stlouislouis - 1:33 am on Aug 12, 2002 (gmt 0)

Thank you Oilman!

You mentioned:

"I see the future of what I call "affiliate linking" dwindling fast."

My question is: Why? What are the reasons as you see them?

I've thought about possible reasons. Are the following on target?

1) Too much competition from too many affiliates selling the same exact thing; there are only so many spots on that first SERP, after all. Profits get split up too many ways among the affiliate universe.

2) Many merchants have poor online sites. Usability may be poor and get in the way of effective selling and closing the sale/order. An "affiliate" site that takes the order and never sends the customer to the merchant site at all, but just sends the customer's order details electronically after the sale -- in contrast to an affiliate that just passes the customer off to the merchant thru a link to a merchant site before the customer is sold -- can capitalize on a couple of factors:

First, being found more often than the merchant in search engines thanks to superior SEO.

Second, a much higher conversion to sales ratio due to both more effective marketing on a more focused site and the benefits of a site that's more usable and easier to order from than the merchant's site is likely to be.

3) The "new style online parter in marketing type site" avoids many problems *in getting paid* the more traditional affiliate link pass thru type site suffers from in the current and likely future business environment. Everything from not getting credit at all for legitimate sales made, to cookie expiration problems to whatever other problems are endemic to affiliates getting paid what they legitimately earn.

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Moreover, under the new style model, each party does what they do best; one sells, the other handles order fulfillment. Since a solid order rather than a "unsold tire kicker" maximizes the value of what the affiliate/partner brings to the merchant, it makes business sense for the merchant to pay higher commissions or fees. After all, the affiliate partner has contributed more economic value to the transaction than affiliates just passing traffic that still has to be sold are bringing to the table.

Interesting, this sounds more and more like an online version of what happens in the physical world where sales reps sell products for companies and earn their commissions. It's not so much a new business done with "them 'thar new wiz bang computers" that hasn't been done before -- it's just business that takes place over a new, lower customer cost of aquisition marketing channel -- the internet.

New-style partner affiliates are using their online expertise to cut out the cost inherent in the physical world of a sales person traveling around client to client and making sales, or running a corner store competing with Walmart. They are also maximizing the value added of their SEO, marketing and selling skills -- and making sure they are getting paid fairly for what they contribute.

Is the above on target....or am I still off target in my understanding on what the future of successful affiliate/partner business models are likely to look like?

I really want to understand this stuff! It kind of calls to me....

Thanks for sharing, I appreciate it.

Take care and absolute best wishes,

Louis
AKA a newbie to all this, but learning.