I recently wrote a lengthy article on What is Retargeting?. Subsequent to it, my recent experience with some of the affiliate programs got me into thinking a bit into the future direction of advertising and affiliate programs.
With the growing cost of online PPC advertising, large companies (alexa rank below 5000) are realizing that they can make use of their own affiliate programs that are more sophisticated and context-aware and pay based on PPA (pay-per-action). Typically the PPA programs offer more commission than the money earned through PPC. But the rate of conversion is typically less.
However, by offering these unique PPA affiliate programs that are context-aware, these companies are able to do re-targeting for free! Yes, that’s right. Take Amazon for example. Any shopper who is actively looking to buy something, if he wants to buy on Amazon but not sure of the pricing, he would search further on the web and might land up on one of Amazon’s affiliate program. After a bit of searching and realizing that there is potentially no better deal elsewhere (combining tax & shipping), then the user might land up back at Amazon through one of it’s affiliates. If the user ends up buying the product, it’s a win-win for Amazon and the affiliate. If not, it results in retargeting for free for Amazon!
Another interesting thing is, some companies don’t care about how much traffic is really brought to their site by their affiliates. On the other hand, Commission Junction recently sent an email to me stating that they would deactivate the account as the volume from my sites is very low. Yeah, right! Like I care? I will write another article about the future of context-aware affiliate programs and what that means to companies like Commission Junction and LinkShare.
