Jeff Molander_

Google's Threat to Ad and Affiliate Networks

Josh...
thanks for contributing your insights. I think I understand your point and it centers on, partially at least, the "branding and reach" campaigns versus the direct response campaigns. Specifically, each have different objectives and therefore cannot be compared. The numbers that David provides make perfect sense but when you mix in market realities regarding commonly defined objectives it gets hairy. I hope I'm understanding you correctly.

Google's Threat to Ad and Affiliate Networks

Also, David, your readers might enjoy this DMNews article and a related story here discussing Avon.

Google's Threat to Ad and Affiliate Networks

David...
Hitting nail squarely on head again. Excellent job in adding the needed perspective. Without this kind of perspective we're lost.

In my opinion, "in general, content sites earn more money on a CPC or CPM" translates to "publishers (read: not affiliates/nimble/sear... individuals who game search ranging from Marchex to people working in undies) who have valued, legitimate READERS (read: not TRAFFIC)."

"However, affiliates that made more on a CPA or a rev-share stuck around" translates more honestly to "CPA affiliates figured out how to use data feeds, leverage basic direct response tactics, employ adware/spyware (without being detected) and game search engines so as to 'shuttle traffic'; this was/is their primary MO versus having loyal readers." The affiliate networks? They facilitate it all. Take it from someone who created one.

Indeed, they are "nimble, quick and fill in the holes" (I might suggest the darker ones) but it's really all about the short term when you boil it down. Affiliate marketing is a short term play. Don't take it from me, though, talk to the advertisers!

Google Introduces Onsite Advertiser Sign-Up; The Threat To Other Ad and Affilate Networks Grows (GOOG, VCLK)

Excellent points, again, David.

How long before companies like ValueClick (VCLK) follow in the footsteps of Think Partnership (acquire contextual technologies... if not networks)? A majority of multi-channel marketers/advertisers have already realized that affiliate marketing is all about search and loyalty sites. How long before advertisers realize that affiliate marketing is not scalable and this is its primary flaw? Most of my clients already have to be honest. They live with this frustration... and they are frustraited make no mistake.

Advertisers have few concerns regarding ad network transparency (where clicks come from). Witness all the hoo-haa over click fraud as just one example. Click fraud is all but an accepted cost of doing business for all who participate in it. Who has time, or money, for anti-fraud software/services and begging Google for credit when they've already demonstrated an un-willingness to cooperate in fighting click fraud?

When it comes to affiliate networks transparency is demanded. More thoughts and a prediction on this subject here.