This is the second of a three-part series of posts about affiliate marketing. For the first post, please click to: http://www.humanuspublishing.com/2008/10/24/affiliate-marketing-for-self-publishers-part-1.

In this second post, we’ll talk about my real-life tool for managing affiliates, a glossary, and walk you through startup costs of a working affiliate program.

You will need to understand some basic stuff before you begin. For starters, here’s the promised glossary…

Landing Page: This is a general term for the first page that consumers see when they first click on one of your ads, from anywhere on the internet. This may or may not be the page where they actually buy the product, and there’s a whole science around how to create the “ideal” landing page (if there is such a thing), and what makes people actually whip out their credit card. This page is crucial, so carefully constructing it with help from various experts is important. (See future posts – I will not go into detail here, but you can just do a quick search on Google and come up with a variety of sources.)

Campaign: this means essentially the same thing is does in the old-school advertising world, which is to create a series of ads, setup the landing page, and plan a time-limited series of ads with a clear and measurable objective.

Traffic Provider: this is the person that has the list of people that they send your ads out to (such as someone who publishes a digital newsletter, or a blog author) or the person who has the website where the ads are posted. The numbers of people who visit their sites or read their stuff are called “traffic”.

Payout: the amount that the affiliate earns for a single sale of your product. Can be quoted in actual dollars or a percentage of the retail sale price.

Conversions: this expression applies to the number of people that are converted from browsers to buyers of your product. Much can be done to improve conversions on landing pages and elsewhere. To commit to any sort of action can also be referred to as a conversion, such as how many people click on the actual banner vs. just look at it and do not click.

CPC, CPM, and CPS: when buying ads, be sure to ask how you are being charged* by the traffic provider, such as Cost-Per-Click (when people click on the ad you make a payout), or Cost-Per-Thousand, where “M” is short for thousand (in French, M stands for “mille” which means thousand) and in this case, the meaning is per one-thousand people that click or take the action on the ad, and Cost-Per-Sale (or CPA for Cost-Per-Acquisition), which means that you only pay the affiliate when the sale actually happens. (These days, CPS is the standard, because clicks are easily inflated and falsified.)

*In the case of managing your own affiliate system, which is the focus of this article, the relationship is more the case that you are paying out rather than being charged, but for the sake of clarity, it may be referred to this way when you’re negotiating with affiliates.

Costs:
When I first began using affiliate marketing as a tool with my clients, we decided to start small and build from there, which is a philosophy that I still recommend. Here’s what you’ll need to expect in terms of costs for startup;

1) Subscribe to a good service provider: I discovered 1ShoppingCart.com about a year ago, and haven’t looked back since. This is now my number one business tool. I’ve used other shopping carts, but this is the best. Seriously. They are an all-in-one package of not only shopping cart services, but also a really, really nice affiliate system, sales reporting, and merchant processing. Without them, my business would be dead in the water. Their system is quite deep, but you don’t need to leap in whole hog right away. I did not need to hire a designer to make the shopping cart work, and their customer support people are nothing short of amazing. I subscribe to their top-end $99 per month account, which handles not only online sales for all my businesses, but all of my affiliate relationships, with full accounting. They even automatically deliver downloadable ebooks to customers! The only help I have is my super-duper Girl Friday who does my books. It makes her job easy and saves me a fortune. Just do it. (In a future post, I’ll do a walk-through of the management panel of 1ShoppingCart.com so that you can see how to setup your starting information.)

2) Your website or blog: Don’t get me started here again about why your website should be a blog, and not a static website, but be sure that you have a page that is your designated landing page for all affiliate sales. The only thing this page needs to have in terms of technical stuff is the actual shopping cart buttons. Everything else is just designed as per your imagination, and what you think will convert well. The only reason I’m including this on the list of costs is just in case you don’t have a blog already.

3) Design some ads: Remember to think about more than banners – text ads may sell products well in email marketing. Crafting careful words can be very difficult for a product that you’re intimately familiar with, so this is one case where I totally advise getting some help. eLance.com, oDesk.com and others are a great resource for this sort of contractor. Even for banners, knowing which words to use, and which not to, can be very difficult. Hire some objectivity.

4) Buy some domain names: Using a variety of domain names for an affiliate marketing campaign serves two major purposes, and several minor ones. Buying about 20 domains and pointing them all to your main landing page allows you to market to multiple audiences and measure their effectiveness more easily. In addition, a domain name like “smootherlegs.com” will attract different users than “newrazorproduct.com”. It’s all about increasing your traffic. (See a future post about how to choose good domain names and avoid bad ones.)

In part three of this series, we’ll talk about avoiding pitfalls, how to get your first affiliate, maintenance, taking it to the next level, and the other really important business-building strategy that you can use affiliate marketing to achieve.

This is the first in a series of three posts about how self-publishing authors, and many other entrepreneurs, can use affiliate marketing to ramp up sales of their books and products on a direct-to-consumer basis.

Many self-publishing authors want to take advantage of the obvious benefits of a marketing method that is highly automated. But it can be a high-overhead method of doing business if it is not managed well.

What is affiliate marketing? This expression can be over-used, so for the purposes of our discussion, let us define it as a way by which consumers click on your advert or link hosted on a website somewhere (or in an email that someone sends out), and you pay the person hosting the ad a small fee for referring the sale.

Affiliate marketing is a just like any traditional sales referral relationship, except that the entire thing is tracked and driven by an automated system. The statistics of your affiliate’s progress are easy for all involved to see at any time, just by logging into the affiliate management system, which is web-based, and not something installed on a privately-managed computer somewhere. Most payments are made virtually, using PayPal or other transaction providers. (At least, until you’re making big enough money that you require a bank draft!) Transparency is the key to making your affiliates happy, and that means giving them easy access to information.

This powerful marketing method is not new, but certain industries are working it in better ways than others. It is tried and true, and there are a variety of tools – both free and paid – that will help you accomplish it. It’s not really that deep, but like many things in business, it’s easy to make it much more complicated than it needs to be.

By setting up an automated system to manage and attract new Affiliates (the people who have the websites where your banners are displayed), you are setting in motion a process that is more or less self-sustaining. After setup, the real work in affiliate marketing comes in the areas of creating new ads that keep consumers and potential new affiliates interested, and in the area of running weekly or monthly reports.

Your affiliates need;
- ads that will pay them well for each sale; not just a few cents, but good dollars
- ads that are really going to convert browsers into sellers (or else nobody makes any money)
_ ads that are professional and attractive, not cheezy or amateurish
- good follow-up and reporting, or preferably an easy way to self-access information
- ads for products that relate well to the audience they already have (gourmet food audiences don’t want to see used car ads, etc.)
- prompt payment

As an advertiser, you will need;
- a master control system to manage your ads, your affiliates and their payments
- to create quality text-based or graphic ads (most people farm this out)
- a finely-tuned shopping cart and website / page where people can buy your product (see the next post for my not-so-secret weapon in this area)
- to remain objective and flexible about what works and what doesn’t
- to be prepared for sales to take off, by having product stock and a good shipping system already in place
- to spend time on the phone talking to potential affiliates, managing relationships, etc., but this is typically minimal unless you’re really selling like crazy, in which case it’s worth it

In the following posts in this series, we’ll talk about the real tools that I use to manage my affiliates, a glossary of terms, avoiding pitfalls, and how to get started as cheaply as possible. Stay tuned!

Today was my first broadcast on BlogTalkRadio.com. You can listen live to the radio-style show about information publishing and marketing every second week by clicking to the segment page, or by viewing my profile at BlogTalkRadio.com.

Now, this first show is not my best work, but the seed is officially planted. Today’s topic was about how Authors of all types can use social media marketing to increase their profile and improve book sales. Future shows will be on a variety of topics for authors, and I’m eager to see this take off as a regular bi-weekly event. I’m currently seeking interviewees, subject suggestions, and comments on this first show. If you know an author who would like to be interviewed, please give me a jingle at 1-866-907-4084. (What about you?)

BlogTalkRadio allows callers to use any phone to call into the show, just like traditional radio. I love taking questions from users, and here’s a great opportunity for anyone to get what essentially amounts to free consulting, just for the price of calling in to the show.

I’ll advertise future shows here on the blog, including the call-in numbers and where you can listen live. Plus, you can always listen to the archives using the widget at right – it’s the black and blue box with a list of show titles scrolling beneath it. (Right now, of course, there’s only one.) You can also download the .mp3 recordings for free to any player, and listen at your leisure.

The next show is scheduled for November 5th at 3:30 pm, for a 30-minute show. The topic will be, “Peggy’s Top 5 Blogging Tips for Authors”. See you then!

Catherine DeVrye is a former IBM Executive who now tours worldwide offering speaking and corporate coaching. She is the author of several books, but most lately the author of Hope Happens: Words of enCOURAGEment for Tough Times, and her autobiography, Serendipity Road: A Memoir, which was nominated for the Australian National Biography Prize. Her books have had positive reviews from everyone from Jack Canfield (author of the Chicken Soup series) to Sir Edmund Hillary. Catherine was kind enough to give me some of her time this past Monday here in Las Vegas.

Catherine here talks about how small and micro businesses, like self-publishing authors, can use added value and good customer service to not only keep the customers they have, but add new ones. And all of this can be accomplished without spending a dime.

I met Catherine a year ago in Sydney Australia, where she has made her home since 1973. But she spent the early years of her life far from there, in an orphanage in Calgary, Alberta, Canada. Catherine has a long and extremely interesting biography (click to her site at GreatMotivation.com if you’d like details) which is now told in her autobiography. She has dined with Princes and Prime Ministers, she has cycled over the Andes and climbed Mt. Kilimanjaro. But she is now best known as a corporate speaker on the topics of change management and customer service.

Catherine’s remarks about not being afraid of change are so important at all times, but especially now as many small businesses close their doors in light of the current worldwide economic slowdown. She makes some very interesting points and offers examples of how even a one-person operation can maintain a successful business philosophy.

 

 Interview_with_Todd_Vernon_of_Lijit.com_October_15_2008.mp3 [15:09m]: Play Now | Play in Popup | Download

Listen to Todd Anderson give us an inside look at a new search technology, and how it can help any author / blogger to cement their expertise and build their profile. Lijit actually shows your readers who you read and affiliate yourself with.

Lijit.com has a fab plugin/widget for a variety of blogging and web-based platforms, including my favourite, WordPress. All you do is install this like any other plugin, tell it what social media organizations you are affiliated with, and a very attractive search box magically appears on your blog. When users type in their search term, not only do they get responses from your own blog, but also from anyone you’re proud to associate with, via your previously-specified social media connections.

What’s in it for the author? You get to view all the search terms people use on your site – a major advantage if you want to know what you readers are looking for. AND, cashola. (Yay!) If you choose to opt-in to the Lijit revenue program, searchers will get targeted ad responses along with the regular search returns. If they click, you get paid. Tailored to the needs of users, and of bloggers. I love this!!

Thanks Todd, for a pleasant and informative interview, and thanks also to Tara Anderson of Lijit, who was kind enough to facilitate this conversation.

Here’s the ebook I should have written, “Getting Real” by 37Signals. This brilliant eBook is about what all of us should apply to our virtual businesses, whether they be about software or not.

For years, I’ve been preaching about “writing backwards”, and for that matter, doing all sorts of business activities backwards. Here is another company saying exactly the same thing. And they’ve done it without debt, without funding, and with only 7 people.

Working backwards means to build any product, service or business and start from the experience of the consumer. What does the customer want to see? What do they need? What is really going to work for them? And, what will they tell their friends about?

This is defined in the book as, “Getting Real starts with the interface, the real screens that people are going to use. It begins with what the customer actually experiences and builds backwards from there. This lets you get the interface right before you get the software wrong.” Sound familiar?

How many of us whined about upgrading to Windows Vista? I know I did. But what was the true problem? I know that my problem was too much. Too many clicks to get done what I wanted, too many features that I never use. Microsoft is stuck with the worst kind of problem – a massive market, so they must be all things to all people. They must design and execute features that will never be used by most people, so that they can keep the specialized applications of their product viable. But the rest of us are not burdened by this, and 37Signals states this clearly, “Getting Real delivers just what customers need and eliminates anything they don’t.”

When writing, building a product, designing a website, and almost any other business activity, we must first consider the reader, the user, and the consumer. They are who we must design for, and for their real, tested, and verified needs. We cannot design for our assumptions about the user. Talk to the user, ask them questions, and test throughout the process. This is why 37 signals will continue to thrive, building products that I use and love.

While browsing in Borders this evening here in Las Vegas, I took a few moments to notice what other customers were passing up, picking up, and buying up.

Fresh off the press is the latest from journalist Bill O’Reilly. Now, I don’t know if other people were picking up this hardback because of the author, because of a nicely designed cover, or because of the subliminal messages associated with the colour red on the cover, but I sure know why I picked it up: it was the only book on the rack with the price on the front.

While all the other books have their prices displayed on a tiny-print label on the back of the book (which I need my glasses to read, and I know I’m not the only one…), O’Reilly’s latest proudly displays the price of a lousy $14.95 – roughly half of many other books on the shelf.

Why is O’Reilly (or his publisher) doing this? Because of the first two laws of modern marketing, and for that matter, modern writing. The first is, “Know Thy Market”, and the second is “Be Transparent”.

Who is buying this book? Conservative parents, teachers, and anyone who cares about kids. That’s about half of America. The underlying message of a smaller price tag is that the book is not complicated, nor does it take long to read, nor to implement any of whatever recommended strategies that it may contain. It’s for people who care about kids, with no time or money. Gee, do any of us know somebody that doesn’t fall into that bracket?

Transparency is important here, too. O’Reilly is already an author with a proven track record, whether you agree with his editorial position or not. But break it down: the book is thin – only about 150-ish pages. The layout is freakin’ brilliant: clear pages, large-ish typeface, cleverly stylish larger-than-required page numbers, and a clear heirarchy that is demonstrated by well-written headlines positioned in a layout that allows the content to be easily absorbed by any reader. You quickly realize that the price is just the cherry on the cake, the closing proposition. The message all of this sends is that O’Reilly is just a guy with a few opinions, and here they are laid out in black and white, and I’m not hiding behind a huge price tag or a thick book, and aren’t I a nice wholesome American, etc. Let’s face it: we eat this stuff up with a spoon and spread it on toast.

Right next to this book is one that almost made me swallow my gum: “Sarah: How a Hockey Mom Turned the Political Establishment Upside Down”. Poor Ms. Palin, who already has credibility problems up the yin-yang, has her pathetic little biography, printed on crappy pulp and bound in a thin wobbly paperback cover, right next to Mr. O’Reilly. And for virtually the same price! When I read the title and saw the piteous photo of her on the cover, I felt bad enough, but that limp little volume with the awful title almost reduced me to tears. I gently put it back on the shelf, and tidied the rest of the sagging pile of them.

No matter what my feelings about either of these subjects (and by the way, I’m no fan of either O’Reilly or Palin – I’d rather elect Tina Fey) I must objectively admire O’Reilly for his clever strategic thinking.

Let’s do the math…

recession = fear / brings out our protective instincts : find validation in well-packaged opinions that make us feel better about our fear. Mr. O’Reilly definitely knows his factors.