Jim Edwards, Bsc
CEO Internet Insights Publishing

Webtrenuers have gone through several marketing models in the last two years. First was banner advertising based on click throughs. Now the latest darling is blasting Email to targeted customers and interested individuals. Behind them is sleeping "Viral Marketing" giant that is a combination of both of the above marketing methods plus more. The newer blossoming affiliate model had skimpy research behind it however so we put it on our research agenda during 2001

A nice term for this sleeping giant is Affiliate marketing. It's basics go back to the old ad copy writers golden rule when thinking in the "customers shoes!" That rule boiled down to, "What's In It For Me (WIFM)." We decided to "go to the horses mouth" contacting various individual persons active in all forms of Viral Marketing using Affiliate programs person to person. Affiliate marketing increases the effectiveness of marketing dollars spent and makes sure that every dollar spent on that marketing is:

  1. Accountable
  2. Quantifiable
  3. Transparent to buyer
  4. Overall Performance Based on sales volume

The pioneer and best known affiliate program is (by banners and links). If you have clicked an Amazon banner on a website and then bought a book, you have participated in Affiliate Marketing.
Amazon even filed business process patents on this method. Amazon didn't enforce the patents because they existed before they filed them and they were so pervasive on the Internet they didn't want to anger masses of net citizens! Amazons basic model has been technically developed and adapted to many types of delivery. Affiliate tracking codes have moved beyond banners can be now delivered by :

  1. Plain email text to the seller
  2. Email HTML links to the seller
  3. Embedded Portal links (one affiliate master site to multiple seller sites)
  4. "Framed" pages so the buyer never leaves the original affiliate site
  5. Other developments to include a combination of all of the above.

Leading Internet analysts predict a steady growth in online Affiliate programs. Nicole Vanderberlit of Jupiter Communications Inc projects that "by the year 2002 it has been estimated that 25% of ALL Internet sales (over 10 billion dollars!) will be generated by affiliate programs. In a different measurement Forrester Research predicts Affiliate marketing will garner 25% of online advertising budgets by 2003 without consideration of sales volume. Both Measurements from premier Internet researchers indicate only one trend for Affiliate marketing of all kinds. UP!

A concept not broached by any Internet marketing research firm was the effect that Affiliate programs had on the buying habits of Affiliates themselves. Did making money, no matter how much encourage an Affiliate Program promoter to buy more from the vendor who writes the check. There has been a flood of research on making websites "sticky" and how to create "stickiness" for customers. Our staff researched the research and could find not one drop of information on how "sticky" an Affiliate was. More importantly did Affiliates have a cash flow value to vendors? If an Affiliate is also customer who generates more customers does the Affiliate have more value than a customer? Does the Affiliate income encourage Affiliates individuals to purchase more from the vendor? Does a check from a Vendor encourage buying?


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