Renaissance for Retail Affiliate Marketing? Part 2 of 2

This is part 2 of an interview conducted by Jeff Molander of Molander & Associates Inc., with affiliate marketing veteran, David Delisle (pictured left). Of course if you missed part 1, you can read it first here.

As we learned last week, veteran affiliate manager and The Partner Maker LLC founder David Delisle recently suggested, “We'll see affiliate marketing move back to where it began with thousands of small mom-and-pop Web sites each driving a little bit of traffic to marketers.”

We will?! This runs contrary to how most practice the art of online affiliate marketing – especially in the retail segment. Here’s the conclusion of my conversation with David…

Molander: Marketers have been continually told to focus on their top affiliates. Is this not sound advice?

Delisle: Yes and no. Consider the results of this approach on a case by case basis. If you want to grow revenues or leads you need a larger base of distribution partners. Period. The answer, thus far, has been to grab the low hanging fruit – the obvious affiliate partners – and completely ignore all other affiliates. The problem with this is that, at some point, a marketer needs to say to itself, “if all this involves is a dozen or two performance partners what do I need an affiliate network for?” In fact, many marketers are asking such questions… but it’s a dangerous mindset in my opinion.

Focusing on top producing affiliates is great advice. The problem is that it shouldn’t be the only focus… yet we are seeing very top heavy programs with a small group of affiliates representing the huge majority of traffic. Because these top affiliates fall into the three concentrated categories stated above, this puts a huge investment into a relatively small number of ponds – search, coupon/deal sites and incentive shopping. Sure there are a lot of fish swimming in those but that pond is continuing to shrink and has a very limited growth strategy. And, what about the rest of the Web? How does this include emerging social-oriented affiliates? It doesn't.

Today, virtually everyone using the Web has a means to become an affiliate. These are the small ’mom and pops’ AND up-and-coming businesses that are largely ignored for larger more established affiliates. It’s become a ‘best practice’ to ignore a lot of these newer affiliate start-ups. Yet it is this ‘long tail’ where the true potential continues to remain largely untapped.

Molander: Ok… I get it but let’s face it. Marketers like the ‘network effect’ where they plug in and walk away. Sure this has been part of the problem for affiliate marketing – in that marketers often lose control – but what you’re talking about sounds pretty labor-intensive.

Delisle: It’s important to note that there’s no silver bullet here. This involves work – contacting potential affiliate partners using email, instant messaging, Facebook, telephone, etc. Marketers must start focusing on a larger group of smaller affiliates if they want their programs to continue to grow and take advantage of emerging social networks. They must and many are. These are the ones to watch but they’re keeping quiet these days.

Molander: So now we’re getting into the ‘tools’ issue and that’s something I’ve harped on for years now. Affiliate marketing doesn’t ‘scale’ very well. Affiliate managers have very little time to do what needs to be done day-to-day. How will this change, David, because without changing that aspect affiliate programs cannot grow. Something needs to give.

Delisle: Agreed… this is the biggest challenge and solving this problem can open the floodgates. Yet even with limited tools some marketers are staffing up around affiliate marketing – heavily. Companies like TicketsNow, Insurance.com, Buy.com. These companies are staffing up, not trimming back.

As for new tools that allow scale occasionally we see traditional, established affiliate networks providing new tools that truly empower marketers and affiliates but, I agree, overall it’s not an innovation-driven environment. But, that can change. Look at Zanox in Europe. Now that’s a network interested in fostering innovation. They’re even running ‘innovation camps.’ At The Partner Maker we’re enabling marketers to find the most appropriate affiliates faster and grow revenues and leads. We’ve chosen to help affiliate managers make better use of their time when managing – as you might expect – more affiliates.

Marketers should look to up-and-coming affiliate technology and network providers – companies like Burstabit, AdValiant, Avantlink, etc. These guys are cookin’ up some interesting tools. They’re the ones to watch.

Molander: So what’s on the horizon for affiliate marketing in your view?

Delisle: Well, as I’ve said before, and continue to believe, I think we are moving towards a Renaissance. A movement back to the early days of affiliate marketing where the small business owners and individuals are the heroes… and we didn’t focus on the top 20%. With the surge of social marketing and the buzz around this, more people than ever are now publishing their opinions online. As this trend continues, we won’t see a few affiliates rise to the top but rather, a large base of new affiliates to continually emerge. This is the reality and ignoring the ‘long tail’ will become a thing of the past.

Jeff Molander is a leading Web marketing expert, author and speaker. He is CEO of Molander & Associates Inc., and can be reached at jeff_at_jeffmolander.com.

Disclosure: Jeff Molander is an investor in The Partner Maker LLC