|Commission Junction from a merchant's point of view|
Is it worth the investment?
I'm just working out some numbers based on CommissionJunction.com's pricing.
Basically the $500/month minimum in transaction fees, means I have to be paying out $1666 to affiliates to not be paying more then the standard 30% transaction fees.
Considering I currently offer a 21.5% commission on Shareasale. Assuming I offered the same on CJ that works out to $7748.84 in gross sales per month generated as a minimum. Anything less and meeting the $500 minimum will seriously cut into my margins.
I signed up recently with Shareasale.com to get my feet wet, but I'll probably be looking at CJ.com in January.
Any CJ merchants on here that would care to share their experience in terms of the sales generated? Were you able to meet the minimum right off the bat? Any specific numbers you can share (# of affiliates, affiliate sales, etc...) would be very much appreciated.
BTW... here's the CJ.com pricing for anyone interested:
I have thinking about this for months but decided this is simply not worth the risk.
This month, our 28 affiliates in darkblue sent us 2977 clicks but made only one sale with a commission worth only $3.00
Even if you can get up to $500 minimum, it may take months to get there. Judging by the number of merchants who deactivates each month, there are a lot of dissatisfied merchants with CJ.
Hmm, but not to step on it, in my own experience (as an affilaite) I find many merchants that practically write "PLEASE DON'T BUY HERE" on all their pages as far as conversions go.
I produced over $4000 in sales in my first month (2nd month the site is online) with CJ and that's really small, with the odd sale or two per day. Most of it from 2 or 3 advertisers. The others have REALLY bad sites for converting, and I'm not just saying that because I send unqualified leads or so.
If your site is well build, and that doesn't mean fancy or complicated (in fact almost the opposite), than you should easily reach those minimum sales numbers, with just one or two decent affiliates.
<ADDED>If you join and are interested, I'll post my top 10 of big mistakes merchants make in my opinion that spoil the sale</ADDED>
What killroy said.
>This month, our 28 affiliates in darkblue sent us 2977 clicks but made only one sale with a commission worth only $3.00
Not to pick on you, but I would really be looking at why I couldn't convert 3000 visitors to more than 1 sale. It doesn't matter what network you use and pay for, if the conversions aren't working on your end.
>I'll post my top 10 of big mistakes merchants make in my opinion that spoil the sale
Please do. We did that a year or two ago, would be good to see where we are now.
Unless you have an established record, most of affiliates that know how to send you serious traffic are going to do a test run with you and if the sales conversions are even only 1 in 100 are probably going to write you off forever, and they aren't even going to take time to say goodbye.
They'll also look at their earnings per click and balance that against their difficulty and/or expense in providing you that click. If the ROI isn't there you can forget having them promote your site.
With the numbers you're reporting here, IMHO you're wasting your time with any affiliate program, unless you've somehow managed to lure in 28 affiliates that don't know how to send you targeted traffic.
(speaking from the affiliate side of the fence)
It's interesting seeing the argument from the affiliate side of the fence. All too often I find myself in discussions with merchants who want me to advertise their site and their brand for free and only ever pay me if a visitor clicks through from my site and subsequently buys something from theirs.
And I say: yes, but even though I can do all sorts of things to send qualified customers to you, that's where my influence ends. I don't have any control over whether they buy from your site or not - if you only want to pay me if they buy from you, you have to employ me as a website consultant as well, otherwise I can't be expected to take responsibility for your lack of sales.
And they say: oh you're really naive and you expect too much etc. etc.
And I'm left shaking my head and wondering what they think an offline publication might say to them if they ran a shop in a high street which only agreed to pay the publication if customers walked in brandishing a copy and saying: "Yes I've just seen your advert and now I'm going to buy something."
How much free branding do these people want?
In the real world you _have to_ pay for advertising.
Handing back to the merchant's point of view...
From what I have read on this and other forums, I do not feel that our site is a low conversion site. The conversion rate from some of our PPC campaigns is as high as 1 in 20.
I think it has got do with the method of traffic delivery by our affilates, that is by banners and pop-ups. We have run expensive banner campaigns before, and the conversion rate from even highly targeted sites is 1 in 400. This is in contrast with text ads which range from 1 in 20 to 1 in 40. Therefore I am very sceptical of what results can be achieved by affiliates using banners.
The only way that I can see affiliates sending highly targeted traffic to our site is through PPC. However, it would probably not be cost-effective for them, and we could find them competing against us.
Ok let's take a look. I once was tempted, CJ send me a "special promotion" for a site only vaguely related to my topic. I gave it my one graphical banner. This banner in the past hsa produced around 1% CTR (compared to around 60% for my other links) but made up for it by recieving over 30 times as many impressions. It also convereted slightly worse then my text links (around 3% compared to 4-8% for other links) all in all, it made about as many sales as the text link, i.e. doubling my income for what ever product I put there.
This merchent sold 0, even though I delivered the same number of clicks. I changed it to the most popular item on my site (by traffic) and boom, 10% conversion (for around 2 sales/day).
I changed it to another merchant, same products, same prices, slightly different site layout... ZIP sales, ZERO, none. You compare them, first thing you notice is that the good one shows the name,picture and price above the fold. More then 50% of merchants show the price at the bottom of 3 pages of sales blabber tzhat sounds so fake that I wouldn't even buy bread form them. What amiazes me is that it'S SO obvious. If any of you look at those sites, you'll say the same thing. Yet, the chances are 50% that you'RE making the same mistake.
As an affiliate I have the great oportunity to pick my merchants and stay with those that convert. I only have some many visitors, and I ahve to maximise that resource. As a Merchant you have the problem that you don'T ahve a limit as to how many sales you want to make. So you want ALL the affilaites that you can get, no matter how bad the traffic. Ergo, you need to convert. It's the only thing you can do. You CANNOT pick "better" affiliates. Better affiliates can PICK YOU. If you converstion rate is right.
Think about that ;)
> sceptical of what results can be achieved by affiliates using banners
Do you not allow affiliates to use text links?
In any case, if your conversion from banners generally is abnormally low, I'd consider examining them to make sure they're attracting the right kind of click - ie that they're accurately reflecting the services your site offers.
I hardly use banners at all, around 300 text links to one banner. And yet almost EVERY affilaite system gives you a choice of banners and makes it prohibitively hard to discover how to target individual product pages, which are the highest converting type of links.
I do allow affiliates to use both text links and banners and they can do what they like with text. But the point of this thread is not whether affiliate marketing is worthwhile, it is whether CJ is worth the risk. Especially with regards to the $500 minimum spending limit.
We cannot offer a high rate of commission and I have calculated that we need at least 500 conversions a month. This means between one to 100 million ad impresssions are required depending on the advertising medium.
There really aren't many web sites in our field that can do this. The ones that can are unlikely to join CJ, but to offer their own banner advertising space or through a high paying third party such as Burst Media and Tribal fusion.
I am not saying that affiliate marketing is not effective. But I am just not confident in achieving the $500 minimum spend with CJ within a short period of time. That is why I would be extremely interested to hear the experience of merchants who had joined CJ.
Maybe I'm completely missing the point, but I, as an ABSOLUTe beginner am doing an average of 3 conversions per day. That's 100 per month, roughly. So to reach 500 you only need 5 like me. And there is nothing stopping you from having 100!
SN, I suspect what you are promoting is good-selling in the first place. This is not the case with our line of business. I would also suggest you may make more money by selling adspace on your web site rather than acting as affiliate.
We ran text ads through what is regarded as the top content site in our line of business. The most conversions we can get is 5 per day from that site. Our ads are also displayed through other top content sites through Google adwords, and the conversions are far fewer. My point is that these sites are unlikely to sign up as afffilates through CJ, they will make much more money by joing adsense or other programs such as tribal fusion and burst-media.
I think too much had been paid to the design of the site in terms of conversions. I feel that the products themselves and their price is far more important. For example, a site that sells $100,000 watches is not going to get many conversions, however many visitors it gets.