22 – 22/2008 – UtilitesDB

Video Validation

All of the predictions that 2007 would be the year of online video came true in spades – it rapidly gained in popularity as a medium last year and its momentum continues today.

The long-lasting Hollywood writers’ strike possibly hastened the migration of people to pass their time visiting online video sites due to the lack of television programming. It’s not just old episodes of “Grey’s Anatomy” they are watching online, but all sorts of content.

A Horowitz study found that news segments and nonprofessional online videos are among the most viewed programming (see bar chart on page 036).

A December study conducted by BurstMedia, a provider of advertising representation, found that approximately seven out of 10 respondents (72.1 percent) have viewed online video content. Although young people represent the largest segment of video watchers, a majority of all age segments have watched it – including over half (58.6 percent) of respondents 65 years and older.

To capitalize on the opportunity, new video offerings are popping up all the time that provide innovative twists on everything from programming to platforms. In March, FastCompany.TV, an online video network that covers technology trends and products, launched. Renowned blogger Robert Scoble serves as managing director, and his popular daily video series, ScobleTV, is one of its several programs.

Seesmic, a platform that uploads more than 4,000 videos per day, has Flash-based social features aimed to enable conversations between users. Participants record short videos in which they ask a question or express their opinion. Other users then record and upload replies to the videos, facilitating a back-and-forth exchange.

Video Revolution

Online marketers were quick to join the video revolution – eager to try out the best ways to leverage its versatility to enhance their interactive efforts. These marketers are moving quickly with good reason – a February 2007 study by The Kelsey Group found that online video converts well. Of the 501 adults asked about whether they had viewed a video ad on the Internet, among the 59 percent who said yes, 43 percent checked out a website, 22 percent requested information, 18 percent went to a store and 15 percent made a purchase.

Jim Kukral, an online marketing consultant, explains that people watch online video because they want to absorb information in the least taxing format possible.

He believes that the easier things are for consumers, the better conversions will be, which is why he thinks online marketers should not just be taking advantage of video, “they should be leading the charge.” Kukral himself is so bullish on video that he has vowed to only create video or audio content as opposed to text posts for his blog in 2008.

Mark Wielgus, founder of the site 45n5, is another online marketer pleased with his foray into video. Beginning on January 1, 2008, he pledged to create a video every day for 365 days in a row – even weekends – with the intention of gaining a voice and being a personality on the Web. The videos, like his site, offer guidance and chronicle his own quest to make money online.

Wielgus has different theme days; for example, The Road to Affiliate Summit Sundays, and ShowYourAdHere Mondays. Of the approximately 100 videos he has up on YouTube, he gets about 300 to 400 views per day. One of the lessons he has learned is to include an overlay of 45n5.com at the bottom of each of his videos so that he doesn’t miss out on the branding opportunity when they get distributed.

Promoting Products

Buy.com was an early adopter of online video and has seen tremendous results from its video program, BuyTV. The half-hour on-demand weekly show launched in May 2006 on its site and through distribution partners like iTunes and YouTube, and is also available on broadcast television.

BuyTV showcases the latest in high tech gadgets and Buy.com’s most popular shopping categories. While viewers watch a segment, they are able to make a purchase by clicking a button next to the video.

Buy.com’s vice president of marketing, Jeff Wiscot, and Marketing Director Melissa Salas, who is one of BuyTV’s hosts, say video is effective for selling to people who are not particularly tech-savvy – because they can see an explanation of a product’s features and how the product works. Salas notes that it’s a good tool for electronics, which sometimes require longer purchasing decisions.

Although Buy.com can’t release specific metrics, the company says video has helped conversion rates drastically – in some cases up to a multiple of seven. As an example, Wiscot says that if the company were running an MP3 player promotion with a 2 percent conversion, it could go up to 14 percent on the high end if BuyTV put up a video about it.

Last fall, Affiliate Summit co-founders Shawn Collins and Missy Ward launched WeViews.tv, a video reviews site of products and services that range from the Garmin Street Pilot to iTunes.

In addition to making videos for the site, Collins and Ward ask users to be “consumer reporters” and contribute their own video reviews, which Ward thinks enables affiliates to get their feet wet in video without the trouble of building and marketing their own site. If WeViews.tv accepts and publishes the video, the submitter receives $10, a model similar to Nuuvy.com’s.

WeViews.tv videos feature what Collins calls a “subliminal call to action” by including the URL for the product at the bottom of each video. For example, the video that reviews Sirius Stiletto portable satellite radio has the URL, www.weviews.tv/stiletto.

Collins says the overall typical conversion rate for products is about 10 percent. Ward has had good experience with shoes; noting that both the Chinese Laundry and Ugg Slippers videos have been the biggest – converting at nearly 16 percent in December, and the Oakley Thumps sunglasses converted at 12.5 percent the same month.

On the WeViews.tv site, transcriptions of the videos are posted with product specifi cations added to the text to provide more details. Collins explains the text is keyword-rich and therefore gets indexed in Google fairly high.

In the future, WeViews.tv might make the videos clickable, and Collins says he could use a vendor like WebVideoZone or Bubble- PLY to do that. Currently the videos are powered by Revver – a service Collins likes because of the quality and because it syncs in well with WordPress blogs.

Revver’s senior vice president of business development, Brian McCarthy, explains that Collins and Ward upload their reviews to Revver and then post them on the WeViews.tv site. Revver delivers ads within the player and shares that revenue with them. Any revenue WeViews.tv makes through ads on the browser page they keep for themselves. Because the WeViews videos are in the Revver library, they are syndicated out to the Revver network for additional distribution.

Video Is Versatile

A different type of product that Collins promotes through video is the conference he co-founded, The Affiliate Summit. Because conference registration isn’t an impulse purchase, Collins says he works on numerous touch points to sell people.

Users who want to watch sessions from the Affiliate Summit are required to double opt-in to the weekly Affiliate Summit newsletter, where content supplements the videos in an effort to sell the prospects.

Viewers can then watch full sessions from the conference at the Affiliate Summit site, which is hosted by Fliqz.com. Each video includes an Affiliate Summit logo in the bottom right that’s clickable to the registration page. But because there is no indication that the video is clickable, Collins does not have specific conversion information.

Kukral also makes promotional videos. In 2007, he made five simple videos to promote his online marketing consulting business and uploaded them to YouTube. Kukral now gets three to five calls a week from people who say they found the videos by searching for the terms “online marketing” on YouTube.

In January, Kukral launched The Daily Flip, a show about online entrepreneurism and marketing that features tips, tools and reviews of products. Kukral films each show using a Pure Digital Technologies Flip video camera, which he says proves the point that anyone can make good video with inexpensive equipment.

Pure Digital gave Kukral a Flip camera to create a promotion, which Kukral set up for the day of the Super Bowl. During half time, he posted a video on his blog with a phone number and the first person who called won the camera. The promotion’s goal was to drive people to his site and subscribe to his videos.

Kukral says there is a number of ways to monetize The Daily Flip, including sponsorships, partnerships with networks, commercials and pre- and post-roll ads in the videos. If the site gets enough traffic, he could become a YouTube Partner and YouTube would sell ads for the site that are contextual and give him a cut.

Like his consulting business, Kukral promotes the program through video-sharing sites. He recommends TubeMogul.com as a quick way to upload videos to several sites at one time. Although there are more than 100 video-sharing sites, Kukral pays the most attention to YouTube because of its 31 percent market share of all video sites on the Web.

Although entertaining videos have been among the most popular ones on the Internet, videos that solve problems are also sought after. For this reason, Kukral recommends VideoJug.com, which is an instructional site that teaches people how to do things such as how to use a Pilates balance ball. Many of the videos featured on VideoJug are professionally made and don’t credit the creators, but there are some user-generated areas on the site that give producers an opportunity to brand themselves.

In February, three ex-Googlers launched Howcast, a site that features both professionally shot and user-generated instructional videos. The video ads are in the form of clickable overlays that pop up in the bottom part of the screen. Each video is tagged by topic and each one has a visible script, which make them searchable. A cookware company could purchase spots in the how-to-fry-an-egg video, for instance, or buy paid links in the list of necessary equipment that is part of the video.

Adding Existing Video

Online marketers don’t need to create video to promote their products; they can add merchant videos to their sites to enhance their site’s content, give it a more professional appearance and potentially push it up in the search engine rankings.

James Nardell, an affiliate manager for AMWSO, an affiliate marketing and affiliate program management company, says that he has seen video help with conversion for programs such as Gaiam, an organic and green-living lifestyles company; and Panda Security SA, an antivirus software company, which has cartoon videos that explain how viruses work.

Nardell, Gaiam’s affiliate manager, says that Gaiam has affiliates who have added videos to their sites and the conversion rates have increased by a staggering 80 percent, according to tracking through LinkShare. Gaiam realized that the affiliate channel was a great way to utilize their extensive inventory of video content.

Dori Schwaiger is a Gaiam affiliate who, with her daughter, runs TopHealthSpot.com, a coupon site that focuses on wellness and health. When she built the site in late 2006, she began integrating video and, with the help of Nardell, designed a “health videos” tab at the top of her site, which she says people go to directly.

Schwaiger attributes the approximately 46 percent improvement in sales of health videos during 2007 to the “health videos” tab as well as to the Gaiam product name – users find her site because they optimize the site for those keywords.

In the “health videos” section, there are previews for each video so people know what they are buying, which Schwaiger believes is important for conversions. Nardell agrees that video works best when it is preselling content – it provides a brief example of why they should buy the product.

Schwaiger uses it as much as she can on her site, including video from Drugstore.com and Mochila. Even though it eats up her bandwidth, she says it’s a wonderful tool.

She says it is easy to add video to her site through the WebVideoZone system. It hosts videos and makes it simple to customize the video files by adding text links to the video player, graphics that get displayed on the video player and URLs that redirect when the video has finished playing.

With WebVideoZone, affiliates add their unique affiliate ID code via a form, and cut and paste the resulting HTML code into their website. Once the code is added, the video is available on demand on the site as a stand-alone video player, all of which is an affiliate link.

Gaiam’s Nardell says that once affiliate managers come up with video creative for their affiliates, they can change the video via the WebVideoZone control panel at any time and the video automatically updates on each affiliate site.

Video Widgets

Qoof, a video commerce platform that matches e-tailer videos with Web publishing channels, enables the affiliate community to leverage video widgets. Qoof offers a rich media video widget that is Flash-based and focuses on on-site sales. Product information is available through the widget, and embedded video shopping functions like price comparisons reduce the chance for a potential buyer to leave the site in search of more information.

Jonathan Stefansky, executive vice president of sales and marketing at Qoof, says that it’s easy for affiliate managers to create different widgets tailored for specific programs. They can make changes on the back end with the latest data, which auto-updates affiliates’ widgets so they can offer the newest promotions. Although he can’t share specific numbers of his clients, he generally sees five to 15x higher clickthrough rates than banners or text-based affiliate links.

Qoof has integrated its widget as a Flex Link in LinkShare, which makes it easier for affiliates to grab the widget code to embed in their websites or blogs the same way they would grab code for banners and text-based links.

Video-Sharing Sites

Another way that publishers can monetize video is to add videos from video-sharing sites like Adotube.com, Blinkx, Magnify.net and Revver to their own site.

For example, affiliates can post a video from Revver on their site or social network page, or promote it through email, sneakernet or peer-to-peer sharing.

Revver earns revenue from selling pre- and post-roll advertisements within videos.

For sharing videos, Revver affiliates earn 20 percent of the advertising revenue – the remaining revenue for each video is split 50/50 between the video creator and Revver. It is made possible by a RevTag, a video file that is promoted by an affiliate that contains information about the video being played and about the affiliate.

In addition to the commission-earning possibilities, adding video from a video-sharing site can help publishers add relevant information to their site. If a publisher has a home improvement site, they could choose video from the Ask- Builder.com channel on YouTube where Tim Carter, a You- Tube partner, offers his videos.

With Google AdSense Video units, affiliates can add video from YouTube Partners to their sites and earn revenue on the ads. The ads are paid on either a CPC or CPM impressions basis. Publishers can choose the type of ads in video units – they can be contextually targeted or they can choose from a list of categories like music or technology, or choose to serve content from a specific YouTube partner.

Affiliates install an AdSense player in their site and customize its size, theme and layout. They can choose to have Google/You- Tube determine the best type of videos to show on their site by analyzing the content, or affiliates can choose individual content providers or select categories of content.

Video’s Future

While 2007 is being called the year of online video, industry watchers say it’s just the tip of the iceberg. Revver’s McCarthy lists some of the reasons he thinks it’s just getting started: bandwidth is coming down in cost, more content is coming online and being indexed well, and video quality and advertising continue to improve.

There’s more than one way to cash in on the video revolution. Online marketers are creating their own video as well as leveraging existing video to enhance their programs and improve conversions. And like all uncharted territory, there is much trial and error. Still, it’s clear that video is not going away and marketers that incorporate the medium are benefiting.

Poaching Prohibited

What’s in a name? According to Shakespeare’s Juliet, not much, but if the name is trademarked it has value worth protecting. Successful companies spend millions developing a brand name and promoting their Web domains online. Some publishers, however, treat others’ trademarks like their personal ATMs by generating commissions through misleading ads.

This practice has become alarmingly present during the past few years and is often referred to by a variety of names: trademark poaching, trademark bidding, domain name poaching and PPC domain name bidding. Kellie Stevens, president of Affiliate-FairPlay.com, says it’s a difficult issue to discuss because the terminology is still not clearly defined or even completely understood.

Some in the industry say it’s actually misleading to call it trademark poaching or trademark bidding. Instead they refer to it as PPC domain name poaching because it’s really a subset of a merchant’s trademark-type words, namely their domain name. Some industry watchers say that using the phrase “trademark poaching” or “trademark bidding” has connotations of it being a legal issue under existing trademark law, but it is really a violation of the terms of services contract between the merchant and the affiliate.

Regardless of the various terminology (which is often used interchangeably), in its most conservative definition, this practice involves a keyword search on a trademarked term or the merchant’s domain name that triggers a pay-per-click ad. The ads use a merchant’s trademark in the copy, and through clever coding, the display URL appears to consumers to be from the merchant.

The way it works is that consumers type an address in places other than the URL bar – such as the desktop Google bar or into their favorite search engine – and are taken to the merchant’s site or an affiliate site via an affiliate link, thus giving an affiliate a commission when none is deserved.

The basis that this commission is unwarranted is the idea that if a consumer types in a merchant’s URL or domain address, it is clear they were seeking that merchant and the affiliate provided no added value in getting the potential buyer to that destination. Therefore, the affiliate should not be compensated.

The origin of today’s trademark poaching problem dates back to 2004, when Google changed its AdWords policy to allow keyword bidding on trademarks and associated Web domains. Cunning individuals began joining affiliate programs and designing PPC ads to appear to come from a well-known merchant. When clicked on, the ad directs the consumer to the trademark owner’s site through a link that inserted the affiliate ID, therefore generating a commission for any resulting purchase. VoilÃ ! No website is required – the ad creates a straight path to easy commissions.

WHY IT’S ATTRACTIVE

Trademark poaching is attractive because of the low barrier to entry. For just the price of a PPC ad, publishers can quickly generate handsome commissions without the usual affiliate administration overhead, and reducing the steps from click to purchase increases the likelihood of a purchase.

One PPC affiliate, who asked not to be named, says there is a “pack of about 30” PPC affiliates that closely monitor the list of new merchants at every network and “crank up campaigns on them all” in order to profit from this behavior.

The anonymous PPC affiliate says “it takes less than four minutes to create a new campaign for a new merchant,” and that this pack of rogue PPC affiliates “don’t read the terms of service” from the merchants and they “don’t care about size – they cover them all.” He says it’s like a competition among this “pack” and that they do this for hundreds of merchants.

“There’s a trickle of others trying it from time to time as well, but the way Google and most search engines work, historical performance and clickthrough rates determine who gets the spots. They’re all competing for the one spot that lands on the merchant’s domain,” the PPC affiliate explains.

He went on to note, “That’s a ton of commissions paid out for almost nothing. If a merchant can easily do this PPC themselves, why pay an affiliate a large percent commission for doing it? It’s the branded traffic the merchant has earned; giving it away to a lazy poaching affiliate is just ignorant.”

Scott Hazard, who runs the website Cooperative- Affiliates.com, says ads that mask their origin in this manner confuse the marketplace and take money away from the merchant and the affiliate channel.

“It’s more of a problem for big brands” with recognizable names, Hazard says, as the popularity of the name as a search term will generate the high volume of traffic needed to create sizable commissions.

However, another school of thought says that although big brand merchants are often targeted more – thus losing more money overall – it’s a problem for merchants of all sizes. In fact, many smaller merchants are less aware of the issue and how to police it, making them easy marks.

While determining exactly how widespread this practice has become is difficult since it’s hard to track throughout the entire industry, a PPC consultant, who asked to remain anonymous, says, that “in some smaller programs I have worked with, as a merchant consultant and/or as a PPC consultant, as much as 40 percent of their registered affiliate sales are coming from this poaching.”

The only penalties for being caught poaching is getting kicked out of an affiliate program and having your commission withheld. That’s a small price to pay compared with the upside of undetected revenue. (See the “Trademark Ads in Legal Limbo” sidebar on page 048″ for details on other potential penalties.) Trademark poaching challenges merchants because as quickly as affiliates are kicked off, others are ready to take their places, according to Hazard.

Hazard launched the website TrademarkPoachers.com in August of 2007 to provide advice and education about the practice. While his site has increased awareness of the problem, “It doesn’t seem to be happening any less,” he says. Some say that they have anecdotal evidence that nearly 50 percent of pay per click is based on trademark poaching.

Chuck Hamrick, an affiliate manager for AffiliateCrew.com, started noticing trademark poaching in mid-2006. He could see that it was impacting overall revenue for some merchants because after he removed the poachers, the affiliate channel earnings went down, while organic and paid search revenue increased by larger amounts. This showed that trademark poaching “was cannibalizing our other efforts,” he says.

In the last two years, Hamrick caught a number of well-known affiliates poaching. He gave them “two strikes and they were out” of the program. If they didn’t take down the offending ads, he would reverse their commissions. “If it happened again, it was not by accident,” he says.

TRACKING THE POACHERS

Still, merchants that do not protect their trademarks from poachers are like retailers that allow customers to walk out with the price tags still on the clothes – if you’re looking the other way, someone will inevitably take advantage of you. Although networks can help with detection, it is the affiliate manager’s responsibility to function as the security guard and prevent these losses.

Fortunately for merchants, tracking this nefarious activity is relatively simple. Reviewing commission reports is one effective method for identifying trademark poachers. High conversion rates or affiliates who rise too quickly in volume of referrals are signs of potential trademark poaching, according to Dave Osman, senior vice president of operations at Commission Junction. “[Trademark policing] is one of the biggest challenges that the affiliate channel has had,” Osman says.

Managers can bid on their trademarks through Google AdWords to see the affiliates that are also bidding as another method of identifying potential poachers. Checking data for the location and time of day where commissions are generated can also help to identify poachers. To head off potential poachers, merchants can specify with AdWords that bidding not be allowed on their trademark or the trademark as part of their domain name.

Google will take down ads from affiliates or competitors that include domain names or URLs if the trademark holder complains, according to the policy stated on the AdWords website. However, Google will not block keyword bidding on trademarks and will not otherwise mediate disagreements over trademark poaching.

THE CASE FOR AND AGAINST

However, there are some merchants that will ask their PPC affiliates to do trademark bidding. AffiliateFairPlay’s Stevens says that there are pros and cons to this tack and merchants that allow it employ the rationale that they would prefer to see their affiliates ranking higher in the search engines than their rivals.

However, these merchants often fall into two categories – those that understand the issue and allow it to happen; and those merchants that are not aware of the implications.

When a merchant understands it and still allows domain name bidding, it’s usually because the affiliate manager can make themselves look good to superiors by showing lots of sales; or the merchant wants to inflate their EPC and sales volume to make their program’s metrics look attractive; or the merchant has made a deal with someone – such as a legitimate consultant – who in exchange for the sweet, low-hanging domain name fruit, obligates themselves to do something else, like pump those margins into deeper product and general keyword PPC on the merchant’s behalf, according to a PPC expert.

For those who don’t completely understand the issue, the reasons to allow it are slightly different: The merchant believes these posted sales are the result of “power” affiliates’ magic and doesn’t understand they’re allowing their brand, via their site name, to be leveraged by someone who does only that; or they have no idea what’s happening and believe these are actually their best affiliates; or someone such as a PPC agency or an outsourced program manager has them hoodwinked into believing this is a good practice.

However, there are instances when this type of bidding can be helpful, according to some PPC experts.

If a merchant has chosen to have coupons, then a search for “merchantname coupons” will be filled with SEO coupon affiliates ready to meet that need in the engine’s natural organic listings. The same principle works for reviews of merchants’ product or services. Most often, consumers seeking reviews don’t want to visit a merchant’s site. Instead, they want a supposedly unbiased view. Therefore, allowing an affiliate to bid on MerchantNameReview.com might be desirable to the merchant.

The Big Decision

One search expert, who asked not to be named, says there are two questions a merchant must ask before making the decision on domain name bidding.

No. 1: Do I allow my affiliates to bid on “MerchantName.com” where they send people directly to MY MERCHANT website and where they earn a commission?

No. 2: Do I allow my affiliates to bid on “MerchantName.com” where they send people directly to THEIR AFFILIATE website and where they earn a commission if someone clicks through to my merchant site from their affiliate site?

Most observers say the answer to the first question, should be – “No way, this is the merchant’s traffic and they earned it. It’s fat with ROI (often a 19x return) and it’s theirs.”

On the second question, the answer is not as clear. Allowing affiliates to do this might keep competitors from squatting on the name with their PPC ads. Search engines could see the merchant’s ads as more relevant because the domain name is the same word as the keyword, meaning that the merchant should be able to still occupy the top search spots with ease.

The Role of the Networks

Networks including Commission Junction offer trademark policing as a value-added service, and specialist companies such as Trademark Tracker and Name Protect can search out poaching ads as part of their broader trademark protection services.

While the industry is in agreement that trademark poaching is unacceptable, there is little consensus on related trademark use by affiliates in their advertising efforts. From keyword bidding on trademarks to the use of trademarks in ad copy, merchants, ad networks and affiliate networks each have their own rules and perspectives on what is permissible, and often those vary depending on individual contractual relationships.

“Ultimately, trademark poaching is in the eye of the beholder,” says CJ’s Osman. “The burden is on [affiliates] to learn each of their [merchants’] rules and to receive permission before incorporating trademarks into their ads.”

Buying a trademark as a keyword in conjunction with other words, such as “iPod and covers” is often allowed or encouraged because search engines do not want to exclude “broad match” terms. With the permission of the trademark owner, trademarks are also permitted as part of the affiliate’s display URL (e.g., www.affiliatesite.com/coupons or /reviews).

Through statistical data and the ability to observe dozens or hundreds of merchants at the same time, the networks have the power to stop this practice, but some think they don’t go far enough in their efforts.

“Good networks will show the referral URLs to the merchant, making it easy to find these poachers if they look, and reverse their orders [don’t pay them] and remove them from their affiliate program for violating the rules,” one PPC expert says.

According to one PPC consultant, who asked not to be named, the networks don’t ban this bogus practice for a variety of reasons – all related to money:

Merchants who want to shine their metrics (and show their bosses how well their programs are running) would go to another network.
Unscrupulous OPMs (outsourced program managers) would suggest alternative networks for new clients.
Unscrupulous OPMs would migrate programs to other networks, and when the reported sales went up, they’d be proven “right” about suggesting the migration.
Some merchants would not be able to make deals with their PPC consultants or agencies, and a new network that allowed this practice would be the only alternative.
Many less-than-savvy merchants would accuse the network of firing their “best” affiliates.

Because merchants have a right to run their own program, networks don’t and shouldn’t take an all-encompassing stance against it, the PPC consultant says.

Commission Junction’s policy is not to allow the use of trademarks in third-party ads without the express permission of a merchant, according to Osman. The rules that each merchant sets depend on their individual objectives, with some opting to be more flexible in allowing trademark use, he says. “All [merchants] do not view their [affiliates’] use of their trademarks in the same light: They have different marketing needs and therefore make allowances when necessary. For this reason Osman says, “I don’t think consistency [across the industry] is possible.”

Affiliates bidding on a domain name and sending the traffic to their own sites is seen by some but not all in the industry as trademark abuse. “One type of trademark poaching – typo squatting – is the intentional use of a misspelling of the trademarked URL, and is considered trademark infringement by most marketers,” says Osman. In recent years, companies Dell and Lands’ End successfully sued affiliates for generating commissions through typo squatting and direct linking.

Merchants can best protect their trademarks by spelling out what is allowable in their contracts with affiliates and by educating their network partners. Network ShareASale provides a dedicated area for posting banned keywords and text explaining the merchants’ choices, easily available referral URLs marked on every sale so the merchant can see the details, a feedback system for merchants to tag terms-of-service-violating affiliates to others, and other mechanisms making implementation of a merchant’s choices easier and more effective.

“Each merchant has different ideas when it comes to this issue, so our goal is to try to make as much information as possible available to both the affiliates and merchants on our network so that they can run their programs as they wish to run them,” says ShareASale President and CEO Brian Littleton. He encourages merchants to upload their individual agreements as well as a list of prohibited keywords so that all parties are clear on what is allowed.

One observer says that merchants need to ask the networks different questions instead of just asking for advice on whether or not they should allow domain name bidding in their programs. Rather, the merchants should be posing questions to the networks such as: What will the networks do for me? What tools will they give me to support and facilitate my choices on these issues? How will they help me police a decision to disallow it and what repercussions/tools will they give me to stop people who do it and won’t stop?

Domain name poaching is not going away anytime soon, but search experts promoting best practices say that savvy merchants and affiliate managers that educate themselves on the complex issues will realize the practice is a shortsighted path to profits, and ultimately bad for the entire industry.

Hooking Search Talent

“As search marketers, we are the insiders. We are supposed to know and understand search in all of its dimensions. We are moving into uncharted territory. It is not territory that I am excited to explore, but I will go there nonetheless,” writes Amanda Watlington of SearchForProfit.com.

Despite her status as an expert on blogs, RSS and search marketing, Watlington is still trying to put a finger on what may be coming down the pike for search this year. Her pondering may sound a bit gloomy – because in many ways, things have never been better for search.

According to GroupM, search will make up about 65 to 70 percent of the measured online advertising in 2008. That’s up from 50 percent in 2005. Also consider that search budgets within brands have become bigger; search marketing professionals now easily have three to five years’ experience handling search initiatives; and most excursions on the Web start at a search engine.

Yet there are really no guidelines on what search-related skills a search team must have in order to propel a company forward – not written down in the company manual anyway. “Knowing” search and running a search team for your company are entirely two different things. Knowing how to budget for search and staying abreast of search innovations is something few teach.

A recent survey by the Search Engine Marketing Professional Organization (SEMPO) stated that in-house search managers are now handling budgets on average of $200,000. However, up to 40 percent of those managers are shepherding that money with three years or less of professional search experience. About 26 percent have five years of experience or more.

Keeping Up With Search

The uncharted territory is the constantly changing nature of the search game. Many search veterans will say that learning search is an ever-changing discipline, fraught with a learning curve that never straightens out. They say that to hire a search manager or search team means upper management must look beyond the experience they have on paper and judge a pro by their passion and innate intelligence.

It’s paying off for some. SEMPO says that about 49 percent of SEM professionals earn $50,000 or less. About 43 percent earn between $50,000 and $100,000 per year. Only about 4 percent of those with five to seven years of experience make more than $200,000 per year. “It’s a respectable career path. I know I wasn’t making 70 or 100 thousand dollars a year when I was three years out of college,” Rob Crigler, co-chair of SEMPO’s in-house committee told SearchEngineWatch.com.

“I equate it to sports – the people who don’t sleep and work really hard get ahead. As a numbers-based job, they attract the hard workers,” says Wil Reynolds of Philadelphia- based SEER Interactive, a search engine optimization company. He says that the tools – software and Web-based analytics and helpers in choosing keywords – are all pretty good now. The ones who rise to the top are the ones with a kind of “street smarts.”

There are some recent attempts to educate the search-interested. Google recently launched a program called Google Online Marketing Challenge, which partners with marketing college professors to teach Google’s popular Ad- Words. Students take a $200 budget and apply it to a PPC campaign for a client. Students then manage the AdWords campaigns including coming up with a pre-campaign plan, manage the ongoing campaign and evaluate post-campaign numbers. The students select keywords, write ads and keep tabs on their clicks. Google then judges the work on up to 30 different criteria and offers an actual prize – a week at Google’s headquarters.

SEMPO also offers distance learning courses in search marketing. Students are introduced to the “foundations” of search marketing; advanced how-tos on SEO; and PPC training. The courses are offered online and can include interaction with “SEM professionals” and grading by SEMPO volunteers. SEER also offers some SEO online video tutorials on its site covering keywords, competitive tools, link building and best practices.

SEM expert Todd Malicoat at stuntdubl.com helps organize an SEO class and an online marketing training class using online courses, podcasts and some PowerPoint. However, he points out that there is really no regulation within the industry and that anyone can build a website and say, “I do search,” and have it be technically true. He notes that the search community has an active base, and learning from these people would be different from the trial-and-error training someone may get when they do it alone.

Reynolds says this kind of education is out there for people to use, “so tenure isn’t important.” What people should really have, he says, is marketing acumen. “If you want to be second place, you go to search training,” he says. “The same materials are available anywhere. But the people who rise are the people that take the basic info and go to the top.”

Matt Spiegel, CEO and founder of Resolution Media, an SEO and PPC consulting firm, says that those with higher educations in marketing have received “little exposure to this new marketing world. The vast majority of recent graduates in advertising and marketing have had little course work specific to online advertising – much less search.” He says to not assume institutions of higher learning will adapt quickly. “Instead, we need to look within the industry for help.”

Rand Fishkin, CEO of Seattle-based SEOmoz, a search marketing consulting company, says that three years’ experience is “quite a bit and is good given the industry.” He says that if he were to interview a search pro for a job, he’d simply ask the candidate to explain how Google works. “How does Google do its rankings and what makes a difference; and how did you pick up these things?” The analogy he draws is with medicine: A doctor should be able to tell you how the nervous system works off the top of her head.

Spiegel says there is a talent shortage. He says to work for his company you do not need a shopping list of skills. “You have to invest in people in this business,” he says. If you are new to the industry, he adds, and learning from the ground up – you get about 18 months to learn nuts and bolts. “When we hire, if they come from another agency, I expect that within 90 days they will be up and running – that you will know enough about search to manage a client list but you may have to learn keyword placement, etc.” He says he has hired one-person shop owners. He looks for attitude as well as skills and a need to “thrive on uncertainty and realize they are at the beginning of an industry.”

Evolving Search Skills

Among the skills that SEER Interactive’s Reynolds looks for is the ability to problem-solve. “Do you like to solve puzzles; things that stimulate and test the mind?” he says. “I would follow that skill with a lack of fear. There are tools are out there to do short-term tests. But are you not afraid to fail? I continue to see more come into the space, but that doesn’t mean they are all going to be good. Anyone with a Net connection and phone can be a search firm tomorrow. That glut can lead to substandard talent.”

Since search seems to be one of those areas that is changing and improving all the time, a search pro needs to stay locked in step with the new. Mike Grehan, CEO of Searchvisible, experts at organic and paid search headquartered in the U.K., has said that it’s getting harder to keep good organic search results on the first page. “What used to work in the good old SEO days won’t cut it in the future.” He notes that while search engines themselves are innovating all the time, search engine optimization is not – meta tags, alt tags, some social media and header tags are still the rage but are seeing their results wear thin.

Constant adaptation is a valuable watchword held by Danielle Leitch, executive vice president of client strategy at MoreVisibility, a search, design and interactive marketing company. She has said that she sees “adaptation of the industry as a whole shifting from just acronyms – SEO, CPC, SEM – to ‘interactive marketing.’ As a result, I believe agencies will become more full service than they had been – which could lead to mergers or partnerships in that area too.”

As the changing landscape continues to shift, SEOmoz’s Fishkin actually sees a constant in search professionals’ qualifications. “To me, the most desirable are those people who started a site in 1998 and have learned from doing. I am always impressed with those guys. They are rare guys.” The other breed of search marketers are those who may have a background working at another agency doing search or with a portfolio of sites they have launched. They may have been a junior marketer on this or that team and they did a search campaign and now they say, “I’m lost.” Now, companies have to spend six to 12 months training this person. He adds that MBAs may spend too much time projecting and doing nothing. “In search, we have to do.” In the end, you can only lose revenue for a few weeks and still correct it and change, he says.

Spiegel says too many companies may hire one person to head up search and leave it at that. “If I were running a company and had to hire one person, I wouldn’t want to put all my eggs in one person. I would hire an agency,” he says.

Searching for Education

Fishkin has put together a primer for those looking for search pros. He states that recruiting might be the hardest part of the work. While portals on the Web offer loads of candidates, the passionate ones are usually found in the Web places where the “young, Web-savvy and tech-obsessed” hang out. In addition to their skill set, you and your company will want to ask how long you will need this pro for; what are the primary priorities for them; and do you want this person or team to grow with the company?

When building the team or fitting the search person into the structure of your company, you need to measure the scale of your search efforts – is your company large enough that you will need more than one person or team? Measure what kind of ROI you want for each segment if you choose to break up the search division into many platforms. And as you carve up search areas and responsibilities, you will still need a person to oversee the divisions.

For training, he recommends letting team members build their own BlogSpot or Yahoo360 sites and experiment with trying to rank them. He likes to give them two to four weeks to “read, learn and get involved.”

SEER’s Reynolds uses himself as an example of the kind of search pro he’d admire. “I loved the game,” he says, “so that’s why I know it well. In the beginning, I loved computers and marketing but also had the cajones to knock on doors.” He says when he got started in search it was a constantly changing and highly competitive field with no rules written. Still is. “Three-year tenure is about all you need – now I have eight.”

MoreVisibility’s Leitch has stated that in the coming year the focus should be on colleges and universities injecting “real world” classes into their business classes. “Those that we will hire in the future need to have solid fundamentals in interactive marketing and search ” regardless of your role in a company or field of interest.”

Marketing in Action: Q & A with Seth Godin

If you’re in any way involved in marketing – online or off-line – chances are that you’ve read at least one of marketing guru Seth Godin’s best-selling books. He is the author of 10 books, including “Meatball Sundae,” “All Marketers Are Liars,” “Purple Cow,” “Permission Marketing” and “small is the new big.” Armed with a degree in philosophy and computer science from Tufts University, he began his career as brand manager for Spinnaker Software in Cambridge, Mass. Godin is also founder and CEO of Yoyodyne, an interactive direct marketing company, which was acquired by Yahoo in 1998. More recently, he founded Squidoo, a recommendation website, in 2005. Revenue’s Editor-in-Chief, Lisa Picarille, talked with the author, blogger and in-demand speaker about his unique views on marketing.

Lisa Picarille: How would you characterize the current state of online marketing?

Seth Godin: It works! It’s always worked, but now it really does. And, at the same time, off-line marketing is not working. We regularly see the results marketers are getting with big campaigns fail to meet expectations. At the same time, the power of social media continues to expand.

LP: What are the most important components of successful online marketing?

SG: Making something people want (choose) to talk about. They have power, not you. Also, delivering anticipated, personal and relevant messages to those that want to get them. And finally, treating people with respect.

LP: Can you give some examples of companies (and/or people) that are getting it right, and why?

SG: Talk about the importance of social media in online marketing – it’s becoming increasingly clear that messages that spread from person to person are far more powerful than those that come straight from a company. So, social media is powerful, but not if it’s manipulated. Then it fails.

LP: Are there aspects of social media that work for online marketers more effectively than others (Facebook, Twitter, blogs, vlogs, etc.)?

SG: Social media doesn’t work for marketers. Social media exists for the users. Sometimes there’s a positive side effect for a marketer who makes something worth talking about.

LP: You often post multiple blog entries each day; where does all your inspiration/topic matter come from?

SG: I look for things that are broken and then talk about them!

LP: If you were to give advice to someone that is just starting out in online marketing, what would you tell them to do as a first step?

SG: Start a blog. It’ll make you humble. And a better writer.

LP: Your book “small is the new big” is a huge success. But do the “Big Guys” really get it? It must be a whole new concept for many companies to grasp that success doesn’t directly correlate to size. That goes against everything they were taught.

SG: Yes it does. That’s where the meatball sundae comes in. This is a new time, a new era and a new industrial revolution. Not everyone will play by those rules, but that’s okay, because those that do will thrive.

LP: I’m curious what role you think customer service plays in marketing, and are online marketers leveraging that facet to their advantage?

SG: Customer service is part of the product now. So, amazing service (e.g., Amazon) is a valid replacement for advertising.

LP: What role do you think mobile marketing will play in the future of online marketing?

SG: Mobile marketing demands permission. You can’t do it as a spammer.

LP: What are the three trends that online marketers should have on their radar for 2008?

SG: Make great stuff. Get rid of the factory. Measure.

LP: What are the top challenges and hurdles that marketers are facing right now?

SG: This whole thing about “prove it,” and show “ROI” is totally bogus. There’s no ROI on TV or other traditional media. Why do I have to prove that the measured thing is better than the unmeasured?

LP: I keep wondering if marketers will become the new “celebrity chefs.” Do you see a time when marketers will be garnering more PR, praise and adulation than CEOs?

SG: I see a time (now) when the great marketers are the CEOs. Like Steve Jobs of Apple and Howard Schultz [chairman and CEO of Starbucks] and Sir Richard Branson of Virgin Corp.

LP: Is there an industry, vertical or niche that is poised to benefit more than others from the evolution of online marketing?

SG: The only people who won’t want to play in this space are those that make commodities, because it makes it more brutal. The neat opportunity is that almost anything can stop being a commodity (bottled water, micro steel mills, etc.)

LP: What is your vision of online marketing five years from now?

SG: When online is everywhere, all the time, it’s all online marketing.

ABCs of Online Marketing

With words entering the lexicon constantly, it’s a good idea for performance marketers to study up on some new industry jargon.

Because performance marketing encompasses a variety of different disciplines, including affiliate marketing, search, interactive advertising and lead generation – each with its own terminology – it can be difficult to keep up. Just getting a handle on this ever-changing industry can be a full-time job, never mind the time it takes to decipher cryptic acronyms. Planning an Internet marketing strategy is complicated. Will you get the best ROI from a CPA, CPC, PPL or a hybrid model? And how will you track your CPM and determine your CTR?

You are not alone if this question overwhelms you. Although many people who are new to the online marketing space understand the basic principles, they lack the essential vocabulary. And like any industry, it greatly helps if you can talk the talk and walk the walk.

To excel in online marketing, you have to communicate effectively with your design and development teams, your clients and potential strategic partners.

To assist those who are new to the Internet marketplace, we have compiled a list of essential Internet marketing vocabulary. Although this guide is most helpful to newbies, we think even more advanced affiliate marketers will find some useful information here.

And because this industry includes search and e-commerce, you can find an expanded list of key terms on our website. We will update that list regularly with new words that pop up in this constantly moving space.

A

Abandonment: When a user leaves a shopping cart with an item in it prior to completing the transaction.

Advertiser (also Merchant or Retailer): Any website that markets and sells goods or services. In affiliate marketing programs, advertisers contract with affiliates to get consumers to register for services, purchase products, fill out forms or visit websites.

AdSense: An advertising program run by Google enabling website owners to display text and image advertisements. Revenue is generated on a pay-per-click basis. Google uses its search technology to serve ads based on website content and users’ geographical location.

AdWords: Google’s text-based advertising system. It is cost-per-click (CPC) advertising and publishers pay only when users click on their ad. It has cost-control features that can set daily budget and limits.

Affiliate: A website owner that earns a commission for referring clicks, leads or sales to a merchant.

Affiliate Fraud: Bogus activity generated by an affiliate in an attempt to generate illegitimate, unearned revenue.

Affiliate Link: A piece of code residing in a graphic image or piece of text that is placed on an affiliate’s webpage, notifying the merchant that an affiliate should be credited for the customer or visitor sent to their website.

Affiliate Manager: The manager responsible for overseeing the marketing of a merchant’s program including forecasts and budgets, as well as communicating with affiliates regularly, establishing incentives and monitoring industry news and trends.

Affiliate Network: An intermediary between an affiliate and merchant. For merchants, it offers tracking technology, reporting tools, payment processing and access to affiliates. For affiliates, it offers a one-click application to merchants, reporting tools and payment aggregation.

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 to analyze the performance of a website or online marketing campaign.

Arbitrage: A practice through which Web publishers – second-tier search engines, directories and vertical search engines – engage in the buying and reselling of Web traffic.

Auto-Approve: An affiliate application approval process where all applicants are automatically approved for an affiliate program.

B

Backlinks (also Inbound Links): All the links that point at a particular webpage.

Banner Ad: An electronic ad in the form of a graphical image that is available in many sizes and resides on a webpage. Banner ad space is sold to advertisers to earn revenue for the website.

Behavioral Targeting: The practice of targeting and serving ads to groups of users who exhibit similarities in their location, gender or age, and how they act and react in their online environment.

Bid: The maximum amount of money that an advertiser is willing to pay each time a searcher clicks on an ad. Bid prices can vary widely depending on competition from other advertisers and keyword popularity.

Browser Helper Object: A DLL module designed as a plug-in for the Microsoft Internet Explorer Web browser to provide added functionality. Some modules enable the display of different file formats not ordinarily interpretable by the browser.

C

Chargeback: An incomplete sales transaction (for example: merchandise is purchased and then returned) that results in an affiliate commission deduction.

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

Click Bot: A program generally used to artificially click on paid listings within the engines in order to artificially inflate click amounts.

Click Fraud: The deceitful practice of posing as pay-per-click traffic for the purpose of generating false revenue by the affiliates serving the ads. In PPC advertising terms, it generates a charge per click without having actual interest in the target of the ad’s link.

Clickthrough Rate (CTR): The number of clicks an ad receives, divided by the total number of times that ad is displayed or served (represented as: total clicks / total impressions = CTR). For example, if an ad has 100 impressions and 3 clicks, the CTR is 3 percent.

Client: A software program that is used to contact and obtain data from a server software program on another computer. Each client program is designed to work with one or more specific kinds of server programs and each server requires a specific kind of client.

Cloaking: A deceptive process that sends search engine spiders to alternative pages that are not seen by the end user. Search engines record content for a URL that is different from what the visitor sees in order to obtain more favorable search positions.

Cobranding: A website or page to which affiliates send visitors that includes their own logo and branding.

Commission (also Referral Fee, Finder’s Fee, Bounty): The income an affiliate receives for generating a sale, lead or clickthrough to a merchant’s website.

Compensation Rate: The rate at which an affiliate receives money in exchange for goods or services. It is how affiliates are paid and should be stated in the affiliate contract.

Contextual Advertising: The term applied to ads appearing on websites or other media where the ads are selected and served by automated systems based on the content displayed by the user.

Contextual Link: The integration of affiliate links with related text.

Contextual Search: A search that analyzes the page being viewed by a user and gives a list of related search results.

Conversion Rate: The number of visitors who convert after clicking through on an ad, divided by the total number of clickthroughs to a site for that ad. (Expressed as: total clickthroughs that convert / total clickthroughs for that ad = conversion rate.)

Cookie: Small file stored on a visitor’s computer that records information. For affiliate programs, cookies have two functions: to keep track of what a customer purchases and to track which affiliate was responsible for generating the sale and is owed a commission.

Cost Per Acquisition: The cost metric for each time a qualifying action, such as sales and registrations, takes place.

Cost Per Action (CPA): The cost metric for each time a commissionable action takes place.

Cost Per Click (CPC): The cost metric for each click to an advertising link.

Cost Per Lead (CPL): The cost an advertiser pays per qualified lead.

Cost Per Order (CPO): The cost metric for each time an order is transacted.

Cost Per Sale (CPS): The term for advertising in which the advertiser pays only for those clicks where the user clicks through on the banner or ad and actually purchases a product on the advertiser’s site.

Cost Per Thousand (CPM): The cost metric for 1,000 banner advertising impressions. The amount paid per impression is calculated by dividing the CPM by 1,000. For example, a $10 CPM equals $.01 per impression.

Crawler (also Spider, Robot or Bot): Component of a search engine that gathers listings by automatically trolling the Web and following links to webpages. It makes copies of the webpages found and stores them in the search engine’s index.

Custom Feed: Enables submission to XML feeds for each of the shopping engines. The engines have different product categories and feed requirements.

Customer Bounty: The merchant payment to an affiliate partner for every new customer that they direct to a merchant.

D

Dayparting: The ability to specify different times of day – or day of week – for ad displays, as a way to target searchers more specifically. An option that limits the serving of specified ads based on day and time factors.

Data Feed: A text file that contains the information needed to generate a website. It is provided either directly to the affiliate or indirectly through a network. The affiliate then converts the data feed into a database, which is then used to populate webpages full of products.

Deep Linking: Linking to content buried deep within a website.

Delisting: When webpages are removed from a search engine’s index.

Demographics: The term that refers to specific information about a population or a target market. Demographics include information such as age, sex, geographic location, and size of the group.

Destination URL: The specific location within a site where the user who has clicked on the ad should be directed. The destination URL does not have to match the display URL but should be in the same domain.

Distribution Network: A network of websites or search engines and their partner sites on which paid ads can be distributed. The network receives advertisements from the host search engine, paid for with a CPC or CPM model.

Domain Name: Controlled by the worldwide organization called ICANN, domain names are obtained on a first-come basis and are used to identify a unique website.

Doorway Page (also Gateway Page): A webpage created expressly in the hopes of ranking well for a term in a search engine’s non-paid listing. It does not deliver much information but is designed to entice visitors to enter.

Dynamic Content: Information of webpages which changes, or is changed automatically.

E-F

Earnings Per Hundred Clicks (EPC): Earnings or average payout per hundred clicks.

Earning per Thousand Impressions (EPM): Earnings or average payout per thousand impressions.

Eighty Twenty Rule: A rule of thumb that dictates that typically 80 percent of the products sold in a product category will be consumed by 20 percent of the customers.

Escalating Commission (also Sliding Scale): A compensation system based on an increase in the money paid to an affiliate. It is a percentage commission that increases based on the achievement of certain targets, such as specific number of copies sold.

Feeds: A Web document that is a shortened or updated version of a webpage created for syndication. Usually served at user request, through subscription; also includes ad feeds to shopping engines and paid-inclusion ad models. Ad feeds are usually in eXtensible markup language (XML) or rich site summary format.

Freemium: A business mode that offers basic services for free, or is ad supported, but charges a premium for advanced or special features. The model is popular with Web 2.0 companies that acquire companies through referral networks, organic search marketing and word of mouth.

Frames: An HTML technique that allows two or more pages to display in one browser window. Many search engines had trouble indexing websites that used frames, generally only seeing the contents of a single frame.

G-H

Gateway Page (also Doorway Page): A webpage created in hopes of ranking well for a term in a search engine’s nonpaid listings.

Geographical Targeting: The analytical process of making decisions on the regions and locales on which a company should focus its marketing efforts.

Hit: Request from a Web server for a graphic or other element to be displayed on a webpage. Sometimes the misleading term hit is not the same as a visitor.

Hybrid Model: An affiliate commission model that combines payment options (i.e., CPC & CPA).

I

Impression: An advertising metric that indicates how many times an advertising banner, link or product on the Internet is viewed.

Inbound Link: A link to a particular page from elsewhere on the Internet. Inbound links are important to SEO because many search engines’ rankings are at least partially based on the amount of inbound links.

Index: The database of webpages maintained by a search engine or directory.

Interactive Agency: An agency offering a mix of Web design and development, Internet advertising and online marketing, or e-business/ e-commerce consulting.

K-L

Key Performance Indicators (KPI): Metrics that are used to quantify objectives that reflect the strategic performance of online marketing campaigns. They provide business and marketing intelligence to assess a measurable objective and the direction in which that objective is headed.

Keyword(s): The word (or words) 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.

Keyword Buys: The act of bidding on specific search terms related to a specific industry.

Keyword Density: The number of repetitions of a keyword as a percentage of the total word count of a webpage. For example, if a webpage has 200 total words on it and 20 of them are keyword advertising, then the keyword advertising has a 10 percent keyword density on the page.

Keyword Domain Name: The use of keywords as part of the URL to a website. Positioning is improved on some search engines when keywords are reinforced in the URL.

Keyword Marketing: The method of getting a message in front of people who are searching through the use of particular words or terms.

Landing Page: The specific webpage a visitor reaches after clicking on a search engine listing, pay-per-click ad or banner ad.

Lead Generation: Websites that generate leads for products or services offered by another company. On a lead generation site, the visitor completes a contact form to get more information about a product or service. The submitted contact form is considered a lead.

Link Bait: A useful, entertaining, creative Web content or Web tool that encourages website owners to link to it.

Linkspam: A company attempts to place as many inbound links as possible to its site regardless of the context of the originating site.

Listing: The information that appears on a search engine’s results page in response to a search.

Loyalty Affiliates: Affiliates who offer incentives to their members with cash-back or other benefits and rewards to shop through their website. Often they own cash-back shopping websites.

M-N

Manual Approval: An affiliate application approval process where all applicants are manually approved for an affiliate program.

Merchant Account: An account with a payment processor for settlement of credit card transactions. Any merchant that takes credit card orders must establish a merchant account.

Meta Tag: A way to describe various aspects of a webpage that is not intended for users to see. Meta tags pass information to Web crawlers and spiders along with browsers and other applications.

Minimum Bid: The least amount that an advertiser can bid for a keyword or keyword phrase and still be active on the search ad network. This amount can range from $0.01 to $0.50 or more for highly competitive keywords, and is set by the search engines.

Multilevel Marketing (also Two-Tier Marketing): Affiliate program structure whereby affiliates earn commissions on their conversions as well as conversions of webmasters they refer to the program.

Nanopublishing: An online publishing model that uses a small-scale, inexpensive operation to reach a targeted audience, especially through blogging. Sometimes communities of shared interest emerge quickly online, such as PaidContent.org and Gawker.com.

Niche Sites: A website oriented toward a very specific topic or audience. Niche sites often have high traffic and items can bring higher prices than on general purpose sites because they serve customers looking for unique content.

Opt-in Email: Email information that the recipient explicitly requests such as a newsletter or eZine.

Optimization: Changes made to a webpage specifically to improve the positioning of the page on search engines.

Organic Search Results: Non-paid search engine results (also called natural search) – the pages that search engines find in a vast index of the Web that the search engine determines are the best matches for the search keywords.

Outbound Link: A link on a webpage leading to other webpages both on the same website and other websites.

Page Rank: An indicator of the value of a webpage that is used for ranking in search engine results and that is governed by a proprietary formula by search engines. It is based on factors including the number and quality of links to a website and the content of the website itself.

Page View: The term for the loading and screen presentation of a single webpage.

Paid Inclusion: Advertising program where pages are guaranteed to be included in a search engine’s index in exchange for payment.

Paid Listings: Listings that search engines sell to advertisers usually through paid placement or paid inclusion.

Paid Search: Paid search often referred to as pay per click (PPC) is a strategy used by a large number of affiliates.

Parasite: Software that works on a person’s computer, typically without their knowledge or consent and without a visible interface. It can include software that is installed along with another application.

Pay Per Call: A model of paid advertising similar to PPC, except advertisers pay for every phone call that comes to them from a search ad, rather than for every clickthrough to their website landing page for the ad.

Pay Per Click (PPC): A program where an affiliate receives a commission for each click they refer to a merchant’s website. PPC offers some of the lowest commissions and high conversion ratio since visitors need to only click on a link to earn the affiliate a commission.

Pay Per Impression (PPI): An advertising pricing model in which advertisers pay based on how many users were served their ads.

Pay Per Lead (PPL): A program where an affiliate receives a commission for each lead that they generate for a merchant website such as completed surveys, contest or sweepstakes entries. Pay per lead generally offers midrange commissions and midrange-to-high conversion ratios.

Pay Per Sale (PPS): A program where an affiliate receives a commission for each sale of a product or service that they refer to a merchant’s website. Pay-per-sale programs usually offer the highest commissions and the lowest conversion ratio.

Q-R

Query: The word (or words) a searcher enters into a search engine’s search box.

Quality Score: Reflects an ad’s historical CTR, keyword relevance, landing page relevance and other factors proprietary to Google. Yahoo refers to it as a Quality Index.

Rank: How high a particular webpage or website is listed in a search engine’s results.

Really Simple Syndication (RSS) Feed: A data format for syndicating news and other content. Subscribers to RSS feeds are notified every time content is updated on a particular site.

Reciprocal Link: A link exchange – the process whereby two websites’ owners agree to display a link to each others’ sites.

Residual Earnings: A program that pays affiliates not just for the first sale, but all additional sales made at the merchant’s site over the life of the customer.

Revenue-Sharing Program: A program that allows merchants and website owners to increase sales. The host site links to the merchant site with a banner, button or text link, for a fee. The merchant pays the website owner for increased traffic, sales and leads from the host site.

S-T

Search Engine Marketing (SEM): Tactics that seek to promote websites by increasing their visibility in search engine results. SEM methods include SEO, paid placement and paid inclusion. It includes the practice of buying paid search listings with the goal of obtaining better free search listings.

Search Engine Results Page (SERP): The page the search engines returns to after a visitor entered a search query.

Search Engine Optimization (SEO): The practice of altering a website so that it does well in the organic, crawler-based listings of search engines. The process usually involves choosing targeted and relevant keywords and phrases that will drive traffic to the site.

Shopping Cart: The term for software that is used to make a site’s product catalog available for online ordering, whereby visitors may select, view, add, delete and purchase merchandise.

Social Network: Online networks of communities who share interests and activities or who are interested in exploring the interests and activities of others, which necessitates the use of software.

Spamdexing: Also called search engine spamming. It combines techniques employed by some Web marketers and designers to fool a search engine’s spider and indexing programs to ensure that their website always appears at or near the top of the list of search engine results.

Spider: A software program that crawls the Internet by following links and indexing webpages.

Sponsored Listing (also Paid Listings or Paid Sponsors): A term used as a title or column head on search engine results pages to identify paid advertisers and distinguish between paid and organic listings.

Spyware: Generally refers to deceitful software that is secretly installed on a user’s computer and that monitors use of the computer in some way without the user’s knowledge or consent. Most spyware tries to get the user to view advertising and/or particular webpages.

Super-affiliates: The best affiliates in a program based on performance and earnings, usually the top 1 percent, who generate the majority of revenue for a program.

Targeted Marketing: The act of making the right offers to the right customer at the right time.

Text Link: A link that is not accompanied by a graphical image.

Tracking Method: The way a program tracks referred sales, leads or clicks. The most common is by unique Web address for each affiliate or by embedding an affiliate ID number into the link that is processed by the merchant’s software.

Trademark Poaching: The act of using PPC ads to appear as though they have come from a merchant (using its trademark). When clicked on, the ad directs the consumer to the trademark owner’s site through a link that inserted the affiliate ID, generating a bogus commission for any resulting purchase.

Trusted Feed (also Paid Inclusion): A trusted feed is a fee-based custom crawl service offered by some search engines. These results appear in the ‘organic search results’ of the engine. Typically, the fee is based on a ‘cost per click,’ depending on the category of site content.

V-Z

Visitor Segmentation: Differentiating of users to site by categories such as age, sex, etc.

Visit: Measurement that has been filtered for robotic activity of one or more text and/or graphics downloads from a site without 30 consecutive minutes of inactivity and which can be reasonably attributed to a single browser for a single session.

Web 2.0: Also referred to as the Semantic Web. In this iteration, sites, links, media and databases are ‘smarter’ and able to automatically convey more meaning than those of today.

Widget: A small application designed to reside on a PC desktop or within a Web-based portal or social network site offering useful or entertaining functionality.

XML (eXtensible Markup Language): Its primary purpose is to facilitate the sharing of structured data across different information systems. It is used both to encode documents and to serialize data.

Kristopher B. Jones: The Small-Town Big Man

His speech is peppered with “awesome” and “ready to rock and roll,” as if he were fresh out of high school. He’s only 32 but he feels luck has a lot to do with his good fortune. He took what was basically an idea to sell jam and turned it into a successful online marketing company.

But we’re jumping ahead. Jones is a small-town fellow. He grew up around the quiet northeastern Scranton, Pa., region – in towns with quaint names like Forty Fort and Wilkes-Barre. He still lives in basically the same area where he was raised and headquarters his business not far from those same stomping grounds.

He knew early on that he wanted to be in public service – drawn to the tantalizing returns of politics. After graduating high school in 1994, he got a full scholarship to Villanova University to study experimental psychology in 1998 after graduating from Penn State, but questioned whether he really wanted to be a clinical psychologist.

During that period, his brother Rick called and asked, “What do you think about selling grandma’s Mississippi mud over the Internet?” Jones says while he was the resident computer guru in school and was sitting on a lot of school and credit card debt, he was pretty committed to going to law school. He decided he would finish out his law degree and start this gourmet food business.

Grandma’s Mississippi mud was actually a kind of jelly he had eaten as a kid. He calls it a kind of gourmet dip. He typed the ingredients into the Web and out came the popular Northeast dip called pepper jelly. But Jones didn’t want to sell just another pepper jelly. In the end – and after consulting a friend in the food business – they decided on “Grandma Jones’ Originals Pepper Jam.”

It Started With the Jam

That, Jones says, was when his entrepreneurial spirit came out. He could point to other adventures in his business past – the lawn business he had in school and the 1-900 psychic service he started, even day trading – but they never really made any money.

The pepper jam, on the other hand, had legs. Through contacts in the gourmet food business, it started to get some traction. The business was started in 1999. “My brother was the creative side and he had all these flavors he wanted to do,” Jones says. “It all happened pretty quickly. I was going to do all the marketing. I drove the branding and launched the website called pepperjam.com. We personalized it with pictures and stories.”

Soon they realized in order to get traffic and sales, they needed to rank higher in the search engines. The most obvious way at the time was to cycle in fresh content. So, they then came up with the idea to interview famous chefs and put those up on the site. In the end, they posted interviews with the likes of Paul Prudhomme, Emeril Lagasse and Jorge Bruce, to name just a few.

Bruce sampled the product and loved it. At the time Bruce was looking to hire a consultant to get his brand and other chefs online, Jones said. “I will try to cook with this product,” he told Jones. “He may have thought we had offices when we were really operating out of a kitchen,” said Jones. Bruce suggested QVC. “I went into shock,” says Jones, “and had to put the phone on the bed and take a breath a minute. At the time, he was the highest-grossing chef on QVC.”

The chef interviews were getting a lot of traffic now and the question of how to monetize it all became important. That’s when Jones joined LinkShare and started adding affiliate links (his first check from ValueClick was for something like $37). He was just about to leave for law school and was trying to make money through affiliate marketing when in early 2000, he says he began his marketing journey in earnest. “I still own 50 percent of the gourmet food business,” he said. His brother told him to take the marketing business and he’d handle the product. “I knew that the Net marketing side of this requires work. I just started to build out websites – build out content based on a theme. My first was cookware.”

Also in 2000, he adds, Google came out with AdWords. “I was generating close to $100,000 per month in affiliate profits,” he said. He was doing this while doing his consulting work and serving as law school class president two years in a row.

“Once I had money, I wanted to do something with it,” he says. He put all the cash he had been earning while in school into this single idea – to turn his super-affiliate status into a new kind of marketing business – pepperjam.com. “We got an office. I hired my best friend as COO. We knew we could hire smart, young professionals and could help these businesses that were coming online and had no clue what affiliate marketing was,” Jones says.

Getting Into the Affiliate Game

2003 was the breakout year. Jones didn’t realize the impact his company was having until he went to his first LinkShare symposium (they got invited through Overstock.com). “We went to this event not knowing anybody and thought no one knew who we were,” he says. “My attitude was, ‘I’m a super-affiliate, let me manage your affiliate program.’ We were blown away.” When a merchant rep found out who he was, she hugged him. “You’ve been making us so much money,” she told him and introduced him to a whole bunch of merchants. “We were very well received,” he says.

With that boost in his pocket, Jones parlayed that excitement into a new small office and started to hire employees. From 2003 to 2005 he built his client list. From 2005 on, he says, it took on a life of its own. In 2006, the company was about 28 employees. Then pepperjam made Inc. magazine’s list of the 500 fastest-growing companies in the U.S. It was the only affiliate marketing company on the list. “As a search engine marketing agency, we were one of three with iCrossing and MoreVisibility.” All he could say was, “It was just a big party. We’re pepperjam, we’re in the black and we’re an Inc. 500 company.”

While still nurturing a desire to serve in a public way, he was invited to speak at a conference for the first time in 2004. He’s been hooked ever since and speaks quite often all over the country. It kind of feels like he’s class president all over again.

Somewhere amid all this work, he did manage to get married – to someone who works for the company. He said while his wife, Robyn, and he did attend the same high school, they weren’t pals. One night when home from school for a spell, his COO and he went out for a drink and spied her. They remembered her from high school. Jones sat back and watched his COO walk over and try to flirt with her. Finally, Jones joined them and he said they hit it off right away.

“She kind of asked me out after 60 seconds,” he says, “and here she was talking to my friend for the last 15 minutes; but we’ve pretty much been together ever since.” She wasn’t happy at her other job and Jones asked her to work for Pepperjam.

“I know you don’t want to work for your boyfriend, but I’ll have you work from home and write an employee manual or something. We can have you write out some client case studies,” he remembers telling her. After about a month, she began to come into the office and has been with the company for two years.

Growth Spurt

Jones says there has been a lot of interest to be acquired and from venture capital money. Last year, with about 50 employees “we had to think about crossroads – and decided to focus on our own technology,” he says. The company decided communication in this industry was the problem. “It is difficult to get in touch with your affiliates to admonish or to praise them,” he says. There was a lack of affiliate transparency. “We said, ‘We will tell you who are the key affiliates and can protect your brand.'”

This led to the notion of launching a Pepperjam network. Jones worked and consulted with hundreds of affiliates and merchants to preview the network – robust players such as Affiliate Classroom’s Anik Singal, and super-affiliates Lee Dodd and Jeremy Schoemaker, to name a few.

In January 2008, he launched pepperjamNETWORK. This essentially turns Pepperjam.com into a technology company with exclusive merchants such as luxury brand Judith Leiber, clothier Ben Sherman and Jelly Belly. Jones sees this as a super-transparent network that can be an alternative to the big three – LinkShare, Commission Junction and Performics – as well as an alternative to ShareASale. “We are not going up against the big three networks,” he added. “They are much better financed than us and bigger. There is still only one investor in pepperjam and that is me.”

Jones proudly says pepperjam.com now has about 105 employees in a 13,000 square foot floor of a building in Wilkes-Barre. He has five executives and 15 senior-management-level people. He has divisions now – online media planning and buying, search engine marketing, pepperjamNETWORK and full-time salespeople – their first. In the next 18 months, he predicts 300 employees. But he thinks of everyone as family. His wife is director of affiliate marketing; his bulldog is in the office every day. He doesn’t want it to be a corporate environment – there’s Free-Pizza Fridays, ping pong and “Guitar Hero” on the floor. In early 2007, they launched a corporate blog where a randomly chosen employee is given less than 30 seconds’ advance notice to come up with a presentation to be videoed and then posted to the site (some can be found on YouTube; some featuring Roxy the bulldog).

Amid all this success, Jones was approached in the early summer of 2007 by publisher Wiley to write a book on SEO and search marketing. “Search Engine Optimization: Your Visual Blueprintâ„¢ to Effective Internet Marketing” will be published this spring. “In fact,” he said, “I had always dreamed of writing a book in college. I always thought, how can you make a difference? I can join the clergy, be a great father or write a book.”

If that isn’t enough on his plate, Jones and his wife are expecting their first child in August. That’s not going to slow him down. “We are very focused on building out what we are creating,” he says. “We have a bunch of families now; we’re not just a small family anymore. I’ve always been the kind of person that believes that my time hasn’t come yet. I want to focus on being a great father, and from a business standpoint we want to become a great affiliate network. I want to see where we take it.”

While the future seems like a busy one, Jones notes that “pepperjam has just started.”

Eastern Promises

Japan’s had it hard. After nearly a decade of stock market doldrums and an economy on the brink of disaster – just as the rest of Asia struggled too – Japan bounced back. Growth happened. Its economy is still a tad slow, but there are many industries looking way up. Online marketing is one of them.

Of Japan’s 130 million people, about 88 million are online. That’s about 68 percent of the population, according to Internet World Stats (Asia), compared with 210 million of the U.S.’s 300 million and 137 million of China’s 1.4 billion residents. Japan’s may seem like small numbers, but the momentum of online marketing and the ever-growing popularity of affiliate marketing in Japan make it a region everyone’s talking about.

Blogging, for example, in Japan is a popular way of getting products in front of the masses. Technorati Japan says that more than 85 percent of Japan’s bloggers write about companies and their products – and that over half of these bloggers have been contacted by companies to extol their wares. Japan’s Ministry of Internal Affairs and Communications says that bloggers totaled about 8 million in that country, making for an in-blog ad market of about $60 million last year.

Expansion on the Way

In the 1990s, the Japanese did not use credit cards much for online purchases, as bank transfers and postal transfers made e-commerce slow and a waiting game. But by 1999, a tech-hungry culture emerged and online spending came with it. Pay-per-performance business models were not far behind.

A leader in this space is online retailer Rakuten and its affiliates – managed through LinkShare Japan, a U.S.-led affiliate company acquired by Rakuten in 2005. Rakuten is the leader in online shopping destinations in Japan, so their penetration made them a default major player. In fact, Rakuten plans to be in about 27 more markets by 2012, according to Atsushi Kunishige, a vice president at Rakuten. He says they will use LinkShare, for example, as a way to "expand our business into the international market. We want to open a full-fledged Internet mall [abroad]."

Rakuten’s 20,000-plus online stores and merchants did about $66 million in operating profit in the second quarter of 2007. With the company traded publicly on the Japanese stock market, that’s a market capitalization of more than $5 billion.

LinkShare Japan has about 68 percent of the top-selling merchants in Japan and is the leader in customer satisfaction, according to a survey by Japan’s Affiliate Marketing Association. Atsuko Umemura, director, corporate planning, of LinkShare Japan, says that their focus on per-sales kinds of merchants has helped make them a leader. "Affiliate marketing has proven to have the best ROI for us," she says.

Late Bloomers

While the U.S. affiliate industry can trace its beginnings to the mid-1990s, the first affiliate providers in Japan didn’t start up until 1999. The U.S. market has had a few years to evolve and grow, whereas the Japanese affiliate space is still considered a "juvenile." There are more than 80 affiliate networks in Japan that cover both Web and mobile platforms. Some of the more high-profile affiliate networks include Adways, Access Trade, LinkShare Japan, Fan Communications (A8), TrafficGate, ValueCommerce and Zanox Japan.

Anthony Torres, president of affiliate marketing program management company MetaFlo Marketing, which is based in Japan, points out that the key difference between the U.S. market and the Japanese market is that the "Japanese affiliate networks can service only Japanese sites. U.S. networks such as Commission Junction operate worldwide due to English being the most popular language for Web content. So, no matter how large the Japanese affiliate industry gets, it will never be as big as the English-speaking networks," Torres says.

He also notes that Japan is still behind the curve in tracking technology and commission sophistication. For example, U.S. advertisers have more choices in how they reward affiliates. Generally, U.S. affiliate networks allow merchants to pay affiliates based on subscription status of digital content and, of course, future sales even if buyer clicks go directly to a merchant store. The U.S. networks also have more payout choices. A small CPA, plus a larger percentage of future sales generated by the lead is a method that hasn’t made it to Japanese network platforms.

Torres notes that the cost of acquisition of a typical online customer is high in Japan. "When you add in customer service and all of the accumulated costs in the sale cycle, you are left with a lower margin per sale," he says. Merchants in Japan are just not used to paying high commissions or lifetime commissions on a customer, he adds. "As the industry matures here and the ability to attract online buyers becomes more challenging, we may see online merchants less reluctant to try more aggressive commission terms." Unique to the Japanese market seems to be the cross-investment of media sites and affiliate networks. In order to increase media coverage, many networks invest in or make their own in-house media sites.

Considered the real pioneer in Japanese affiliate marketing is ValueCommerce (Yahoo Japan took a sizable stake in the company in 2005), started by a New Zealander named Tim Williams. ValueCommerce has more than 50,000 websites and blogs in its network, with about 2,000 advertisers. The company has about $43 million in annual revenue and trades on the Tokyo Stock Exchange. Goldman Sachs veteran Brian Nelson is now CEO, having come on in 2000 as COO. Nelson says that "we focused on our strengths, continued to hire great people, and launched new products and services that kept new customers, especially large brand name customers, coming in to work with us."

Consolidation is Coming

Nelson says that a large product database for shopping and their Web 2.0 applications have kept them in the No. 1 spot. It also doesn’t hurt that there is some consolidation going on in the Japan online marketing space now. "I have been telling people in the market for a long time that consolidation is coming " and it is in full swing now," Nelson says. LinkShare’s Umemura says, "It is a very saturated market right now. There is not enough room for everyone to survive."

Online marketing observers in Japan note that there are just too many networks trying to service the same advertisers. With about 1.3 million affiliates registered with the major networks and the majority of transactions driven by a group of search affiliates and "incentive media sites," there are not enough "quality" affiliates to take on all the offers out there. This means the networks are starting to look at new channels for ads.

One of those new channels is mobile, a platform that has performed very well for Japan. Because the Japanese adopted 3G standards fairly early, more than three-quarters of all cell phones in Japan have smooth Internet access. This means delivery of interactive content and ads to about 86 million cell phones (compared with 31 million in the U.S.). There are more than 48 mobile affiliate networks in Japan, with names such as Moba8, Pocket Affiliate and Smart-C. In 2005, the Japanese spent more than $3.8 billion on purchases over cell phones – 57 percent over the previous year. In addition, the CPA-based mobile affiliate provider model does much better in Japan than in the U.S., where CPC or CPM models prevail. It’s been said the culture in Japan plays a role in this since there are so many more commuters in Japan – leaving more travel time for the Japanese to experiment with their cell phones.

And with greater mobile traffic comes the opportunity to serve more Internet phone search advertising. Local search engines like Goo, Nifty and BigGlobe get a share of those eyeballs, but the leaders are Yahoo Japan (with about 63 percent of searches), Google Japan at 23 percent and about 14 percent left to split between MSN and the regional engines. Yahoo Japan is also the biggest local player in Internet auctions, Web email, mobile content and broadband.

Search Challenges

Japanese online marketing agency and search specialist Sozon sees challenges in the search marketing arena. One area in SEO that is unique to Japan culturally speaking, says Andy Radovic, VP of strategy and planning at Sozon, "is its variety in language used. Essentially, there are four methods of writing – kanji, the character system borrowed from China; hiragana, a more simplified form of kanji; katakana, the Japanese expression for foreign words; and romaji, which is the alphabet," he says. "Depending on what you intend to communicate, you may use just one or a combination of these. This greatly impacts the keyword planning stage of your SEO program. Another major difference is Japan’s reliance on Yahoo as the search engine of choice."

Radovic notes that Japanese-run companies are the leaders in services and customized solutions. "There are very few successful, market-leading international companies in the online space," he says. The international companies that operate in Japan tend to do so with a local partner. The exceptions, he says, are technology- dependent products, where some U.S. companies are in the lead, such as in search (Google) and bid management and Web analytics tools (like Omniture). "Some of the Japanese homegrown companies in the mobile, travel and insurance space are getting more sophisticated in their online marketing programs and are tracking to off-line sales," he says.

Scott Neville, COO of Sozon, says that, creatively speaking, ad messages need to really know their audience. "International ad concepts simply will not work most of the time," he says. "Text is definitely king here. More information is better and creative is often very busy with multiple propositions." He says you will need to provide as much detail as possible in your campaigns – that Japanese users will definitely read your privacy policy. He says that text email is the standard and somewhat limiting in terms of email marketing campaigns that may rely on HTML. Flash and graphic-centric sites tend not to work that well at either an advertising or a site-campaign level. He says that Flash campaigns "are not really supported by major portals for media buying and tend to be not that well received." Also, comparison campaigns are not generally used in Japan and "culturally not respectable to run."

While online ad agencies in the U.S. are slowly starting to synergize their off-line traditional ways and the brave new web of interactive display advertising, the Japanese banner ad companies are not doing too well. Two online ad agency leaders, Cyber Communications and D.A. Consortium, actually had negative growth in recent years.

The Network View

Aside from the few U.S. companies acquired or now run by Japanese companies, there are few pure U.S. players in this market and there are not likely to be more anytime soon. Observers note that U.S. networks just don’t have the Japanese-language support. While LinkShare and ValueCommerce have a bilingual platform interface, they are the only two out of dozens. One of the U.S. networks to gain a measurable foothold in Japan is DTI. They host affiliate programs for Japanese adult sites, but since most networks in Japan won’t handle porn ads, DTI has found its niche in this area. Some experts point out that one opportunity for U.S. companies would be to acquire small- to medium-sized networks and re-brand. LinkShare’s Umemura says that in Japan, U.S. companies could have come in at an earlier stage, but that "starting now from scratch would be pretty difficult whether you are a U.S. or European company. There are some smaller U.S. networks that do quite well here."

In terms of what hasn’t been popular in Japan’s affiliate programs are third-party management vendors. Currently, only a handful of the affiliate networks have management services, mainly because they are pushing their own media. However, experts say, tool and service vendors could eventually find a market in Japan. Keywords tools such as Wordtracker, recruiting tools such as Syntryx Executive Solutions and competitive keyword research tools such as the makers of KeyCompete could enter the market fairly easily.

Perhaps the best indicator that the online marketing landscape in Japan is maturing is the formation in May of 2006 of the Japan Affiliate Service Kyokai, an association that started to draw up guidelines, educate the public and monitor ethical behavior in online marketing. The six major networks in Japan founded the association when they felt that "shady affiliates" were starting to encroach on the growth of the business.

A learning curve, however, still applies. Sozon’s Radovic says that "everyone is struggling with how to market in a Web 2.0 environment. The Japanese blog and peer consumer trust are major drivers of consumer purchase. So this is an ongoing challenge." And solutions to the challenge will certainly add up to a better marketing landscape.

The Sticky Question of the Results Page

In the mid-to-late ’90s, none of the search engines wanted to be mere search engines, because searchers quickly left their sites. Instead, they largely ignored search to create portals – those sticky sites they hoped would show more advertising to each visitor by catering to all of their information needs.

Then Google came along. Google gained prominence as an unvarnished search engine that got searchers off the search page to where they really wanted to go, and did it faster than the rest. Over time, Google’s search emphasis has made it a far more profitable company than those sticky portals, and Microsoft, Yahoo and the other portals have been forced to refocus on search in recent years.

Well, everything old is new again. Led by Google, everyone is trying to be sticky again. As with the original portal mania, it’s all about advertising. It’s different this time, however, because instead of ignoring search, they are making search itself sticky. Let’s look at what’s happening and what search marketers can do about it.

The New Search Results Page

As you might expect, with multiple search engines out there, we can never talk about the new results page – these changes are being seen in various degrees with each search engine’s results pages. So what’s happening?

From time immemorial (around 1998), the main results page for each search engine has contained a list of 10 organic links to Web pages – period. Each showed paid search ads around those organic links, but those organic results pointed to pages on vanilla websites. If searchers wanted images, or videos, or news, they needed to use more specific searches devoted to those kinds of content.

A few years ago, Google began offering its OneBox capability (such as showing movie times and weather forecasts at the top of its results pages). But that was a small step compared with what the search engines are doing now. The new search results pages break the content type barrier.

Google now offers Universal Search, where all of these content types are blended together on the page. The top search result might be a video or an image, or even a news story, rather than a standard Web page. Yahoo and Microsoft have followed suit. Similarly, Ask.com has unveiled Ask3D, which stacks the search results so that different content types are shown in separate areas on the same results page. Try typing “darth vader” into each of the engines to see what you get.

These newfangled search results pages have been much ballyhooed, but so far, relatively few keywords get the Darth Vader treatment. Search marketers should expect that these blended and stacked results will affect more and more keywords over time, however, for two reasons:

The search results are better. Google and friends believe that their new approaches serve more searchers than their plain Web results predecessors. It does make sense that searchers are looking for more than just Web pages.

Search engines sell more advertising. Some search engines don’t like to talk about their monetary motives for new search results pages, but Yahoo’s Tim Mayer has been refreshingly open about their goal: to keep searchers on their results pages for as long as possible.

Similarly, these new search result pages often highlight Web properties owned by their parent company. Google shows its YouTube videos, Yahoo shows its Flickr photos, Ask.com shows its CitySearch results, each of which shows more of their advertising.

What Search Marketers Can Do

As a search marketer, you can’t control which results the search engines decide to display, but you can provide the kinds of content that the engines are looking for. As these new search results pages begin to be seen for more and more searches, search marketers should:

Use what you have. You might feel as though you don’t have any of these new content types. But you have press releases that could show up in news searches. You might have TV commercials and other videos that you can post on YouTube and on your own website. Don’t overlook the existing content assets you can start with.

Create new content. If Google wants new kinds of content, then feed the beast. Start a blog. Take photos of your products, your customers, your employees – whatever you think people want to see – and post them on Flickr and on your website. Put some interviews on video, or tape live product demonstrations. Provide opportunities for customers to create content for you, such as message boards, product reviews and wikis. All of this content is the new fodder for search engines.

Optimize your content. For the content that you create, continue using your target keywords in titles and elsewhere, just as you always have for old-fashioned Web pages. For non-text content – such as photos and videos – titles and descriptions are especially important. Submit your content to as many aggregators as you have time for, not just YouTube and Flickr, for example. Claim your blog in Technorati (and in other blog search engines and directories). And place social bookmarking buttons on your pages for Digg, del.icio.us and other sites, so your readers can bookmark your content for other social bookmarking users to see.

Although designing your content with interesting titles and descriptions is timeworn advice, it still works. Applying this technique to new content types, such as blog posts and videos, is a great way to start.

Make compelling content. Your Web pages have always needed to be interesting to attract the links critical for high search rankings. These new content types are no different. Moreover, some experts believe that search engines are looking beyond links to other indicators of intriguing content.

No one knows exactly what search engines consider in their ranking algorithms, but speculation abounds that relevance ranking for blogs is based partially on subscriber counts. Videos may get a boost based on how many times they’ve been viewed on YouTube, or on the number of viewer comments posted. Expect search engines to continue to use whatever data is available to determine the popularity of each new kind of content – it’s not just inbound links anymore.

What’s most striking is that marketers who’ve created the most interesting content are beginning to be rewarded for it by the search engines. For those search marketers that were optimizing only Web pages because that’s all the search engines rewarded, they’re getting left in the dust by those marketers that have provided the new content types their customers are looking for.

Get Inspired

Has this ever happened to you?

It’s late evening and your weekly newsletter, which would normally be queued for delivery on your autoresponder and blog by this time, is still nothing more than the vast white expanse of a blank Word document. Not only haven’t you written a word, you also don’t have the first clue what to write about, or which product you should try to sell.

Although you are usually passionate about your topic – organic vegetable gardening – you begin to wonder what the heck you were thinking when you chose to build a site around a seasonal niche.

Throughout the spring and summer, your income spiked nicely every time you sent out your weekly newsletter. As temperatures started to drop however, so did your subscribers’ interest, sales revenue and the better part of your motivation.

A vision of the repo man coming to get your new truck convinces you to persevere into the wee hours if necessary – but before long, the thought occurs that you simply have nothing to say on the subject and now you’re paralyzed with fear.

Well, fear not. Inability to select a topic, last-minute crisis writing and paralysis are all symptoms of writer’s block; something most writers experience at some time or another. With some strategic planning, you can prevent writer’s block, spark your imagination and earn commissions in any niche – at any time of year.

The first step is to build a “swipe” file that is chock-full of ideas for future articles and which you can access whenever you are in need of inspiration – and contrary to what the name may imply, a swipe file is not for copying other authors’ content to publish later, a.k.a “plagiarizing.” We just want to collect ideas from their work, such as headlines that grab your attention or unique topic ideas, and then create our own work based on the concept.

You can build a swipe file using an Excel spreadsheet with columns named for primary topic categories, suggested article titles, notes, relevant products and proposed publishing dates. If you have a number of sites on different subjects, create a new worksheet within the file for each topic.

Another method is to draft a post on your blog whenever you get an idea for an article. The post may consist of as little as a title and a few bullet points, but each time you log in to your blog’s interface, the draft titles will jog your memory about topics you can develop.

One of my swipe files currently holds 672 entries of both “swiped” titles and a number of fill-in-the-blank title suggestions such as “5 Quick Ways to ________,” “5 Brilliant Strategies for ________” and “How to Conquer _________.” There’s also a long list of emotional trigger words within the workbook. I find both the trigger words and the fill-in-the-blank titles are especially helpful when I already have a topic idea, but need some help crafting a catchy headline.

To start building your own swipe file, consider the following suggestions.

Although organic gardening is used as an example, the suggestions apply to any mainstream niche.

Search article directories

Article directories such as EzineArticles. com, GoArticles.com and ArticleCity. com are idea gold mines. My search for “organic gardening” at EzineArticles.com resulted in 1,540 articles targeted to people of different regions, skill levels and interests. From the results, you could quickly build a list of generic titles such as “Organic Gardening Supplies to Help You Get Started,” “Organic Weed Control” and “How to Grow Organic Tomatoes.”

Visit Amazon

At Earth’s Biggest Bookstore, I dug deeper into the topic and found Mike McGrath’s book, “You Bet Your Tomatoes! Fun Facts, Tall Tales, and a Handful of Useful Gardening Tips” at the top of the search results. Key phrases under the main title included “compost tea,” “sunny windowsill,” “Georgia Streak” and “Tomato Head.” If “Sunny windowsill” sparks an idea for an article about indoor tomato gardening, put it directly into your swipe file along with a link to the book.

Use the “Search Inside” feature to scan tables of contents. Sometimes an interesting chapter title will present a unique perspective on a topic. In this case, the first chapter is titled “Picking Your Tomatoes: Do all of these things have funny, rude, mysterious names?” which prompts an idea for an article about the best types of tomatoes to grow indoors.

While you’re at it, swipe the “Listmania!” title “The Dirt Diva’s Picks: A List of ‘Green’ Books to Save the Earth!” as a reminder to put your own Top 5 or 10 list of recommended books together.

Items such as the AeroGarden Indoor Gardening Kit and Felknor’s Topsy Turvy Upside-Down Tomato Planter can be added to the file as potential products to sell.

Visit relevant forums

Dig up what gardeners are saying right now at forums such as GardenWeb. com and HelpfulGardener. com. The latest posts with the most replies are a good indicator of hot topics.

Set up Google Alerts

To get the latest scoop on tomato hybrids, Google will send you email updates of its latest relevant search results. You can elect to receive Alerts once a day, as it happens or once a week from news sources, the Web, blogs, video or groups; or receive a comprehensive Alert with news from all five sources. Sign up at Google.com/alerts.

Read trade publications

Now you can finally put those stacks of old magazines to really good use! Subscribe to publications to stay current, and don’t forget to check whether your favorite magazine publishes an online version.

Poll your readers

Create a weekly survey and ask your readers what topics they would like you to cover. Regularly invite your readers to leave a comment on your blog by asking a question at the end of your post. Answers to such questions as “What’s your biggest gardening challenge?” will provide you with plenty of grist for the mill. The free Democracy polling plug-in can be downloaded at http://blog.jalenack.com/archives/ democracy/ or use the service at SurveyMonkey.com.

Use merchant resources

Review your merchants’ sites and recent newsletters to find out on which topics and products they are currently focusing. And although I usually advise against using merchant copy – because it is so overused by affiliates that your subscribers will question your credibility as an expert when they see it for the 10th time in your newsletter – in a real pinch, you could check a merchant’s affiliate interface for a well-written advertorial to publish on your blog. Better yet, use it as a basis to write your own product review.

Repurpose your content

If you wrote “Organic Garden To- Do List: March” in 2007, republish the piece in 2008 and incorporate any new tips you’ve picked up during the year.

Share your experience

What’s happening in your garden right now? Get out there, take some pictures, share your news and don’t forget to throw in some emotion! People are far more likely to respond to “Yikes! Giant green-horned caterpillars are eating my tomato plants!” than to yet another “Tomato Pest Management” article.

Those are but a few suggestions to get your swipe file started. Try to add to it frequently so that you always have fresh article ideas at hand.

Ideally, it’s best to create a publishing plan and work at least two to three months in advance. For example, you should be planning for Christmas in September and writing your spring articles in the dead of winter.

Not only does having a swipe file with a plan completely remove the stress of “crisis writing,” but it frees you up to react swiftly when there is breaking news within your industry. Best of all, advance planning and preparation give you the freedom to get out in the garden without looming deadlines to spoil your fun.

Think Content First

When customers start telling you that it’s time to update your website, you’ve waited too long. That’s the position that Chris George, CEO of Think First, was in when he emailed us asking to be considered for this edition of By Design Makeover.

“We established our website (http://www.thinkfirst.us) in 2005. We have grown tremendously since that time and have not updated the design or content of our website. We receive comments all the time from prospective clients that tell us that our website does not have a lot of information about our company. We are in desperate need of a makeover,” George wrote.

Well, you came to the right place. It just so happens that makeovers are what we do here. As many of you know from past issues, the first step to a successful makeover is to review what your current page has to offer.

In reviewing ThinkFirst.us, my first thought is that the logo is nice and professional looking, but a bit generic. This leads me to look around for a tagline or some other element that will tell me what this company does. Before I get to that, the animating center section catches my attention. It starts off with, “Copernicus didn’t start the earth revolving around the sun.” Next frame, “Isaac Newton didn’t make the apple fall.” That’s clever. I see where they’re going, but I’m still not sure what they do. I see some buttons (or what appear to be buttons) under that section: Technology, Process, People, Innovation. I try to click on those, but they aren’t clickable.

Finally, I get to a tagline of sorts: “Unlike consultants, we’re experts who create and implement IT strategies that allow physician practice groups to meet their business objectives.” That’s quite a mouthful, and still doesn’t tell me much about their services.

Unfortunately, besides a clever marketing animation, this home page doesn’t have anything that leads me to believe that these guys have the expertise to take my company (or healthcare organization, since that is their primary market) to the next level. How come there’s no real content about the company or what they offer? In order to create a site that is useful for visitors and potential clients, this home page should include a company overview, their services, consultants’ bios, testimonials and company news.

This is where website makeovers can be tricky. In most cases, many of the content pieces are already there – they just need to be rearranged and given the right visual priority. But when the content on an existing site is so far off from what it should be – it’s better to start the process with a wireframe.

According to Webopedia, a wireframe is “a visualization tool for presenting proposed functions, structure and content of a Web page or Web site. A wireframe separates the graphic elements of a Web site from the functional elements in such a way that Web teams can easily explain how users will interact with the Web site.” As we discovered, the graphics are not the problem for Think First. Instead, they need a wireframe that illustrates the what, where and how much for each new content component they want to add.

The great thing about wireframes is that anyone can create one using simple tools like Microsoft Word. And presenting a well-thought-out wireframe to your Web team will most certainly result in a better end product.

First, let’s go back and create a wireframe for the existing site – so we can compare apples to apples. The first thing I notice is that the site is designed for an 800×600 browser resolution. In 2005, when the site was designed, this was considered a best practice. But now that monitors and resolutions have gotten larger, it just means we’re not making the best use of our available space. Next, I see that the marketing message takes almost 45 percent of the page. While it is a nice marketing message, it’s just taking up way too much page real estate. Finally, and the real reason this page is not successful, is there is just no real content.

Our new wireframe seems to iron out all the issues. First, it’s designed for a 1024×768 browser resolution, which is the standard size on the Web today. Next, we have made the marketing message much smaller – now it’s a little over 10 percent of total real estate. And last, but certainly not least, we added lots and lots of vital content.

Wireframes are a great way to eliminate the graphical element so you can focus on which content components are most important and how best to arrange them. With news, case studies, a featured consultant and a list of services, users are sure to understand exactly what Think First offers, and they are much better equipped to make the decision to hire them.

When designing any site, it’s best to put the content first. I’m not going to go into a rant about the evils of template websites, but I do want to mention that this is exactly why most template sites are ineffective. They offer you a pretty-looking, pre-designed website, and then ask you to squish all your content into it. That is not the ideal situation when you’re looking to create a website that performs for your business.

Now, I know that you hardcore By Design readers are wondering where we ended up with the makeover for my design firm, Sostre & Associates. Not to worry; we’ve got a final follow- up column coming soon – complete with analytics data and some post-launch thoughts – but you’ll have to wait until the next issue of Revenue (Issue 23).

Until then – would you like your website to be the topic of a future edition of By Design Makeover? Send your name, company, contact information (phone, email, etc.), a brief description of your business and its goals, and, of course, your URL to bydesign@sostreassoc.com. Please put “Revenue’s By Design Makeover” in the subject line.