can save the information found so that next time they plug the search term in to the toolbar, it goes right to the page set as the preferred destination – kind of like favorites.

Indeed.com is an engine for job seekers that culls listings from all over, adding more than a million new jobs each week. Users fill in the fields for job title and location and the direct links to the jobs on the hirer’s websites are displayed. And Eurekster.com is built kind of like a wiki, called Swickis, which are search engines generated by individuals and used by groups. The groups then learn from users how to deliver more targeted results.

On the horizon is Jimmy Wales, who started Wikipedia, and his announced venture into a wiki-inspired search engine, but details are scarce at this early stage in Wales’ project.

Everyone is coming after Google, but the search behemoth is not standing still. John Battelle, search guru who wrote the book, The Search: How Google and Its Rivals Rewrote the Rules of Business and Transformed Our Culture, thinks a voice-driven search engine is the next innovation. He says that Google is working on search based on the engine’s understanding of a user’s previous search history “in a way that makes sense.” And while not Internet search, Battelle would like to see a desktop search capability that is intelligent.

What all these new search engines are really offering is a multiple search engine world, where users choose the engine based on what kind of information they need. And observers say that finding an engine that works for each user is about to get easier and easier.

Judi Moore: The Leaper

About Judi MooreJudi Moore is not a super-affiliate. She’s not even sure what that is. She doesn’t see this as a detriment. Being an affiliate is also not her first career. In fact, at 52 years old, she’s had a lifetime of work in the corporate world – in about three industries, she says – only to land back in her home state of Illinois, with six grown kids, husband No. 2, a Schnauzer and a burgeoning affiliate business.

She is the first one to say that she hasn’t really got a plan. She’s a leaper, not a looker, even though her diminutive frame doesn’t scream out that she’s a fighter. Always ready with a quip, her independence and voracious mind more than make up for her stature. Her personal motto is, “Leap and the net will appear.” And that is pretty much what she’s been doing her whole life.

What makes her stand out and helped inform her independent spirit goes all the way back to high school. Before she was even out of her senior year, she received a full scholarship to Brigham Young University in Utah back in the early ’70s. It was a long way from where she grew up in Illinois, but she grabbed her sweetheart, married him and lit out for Utah in nearly the same week. He was a farmer and followed her out there to see what he could do.

By Christmas of that year she and her husband were back in Illinois. Her attempt at higher education was over. As a good Mormon, she knew some of the expectations – get married, have kids, be faithful to the faith. But what she didn’t count on was living in a society that basically devalued her studies – journalism and the fine arts.

What she also didn’t count on was having a husband that abused her and was unfaithful. In 1981, after having three children and moving to Montana for her husband’s job, it was clear that her marriage was also over.

“I’m an independent sort,” she says, “and I swept up the kids and went to town. And felt betrayed. Then he filed for divorce. While there was domestic abuse – I was excommunicated from the church. I was the bad one in their eyes.”

She thought it was more than odd that when she arrived to start school, the reception was chilly. “I never expected to be looked at funny for being the one going to school and my husband working.” While she looks back at that time and calls it a “failure in my life,” the experience taught her a lot about liberty, self-determination, the troubles with blind faith and introduced the notion that “everything that happens to you puts you to the path you are on.”

These are all helpful pieces of life’s mosaic she took into the corporate world – with three kids and no college degree. She started selling radio ads in Montana. It was just a job that began as the “little girl order taker,” but she found she was good at it and moved to other kinds of marketing. Eventually she was going to stop work to be with family – but ended up in a small mortgage firm. Mortgage lender Countrywide Financial recruited her and made her an assistant manager and then regional manager. By then she was commuting two hours each way and decided to get back to Rockford, Ill. – where she and her second husband have been for 20 years, with her three kids and his three kids.

Judi Moore Along the way, they bought and sold a small radio station in New Mexico. Her second husband, Dave Moore, was known as the guy who would come into radio stations and turn them around if they were in trouble. Meeting him turned her around as well. She says that he just made the cut – before her radical feminism ruled out anything to do with marriage. “I’m not radical anymore,” she says. “It’s young blood that runs hot.” And it was her husband and his “geekiness” that first led her to the Internet. Also, she was at Countrywide Financial as a middle manager when the company went online, and while she didn’t know about things like eBay.com, she figured if she could sell books about mortgages online she could put some money away for retirement.

Moore will be the first one to tell you that she lacks an affinity for technology. Not that she can’t do it – she says she can pretty much teach herself anything – but she thought an easy way would be to have her husband and stepson code Web pages for her.

So in 2004 she opened LunchBreakShopping.com, her mall, selling everything from crafts to fashion to movies to bridal and baby stuff. Having come from corporate America, she knew first hand that many people shop online while at the office. She says she built the mall with one hand while holding the HTML book in the other and saw a little profit in the first year she filed a tax return.

She’s still not making big bucks and she knows that a bit more care in her campaigns may get her more notice. She’s not rich and she’s actually not looking to get rich – just a little extra for her husband’s retirement would be great. He retires soon and therefore she would love to find strategies to keep her commissions coming.

One turning point was joining ShareASale.com in the summer of 2005. Up until then her sales were fairly flat. “I learned from ABestWeb forums that I should give ShareASale a shot,” she said, “and kind of didn’t make a dime until that. I started seeing little successes with them.”

She also believes that her writing background gives her a leg up. She feels she can write good, tight copy. She’s kind of a newspaper nut and she will often see something in the paper that gives her an idea for an article. Something on mortgage advice to first-time home buyers, for example. She’s seen all the horror stories about home mortgages in the flesh and can usually come up with a small article that can be peppered with common sense. “Wise old grandma kind of stuff,” she says. She’ll write it up – about 700 words – and post it. She thinks that the quality of the writing gives her rankings a boost without any paid placement. The writing comes pretty naturally and it helps to have set templates or blog-style templates for her to pour the content into.

Today she owns about 50 domain names but she says that more than half are underdeveloped. In addition to her website LunchBreakShopping.com she has sites on home mortgages, Stanley Home Products, an all-things-Santa-Claus site and something she calls Middle Aged Spread, for people like herself, she says. Middle Aged Spread runs under the JudiMoore.com domain and is where she will sell a niche item for awhile – gifts, stuffed animals, diet-related items – and then just wipe the site clean and post a whole different niche product.

That’s not what she did in the beginning. The mall was an attempt to sell all things. It didn’t work too well. But once she picked a specific area – pajamas was the breakout one – things took off from there. “I’m interested in everything,” she says.

Midwestern Moxie

And while her interests are varied, her core is very Midwestern. She wakes up about 6 a.m. to see her husband off to work. She’ll fix his lunch and take something out to thaw for dinner. First thing in the morning, her husband usually goes to his newspaper while she runs to her computer to check stats on her sites. On some mornings – if she was up late the night before – she may go back to bed after he goes to work. If there is a lot of cut-and-paste work, she will save it to do it at night.

And while she’s “tried the PPC thing,” the results have been less than impressive. “I’ve tried it and come out with two or three specific things and my conversions are okay and so I let them run.” She just recently added Google analytics but still figures 80 percent of her traffic is from organic search. “With gifts and pajamas I must have a unique voice,” she says. Her husband and sons run some sites under her banner – about Linux and Linux books, which she says are quite popular. According to Moore, her husband has the traffic but hasn’t monetized it yet.

Judi Moore While she can code and is quick to learn, she says her husband is the real geek of the family. She says they have about eight computers in the house. And while she does have a laptop, it’s not her primary machine so she has to load it with the correct files every time she takes it out to the lake. She sent her first text message when she was in Las Vegas for Affiliate Summit in January. She says she knows just enough PHP coding to be dangerous. Of the eight computers she only uses two; the others are Linux test machines. She does have a Bluetooth phone and is wireless in the house, but still leads a life that is unencumbered by technology, including going sailing whenever possible and reading up to six books at a time (her most recent, the offbeat That’s Funny, You Don’t Look Buddhist: On Being a Faithful Jew and a Passionate Buddhist, by Sylvia Boorstein).

She says her creativity and the technical side don’t go well together. Her desk is a storm of sticky notes. Whether she is going to write or code depends on which side of her brain gets up in the morning, she says. She could be writing or she could be cutting and pasting. If she’s in the zone, she’ll stay up until 4:00 in the morning getting it just right. She’ll make a list the night before and even if she says she may ignore the list the next day, at least she organized her thoughts.

And while it takes planning to help your business grow, she’s taking it easy on dwelling too much on what it all will mean for her future. Maybe she’ll go back to school and chase that college degree that was so rudely put in suspended animation. But maybe she won’t. She says she’s toyed with the idea that she would make a good affiliate manager, but that would mean walking back into the corporate world. “I’m still just learning it all as fast as I can,” she says. And that is also part of the attraction. She likens the way mortgage rules change so often to the changes in the average affiliate business. “I love that about it.”

Meanwhile, she and her husband dream of the days ahead. She says they love to just “dink around together,” whether it’s traveling or going to the supermarket. They want to get to a warmer climate. He wants to sail but she’s not sure they should be that far from medical attention in case they need it. And since affiliate marketing is taking off for her this year, she thinks the dream could still happen. “But,” she adds, “if I have to pass out carts at Wal-Mart, so be it.”

She would love to move around as much as possible, now that the kids are out on their own – one’s in Iowa; one’s a midwife in Montana; another is a hospice care worker; two live in the same state as her and one was in New Jersey. Originally the attraction of affiliate marketing was that it was a business you can pack into a suitcase. Plus, she says, when you’re in radio you move around a lot, too. And while her husband switched to television and is now at the phone company, his retirement is imminent. When that happens they will be free to roam wherever they please. And that might end up being on a sailboat. Going across the country in a motor home also sounds appealing. But, she adds, whether on a boat or in a home, “I think I’ll be doing affiliate marketing until the day I die.”

Overcoming Your SEO Fears

Ask nearly everyone and they’ll say that search engine optimization is intimidating. Search engine optimization – SEO for short – should be a familiar term and practice for anyone or any commercial company with a website. SEO is what you do to your website to get a higher ranking on search engines,particularly Google,Yahoo and MSN.The higher you rank the more likely someone will click through to your site and buy your stuff. Lately, information and tips on just how to do that can fill a library.

“I don’t think you can be in business without realizing that search is a big part of the tool you need – you need to have a strategy to be found,” says John Battelle, search guru and author of the book The Search: How Google and Its Rivals Rewrote the Rules of Business and Transformed Our Culture.

And yet being found is still perceived as some sort of magic formula. “SEO is not sorcery or deception; just something that requires diligent research and staying on top of changes to the way search engines do things,” says Joe Balestrino, who runs the Mr. SEO website.

If someone enters the term pizza into Google, for example, the first results are most likely the product of SEO. Pizza Hut, Domino’s and Papa John’s have all made an effort to rank in the top three spots on Google. Whether they remain there is something search engine marketers will need to stay on top of. Search engine marketing – SEM – are the tactics employed in order to rank higher, be they through paid search or other nonpaid methods. It could be by transforming a website’s look and feel to gain higher ranking.

Many Search Marketers Fail to Measure Results Take the term iPod and plug it into Google. What you get is a sponsored (or paid) search result for Apple. The first nonpaid result is also Apple. Not a coincidence. The Apple brand is so strong that it ranks very high on unpaid results, and paying for a sponsored result is just bet hedging.

People who are new to selling on the Web can get very confused by the “science” behind SEO. Talk of relevant keywords, algorithms and cost per click can terrorize Web sales newcomers. It’s an issue that continues to frighten brand-name companies as well. Since the concept of SEO is only about eight or nine years old, most companies have typically hired a chief marketing officer with as little as two years’ experience in matters of SEO.

Companies are also realizing that search engine marketing is a full-time job and have created executive positions just to monitor and enact SEM strategies. Companies that will do your SEO for you are growing as well. Books and conferences continue to provide advice whether you are a newbie or have been practicing SEO for awhile.

While trying to demystify SEO for people who have gone to a few dozen websites and have not been able to understand it, we can’t ignore the advancements in SEO and how big the market has become. Search still finished first in online ad spend in 2006, to the tune of 40 percent of total online advertising revenue, according to the Internet Advertising Bureau and PricewaterhouseCoopers. This trend of 40 percent is predicted to continue through 2010, according to eMarketer.

Back when there wasn’t a name for SEO, the tried-and-true way to rank high on search engine results pages was using as many keywords as you could in your content. If you sold cigars, putting the word cigar in your articles and written materials as many times as humanly possible would probably get you a pretty high ranking. With the ascension of Google and its algorithmic rankings, that doesn’t work so much anymore. Not to look too far under the hood, but the Google algorithm that ranks pages basically looks at who is linking to whom on the Internet and the quality of those pages. The more high-quality pages linking to you, the higher you get.

Most marketers employ a combination of SEO and paid search, also called pay per click, which results in a sponsored ad when someone searches for certain keywords. For example, that’s why searching for iPod brings up Apple’s URL in the sponsored position and as the first search result – or the “natural” search result.

Getting there has been considered by some as rocket science. And there is a current debate in the industry over whether SEO is too hard for the average Joe to execute effectively. Some consultants who do SEO say, of course, it’s a very difficult science. Critics claim that search gurus want to keep SEO sounding complicated so that they will continue to get your business.

“SEO is a new-school-of-marketing thought – switching someone’s beliefs is nearly as difficult as converting someone’s religion,” says Todd Malicoat, who consults on SEO from his StuntDubl.com site.

“I think that there’s a complete misnomer that SEO equals top position on the search engines,” says Dave Taylor, tech blogger at AskDaveTaylor.com. “In fact, smart SEO is much more about being findable for the specific keywords and phrases that will drive customers to your site, rather than just a more simplistic popularity contest.”

Job Functions Performed by Search Engine Marketers in the U.S. - 2006 That said, there is no denying that SEM efforts continue to grow. Forty-two percent of advertisers say that their SEM budgets are new, says the Search Engine Marketing Professional Organization (SEMPO), in its recent annual survey of marketing executives. The survey also found that 83 percent of advertisers prefer organic (or natural, nonpaid) search, while 80 percent put paid search at second place. Respondents stated that sales was their primary goal for SEM – 59 percent said this. Fifty-three percent said brand awareness was the primary objective and 48 percent said lead generation was the goal. SEMPO’s 2005 survey stated that the North American search engine marketing industry grew to $5.75 billion. That’s a 44 percent jump over 2004.

“Search engine marketing is growing at a faster rate than television, than radio, than print media,” pepperjamSEARCH.com CEO Kristopher B. Jones said at a press conference in August 2006.

While brands are becoming more adept at SEO, a battle is still ongoing behind the scenes between traditional advertising and search marketing. “I think the big brands are starting to get it, but yes, at a snail’s pace,” says Mr. SEO’s Balestrino. He says that while a few of the “heavy hitters” have been looking for SEO people to get them started, most still rely on the word of their SEM. “As you might imagine, few SEMs are into SEO because it can greatly reduce the need for PPC over the long haul.”

Balestrino adds that some companies are starting to see PPC “for the losing battle it can become,” especially among highly competitive retailers and service providers. “The company who is willing to spend the most can rank the highest, but the ROI is dwindling because PPC costs are rising faster than inflation,” he says.

StuntDubl’s Malicoat says that “I no longer try to claim that ‘branding is dead,’ but that certainly won’t keep me from kicking it while it’s down. It’s amazing how often I see a big brand completely blow top search rankings that could have been achieved with a little understanding, some initial planning and very little additional budget.”

Keywords are Key

The camp that believes SEO is not an intricate science say the first thing any SEO beginner needs to do is figure out what your relevant keywords are. Since the major search engines are organizing results based on the word or words people type into the engine, knowing how to organize your keywords is step one. Plus, coming up with all the applicable keywords for your site helps you understand much more clearly what it is you sell.

You can find these keywords by writing down as many as you can think of, or you can survey your core audience. You can also buy software to help you come up with words. There are sites and software to help you find the value in the keywords you have come up with, such as Overture.com (now known as Yahoo Search Marketing) and WordTracker.com.

Statistics associated with your keywords will help you decide what words get more traffic than others. Companies such as Trellian offer SEO software tool kits that help manage keywords, check your rankings, edit your meta tags and create PPC bid comparisons, among other things. For your cigar site, for example, “Dominican cigars” may get far more traffic than “Mexican cigars.” In fact, the latter may do so poorly as to warrant omission when it comes to keyword bidding.

What you are shooting for is a site that can be easily indexed by a search engine. Search engines send out automatic programs that look for new content and create an index based on the words on each website page. That means that attention to Web design and quality writing will boost your site’s chances of getting high rankings. For example, try to keep each Web page small in size, have no broken links, use correct HTML, a server that is up all the time, no identical Web pages on your site and good, clear navigation. All these elements help the site get indexed by search engines.

Some believe that little things such as title tags can make a difference in your site’s rankings as well. Title tags are the one-sentence descriptions coded into the HTML that are displayed at the top of the browser when you visit a page. Organizing your site in URLs that make sense also may contribute to rankings (URLs that show the structure of the site in words as opposed to a series of numbers). Something as simple as a sitemap page helps when you are being indexed.

Especially in Google the more sites that link to your pages the higher your ranking will be. This is called backlinking and is very effective when “high quality” sites link to you – and is even more effective if the link text itself contains one of your keywords. This may mean you will need to put on a public relations hat and send information or press releases to other sites. Joining industry Web forums can help get the word out as well.

This is how SEO has operated over the last few years. There have been many nuances along the way and those degrees of execution are what make SEO seem very impenetrable. In recent years, companies and website owners have opted to buy SEO from firms that do it for you – pepperjamSEARCH.com, Prominent Placement, Fathom SEO, SEOInc.com, EngineReady.com, Adoofa.com and iProspect, just to name a few.

SEMPO’s annual survey indicates that more companies are interested in outsourcing their SEO, but the overall numbers are still small. Only 26 percent of advertisers plan to outsource half or more of their paid-placement budgets for 2007. About two-thirds said they plan to do all of their organic SEO in-house. Only 10 percent said they would outsource all of their SEO needs. The high tech sector is also not immune to the difficulties of search. Among top software firms surveyed by marketing research firm MarketingSherpa, 25 percent were not “sufficiently optimized for search engine visibility.”

Brand Awareness

Some search pundits and bloggers continue to believe that big companies are slowly awakening to the power search brings to their brands. “Big companies are doing too little, and many small companies are too focused on SEO at the price of good content production. The magic bullet is just to produce lots of good, fresh unique content; not to play SEO games and trick people into linking to you,” says Taylor.

Having everyone on the same side of the fence would solidify search as a must-have for all companies. Currently the jury is still out about what constitutes the best approach to search. Some critics have written that SEO is a “one-time fix” – that once a site is optimized, you won’t have to touch it again. Counterarguments are that sites have to change as search engine algorithms change. “I think there are more than a few [SEO firms] that give companies the indication that over-thinking an SEO strategy is necessary, when in reality, it isn’t,” says Mr. SEO’s Balestrino. He says that most companies budget SEO expenditures pretty low, but not necessarily too low to be effective. He says to be wary of the “overly grandiose implementation.”

Others predict that the future of SEO is specialization – broad-category specialists who see SEO as “just plain marketing” and people who will specialize in areas such as keyword research, link building and analytics.

Search engine marketers are still having a hard time because so many of them working for mid to large companies are not focusing exclusively on SEO. A JupiterResearch/iProspect survey found that 88 percent of SEMs are doing SEO; however, 58 percent of them are doing website design, 26 percent do public relations, 44 percent do market research and 22 percent do direct mail. There are only so many hours in the day and only so many hats for overworked SEMs.

This is where legitimate SEO firms hope to gain ground. While MarketingSherpa research stated that SEO firms were still mostly “mom-and-pops,” staffs are growing at these firms and client accounts have doubled. MarketingSherpa says there are a handful of SEO firms reporting more than $10 million in revenues from SEM work and there are at least a few companies reporting $20 million in SEM revenues. The research reveals that most of these businesses have only been in operation for about four years at the most.

Some say that the buy-in from companies who could use search isn’t complete. SEMPO’s 2005 marketing survey stated that only 37 percent of companies said that executives were “moderately interested in search engine marketing practices.” Even companies who would like to outsource their SEM appear to be intimidated by the choices. “The biggest mistake is not doing enough homework on who is reputable and what works,” says StuntDubl’s Malicoat. “Companies should search names, company names, past company names and really be diligent in learning what is going to work best for them.”

Battelle is straightforward when it comes to telling companies what they need to do. “It is hurting companies that don’t use search,” he says. “It is our user interface. It is like a listing in the Yellow Pages.”

Do Your Metrics Measure Up?

Steve DiPietro is amazed at how frequently he listens to prospective clients parroting clickthrough percentages, Web traffic statistics and conversion ratios with great enthusiasm but little-to-no understanding of their value to their organizations. Increasing a conversion rate from 12 to 15 percent can become a goal unto itself as marketers immersed in number crunching can lose sight of the fact that sales aren’t also growing.

Making Sense of Metrics

ALGORITHM: A set of mathematical equations or rules that a search engine uses to rank the content contained within its index in response to a particular search query.

ANALYTICS: Technology that helps analyze the performance of a website or online marketing campaign.

BENCHMARK REPORT: A report used to market where a website falls on a search engine’s results page for a list of keywords. Subsequent search engine position reports are compared with that.

CHARGEBACK:An incomplete sales transaction that results in an affiliate commission deduction. For example: merchandise is purchased and then returned.

CLICK & BYE: The process in which an affiliate loses a visitor to the merchant’s site once they click on a merchant’s banner or text link.

CLICKTHROUGH: The process of activating a link, usually on an online advertisement connecting to the advertiser’s website or landing page.

CLICKTHROUGH RATE (CTR): The percentage of those clicking on links out of the total number who see the links. For example: If 20 people do a Web search and 10 of those 20 people all choose one particular link, that link has a 50 percent clickthrough rate.

CONVERSION RATE: The percentage of clicks that result in a commissionable activity such as a sale or lead.

CONVERSION REPORTING: A measurement for tracking conversions and lead generation from search engine queries. It identifies the originating search engine, keywords, specific landing pages entered and the related conversion for each.

HIT: Request from a Web server for a graphic or other element to be displayed on a Web page.

IMPRESSION: An advertising metric that indicates how many times an advertising link is displayed.

KEYWORD: The word(s) a searcher enters into a search engine’s search box. Also the term that the marketer hopes users will search on to find a particular page.

PAGE VIEW: This occurs each time a visitor views a Web page, irrespective of how many hits are generated. Page views are comprised of files.

RANK: How well a particular Web page or website is listed in a search engine’s results.

UNIQUE VISITORS: Individuals who visited a site during the report period – usually 30 days. If someone visits more than once, they are counted only the first time they visit.

“It’s sad and somewhat surprising that after all this time there is a pervasive lack of understanding … of how these numbers correlate with how to make money,” says DiPietro,who works with clients large and small as the president of the Marlton,N.J.-based DiPietro Marketing Group.

Many marketers continue to rely on basic campaign performance data as the primary or even sole metric for measuring success, according to DiPietro. People often get caught up in the measurability of online campaigns and miss the ultimate corporative objective of a marketing campaign – to increase profitability.

Despite many marketers’ incomplete understanding of how buying keywords affects the bottom line, search marketing spending continues to grow rapidly. According to a survey conducted by the Search Engine Marketing Professional Organization (SEMPO), advertisers in the U.S. and Canada spent $5.75 billion on search engine marketing in 2005, up 44 percent from 2005. Search engine marketing spending in North America is projected to reach $11 billion per year by 2010.

Some marketers whose careers started in the brick-and-mortar world have seemingly become spellbound by the top-level data for measuring marketing campaigns and forget their “old-school” fundamental tenets about increasing sales and stockholder value, according to DiPietro. Finding methods of doubling the conversion rate of a keyword campaign is admirable, but who cares if sales don’t grow? Estimating the value of a keyword purchase by focusing on clickthrough rates or increasing traffic to the website is an easy way to justify spending, but may be totally meaningless, DiPietro says.

The clickthrough ratio is analogous to the batting average in baseball – it is easy to compute and understand, and therefore is the most relied-upon statistic. However, during the past few decades, baseball executives such as the Oakland A’s Billy Beane, who probe deeper into statistics, have learned that other metrics – such as on-base percentage – are more directly related to achieving the objective (scoring more runs). The A’s have managed to succeed while spending considerably less than competitors, and many fellow baseball executives now are looking beyond the batting average. Similarly, marketers who identify the metrics that more closely correlate to their specific goals can increase their success.

MATCHING GOALS

Getting customers to your website is an important first step in increasing revenue, but determining the return on the investment requires analyzing what happens after they arrive at your doorstep. “You must have an action attached to [increasing traffic] or the campaign is useless,” says Douglas Brooks, vice president of consulting firm Marketing Management Analytics.

Before embarking on a campaign, marketers must define the objective – be it increasing leads, sales or brand recognition – and apply the appropriate metric, according to Brooks. The most appropriate metric may depend on whether the company is focused on e-commerce sales or if sales staff is usually involved in any transaction. Different yardsticks are appropriate for companies that use their website as a direct sales channel than for companies who are focused on generating leads that are converted off-line, he says.

Companies that rely on sales personnel should look at the volume of leads a campaign generates, according to Jerry Moyer, manager of analytics at interactive agency Refinery. Moyer says he tells his media clients – many of whom continue to focus on clickthrough rates – that tracking leads is a more effective barometer of campaign performance.

Campaigns that drive traffic to a website that cannot identify where visitors came from may be over- or underestimating their effectiveness, according to Moyer. By using first-party cookies and analyzing all of the activities that occur over time, advertisers can better understand the value of the leads generated.

Using cookies enables marketers to identify the unique visitors, according to Andrew Hanlon, who owns advertising agency Hanlon Creative. Cookies enable companies to track how many times a visitor was exposed to messaging during an entire campaign, as well as counting the total number of interactions on a website before visitors enter personal information and become a lead. “Unique visitors is the most raw level of success; you have to consider how many [leads resulted],” Hanlon says.

For example, Designer Linens Outlet implemented first-party cookies and saw revenue from returning customers increase by 45 percent and shopping cart conversions increase by 20 percent, according to Web analytics firm WebTrends, which managed the campaign.

Measuring the quality of leads is as important as the clickthrough ratios or total Web traffic generated by a campaign, according to Hanlon. He says many of his Hatboro, Pa., agency’s clients ($20 million to $1 billion in sales) “rarely know what they are asking for” when trying to gauge the impact of campaigns on sales.

He stresses to clients the importance of tracking leads throughout the entire sales process. “The client has to be able to act on the data – what happens with the lead after it is collected,” he says. The ability of keywords to generate leads varies widely, says Hanlon. Marketers should use metrics that create quality leads versus those that merely drive traffic.

If branding is the goal, then measuring increases in traffic can be appropriate since many keywords generate low-quality leads, Hanlon says. Companies looking to reinforce messaging through multiple media should consider several online metrics, according to Jason Palmer, vice president of product strategy at WebTrends.

LANDING CLIENTS

Some campaigns are incorrectly viewed as ineffective because of low conversion rates, according to consultant Hanlon. Landing pages that were not designed to entice visitors to delve deeper into a website could turn away potential leads, so their effectiveness must also be evaluated. Landing pages should have interesting content such as blogs or unique offers to encourage clickthroughs, says Hanlon. Companies should measure conversion ratios after visitors hit a landing page, and if they are shown to be “dead ends,” they should revise the landing pages to add more content, he says.

Software companies including WebTrends and Salesforce.com are developing applications that zero in on landing-page performance. For example, Webtrends Dynamic Search evaluates the effectiveness of the landing page and keyword in matching specific company objectives.

Tweaking the content of a landing page can increase the percentage of clicks converted to leads by as much as a factor of 10, according to Kraig Swensrud, senior director of product marketing at Salesforce.com. Tracking and improving landing-page conversions is equivalent to increasing money spent on Google AdWords, he says. “Everything is interconnected – as soon as you have visibility on [landing-page] conversion rate, you can impact change,” says Swensrud.

FROM CLICKS TO SALES

The best metrics link gains in Web traffic or clickthrough percentage to the overall business objectives – increasing sales, profitability and effect on the stock price. Consultant DiPietro recommends the break-even sales analysis is applied to off-line marketing should be applied online. Companies should calculate how many sales – based on the profit margin per average sale – would have to be generated to determine whether or not a campaign is a good investment.

“Whether it’s participating in a trade show, setting up an affiliate program or a PPC campaign, work it back to break-even sales,” DiPietro says.

Connecting the dots between Web analytics and sales data has been largely a manual process for DiPietro, who spends more hours than he would like handcrafting spreadsheets to complete his analysis.

Web analytics firms such as WebTrends, Omniture and WebSideStory are addressing this software void with applications and services that can link Web and sales data to simplify calculating the return on investment. These applications can incorporate Web data such as traffic analysis, email marketing and search marketing performance with customer relationship management sales data.

Accurately gauging the value of a campaign to a company’s bottom line, tracking a visit as it becomes a lead and until the sales cycle is completed is what should be measured, according to WebTrends’ Corey Gault. Web data should be combined with higher-level key performance indicators (KPIs) such as cost per visit, cost per lead and cost per sale, he says. “KPIs can also be combinations of various metrics, such as revenue dollar per marketing dollar spent, or percent of orders from repeat purchasers,” says Gault.

Measuring the lifetime value of online branding campaigns is challenging for companies that also sell off-line, as the ability to automate the process ends at the desktop. Refinery’s Moyer says customer surveys are an efficient method to link online with offline impressions. The surveys incorporate data collected by contacting customers about their behaviors before and after campaigns, and factor in both online and off-line (broadcast, print, outdoor) impressions. This enables companies to calculate how the campaign contributed to the overall sales effort, he says.

Metrics should factor in all of the times a company interacts with the customer, not only the most recent, which can skew performance data, according WebTrend’s Gault. “Many marketing analytics solutions credit the conversion to the last campaign touched, effectively undervaluing all the programs that initiated awareness and consideration.”

Vendors are also re-engineering their products so that sales data can automatically be integrated with Web analytics to complete the campaign-to-revenue analysis.

“The ability to tie marketing metrics with sales metrics is one of the biggest problems that customers have,” according to Salesforce.com’s Swensrud. To address the difficulty in understanding the impact of keyword purchases on sales, the company introduced Salesforce for Google Adwords late in 2006. The software, which is sold as a service, traces the leads generated by keyword purchases and follows them through the sales process to determine their return on investment.

COMPARING OPTIONS

Although comparing current campaign- to-revenue performance with historical data is informative, marketers should create a baseline of return on investment so that they understand the relative value of each type of online campaign.

The cost per thousand of a keyword campaign may seem relatively low when compared with cost of an email marketing campaign. However, determining the return on investment of each can justify what appear to be higher costs per customer contact, according to Marketing Management Analytics’ Brooks. He says calculating the individual return on investment for each type of online campaign enables an apples-to-apples comparison.

For example, the lifetime value of a customer acquired through keyword buys might be a fraction of that of someone originally contacted via email. After factoring in revenue, marketers can better decide the best marketing mix for their collective media expenditures.

The volume of statistics contained in monthly Web analytics reports can make it a challenge to interpret the metrics that matter most. The bottom line: Don’t forget about the bottom line.

JOHN GARTNER is a Portland, Ore.- based freelance writer who contributes to Wired News, Inc., MarketingShift, and is the editor of Matter-mag.com.

Spiders Don’t Eat Spam

It’s the headline any search marketer would dread: “Google Bans BMW for Search Spamming.” For well-known companies, such bad publicity is reason enough to stay away from deceptive search practices. BMW’s plight was published in leading newspapers worldwide. But even small companies have reputations to uphold, because the blogosphere can trash a carefully cultivated image for ethics in a heartbeat.

On top of the public relations headaches, getting banned from search engines hurts your bottom line. Perhaps large companies can say their “mea culpas” and get reinstated quickly, but small companies may wait months to get back in Google’s good graces. What if your search traffic suddenly stopped?

Whatever the consequences, you must understand the terms of service of the major search engines. Google’s guidelines are located at www.google.com/webmasters/ guidelines.html (and other search engines have similar rules). Sure, a few people make a living fooling Google, but you’re not likely to be one of them.

Even if you think you can fool the search engines now, they increase their vigilance each day. Moreover, tricky techniques leave you vulnerable to being reported to the search engines by your competitors, causing an investigation. It’s safer and less work to know the rules of the road and abide by them.

Is Your Site Banned?

If your site’s pages are highly ranked in one search engine, but missing in action from another, your site may have been banned, or at least highly penalized. When search engines detect your use of spam techniques, they may ban your site (completely remove its pages from the search index) or penalize your site (remove some pages from the index, or lower your rankings from normal levels).

You should suspect a ban or penalty when:

  • Your home page can be found only by a direct search on the URL – queries for words on the page don’t work anymore.
  • The number of your site’s pages included in the search index rapidly decreases. To check, do a search for site:www.yourdomain.com to check.
  • The search engine shows fewer and fewer links to your site each month, maybe decreasing to zero. Search for link:www.yourdomain.com to find out.
  • Your site’s search engine referrals have dropped drastically in a short period of time. Use your Web metrics software to detect this situation.

If you suspect a problem, you first need to diagnose the cause. Let’s look at the technique that tripped up BMW. We’ll explore others in columns to come.

The Old Bait and Switch

BMW was caught using a spamming technique called cloaking. Cloakers employ tricks to show the search spider one version of their page and show searchers another, in a high tech version of the old “bait and switch” scam.

In BMW’s case, they coded a JavaScript that showed their normal Web pages when people looked at them with their Web browsers, but the script delivered highly optimized pages full of search keywords when spiders came to call. Google detected BMW’s use of JavaScript cloaking, but more clever methods of cloaking are harder to spot.

Some cloakers use a sophisticated technique called IP delivery, in which the spider’s name (called the user-agent name) and its IP address (the unique identification of a computer’s location on the Internet) are used to switch the page. The cloaker creates a program to dynamically serve a Web page, but that program checks the user-agent name and the IP address to decide which version of the page to show.

IP delivery is a bit more difficult to detect than JavaScript cloaking, but one clue shows up in the “cache” link in the Google results. That link shows the page as Google actually crawled it. If the cached crawled page looks significantly different than the actual page, you may be seeing a cloaker. Clever cloakers code their page as “nocache” so that Google does not show the “cache” link, but “nocache” could be a sign of funny business.

It’s sometimes acceptable to use cloaking techniques, as long as the effect is not to show one page to visitors and another to search engines. One ethical use is to deliver pages to spiders that require cookies (which spiders choke on). If you use IP delivery, make sure you present essentially the same content both to spiders and people.

My SEO Made Me Do It

BMW didn’t blame its incident on a rogue search engine optimization consultant, but many spam violations are indeed caused by unethical consultants. Understand that the search engines hold you responsible for your site’s spamming regardless of how it happened. If you want to stay out of Google jail, ask yourself some questions about any firm you are considering hiring:

  • Do they guarantee top rankings? Reputable firms don’t. Expect ironclad guarantees to be fueled by cheating, and expect those ill-gotten results to be fleeting.
  • Do they promise that you won’t have to make big changes to your site? Be suspicious of link spam if the only changes needed are weird links to other sites hidden on your pages. Those other sites are your consultant’s other clients, whom they also coerce to link to you. If it seems fishy, well, it is.
  • Do they talk about special techniques that give you an edge? Pay attention to the old bait and switch, or suffer BMW’s fate.

If you answered yes to any of these questions, you may be working with a spammer. One way to trick the trickster is to pretend that you really want to hire a firm that does spamming. See if they promise they will. Ethical companies will try to talk you out of spamming instead.

What if you catch competitors spamming? Turn them in to the search engines. Google and the other search engines investigate each spam report and take action when warranted. When you report a spam violation, make sure you include the search term you used, the shady URL from the search results, the exact spam technique you suspect (with whatever evidence you have) and why it’s bad for searchers for this violation to continue unchecked.

We looked at cloaking today, but many spam techniques are in use that you need to be aware of. In my next column, we’ll examine content spam techniques, and finish up our three-part look at the dark side of link spam. Whatever the technique, spam leaves you vulnerable to negative publicity and outright ban by search engines, so steer clear.

MIKE MORAN is an IBM Distinguished Engineer and product manager for IBM’s OmniFind search product. Mike is also the co-author of the book Search Engine Marketing, Inc. and can be reached through his website MikeMoran.com.