Strategic Web Marketing

Search Engine Marketing - New Series

2005-11-01T07:39:00.000-08:00

Search engine marketing has been now for a while a very hot topic. The simple reason why is because search engine marketing makes people money. As long as money is being made search engine marketing will continue to be the topic of conversation.

Without question my interest in search marketing is how to use it to generate the most amount of profit possible. Sales are good and represent the top line in revenue generation; however I’m more interested in free cash flow for my shareholders (profit).

Since for the last 10+ years I have been spending cash with the major engines and of course making money profitably I can speak with authority when I say that shareholder profit on a percentage basis is the highest through organic search sales.

The challenge that we all face is how to capture the highest possible number consumer clicks through search (organic clicks and ppc clicks) and convert those clicks into paying customers!

My next series of articles will focus on this very daunting challenge. As you may correctly perceive the series will be long and will unfold (forgive the pun) naturally! Inevitably however I will consider all aspects of SEO and all aspects of eCommerce. Throughout the series I will descibe exactly (as possible) my techniques (both successful and not so successful). Hopefully we will all learn something from this series.

Until next time
Dan Hagopian

My Hiatus My Return

2005-10-31T06:46:00.000-08:00

It has been a long time since I last posted an article regarding marketing online. I have for the last seven months have been undergoing major job and life changes (left the employ of an ad agency, started my own business, and had my first child little Gwyn Victoria)! Very exciting seven months indeed.

I plan on getting back to the writing at hand and will post a new article shortly. I look forward to more articles as I hope you do as well.

Until Next Time,
Dan Hagopian

PDA Battery Life - New Blog

2005-08-29T06:18:00.000-07:00

There is a new blog I created. It is called PDA Battery Life.

PDA Battery Life began out of an interest to understand the life of PDA Batteries. How long do they last and more importantly how long should they last! As I post new comments and ideas I would be interested in your replies. So please feel free to write responses on PDA Battery Life.Thank you and stay tuned for more interesting news reports on PDA batteries! PDA Battery Life is a blog written and maintained by BatteryShip.com

PDA Battery - PDA Batteries

2005-07-28T08:48:00.000-07:00

PDA Batteries including Sony Clie Battery, Axim Battery, Palm Battery, iPod Battery, iPAQ Battery, and BlackBerry Battery, can all be found at www.BatteryShip.com. But it is more than a great PDA Battery resource. Take a look by going to www.BatteryShip.com for PDA Batteries.

Optimizing Conversions

2005-02-13T19:41:00.000-08:00

Increasing sales by optimizing conversions is the primary function of an Internet marketer, but how do you do this? What is the process that will increase order conversions and how should resources be focused, both internally and externally? These are the questions I get asked everyday by leading companies and over the years I have found that the answer can be outlined by the following five points:

Company Credibility
Site Credibility
Product Value
Service Value
Transactional Trust

Let's discuss these five points from a very high-level and strategic point of view.

Establishing company credibility is by far one of the single greatest factors a marketer can do to sell more product. If you can not build into the consumer's mind that you are experts in your industry then selling your product will be a challenge. To establish company credibility you need to create synergy between your marketing department, customer service, fulfillment staff, and back it up with follow-up support, as needed. What should your synergy be - profit! You see regardless of product or industry these aspects of your business must be uniquely tied together through a very pronounced and unwavering focus on profit. Please do not think that by focusing on profit you are hurting your customer, vendors, or employees. The profit of a company benefits every stakeholder including those I just mentioned as well as the shareholders. Why - because a profit focused company will develop internal processes that will streamline costs, reduce prices for customers, increase order volume, and bolster the bottom line for shareholders.

Establishing Site Credibility is without a doubt a unique challenge. The primary areas to focus on and fully integrate into your site when establishing credibility is marketing, merchandising, technical, and customer service. Some tactical facets that need to be addressed are: overall presentation, speed of the website, navigation, search features, and content quality. One more thing - tie your advertisements into your site. If you do not you will create a disconnect between what the creatives that brought a consumer to your website and what your website may or may not have available. Another words don't set your customers up for a fall!

Establishing Product Value begins before you start selling. It comes through building equity in your brand. Is it costly yes. Will it produce an immediate return - no. Is it necessary yes and no! It really depends on the product and industry your trying to enter. Regardless, there really are some common and key elements you need to focus on before your customers arrive at your site to look at product. Focus on product photos, product description, product selection (colors, sizes, add-ons), inventory selection, price, customer testimonials, customer reviews and ratings, expert opinions, and any published product reviews. These elements are key in conveying to customers how "on top of the game" you are and customers will be more likely to transact with you if your look and feel shows them that you value them! Another words lead them to the shopping cart page by giving them the material they want and not what you think they need.

Establishing service credibility is probably the greatest concern (after profit) to companies. A friend of mine just came back from Texas and he said that everywhere he went people went out of their way to help him. When he went into a roadside diner they did everything possible to make sure he was having a wonderful dining experience even though he was eating a $5.00 lunch! Here is the point: if you offer service that creates a wonderful experience, it will be remembered and shared! Think viral marketing!

Establishing transactional trust means insuring the security of the customer's transaction, conveying that security, and making sure the customer understands that spending their money with you is safe. Guarantees and warranties will always help conversions and should be offered on every aspect of the transaction, including the product bought! What transactional trust tells the consumer is that the business that I'm spending money with will back me, will support me, will protect me, and for that I feel secure about buying from them!

Until next time!

Segmenting Consumer Demographics

2005-02-10T16:58:00.000-08:00

As I posted in my last post on Market Segmentation, one of the ways you can segment your market is by demographic information. There are many ways to segment demographically including by the way consumers spend their money.

For example the average American family spent $40,817 on goods and services in 2003. Where'd the money go? More than half of the typical family budget went for the house (33¢ of every dollar) and car (19¢). After paying for food (13¢), medical bills (6¢), families had a six cents left to spend on entertainment.

Since the 1950's household spending has increased tenfold, according to the Bureau of Labor Statistics. After you factor in inflation the increase is less spectacular. Spending, adjusted for inflation, rose from about $29,000 in 1950 to $37,000 in 1972. Since then, spending has seen smaller real increases.

Viewed over the long term, statistics prove that American's real income has increased, which leads to more consumption and the natural outcome - changing priorities.

You see from a marketers point of view if you can isolate what priorities are changing then you can position your products in accordance with how consumers spend money. Doing this will help you convert better as you reach into your market segment.

Until next time.

Market Segmentation

2005-02-08T08:51:00.000-08:00

The success of your Strategic Web Marketing Plan depends in large part on how well you define your customer base. This is true because if you can identify and segment your qualitative customers from available shoppers then you will reduce customer acquisition costs and increase ROI.

But let's take a step back and describe at length market segmentation.

Market segmentation is the process of dividing different homogeneous groups by a prescribed set of criteria for the purpose of target marketing directly aligned group variables.

Through market segmentation you will be able to test different sets of promotions to different groups that are all catered to the specifics of each segmented group. This granular focus insures that you as the marketer are: meeting the needs of the segmented group by directly identifying with them; increasing the conversion rate (the ratio of orders to shoppers); and lastly to increase the ROI for your shareholders.

When you segment your market five variables should always be present:

a market segment should be measurable

a market segment should be accessible by communication and distribution channels

market segments should differ in responses to your marketing mix

market segments should be durable (not changing too quickly)

market segments should be substantial enough to be profitable

There are four primary bases by which you can segment a marketplace:

Geographic segmentation - defining a homogeneous group based on regional variables such as region, climate, population density, and population growth rate.
Demographic segmentation - defining a homogeneous group based on variables such as age, gender, ethnicity, education, occupation, income, and family status.
Psychographic segmentation - defining a homogeneous group based on variables such as values, attitudes, and lifestyle.

Behavioral segmentation - defining a homogeneous group based on variables such as usage rate and patterns, price sensitivity, brand loyalty, and benefits sought.

Until next time!

Strategic Planning - A Tactical Focus

2005-01-31T13:26:00.000-08:00

As I stated in my Director of Web Strategy article a few days ago, I mentioned that I will be taking a few days off before I begin my new role. As this will be my last post for a few days I wanted to make you aware of what my focus will be once I return.

In my last article, I touched on Strategic Web Marketing, and identified a series of processes that you need to incorporate into your Strategic Web Marketing Plan. In the next handful of articles I will be writing on these tactical processes in-depth.

Upcoming tactical articles include:

Segment Your Customer Base
Web Costs Models
Focus Conversion Rates - Attract, Retain, & and Convert Customer Traffic
Analyze Cost Models to Maximize Sales
Manage Your Relationships
Effective Content Distribution Points
Analyze, Measure, and Adjust - Building ROI
WOTS-SWOTS - Insure ROI Success
Communicate, Communicate, Communicate

I hope you have a wonderful week and I look forward to posting my next article next week!

Until next time!

Strategic Web Marketing

2005-01-30T07:41:00.000-08:00

Developing a Strategic Web Marketing Plan is mission critical to every Internet endeavor. Why - because if you are selling anything, then your web site requires customer traffic. Strategic Web Marketing brings in traffic but it's primary focus is not traffic...it is ROI.

You see at the core of every business model is the demand to generate Net GP$ that contributes to the wealth of shareholders (for an interesting take on this see my article 'How Much Have You Contributed to My Wealth'). Your Strategic Web Marketing Plan must align itself with your shareholder's needs. Indeed your Web Strategy must be ROI centric and it must be constantly analyzing costs and sales in order to maximize profit.

But what is a Strategic Web Marketing Plan? Simply put it is the methodologies you use in order to advertise on the Internet for the purpose of driving customers into your site.

How do you do this?

You develop a Strategic Web Marketing Plan by doing the following:

Define your customer base.
identify the costs models that attract, retain, and convert your customer traffic.
Analyze the costs and potential sales of these cost models
Position your marketing with your product to insure maximum cost model potential.
Manage your marketing relationships.
Maintain the effectiveness of your content distribution points.
Analyze, measure, and adjust your Strategic Web Marketing Plan!

Sounds easy....not really I know, but I never said it was easy. It is a lot of work but if done right you can begin generating Net GP$ immediately.

Until next time!

Strategic Planning

2005-01-28T10:05:00.000-08:00

If you were giving the opportunity to take an investment of $20,000 and within a 60 day testing period prove a profitable business model, could you do it?

Well that was the challenge I was given last weekend. Now though the details of this opportunity are private and only relate to the parties involved, the planning process I chose to take to prove my model is something to take note about because it is a model through which, careful project managers follow everyday.

You see this opportunity is at its most basic core a coming together of wants and needs and it is this core that is also the most representative base of every opportunity. Wants and needs! I tell you....I have been involved in business for about a decade now and in every business meeting I have ever been in, the negotiating of wants and needs has always been present, and if you can master the art of negotiating the wants and needs of people, then believe you me you will fair very well.

But let's look at the art of strategic planning and my approach to proving this $20,000 test!

To begin with you have to have a desired need in place before you can go about planning a strategy that will meet your desired need. Assuming, however, you have the desired need your first step in creating a strategic plan is identifying your mission and objectives.

Your mission statement identifies very clearly what your ultimate reason for undertaking the objectives which you will define (and that will explain in a moment). A mission statement is a forward-looking position of your firms-projects desires and reasons for risking resources. A mission statement explains "why are you doing this." The mission statement is a high-level position and purpose that will keep your focus as you march throughout the life of the project.

Your objectives are task oriented measures you can analyze to keep your team on track with your mission. Objectives can come in the form of financial objectives (sales benchmarks, conversion rates, order volume, EBITDA, ROI etc...). Objectives also come in the form of market share, reputation, and other non-financial measures.

Step two of developing a strategic plan is to analyze the playing field. This is called an environmental scan which includes an internal analysis, an external analysis, and if necessary a macro-environmental scan (Political, Economic, Social, and Technological scanning). The purpose of this aspect of your strategic plan is to help identify what resources are available, what resources are needed, and what is needed to achieve the objectives, and what obstacles need to be overcome in order to achieve your desired objectives.

Step three of developing a strategic plan is to develop the strategy of achieving the objectives. After determining the mission, the objectives, and the environment you will be working within, then you will be able to develop a working process of achieving your goals. During step three comes the implementation and integration phases of your strategy with various teams need to achieve the goals at stake.

Step four of developing a strategic plan is to evaluate and control. During this part of the process you will ascertain how effective your strategy is in completing and meeting the objectives at stake. During this phase of the strategic plan you will be able to make adjustments in your strategy and team assignments as the needs arise. This aspect of your strategic plan will require parameter definitions that can metrically describe objective achievements. You will also define these metric in terms of why they are necessary and how you determined them to be the effective measures for your objectives. Naturally you will also perform the metric analysis and report back to your various stakeholders throughout the process how the teams are doing in meeting the objectives against pre-determined benchmarks. And finally put in place control mechanisms to keep the teams on track for hitting the desired objectives.

Until next time!

A BIG Blog Universe

2005-01-25T14:23:00.000-08:00

One way to determine whether or not Blogs are something that demand our attention is to measure the impact blogs are having on the Internet. Let's look at a few interesting facts:

As of 1-25-2005 according to:

PubSub there are 8,176,954 total blog sources.
PubSub there are 4,677,333 active blog sources.
PubSub there are 1,630 new blog items are added per minute.
Google: You can find 161,000,000 results for the search query "blog".
Yahoo: You can find 89,500,000 results for the search query "blog".
MSN: You can find 23,693,689 results for the search query "blog".
Ask Jeeves: You can find 23,693,689 results for the search query "blog".
Technorati is tracking 6,403,063 blogs with 791,231,990 links tracked.

I could go on but I think you will agree that people are attracted to Blogs. As a marketer then it seems prudent to understand a Blog's relative impact on your business.

Until next time!

The Blogging Opportunity

2005-01-25T08:40:00.000-08:00

In my previous post on Blogging I laid the groundwork of what Blogs represent. Today I want to begin to explain what Blogs provide us in a way of an opportunity.

To recap yesterday's post, Blogs are a cultural form of simplified web publishing that can be segmented contextually to connect publishers to users, merchants, consumers, agencies, and other web publishers. To that end Blogs are in effect topical islands of information. Information that can create an opportunity for blog owners.

You see the greatest challenge that merchants face is the need to offload their product inventory to customers. Marketing Professionals must fulfill the product demand of customers as well as fulfill the desire of the merchant's shareholders to turn the inventory into a financial reward.

The opportunity Blogs provide for Marketing Professionals is the creation and distribution of excess content inventory, which can be then monetized by Marketers by through the distribution of product information into a specific customer segment that attracts, retains, and converts consumers to customers.

The challenge is that blogs are not a formalized sales channel and so merchants are faced with the responsibility of analyzing the advertising return and developing a blogging cost model that can be easily swallowed by the merchant's shareholders.

I personally believe that blogs like other publications will develop into it's own online sales channel and will become a leg in the advertiser's sales footstool. In other words blogging will be as important of a sales channel as Affiliate Marketing, SEM, SEO, Media Buys, PPC, and Contextual Advertising.

In my next post I will poke a hole into the blogosphere and highlight the magnitude of the blog universe which should underscore why Marketing Professionals can no longer ignore the Blogging Opportunity!

Until next time!

Link Exchange

2005-01-24T09:01:00.000-08:00

I am interested in exchanging links with a well written site. If you are interested in a reciprocal link exchange with my site then let me know. If you also are interested in a non-reciprocal link going into your site from mine then again let me know.

I can be contacted by email at djhg_4@hotmail.com

Thank you

Blogging - Info-Journals of the Next Generation

2005-01-24T08:38:00.000-08:00

Bloggers are hitting the radar's of mainstream corporate America. Why - because bloggers and their blogs represent a medium for product and service distribution. But just because the blog medium exists it does not mean that the blogosphere is free from questions and concerns!

Before I continue, however, I need to lay some foundational groundwork that explains blogging.

What is Blogging - I personally like to think of blogging as an info-journal. As such info-journals can be simple or complex (and anywhere in between). Blogs can be very well known or almost non-existent. Regardless however of a blogs popularity and or complexity there are some basic factors that every blog shares. Blogs can be personal, communal, or corporate.

Blog's, also known as a weblog, is a format of web writing that allows an individual to digitally communicate around the world, express themselves freely, connect with other like-minded individuals, and interact through a common linguistic format. Blogging is a first generation tool that removes the technical obstacles of web publishing to allow a more interactive Internet.

Just to give you a basic insight as to what blogs are, let's define them by saying:

Blogs are social.
Blogs are expressive.
Blogs are critical.
Blogs are theoretical.
Blogs are humorous.
Blogs are political.
Blogs are commercial.
Blogs are self-satisfying.
Blogs are historical.
Blogs are personal.
Blogs are cultural.
Blogs are societal.

Blogs are ideas transmitted from one person to another through words, audio, video, animations, and pictures across the Internet, without the need for technical interference. In that sense Blogs empower everyone with the ability to communicate, thus blogs also exploit the democratic nature of the Internet.

Needless to say blogs represent a wide variety of expressive communications that people have a unique and specific interest in and to recognize that is the first step in truly understanding the real power that blogs offer.

In my next post I will continue investigating the power and the opportunity of blogging for businesses, people, and governments.

Until next time!

The Sole Measure of Success

2005-01-21T11:38:00.000-08:00

Far too often Internet Marketers focus on transactional data as the sole measure of success. Conversion rates, price points, promotions, shipping charges, margins, media costs, fixed, and other variable costs are important metrics but offer only one view of sustainable measures.

You see transactional data describes in objective measures what occurred. They offer a historical litmus test by which business managers can explain what happened. By this type of data, accountants and other financial wizards can explain the delta (the measure of change) within a controlled static environment. In a dynamic operational environment, however, where the creation of transactional data begins all the skills accountants and financial wizards bring to the table fall short.

You see transactional data explains what occurred after the fact. Transaction data can not explain why transaction data occurred, it can only demonstrate that a transaction indeed occurred.

Creating the transactional data in the first place occurs way before the actual transaction. It occurs in your market segment. It occurs way before your customers pull out their wallets to close the sales. It occurs because of a marketer ability to define a need and fill a need.

I have experienced first hand the formation of companies. I have experienced both well informed decisions prosper and fail as well as poorly informed decisions prosper and fail.

But I can tell you that in every instance where a business decision failed it was because the business managers solely focused on transactional data as the sole measure of success.

Until next time!

How Much Have You Contributed To My Wealth?

2005-01-21T08:51:00.000-08:00

Contributing to the wealth of nations, companies, and people seems to be the way of life. Today the average person works the first 5 months of each year to just pay their taxes. It is a somber reality to the real expense of living. An even scarier reality is that even though our government rakes in over a trillion dollars per year we still have to borrow a billion and half just make our interest payment. If you think about it does not make any sense. Borrowing money to pay the rent for borrowed money! I guess the government does not like living below its means!

What does all this have to do with marketing? A lot. You see as Director of Marketing at Laptops For Less I am often asked by our shareholders 'How Much Have You Contributed To My Wealth' my common response (jokingly) is 'how much have you contributed to my wealth! But the truth of the matter is that as the head of the sales funnel at Laptops For Less it is my responsibility to insure that targeted traffic is converting at a rate that returns the greatest ROI for our shareholders.

On the flip side of that I have advertising agencies and account executives call me for my Ad $ and the question I commonly get is 'what's my budget', my common response is that 'I don't have a budget, but I can go out to lunch!'

You see every sales channel in Internet Marketing needs to be self funding. Initial investments, without question, must be made to create relationships, but after that every dollar poured into a sales channel must be taken from the sales generated through the channel itself.

So the question of how much have you contributed to my wealth is a valid question and a right one, for within the realm of Internet advertising if your sales channel are self-supporting then you should not be advertising within them.

I think that is why I like Affiliate marketing so much. From the merchants point of view of mitigated risks, leveraged knowledge, and high Net GP $ Affiliate Marketing is truly best of breed marketing.

So when I'm asked by our shareholders "How Much Have the Affiliates Contributed To My Wealth," I can respond positive and say quite a bit! I can also feel good about the response because I know that not only did my shareholder make his share through the Affiliates, but also the Affiliates themselves made their commissions. If your an affiliate reading this I would love to have you a part of the Laptops For less Affiliate Marketing Program.

Back to our government - stop living beyond our means! Take a lesson from Affiliate Marketing and create a self funding revenue channel beyond the current tax system that creates a smarter derived benefit for all!

Until next time!

State of Search Engine Marketing

2005-01-20T10:23:00.000-08:00

A report was published by SEMPO (Search Engine Marketing Professional Organization) that surveyed a segment of the Search Marketing Industry. The report attempts to highlight:

the size of search marketing;
where the $ spend by advertisers and agencies were going in the search industry
key trends
key issues

The report is interesting, all together in 2004 over $4 billion dollars went to search engine marketing:

Paid Placement - $3.3 billion
Paid Inclusion - $181 million
Organic SEO - $492,000
SEM Tech - $71,000

The report found that over half of the advertisers were going to build their SEM program in-house, with the balance using an agency for part of their SEM strategy with about 10% of merchants outsourcing 100% of their SEM programs.

Internally at Laptops For Less, we do employ SEM programs. Their effectiveness is appropriate for the specific ROI measure I aim for but I must admit my personal take is that it is an expensive way to advertise. I think that whenever a publisher will not help work a relationship by mitigating the advertisers risk on their site brings into question the very nature of the relationship.

Affiliate Marketing mitigates the advertisers risk by working off a revenue share. It is a perfect partnership where success is relational. The keys to success are conversions, market scale, market targets, and performance incentives.

Ideally I would love if Google worked off of a Rev Share! Not likely I know but it doesn't hurt to dream!

Until next time!

Preventing Blog Comment Spam - Google Style

2005-01-19T09:37:00.000-08:00

Google announced yesterday that blog comments will be stripped of adding any benefit toward a website's Link Popularity score.

The way it used to work is that Spammers would traffic a persona's Blog and post reply comments on the a legitmate author's blog. Spammers do this in the hopes of increasing their link popularity by piggybacking on somebody else's original work.

In other words Spammers promote their own websites' search engine rankings by submitting linked blog comments like "Buy My Bikes" at the end of their comments. Previously Google would factor those and incorporate them into the overall authoritative weight score used to create PageRank, but as of yesterday they have stopped this practice.

According to Google when Google sees the attribute (rel="nofollow") on hyperlinks, those links won't get any credit when websites our ranked in thier search results. It is not a negative vote for the site where the comment was posted; it's just a way to make sure that spammers get no benefit from abusing public areas like blog comments, trackbacks, and referrer lists.

FYI - MSN and Yahoo support this initiaitve.

To be clear this does not effect the Blogger's own work. It is merely going to be applied to sections of your Blog where other users can "post comments".

The new link systems will look like:

Any link that a user can create (i.e. comment on) on your site automatically gets a new "nofollow" attribute. So if a blog spammer previously added a comment like Visit my discount pharmaceuticals site. That comment would be transformed to Visit my discount pharmaceuticals site.

Until next time!

Search Engine Marketing Definitions

2005-01-18T11:49:00.000-08:00

I thought I would write a quick list of common definitions in the realm of Search Engine Marketing. This is not intended to be a comprehensive list but moreover a list of the popular and common terms used in Search Engine Marketing.

First of all we can define Search Engine Marketing as the entire set of techniques, tactics, and strategies used to direct more visitors from search engines to websites. The set of techniques, tactics, and strategies are listed below.

Paid Placement - Text ads targeted to keyword search results on search engines. Specific programs include Google Adwords, and Overture's Content Match. Common alias include pay per click, keyword bids, PPC, CPC.

Contextually Targeted Text Ads - text ads targeted down to the subject matter of web content.

Paid Inclusion - the practice of paying a fee to search engines, directories, shopping comparison sites, so that a web site may be included in the service's directory. Typically paid inclusion does not guarantee a particular position.

Organic Search Engine Optimization - The practice of using a range of techniques, including augmenting HTML code, web page copy editing, site navigation, and link building campaigns to improve the natural organic position of a web site within search engines.

Search Engine Marketing Service Provider - agencies or individuals who assist companies with the various search engine marketing practices.

Search Engine Marketing Technology Provider - makers of software application specialized to assist companies with the various search engine marketing programs for example: bid management, campaign management, portfolio management, and dynamic optimization.

Web Analytics - the practice of analyzing, measuring, and reporting results through a software application like HBX or Webtrends.

Affiliate Types - How To Start an Affiliate Program

2005-01-18T08:01:00.000-08:00

When starting your Affiliate program you need to know the types of Affiliates you will be working with in your Affiliate Marketing Program. Some of the Affiliate types you will encounter are:

Pay per Click Search Engine Arbitrage Players
Coupon/Rebate Sites
Reward/Loyalty Sites
Search Engine Optimizers
Comparison Shopping Sites
Content Sites
Emailers
Data-feed Sites
Bloggers
Other Merchants
Service Providers

Each Affiliate type represents real value for your Affiliate Marketing Program and all will drive in targeted traffic. In terms of creating a hierarchal pattern is difficult because of the many subjective value that each individual applies to his/her particular Affiliate type. The real key in creating your Affiliate Marketing Program is to know each Affiliate type, understand how they attract and retain traffic, and learn how to work with each Affiliate to increase the conversion rates the most.

Until next time!

How to Start an Affiliate Marketing Program - Contextual Advertising Techniques

2005-01-17T07:33:00.000-08:00

Contextual Advertising as I mentioned before is a method of advertising where advertisers inject their ads into content that best integrates with the advertisers product/service so much so that the consumer is almost unaware there are ads built within the content.

Contextual advertising can be presented in a number of ways: text links, sponsored articles, graphics-creatives, rich media integration, ebooks, white papers, co-registrations, keyword auctions, and shopping portals.

The typical web media formats used to deliver the ads are: web pages, email, and either a video or radio feed stream (live or pre-recorded).

The cost model typically will vary between a CPM, CPC, CPA, or some hybrid model. If you're unfamiliar with these cost models then let me give you a brief definition of each. A CPM model is the cost per 1000 impressions. This means that for every unit of cost you pay your ad will be delivered up to 1000 impressions. A CPC model is the cost per click. This means regardless of how many impressions delivered you are only charged a cost per click each time a consumer clicks on your ad. A CPA model is the cost per action you must pay each time some prearranged action is committed by a consumer. The action could be some form of registration or a sale.

Personally I always attempt to work a CPA deal. CPA deals represent the greatest advantage to both parties. To the advertiser CPA deals mitigate the risk the advertiser faces when entering into a contextual advertising relationship. For the publisher a CPA deal also represents a real value because CPA deals or likened to a commission format and with commissions there are typically no restrictive payout caps. So the publisher if they believe in their content will likely accept a relatively high CPA deal to get the most value out of the relationship with the advertiser.

At Laptops For Less I do my best to work with publishers that have thematic similarity between their content and my product offering. I consider each product that I have and will analyze the different user groups of my products and their interests and behaviors. By doing so I can best define the publisher that I want to work with thereby making the relationship building as easy as possible.

Contextual advertising generates revenue if done strategically and surgically. The key is identyfying the right content creator to work with.

Until next time!

How to Start an Affiliate Marketing Program - Understand Contextual Advertising

2005-01-14T12:03:00.000-08:00

Every morning I arrive at Laptops For Less and as I head over to my desk I look directly into the warehouse which holds all the products that we carry. Looking at the products I know that within the next 10 hours there will be about a thousand items less then there are now. It marvels me at times. To think that every 12 months hundreds of thousands of people visit this very busy specialty electronics retailers. It is by all accounts very successful and offers a sobering view of how corporations should be run! Every corporate officer with a smart understanding of business would marvel at our little business.

How can this business generate the revenue that it does on such a small operating budget? Well I can't reveal everything but I can tell you where it all begins! It begins with the content. In fact it is all about the content. Content, the creation and distribution, is the lifeblood of Laptops For Less.

As the one in charge of insuring that our content is disseminated, not merely as an exact representation of our corporation's products and information, but as an effective and efficient means to develop the business, I am constantly drawn back to the building blocks of the web.

As I have commented before the web can be seen as a graph of interconnecting nodes whereby hyperlinks create the links between web pages - hence, content on one page connects content from another.

So then what causes people to come into Laptops For Less is our content. But how does this happen? People do not typically know Laptops For Less. We are not a household name, but people do know the products we carry. In fact our products have become essential for today's mobile consumer and this fact then becomes the bond I use to attract, retain, and convert customer sales.

Consider again how the web is interconnected. Since we know that content connects content, it is logical to assume, then that thematic content links make the most efficient use of a consumer's time. Like content linking one another keeps the consumer focused on a specific web path. The question that I as a merchant have is how can I then, interject my content along the same thematic path as a person would travel down to find my products?

This is the basis of contextual advertising. On my next post I will focus in on some techniques I use to identify the most appropriate content paths.

Until next time!

Links to All Marketing Articles

2005-01-14T09:00:00.000-08:00

BACKGROUND BRIEF

From my articles above I hope you have gathered that I have spent some time in the field of online marketing. I have 10+ Years of eBusiness Operations Management, 10+ years of B2C Direct Marketing Managment, 10+ years of Search Engine Marketing, 10+ years of Affiliate Marketing Managment, 10+ years of Web Content Development and Management, 10+ years of eCommerce Sales Operations Managment, and 10+ years of Web Analytics Repeorting.

My industry specializations include consumer electronics, mortgage, and REIT industries. I have senior level agency management experience that includes strategic development, resource planning and managing, research, analysis and reporting to C-level presentations. I have extensive strategic business development and product marketing experience - from catalogue merchants to national retailers.

EXPERIENCE

Senior Director of Internet Marketing, BatteryShip, Big Bear, California
Director of Web Strategy, WebMetro Inc., San Dimas, California
Director of eCommerce Marketing, Laptops For Less, Anaheim, California
E-Commerce Marketing Manager, PC Connection, Merrimack, New Hampshire
Merchant Program Manager, Finon, San Clemente, California
eBusiness Specialist, Internet Communications Plus Mission Viejo, California
Internet Sales Consultant, Internet Communications Plus, San Juan Capistrano, California

EDUCATIONAL BACKGROUND

University of Redlands,
School of Business
Bachelor of Science of Business and Management, 2002

How to Start an Affiliate Marketing Program - Tools & SEM

2005-01-13T07:19:00.000-08:00

In my last two posts I spoke directly on the impact the new Google Adword policy will have on Laptops For Less and our Affiliates. I am now going to get back on track on my series of How to Start an Affiliate Marketing Program and that is exactly what I'm going to do. Interestingly enough my next segment in the series will be an integration post on the tools Paul has created and how they impact search engine marketing both organically and through paid models.

Why! Because you can't get too far into Affiliate Marketing without realizing how beneficial helpful tools are when it comes to search engine marketing and your Affiliate marketing program.

Let's first talk about the tools. To find out what they are go to my post on the tools. Tools are important because it allows merchants to distribute their product content out to their Affiliate sales force in a fashion that can be easily integrated into the Affiliate's website. In the program at Laptops For Less we have well over 3000 Affiliates. These Affiliates range in their ability to program and build web pages, but they all have the common bond of promoting our products for the purpose of generating commissions. Moreover, since it is my role to drive the revenue into the company I must assist my Affiliates as much as possible and so I employ the tools.

The tools also provide the back drop to the real prize of Affiliate marketing - content! People love content and search engines love content! By removing the technical obstacles our Affiliates can then concentrate on marketing the products through strategically placed content. Furthermore, by integrating Laptops For Less's product content with the Affiliate's highly optimized page content we are creating contextual relationships that increase order conversions and sales/commissions.

How do the tools help Affiliates who want to bid on keywords? The tools create content rich product-landing pages that qualify consumers, increase conversions, and they help meet Google's new policy requirements.

Interestingly enough I have received a number of questions regarding exactly how I'm going to handle Affiliates who want to bid on our products keywords. I get questions like:

Can I get a copy of our keyword list?
Will Laptops For Less Bid against me in effect increase the CPC price?
How much should I set my budget on a specific keyword?
Can I offer bidding strategies at the keyword level?
What kind of conversions can I expect?

Well let me answer those specific questions:

I will not distribute my entire keyword list. I will however make available a small segmented list based upon product categories that you want to target.
No I will not bid against you. If you want to bid on Google adwords ads that use a domain owned by LaptopsForLess.com in your ad I will back off on bidding on the specific keyword in question. To take advantage of this offer, let Paul know which keywords you intend to bid on. We'll then pause our ads on those keywords as soon as we see that you are actually bidding on them. By playing it this way, we make sure that SOMEONE is bidding on those keywords.
Each keyword's bidding strategy is different but common to them all is how I come about my business decision. It is by considering many of the variables that you can read about here along with the CPC fee.
Again this takes running the numbers and then coming up with something where I'm comfortable. Obviously what I'm willing to spend on a keyword is probably radically different then what you would spend.
The kind of conversions you can expect depends on the dynamic nature of the keyword environment. I would consider the product, the keyword, the demand, the costs, the revenue, the need, as well as the competition. Then considering my degree of risk aversion and the known opportunity costs I would cater my numbers to achieve the desired conversion rate I want.

On my next post I will be continuing the series to talk more on contextual advertising from a business development point of view. Until next time!

Google Adwords Policy and Laptops For Less - Part 2

2005-01-11T07:08:00.000-08:00

In my last post I highlighted the new Adwords policy going into effect this week (most likely 1-12-2005). I now want to define how I will be managing the new policy in its relation to Laptops For Less and our Affiliates.

First on a personal note I do not believe that this new policy was thoroughly thought through from the industry point of view. I personally know that the policy change adds additional management challenges internally at Laptops For Less and I also am aware of the great stir it is causing within the industry. I do believe Google will experience a drop off in advertising sales as it revamps its business policies. Google is removing those ads that generate low click-through rates. It is trying to improve shareholder value (more revenue) of the paid Adwords under the pretext of improving the searcher's consumer experience. With that said I do agree that advertisers have built and let run plenty of bad ads. But the way Google is removing them hurts many good ads.

The new policy stands however and we will find that a reallocation of traffic flow going into merchants will begin to occur. Affiliates may still bid. My representative at Google assured me of this. What they also said reading between the lines is that Google wants more money. Remember the Adword system is a dynamic environment whereby an ads position is a combination of clickthrough rate (CTR) and bid price. Look at the following CTR % and corresponding bid price examples:

1.2% x $0.50 = .006
2.6% x $0.25 = .0065

In the above examples, Google will display example 2 even though the CPC is lower. Why because the end volume is higher and naturally Google will make more click fees. Now when a brand new keyword advertiser enters the bidding auction and decides to up the ante as in the next example:

1% x $1.00 = .01

Then Google will display this new advertiser even though this advertiser's CTR is lower then the two advertisers above. On this Wednesday this third advertiser will be displayed and the other two will not.

But Google is a dynamic system and so increasing either your maximum cost-per-click (CPC) or your ad's clickthrough rate (CTR) will improve your ad's position and constantly create a dynamic environment of ever changing positions.

What will ultimately end up happening is one of two things - Affiliates who want to bid on keywords using one of Laptops For Less's domain names will have to outbid Laptops For Less (assuming I'm bidding on the particular keyword) and or other Affiliates.

Now for my part I have built a database of keywords relating to our products that currently holds 300,000 keywords. I am bidding on a number of them (not all). Actually over the last three months I have been pulling off of keywords that have either a good organic or affiliate presence in Google. I would prefer to spend my advertising budget on Affiliates rather than Google. If you can help me do this then you will get more of my ad budget!

You see it is my best interest to work with you. I don't want to compete with you. I want to make this work as best that I can given the new Google ad policy. To that end let's work together on this! But what I can't have happen is a drop in sales. That hurts everyone.

So then let's work together on this. First of all you should know that Google is not the only way to generate pay per click traffic (though it is the most expensive)! Check these other search engine pay per click sources:

Overture
FindWhat
Kanoodle
Business.com
Industry Brains
ePilot
Lycos
Enhance
Go Click
Search Feed
Search 123

These sources often represent a lower cost to advertisers. Also check these resources for more info: Pay Per Click Universe and Pay Per Click Analyst.

Secondly and most important even if you choose to advertise beyond Google, use the content creation tools Paul has built for you - they are simply awesome!

Please see the tools made available to you:

External Datafeed Manager:

Product Display Maker

Direct Link Maker

Search Link Maker

Search Form Maker

Using these tools you can create awesome pages that help qualify the sale. So build ads like:

Laptops For Less - Sale
Laptop & PDA Batteries & much more
Buy Online & Save Money
www.your-website.com/LaptopsForLess

Direct them to your awesome content rich landing pages that pre-sell and qualify the consumer, then lead them to our shopping cart pages. Your conversions will increase. This form of Adwords advertising not only meets Google's new ad policy but it also allows you to focus in on consumer content- the real secret in Affiliate Marketing.

Next time I will get back to my series on Affiliate Marketing and will write specifically on how our Affiliate tools will help you create better qualified traffic that generates higher conversions. Until next time!

Google Adwords Policy and Laptops For Less - Part 1

2005-01-10T09:23:00.000-08:00

I'm going to pause for a post on my series of How to Start an Affiliate Marketing Program and change the subject a bit. As I have been writing the series much has changed within the world of search and I just wanted to offer my take on the changes as I see it.

Google Ad Word and Affiliates Policy

On January 6th, Google announced new rules restricting the display of AdWords ads by Affiliates. Starting in the next week or two Google will no longer show multiple ads that all point to the same domain.

Let's see some examples of current Google Sponsored Links:

Example #1
Laptops For Less
Welcome to the world of mobile
computing at Laptops for Less. aff
www.LaptopsForLess.com

Example #2
LapTopsForLess.com
Top Selection - Lap Tops Galore
Special Offers - Premier Affiliate
www.LapTopsForLess.com

Example#3
LaptopsForLess.com
Get discount batteries for laptops,
cameras, camcorders, more! Aff
www.laptopsforless.com
California

Example #4
Laptops For Less
Find over 700 Accessories for
Mobile Products & More! Aff.
www.laptopsforless.com

As you can see each Affiliate ad above has been using the same Display URL (the URL listed in the ad).

Instead, they will only list the highest ranking ad for that domain. As the new policy states "we'll only display one ad per search query for affiliates and parent companies sharing the same URL."
The change will affect Affiliates in two ways:

Affiliates no longer need to identify themselves as an affiliate in your ad text. This is a good change because of the restricted advertising space alotted in Adwords this should allow for more creativity in the messaging ad text.
Since only the highest paid advertiser will be able to occupy the domain name of the Laptops For Less you will more than likely have to create a sales landing page to lead PPC traffic to before you lead them over to the specific Laptops For Less page you are targeting.

As affiliates of Laptops For Less realize we employ a lot of unique domains across our company. But if we read the language of the policy change it specifically says "Affiliates or advertisers using unique URLs in their ads will not be affected by this change. Please note that your Display URL must match the URL of your landing page, and you may not simply frame another site." This really open's a can of worms specific to Laptops For Less.

What I know to be acceptable is and Affiliate ad like:

Laptops For Less - Sale
Laptop & PDA Batteries & much more
Buy Online & Save Money
www.your-website.com/LaptopsForLess

This form of Adwords Advertising not only meets Google's new ad policy but it also allows you to focus in on consumer content. This is good! As many of you already know with the Laptops For Less Affiliate program creating content with our program is so easy because of all of our tools we have available.

Here are the tools:

External Datafeed Manager: Complete Feed Management
Product Display Maker
Direct Link Maker:
Search Link Maker:
Search Form Maker:

In my next post I will define precisely how we will permit our Affiliates from bidding on keywords and be able to use our domains according to Google's policies.

Until next time!

How to Start an Affiliate Marketing Program - Content 3

2005-01-09T09:14:00.000-08:00

In my last post I spoke about the page attributes that I incorporate into the web pages at Laptops For Less. It was post about the science of "on page" search engine optimization. It was a post that described from a more scientific analysis the best way to optimize your web page content for the search engine spiders. In this post I will describe some of the tactics that I build into content that is pure marketing.

I have said many times that written content must accomplish three things: content must attract, content must retain, and content must convert. Why, because content written for business purposes has one goal - to create more sales. To that end let me explain how I attract, retain, and convert more sales through content.

First - I have to attract more consumers and to do that I use content distribution centers to syndicate my content. There is a cost model involved here though not necessarily a monetary exchange. The content in and of itself could be enough payment for your distribution partner to forego and fees if the content is a true value added compliment to your partner's syndication. Value added content is content that attract readership. For content to attract readerships it must contain the following qualities:

Content must deliver a recognizable consistency to it's message.
Content must be intuitive and naturally fit with your market segment conditions.
Content be able to become ubiquitous by relating to the specific needs of your market segment.

Secondly content must retain your audience segment. Interestingly if you develop your content to attract your readers the value of the message will naturally retain.

Thirdly content must convert. For content to convert it requires:

An authoritative nature;
An perception of intelligence;
A perception of being right
A perception of meeting a need
And a perception of want.

On my next post I will contine on with the series on How to Start an Affiliate Marketing Program. Until next time!

How to Start an Affiliate Marketing Program - Content 2

2005-01-08T07:28:00.000-08:00

In my last post I spoke how it is needed to create original, valuable, and authoritative content. In this post I want to talk about known search engine optimization practices. Now as you read through this you will question are all these variables needed within each page I write? Let me just say you don't have to have any of these variables built into the pages you write. Furthermore I also submit that there are some variables far more necessary than others. But I list all the variables I incorporate into the pages at Laptops For Less. Think of all these variables, especially the minor variables, like vitamins. They won't hurt you and they can help you so why not include them into your documents. Obviously if your argument is the resource intensity of building doucments' like this then of course do only what you can do.

In business I always subscribe to the 80-20 rule because I know that 1) there is no such thing as perfection when we talk about business; 2) resources are finite and each available resource you employ must be considered as an opportunity cost. So as you read the below recognize that I am familiar with any potential argument you may bring forth, that's fine, just know that I list the below variables for educational purposes only.

Now with that said the page attributes that I integrate into each web document I build can in be aptly described as Dan Hagopian's Page Optimization Best Practices. Here they are...

Dan Hagopian's Page Optimization Best Practices:

Keyword Density - 2%-5% - the percentage that the keyword is represented on the page.
Page Crawl Depth – max 116k Keyword in URL - The precise keyword focus should be represented first.
Alt Tags - The precise keyword focus should be represented first.
Title Tag – Within 83 characters describe specifically the page’s content. The precise keyword focus should be represented first within the title.
Description Tag – Be original, descriptive, and no more than 170 characters about (10 words). The first 83 characters are the most important. Apply proper grammar and syntax rules. The precise keyword focus should be represented first within the description.
Keyword Tag – Be focused within 250 characters, incorporate stemming, and the precise keyword focus should be represented first.
Proximity - Space the focused keyword. This is a varied number dependent on total page depth. On some pages the keyword should be represented every 7-18 word.
Relevance – content should directly reflect phrases; The precise keyword focus should be represented.
Placement – top 1/3 of page the optimized page and indirectly reverence other pages minimally.
Keyword Rich Content – URLs, Text, Links, Code Inserts, Remember Word Order.
Page Word Count – Solid content pages have above 250 words; the more the better; don't lose keyword focus.
Page Type - (as of this writing) pages of currently known indexable file types including: pdf, asp, jsp, hdml, shtml, xml, cfm, doc, xls, ppt, rtf, wks, lwp, wri, swf.

In short, by creating content that is structured for maximizing reach while all the while focused on capturing the greatest number of orders through content that attracts, retains, and converts is the primary driver of the Affiliate Marketer.

In my next post I will talk about content from the direction of attracting, retaining, and converting qualified traffic into higher order volume. Until next time!

How to Start an Affiliate Marketing Program - Content 1

2005-01-07T07:05:00.000-08:00

The next several post as you will soon see can actually double for a series on Search Engine Optimization, similar to the articles I previously wrote on search optimization: "Search Engine Optimization - Its All About The Content" and "Google Search Engine Optimization". But I'm building these next handful of posts into the my series on How to Start an Affiliate Program because at Laptops For Less I have found that at the core of all online sales is the creation and distribution of content. As you may recall in my last post I listed several quality revenue generation tools to help you distribute content but now I would like to talk about how to create content that generates sales through your affiliate force.

To that end let's us look at content and its impact on the Internet industry from both a quantitative state and a qualitative state.

First let's begin with a definition of content as we use it online (if you are a linguist or a student of language forgive this layperson definition). As we define content we need to take a step back and look at language, which in effect, are words, their pronunciation, and the methods of combining them that are used and understood by a community. Language can be an audible, articulate, and meaningful sound as produced by the action of the vocal organs. Furthermore language can be a systematic means of communicating ideas or feelings by the use of conventionalized signs, sounds, gestures, or marks having understood meanings. There we go....by and large language online is driven by conventionalized signs, letters, that are tuned into words and ultimately into content to create a lexical meaning by which a language transfer can occur digitally.

We know that as we combine letters into words we are ultimately transferring, sharing, and educating another person (or machine) about what we are thinking. Affiliates and search professionals recognize this and have used word creation to attract, retain, and convert consumers into buying their products.

It is a targeted focus on a specific segment of the Internet population to which a grouping of content drives consumers to make product sales. This is where affiliates have learned to excel and so then this is where you as a merchant must learn to operate and work with those Affiliates who have the knowledge, skills, and abilities to deliver solid content that attracts, retains, and converts product sales for your online store.

At the core of this content theory is the need to create original, valuable, and usable content. Affiliate and merchant alike must create content that is authoritative, retentive, and interactive.
Developing original and valuable content for electronic distribution is a combination of document writing and creative flow. Science and art another words. The artistic function can not be readily explained here but is easily recognizable as valuable and qualitative content source.

What can be explained is the science of writing for search engines and on my next post in this series will look at the science of document writing from an search engine optimization perspective.

Until next time!

Affiliate Marketing Program - Revenue Generation Tools

2005-01-06T07:30:00.000-08:00

In the last discussion on starting an Affiliate marketing Program I spoke about the structural view of an Affiliate program and how each managerial role supports the overall growth and ROI of an affiliate program. Now I would like to discuss some specific revenue generating tools that you need to use in order to manage your affiliate marketing program effectively and efficiently.

First off you need to be able to distribute your product information out to your affiliate force. You do this so that your affiliates in turn can place your product data in front of their web audience. To do this you can build creatives but the most effective methodology I have found with the Laptops For Less Affiliate Program has been in the form of the integrated affiliate tools from the Finon Corporation.

External Datafeed Manager: Complete Feed Management

The External Datafeed Manager updates itself each night (or at any pre-scheduled time) by automatically retrieving data from your company’s server. It restricts access to your program’s feeds to only those users with usernames and passwords you assign. Each user is assigned a unique URL to access the feed. The feed manager converts your feed to all common easily imported formats (comma-separated .csv, tab-delimited .txt, etc). Users can then download one or more formats of their choosing (on-the-fly). Users can easily configure the feed download process to convert all links to CJ links specific to the Affiliate’s CJ PID (or any other compatible tracking link) on-the-fly. It also keeps log of all accesses for your review.

Product Display Maker

The Product Display Maker creates customized HTML-based displays of any and all products from your datafeed. It automatically creates professional looking product display pages on-the-fly for any and all product lines or only products matching certain keywords or item numbers found in your datafeed. Allows for the customization of product information fields (price, description), table border colors, number of columns per page. All links automatically converted to CJ links (or any compatible tracking link) bound to the Affiliate’s ID (CJ PID, for example)
Assists the Affiliate by providing “one click copy” of the complete HTML code for easy pasting to any site. This is a great looking way to get your products in front of more consumers.

Direct Link Maker:

The Direct Link Maker allows Affiliates to easily create a direct CJ link bound by their CJ PID (or any compatible tracking link) to any page on any of your program sites, even dynamic pages. The Direct Link Maker customizes the font and font size on-the-fly and it assists the Affiliate by providing “one click copy” of the complete HTML code for easy pasting to any site.

Search Link Maker:

The Search Link Maker allows Affiliates to easily create a direct CJ link bound by their CJ PID (or any compatible tracking link) to any search results that can be found in your site’s search engine. The Search Link Maker customizes font and font size on-the-fly and assists the Affiliate by providing “one click copy” of the complete HTML code for easy pasting to any site.

Search Form Maker:

The Search Form Maker allows Affiliates to easily create a search form for their site visitors that interfaces with your site’s search engine and includes CJ tracking bound by their CJ PID (or any compatible tracking link). The Search Form Maker customizes font and font size on-the-fly and assists the Affiliate by providing “one click copy” of the complete HTML code for easy pasting to any site.

In my next post I will continue the discussion on revenue increasing tactics for your affiliate program. Until next time!

How to Start an Affiliate Marketing Program - Management

2005-01-05T06:44:00.000-08:00

In my last post about Affiliate Marketing Programs I spoke about the objective measurements that I use to manage the ROI of Laptops For Less's Affiliate Marketing Program. Now I would like to talk about how I have structured the management of this affiliate marketing program.

If you are looking from the outside in there are levels of management within any company that are designed to effectively watch over, guide, and attend to the matters of driving as much revenue and bottom line profit as possible back to shareholders. Within a company like Laptops For Less where marketing is the primary business driver the marketing layers for an affiliate marketing program are rather simple and looks something like:

Shareholders > COO > CFO > Director of Marketing > Affiliate Marketing Manager > Technology Partner > Affiliates.

Now without discounting the value and worth of our Shareholders, COO and CFO let us talk specifically from the Director of Marketing position on down.

Now as the Director of Marketing for Laptops For Less I am charged with driving new business into the company. To insure that consumer traffic and sales remain constant and dependable. In the same light I am also responsible for driving gross sales while all the while focusing down on the bottom line numbers that insure a continuous flow of net profit to our shareholders. With that responsibility I take great care in finding the right marketing partners to effectively increase my ROI while minimizing my direct involvement so that I can concentrate on other marketing programs for the company.

That is why I outsourced the Affiliate Marketing Management of Laptops For Less's Affiliate Program to the Finon Corporation. In the past year the Finon Corporation headed up by Paul has done a great deal to improve Laptops For Less's Affiliate Marketing Program. The annual return that Paul has created for Laptops For Less, an astonishing 327% ROI for shareholders, should be enough to say, but I want to describe some of the specific acts that Paul and Finon have done in 2004. First and foremost the incredible assistance and communications with Affiliates through email, phone, and through the Laptops For Less Affiliate Forum. Simply look at the forum and you will get a sense of the level expertise that Paul and Finon bring to the program. Let me encourage you to outsource your Affiliate Marketing Program to Finon. The fees are extremely reasonable even if you are in the competitive tech field like Laptops For Less. A final word about selecting your Affiliate Marketing Manager - the most important qualities that you want to find in a manager are: technical expertise, marketing expertise, management expertise, low cost of service, and the capability to create awesome ROIs for your shareholders. You could also simply hire Paul and get all of the above.

The next level of hierarchy in the marketing department of Laptops For Less is the technology partner. I chose to go with CJ.com. There are others as well such as Performics, BeFree, Linkshare, Shareasale, and many more including in-house programs. Technology partners track the clicks, sales, and commissions for the merchant and the Affiliates. It is a three-party way to keep everybody as honest as possible. Some up-front costs can be as high as $10,000 for LinkShare and as low as a few hundred for Shareasale. I spent at CJ a $2,250 upfront fee plus the first $3,000 deposit of commission fees. It was a fair deal and to date there have not been problems. Remember the technology partner does not manage the profitability of your Affiliate Marketing Program it just tracks it! That is why you need an Affiliate Marketing Manager see the above paragraph.

The next partner in your Affiliate Marketing Program is the Affiliate. Affiliates are awesome. Affiliates are smart. Affiliates love to make money. Help them make money by providing the affiliate tools to make money and they will pleasantly surprise you! Thank you to all of Laptops For Less's affiliates!

On my next post I will write about some very specifc tools that you can provide to your affiliates to help them generate revenue for you and commissions for them!

Until next time!

Blog Directories

2005-01-04T17:56:00.000-08:00

Here is a list of blog directories that I have found useful:

How to Start an Affiliate Marketing Program - Analytics Finally

2005-01-04T07:05:00.000-08:00

Before we get back to next installment of How to Start An Affiliate Marketing Progam I wanted to provide a list that links back to my earlier articles on How to Start An Affiliate Marketing Progam. Hopefully this will provide some convenience. Also for those of you new to this series the information that I provide here is based upon my experience beginning the Affiliate Marketing Program at http://www.laptopsforless.com/. So then if you would like check out the previous articles:

Part 1 - How to Start an Affiliate Marketing Program?

Part 2a - How to Start an Affiliate Marketing Program?

Part 2b - How to Start an Affiliate Marketing Program?

Part 2c - How to Start an Affiliate Marketing Program?

In the last post on How to Start An Affiliate Marketing Progam I wrote traffic, affiliates, and order volume and how each are in effect tied to one another. Next I would like to talk briefly about the balance of the measurements:

AOV - this is the average order value
Sales - this is the total sales brought in during the measured period.
GP$ - the gross profit dollars represent sales X product costs represented as a percentage
Net GP - is GP$ less program costs.
Net Margins - is the ratio of profit gained by the overall program represented in a percentage format.
Total costs - is the total real dollar cost of your affiliate program.
Cost per order - is the dollar cost average at a per order level.
Cost per visit - is the dollar cost average at a per visit level.
Conversion rate - is the rate of orders to clicks.
Sales per visit - is the average number of sales per visit.
Contribution per order - is the average program contribution to the shareholders wealth per order
Total contribution - is the total program contribution to the shareholders wealth.
Effective Rev Share - is the effective revenue share that the program costs per dollar earned, represented as a percentage.
ROI - this is the total return on investment that your affiliate program generates for your shareholders.

These measures provide relative views of the success of your Affiliate Marketing Program. There is quite a bit of information that can be talked about each of these measures but the key point amongst all of these is to monitor them, understand them, and work with your affilates to maximize the efficiencies within these measures.

You see as the Director of Marketing at www.LaptopsForLess.com I am responsible not merely for the reporting of the numbers but the actual creation of the numbers. Anybody can count numbers and gather reports but to actually create the numbers that go into the reports (and more importantly the dollars that go into the bank) is something entirely different.

Affiliate Marketing Managers must understand these numbers as it relates to knowing the right business decision to make to increase the ROI of your Affiliate Marketing Program. But where I would like to spend the time on is just actually how you go about increasing the ROI of your Affiliate Marketing Program.

So it is that on my next post I will move into the realm of dollar generation with Affiliates. By the way let me encourage you to read the Laptops For Less Affiliate Marketing Forum during this series. The Laptops For Less Affiliate Forum is a great place to see how current Affiliates are thinking and the advice that the Laptops For Less Affiliate Manager is giving to Affiliates.

Until next time!

Google Search Engine Optimization

2005-01-03T07:05:00.000-08:00

Before I begin again on my series on How to Start An Affiliate Program I thought I would take a mental break and write on Search Engine Optimization. Being in the business of generating sales through search engine optmimzation I have spent a considerable amount of time in many web forums with many advanced webmasters and SEO specialists. I want to take a step back, however, to examine what actually is taking place during a web search, not from the consumers perspective (though that is where marketers primarily work) but from the point of view of a search engine algorithm.

A basic defintion of an algorithm is a computable set of procedures that when computed will achieve a desired result. Search engines use algorithms to organize and display to web consumers inputted information query sets. A basic search methodology is as follows: information query sets are inputted into a search form; web documents are found and measured based on a specific algorithm function; web documents are then indexed; and then web documents are returned with a basic listing result for the search user. It is a four step process that happens billions of times each month. It is a process that is mathematical, analytical, and to a large degree a philosophical means of presenting large quantities of user actionable information.

So how do Search Engine Result Providers like Google, Yahoo, and MSN use algorithms to best provide value added results for consumers? There are hundreds of possible algorithms available but for SERPs the algorithms that represent the best method of achieving results are hyperlink analysis algorithms.

You see the web is best viewed as a large graph. As such individual graph vectors are in point web documents. Considering clusters of web documents as vectors then opens the door to composite views of identification and understanding. Through a web graph that is a static equilibrium network with a classic Poisson type distribution where the number of outcomes is an interval of space-time that has its mean equal to its variance, creates a structure to vector analysis that is based upon degree separation. Through this structure algorithms can be computed to map the web via its connections (hyperlinks) between nodes (web pages) and subsequently cluster nodes based upon any thematic combination desired.

Let's look at Google's Search Engine Algorithm: PageRank!

PageRank, is a static hyperlink based ranking algorithm, the basis of which stems from the structure of the hyperlink and the premise that hyperlinks cause a person to make mature decisions without knowing the scope of the whole. In other words, hyper text implies choice in sequencing a linear path from one point to another with an absence of knowledge of the larger text waiting at the other point of the hypertext.

More to the point, hyperlink structures encompass efficiency and depth. Theoretical assumptions can be made that the link text represents the text on the page and so then the “link” with the most relevant link text to the inputted information set should be placed as a higher importance then another link that does not closely represent the inputted informational set. In theory hyperlink structures that are efficient links the person from one quality point to another quality point, in the least amount of links possible, thereby creating an efficient algorithm (good algorithms generate the best use of a persons time). Accordingly, a static hyperlink based ranking algorithm that is "good" will attempt to link a query result to a minimal amount of web pages, the assumption being that efficiency (a product of link quality) and depth ( a product of scope) will be calculated accurately.

The inherent problem is the natural (or unnatural) subjectivity that exists within efficiency and depth. Google’s PageRank attempts to resolve this problem of subjectivity by quantifying page attributes in conjunction with measuring the link itself. The algorithmic processes are to first discover the relational properties of hyperlinks utilizing graph theory for rapid calculation of link popularity, and then, quantifying the relative degree of importance of subjective link variables.

These variables include Keyword Density, Page Depth, URL, Meta & HTML Tags, Keyword Proximity, Keyword Placement, Keyword Relevancy, Link Popularity, Link Reputation, Page Content, and Page Word Count.

Now based upon available data about PageRank, the algorithm collects information attributes and then scores them to quantify PageRank by using the following formula: PR(A) = (1-d) + d(PR(T1) / C(T1) + …+ PR(Tn) / C(Tn)) The formula is defined as follows:

• PR = PageRank;
• A= Authority;
• d= damping factor set between 0 and 1;
• T1…Tn = Pages Pointing to A;
• C = number of links going out of A.

Notable considerations of the formula that need to be highlighted are two intuitive factors: the damping factor and the association of both the quantity and quality of IBL anchor text.

The damping factor is an extension of PageRank that prevents misleading of the algorithm by placing a probability that a web surfer that requests a new page will move away from that page. Another words PageRank is the likelihood that a person will stay on a page and d is the likelihood that a person will leave a page. D is at it’s core a model of consumer behavior. How is d affected by a website owner…through the ongoing development of content. Unique, original, value added content will decrease d and increase PageRank. One sidebar that is also notable as it relates to d is the Google Dance, Google Update (Florida et all) and that is the normalization of quantifying d. D used to to be calculated every 4-6 weeks causing website owners to adjust to new changes in the algorithm and then scramble once the reshuffling has occurred to react to changes in rank. Recently, however the algorithm has moved to a continuous adjustment helping to normalize the gap in rank change for website owners. The real advantage for this is that website owners are now able to focus in on known content variables and improve them by adding better content for consumers rather than scrambling to write better content for the algorithm.

The second factor that is indicative of higher PageRank is the objective and subjective value of IBLs (inbound links). The objective value of IBLs is the quantity of IBLs. The subjective value of IBLs are the quality of IBLs. Think of these two values of IBLs as the way the Internet population validates the authoritative value of a website. More IBL’s is good and simultaneously better IBLs is well…better.

There is an interesting movement to try and go beyond PageRank ( and its cousin algorithms HITS/CLEVER) when it comes to link analysis, and it is spearheaded by Microsoft. The movement identifies a known problem that we are made aware of through the above analysis and that is: existing link analysis algorithms treat a web page as a single node in the web graph. This is a problem because as we know that each node (page) rarely is about one specific topic.

All of our planning and implementation to date which has been pushing to focus our page around one or very few keywords testifies to the scope of this reality and intensity of resources involved. Each node, theoretically and proven empirically, is a representation of more then one semantic topic. This brings in to question the real authority of a PageRank which dismisses an entire page if the focus is not about a singular topic, even though the page does represent some blocks of qualified content for the searcher.

By dismissing the page entirely, previous link analysis algorithms deny searchers from finding the content they may have been looking for since the result would not have been retrieved at all. Microsoft is proposing a precision approach to reading web attributes: Block Level PageRank and Block Level HITS both of which are based on Block Level Link Analysis.

Well I will end here even though a lot more can be written on the subject. My next post will be back on track with Affiliate Marketing and how I manage the Laptops For Less Affiliate Program. Until next time!

How to Start an Affiliate Program - More Analytics

2005-01-02T17:24:00.000-08:00

Happy New Year! Welcome to 2005! I just want to wish each of you many happy blessings and a very purposefully 2005.

Well we spoke last time about then different measurements I look at when administering an Affiliate Marketing Program. I would encourage you to go back and read the post on this metric overview.

In the next several posts I want to give you a brief summary on each metric and how I use each measure in planning and projecting for the Laptops For Less's Affiliate Program.

Let's look at the first three measures in this post: Click Traffic, Affiliates, and Order Volume.

Targeting Click Traffic:

Internet marketers realize that the holy grail of selling online is the 1 click one sale ideal. The conversion rate as we will soon see helps tell how us how close we are to that ideal - or how far away way are! Internet Marketing professionals segment consumer traffic to target to the "nth" degree to come as close as possible to this ideal. So it is with this targeted goal in mind that Affiliate managers work with their affiliate sales force to define, reach, drive, and close the consumer driven traffic sales through their affiliate sales channel. Affiliate Marketing Managers need to seek out Affiliates that share a common bond between the Affiliate's web audience and the product(s) the Affiliate Marketing Manager is trying to sell.

Building Quality Affiliates:

So it is that as Affiliate Marketing Managers discover those affiliates that can directly associate their website with the product(s) that the Manager is trying to sell; in order to bring the affiliate into the Managers's Affiliate Marketing Program, the manager must consider the qualitative state of the affiliate's website. What should the Affiliate Marketing Manager look for in an affiliate's website? Well remember my earlier post about search engine optimization? Well in that post we spoke directly about content - original, valuable, and usable content. The affiliate marketing manager must work with Affiliates that can create content that is authoritative, retentive, and interactive. Why because then both the Affiliate and the Affiliate Marketing manager will succeed in procuring targeted consumer traffic that will have a greater opportunity to make a final purchase at the merchant's website. How can this be? Well to borrow from my SEO RoadMap report that I wrote in November of 2004 "Search engines employ technologies that make searching the web convenient. Search technologies graph the web for the purpose of taking nodal imprints based upon user defined and inputted informational sets. These informational sets are retrieved, indexed and then displayed to users for the purpose of a user defined actions." Search engines want information rich content to bring back to the consumers querying the data inputs. Developing quality content is the first step to increasing order volume.

Increasing Order Volume:

As the affiliate's content increases in its authoritative, retentive, and interactive state then the net effect will ultimately be an increase in order volume directly derived from the affiliates website. Affiliate Marketing Managers must at all times help their affiliate sales force write content by adequately promoting their product offering in such a way that it makes the affiliate job easier to create quality content for consumers and search engines.

Next time I will explore the next set of measuments that I use to manage the Affiliate program at LaptopsForLess.com. Until next time!

Related Sites

2005-01-01T08:16:00.000-08:00

Finon Corporation’s Affiliate Program Management Services are designed to position your company’s products as the leading choice for buyers shopping on the web.

BestBuysOnTheNet.com - is a shopping portal that connects hundreds of thousands of consumers to find millions of products from quality merchants.

How to Start an Affiliate Program - Analytics Again

2004-12-31T09:48:00.000-08:00

Well here we are in our second installment of second section of how to start an Affiliate Program. If you have not yet read Part 1 or Part 2a then follow the links and do so now.

In Part 2a I talked a lot about the metrics involved in measuring an affiliate program. I know there are other metrics that web analysts use but as a marketer that is EBITDA focused I like to focus strictly on commerce measurements as method of determining the success of a marketing program.

To that end let's break down what the various commerce measurements I use when determining the viability of an affiliate program.

1. Start-up costs - The start up costs include the following: management (I recommend going with the Finon Corporation - I will write another post on the importance of using Finon later). Other start-up costs include Technology partner costs, recruitment costs, and communication costs. After your costs are determined then you can move forward with your measures.

2. Until you have real data create certain assumptions to base your projections on as you will see in order to meet all the calculation needs you will need the following data (either real or assumptive):

Click traffic - the amount of customer traffic derived from an affiliate program.
Affiliates - the total number of affiliates in your affiliate program.
Order volume - the total number of orders in a given time period (I like to measure monthly)
AOV - this is the average order value
Sales - this is the total sales brought in during the measured period.
GP$ - the gross profit dollars represent sales X product costs represented as a percentage
Net GP - is GP$ less program costs.
Net Margins - is the ratio of profit gained by the overall program represented in a percentage format.
Total costs - is the total real dollar cost of your affiliate program.
Cost per order - is the dollar cost average at a per order level.
Cost per visit - is the dollar cost average at a per visit level.
Conversion rate - is the rate of orders to clicks.
Sales per visit - is the average number of sales per visit.
Contribution per order - is the average program contribution to the shareholders wealth per order
Total contribution - is the total program contribution to the shareholders wealth.
Effective Rev Share - is the effective revenue share that the program costs per dollar earned, represented as a percentage.
ROI - this is the total return on investment that your affiliate program generates for your shareholders.

In my next posts I will talk about how to use these mesurement to understand your affiliate marketing program objectively. Until next time!

Search Engine Optimization -Its All About the Content!

2004-12-30T21:16:00.000-08:00

Well before I sign off for the day I wanted to write something on search engine optimization. Yes I know I plan to get back to Affiliate postings shortly but as any Affiliate worth their salt will tell you search engine optimization is an integral part of affiliate marketing and so it is in that vain that I write this final post for today.

You see affiliate marketing uses search engine marketing to capture and drive traffic to merchant products. So it is that successful Affiliates know intimately how to optimize their sites for the search engines.

At the core of search engine optimization is content. Content - original, valuable, and usable content. We must create content that is authoritative, retentive, and interactive.

But developing original and valuable content for distribution through SERPs is combined effort of document writing and creative flow. Science and art another words. The artistic function can not be readily explained here but is easily recognizable as valuable and qualitative content.

Well I promise you I will post on how to write content like this at another time. It is actually really cool and I promise if you are like me then you will really like it. But as I stated above I want to get back to the setting up an affiliate program. So until next time!

How To Start An Affiliate Program - Analytics

2004-12-30T07:26:00.000-08:00

As discussed in Part 1 of How To Start An Affiliate Program, we realized that the ROI is really impressive and leads us to think that there are some significant riches to be found in Affiliate Marketing. But just how do we go about setting one up? Here are the steps and thought processes I used when I established the Laptops For Less Affiliate Program. I will forewarn you that the Part 2 of How To Start An Affiliate Program will itself be broken up into a number of posts, only because the granular details of all the necessary steps are quite exhaustive. So bear with me, now moving on...

Begin with measuring for success:

I knew that every marketing program I manage must in and of itself remain ROI positive in order for it to remain a viable channel with management. Indeed the number that I measure my programs against is 10% of sale. I know 10% is not a lot but remember I have to be constantly centered around the EBITDA numbers in order to continually provide value to my Shareholders. So with the overall program costs of 10% I move forward with discovering how to cost spec the program out. I used numbers that I have experienced before with selling computer related products and measured the cost columns: Start-up Costs, Management Costs, and Affiliate Costs. Then I projected affiliate partner acquisitions, click traffic, order volume, AOV, and sales. Then I calculated GP$, Net GP, Net Margins, Total Costs, Costs Per Order, Cost Per Visit, Conversion Rates, Sales Per Visit, Contribution Per Order, Total Contribution, Effective Rev Share, and finally ROI. Yes I know a lot of math, but the metrics are invaluable to an online marketer!

My next post will breakdown each of these metrics so that we will know why they are essential to an Affiliate Program. Until next time!

A Quick Preview to My Next Post on Affiliate Marketing

2004-12-29T17:45:00.000-08:00

I wanted to let you know that I'm still working on my next posting on "How to Create An Affiliate Program" but I want to give you a preview of some of the sites I will be referencing.

First take a look at the Finon Corporation. The Finon Corporation is a web management company that specializes in Affiliate Marketing. Take a look at their site and the really cool tools. I will talk about the tools in the next postings.

Secondly take a look at ABestWeb.com. A Best Web is a community of Affiliates of all levels. I will talk more about the importance in the next postings but let me just say the community is indispensable for those who are serious about Affiliate Marketing. To get an idea of how the forums help both merchants and affiliates take a look a the Laptops For Less Forum.

My next post will hopefully come tomorrow. Until next time!

How To Start An Affiliate Program -In the beginning

2004-12-29T10:18:00.000-08:00

This is an interesting question. One that I actually asked myself when I established the Laptops For Less Affiliate Program in December of 2003. There 4 key questions you must ask and answer when establishing an Affiliate Program for your organization. The first question will be answered in this post and the other questions will be answered in my next post.

1. Why am I starting an Affiliate Program? As Director of Marketing at Laptops For Less I am repeatedly asked (in not so many words) how much have I contributed to the wealth of my shareholders. You see in my role I am focused on EBITDA numbers. For those of you not familiar with a corporate Income Statement let me give you a quick explanation. EBITDA is the earnings before income taxes and depreciation. It is the number that represents what actually went into the shareholders pocket after all revenue was recieved and operational expenses were paid. Obviously it represents an really important number to shareholders because that is in effect their earnings from corporate affairs (another words their paycheck)! To that end as the Director of Marketing charged with driving sales for Laptops For Less I am constantly trying to increase this bottom line number for my employers. So therein lies the why? Why do we start an Affiliate Program....because Affiliate Marketing Programs yield cost effective sales, high ROI, and other intangible benefits for organizations. Just how high can an Affiliate program yield for a company. At Laptops For Less I have repeatedly seen month over month ROI's of up to 300%. I think that sufficently answers the why! Next post I will answer the second most important question to ask when starting an Affiliate Marketing program.

Affiliate Marketing

2004-12-29T09:04:00.000-08:00

Affiliate Marketing has been an Internet standard marketing channel since 1994. Affiliate Marketing leverages the strenght of many to benefit many. It is a way to drive targeted traffic in a way that a merchant can not directly do themselves. There are many expalnations of how Affiliate programs work but at its most basic level one website links to another. The link contains an embedded tracking variable. The tracking variable is used as a mechansim to attribute a dervied sale from the flow of traffic off of the link and to properly compensate the linking partner. Before I continue let's look at a real life program: Laptops For Less Affiliate Program.

As you can see from the Laptops For Less Affiliate Program a properly executed Affiliate progam incorporates many different levels of operations. But the complexity of the program is mitigated by the provactive fact that if executed properly Affiliate Marketing yields extremely attractive ROI results.

The next series of posts will walk through an entire Affiliate Program from start to finish.

The Age of Internet Marketing

2004-12-29T08:28:00.000-08:00

Let's face it as the Internet emerged as a vehicle to distribute goods organizations both private and public (for profit and non-profit) have quickly grasped on to sell more products efficently. Throguh this reality emerged the need by these same organizations to understand how best to do that and so entered the age of Internet Marketing.

The various channels within Internet Marketing vary demanding expert understanding of costs and ROI almost before a product is sold. Experts in the field use their experience as the basic provider of knowldege to the corporate machines and test out new channels and partners sparingly until the relationship is a proven money maker.

In upcoming posts I will look at each channel I have personally worked with and will tell you exactly how I feel about each. One thing that you can expect is a report supported by not merely industry standard metrics but by real life situations that I have encountered. Don't worry the numbers will be in aggregated format so that I do not violate and trusts from my NDA's that I'm under!!!