At Rocket Clicks we conduct an interview series that features a Q & A with entrepreneurs, innovators, thinkers and leaders (I.e. really smart people). For this interview, we interviewed Jack Born, an industry leader and thinker in affiliate marketing.
Jack Born teaches entrepreneurs how to grow their revenue through affiliate marketing. In 2008 he was handpicked by Perry Marshall, author of the Ultimate Guide to Google Adwords, to be his marketing manager. Prior to 2002 he was a financial adviser for Merrill Lynch. He left the corporate world in 2002 and has worked as a consultant, merchant, and affiliate ever since.
Q : Is affiliate marketing a sales channel that any business owner can use in any niche/vertical or are there limitations?
Jack Born : The short answer is ‘yes’. Because affiliate marketing at its core is building relationships with promotional partners who can bring you new business or new prospects and paying them based on results.
When most people hear “affiliate marketing” they think of large affiliate networks like Commission Junction, Clickbank, or Share A Sale where thousands of affiliates can discover new products to promote and can start sending visitors to a merchant website without any direct contact between the merchant and the affiliate.
If you sell products that are B2C and have broad appeal then it could be very profitable to make your products available to affiliates for promotion. There are several ways you can recruit and attract affiliates – I’ll cover that in a bit.
But I believe that even if you sell products B2B there are plenty of potential affiliate partnerships waiting to be realized. Every audience has thought leaders. Most purchases spark related purchases, and so every business can identify a potential affiliate partner. Think about your clients and why they buy from you. They’re buying from you to solve a problem or to satisfy a desire. What other products are they buying that’s related to solving this problem? What else do they want? Research those products and who sells them because these are perfect candidates for you to approach for an affiliate relationship.
To find more potential referral partners you can ask yourself questions about your audience and who they currently give their attention to. For example, if you sell a high priced product to manufacturing companies in a relatively small niche you can ask questions like: Who’s involved in the buying process? What online and offline publications do they pay attention to now? What newsletters do they read? Who’s the most influential opinion maker they pay attention to?
You might discover that there’s an online forum or blog that most of your best prospects subscribe to. Approach the content provider and start developing a relationship. The more influential the source, the more time it might take to cultivate an affiliate partnership. The good news is that most of your competitors won’t take the time to build that relationship and so your message won’t have to compete with the typical “noise” of competing offers.
Q : How do you help cut through the noise of competing affiliates and resonate to your ideal targets?
Jack Born : The better you know your audience and their problems, hopes, and goals, the better you’ll be able to discover who your audience already knows, likes, and trusts and what other products they’re buying. The more accurate your answers, the more likely that you’ll find untapped opportunities to develop an affiliate partnership.
I often have my clients go through an “Avatar” exercise. I tell them to think of their audience as one person. Give that person a name and write some paragraphs about who they are, what their life is like, and what problems they have. If your audience is broad and your products appeal to many types of people then pick one and create an avatar for that segment of your audience. Your market isn’t an amorphous crowd of buyers – it’s individuals. If you have a strong picture of who they are, what their habits are, what they read, what they want, what they hate, and what they fear – and your image is accurate, then you’ll quickly discover unexpected opportunities to reach them.
Q : What are some of the challenges and pitfalls of selling through affiliates?
Jack Born : Any time you have a third party promote your products and services you run the risk that they’ll misrepresent your company. You need to actively review what’s being said about you and your products by your affiliates to protect your brand and decrease your liability.
You also run the risk that your affiliates will become your biggest competition in promotional channels that you already succeed in. Especially when you’re connecting with affiliates through an open enrollment network like Commission Junction, Share A Sale, or ClickBank, you run the risk that a well trained affiliate can outrank you in the search engines for keyword phrases you already succeed with. It’s common for affiliates to run paid search campaigns targeting your product names and company name.
Your best course of action to reduce your exposure to these pitfalls is a 2 step process of documentation and enforcement. You document the terms of the affiliate role and responsibility through a well constructed Affiliate Terms of Service document that all affiliates must sign. For example, a thorough Terms of Service Agreement will specify what terms affiliates cannot build paid search campaigns around.
Then you enforce your agreement through proactive research. To make your job of auditing your affiliates’ promotions you can filter your affiliate referrals for three groups to pay special attention to:
- Your most active and successful affiliates
- Your new affiliates making sales
- Affiliates with above normal refund rates or complaints
Some other risks you should be aware of include affiliate fraud, tax issues with paying affiliates, opening your sales process to your competitive spying, opening up your conversion rates and refund rates to competitive spying, and affiliate poaching from your competition.
To address the tax and fraud issues I’d recommend restricting your enrollment process to affiliates that live in specific countries and states. But to fully cover the tax issues you’ll need to get professional help from a qualified tax expert.
Q : How would a merchant recruit and manage affiliate sales?
Jack Born : To determine your strategy, I’d use my “Magazine Rack Test”. Here’s how it works. Walk over to the magazine aisle at your nearest bookstore (yes, take a break from your computer and actually visit the bookstore) and see if your audience and clients are being targeted aggressively by the magazines sold. Brick and mortar bookstores can only devote a finite amount of shelf space to magazines and so they stock the magazines that sell to the broadest range of buyers.
For example, you’d answer “yes” if you sell products relating to beauty, fitness, martial arts, software, business opportunity, travel, health, or getting married (just to name a few).
If your products pass my Magazine Rack Test then you’d be best suited to tap into large networks of affiliates. I’d recommend that you find an affiliate manager that specializes in your niche and listen to their advice on what network to use, how much to pay, and then work with them to create a strategy for growing your affiliate sales.
If your products fail my Magazine Rack Test then you can still use affiliate marketing but instead of trying to make your products available to legions of affiliates for promotion I’d focus my attention on finding a handful of key partners and developing relationships with them. Work on getting to know your potential partners on a deep level rather than pitching them a “one size fits all” compensation package. Understand their business, their challenges, and their goals and be open to ideas outside of the “normal” affiliate structure.
With both strategies I recommend that you develop special promotions and resources for your top partners. The majority of your affiliate sales will come from just a few affiliates and you want to incentivize them with more aggressive payouts as well as special promotions and resources that average affiliates don’t receive.
Communicate frequently with your top affiliate partners and understand their business model clearly. They can provide you with vital information about market conditions, trends, and even your competition. They can be your greatest allies if you have developed a strong relationship with them.
Q : Are there other tips and strategies you can share?
Jack Born : Absolutely. I have a training series that delivers quick actionable ideas that any entrepreneur can use to relevance navigate the confusing options involved with selling through affiliates.
To receive my free tips go to www.jackborn.com/affiliateideas
Q : As a bonus question, we always want to know who you think we should interview next. Who’s really smart that we should ask five questions?
Jack Born : I’d like you to interview Robert Cialdini, Shoemoney, Gary Bencivenga, Dana White (UFC), Dan Ariely, and Malcolm Gladwell.
This Post Has 2 Comments
Thanks, Jack, for this interview. I really appreciate it. For the record, I also am a big fan of Cialdini and Ariely’s work. We’re considering doing a staff-wide book club reading of Cialdini’s Influence, and we’ve already done a training summary of Ariely’s Predictiably Irrational. I’m with you that social psychology is a base knowledge underpinning marketing.
I have never heard of Shoemoney so I did some research. ShoeMoney has the Skills to Pay the Bills. That’s right, ShoeMoney.com has been named the Best Affiliate Marketing Blog and ranks in Technorati’s top 50 blogs for the past three years. After reading a few of his post, he brings a great insight into the Google Adsense program and the creativity to really make big money. His man picture shows him with a check from Google for $132,994.
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