Byron Kho Unlocks Money Making

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2011-07-25

Byron Kho is the CEO of IDz Media, formerly InstantDollarz, an affiliate network and advertising solutions provider. After graduating from the University of Pennsylvania in 2005, Byron helped build and develop IDz Media from loyalty website specialization to an affiliate network handling tens of thousands of clients. IDz Media continues to do all development in-house, including its affiliate network software, the now ubiquitous Content Unlocker software it debuted in 2008, and exciting new products scheduled for release in late 2011.

1) Byron, tell us briefly about yourself and how you got started in this industry. Before moving into this industry, I was conducting biomedical research into neurodegenerative diseases at Penn. While fascinating, the bureaucracy and politicization of science was very frustrating and prompted me to look at opportunities elsewhere. Initially as a side project, my business partner and I started developing websites back in 2004 and 2005 to varying degrees of success. We ran all kinds of content sites, including a very popular MCAT preparation site, several ringtone sites, credit card comparison sites and other such ventures. Our first financially successful hit was a shopping cash back program that very rapidly grew in sales and volume to grab a place right behind Inbox Dollars and FatWallet for a time. We started out as affiliates working with content we enjoyed creating and sharing, but we picked up a lot of experience on the way and realized that we could do a lot more with our talents. We then switched business models to helping others monetize their own content and generating value for advertisers. Currently, we operate as an affiliate network and as an advertising solutions provider for all types of clients.

2) Do you think being an Asian in this industry has hindered or helped you achieve the level of success you currently have or anticipated?I would throw age into the mix as well. As a very young entrepreneur trying to pitch my wares to networks and advertisers way back in the day, age and race were definitely considerations I had to think about. I assumed that everyone would take young people less seriously, and knowing some of the stigmas against Asian marketers, I felt that I also had a duty to ensure I presented myself as a serious, educated businessperson with some solid ethics. This rather obligated me to set aside some time to review what I wanted for myself and for the company, how I thought I could get there, and then putting all of that to paper as our future plans. In reality, I found the industry to be extremely diverse and accepting – which was exceptionally rewarding and helped let me know this was a business I wanted to be in. Looking back, I realized that the time I spent planning was the best possible thing I could have been doing to get started properly, and get ahead.

3) What are the top 3 factors that you feel contribute to your success? First is definitely technology. I’m the front-end designer and my partner is the back-end programmer, and together, we’ve built a whole slew of advanced products that have helped establish our little niche in this industry. A case in point: a few years ago, we sat together in a little room for ONE WEEK and cranked out the software for our affiliate network. Today, our affiliate network software handles tens of thousands of clients; hundreds of advertisers; tracking and adserving for millions of impressions, clicks and leads every month; robust IP filtering and fraud detection/prevention measures; and rigorous accounting and quality control management modules. With only minor modifications and periodic upgrades to newer versions of PHP, SQL and other necessary items, our programming has stood the test of time – no major failures or technical loopholes (fingers crossed, of course). Back in 2008, the release of our Content Unlocker software got a whole new channel of online marketing started and a whole bunch of our competitors busy replicating. At the moment, we’re even working on a new technology that will hopefully break open a channel of its own.

Second, planning. I find it a great idea to keep up to date on all sorts of news, from tech updates to entertainment tidbits. Everything is of use to an affiliate marketer, and can help you figure out the Next Big Thing. We sit down and figure out what’s working in the industry and what people want, and from there we plan what products and services we need to be offering to keep up with the times. Same with managing content – you need short-term and long-term analyses of what will be hot, and you create and release content and marketing plans accordingly.

Third, being prudent with risk. After being around this long, we’ve seen dozens and dozens of companies rise and fall, many of them catapulting their way to short-term fortune with poorly prepared forays into new channels and abusive marketing methods that provoke consumers, advertisers and the government to react – and react hard. When releasing our Content Unlocker technology, we chose to ease into the markets and grow conservatively, constantly monitoring advertiser response to these new business methods and practices. We take the time to properly introduce and acclimate our current and future clients to our new products and services, leading to more steady growth, manageable cash flow and an overall positive experience. Six years after our founding, it’s this approach that has ensured that the issues and scandals plaguing our industry have not touched us in any significant way, and which sees us still around when many of our more wild competitors have disappeared or have garnered terrible reputations and frequent lawsuits. Much of our aversion to risk is because it will eventually lower the value of the business: largely unethical behavior will generally make up a significant portion of that risk, and it is that kind of behavior that advertisers and the government will eventually target for punishment and over-regulation.

4) How important is it to you to communicate with your partners? Is there a particular message you are wanting to convey? Lines of communication should always be open. To build strong healthy relationships between partners, both sides need to be convinced of what the ultimate goals are, and whether or not the other side is stable, honest and trustworthy. The more they know about what we do, why we do what we do, who we are and the problems we face, the more likely they will be there for us when we need it – and it’s a two-way street.

5) Talk to us specifically about your experience and frustrations in dealing with people in the industry. Personally, I love learning, so hearing about or debating new advances in technology and how they can propel the industry forward is a supremely attractive proposition. My frustration comes around when dealing with companies that are less interested in ideas and very narrowly focused on numbers, or on things that are comfortable. We see it often: companies go stagnant, doing the same old thing year after year, and don’t adapt with the market and with new discoveries until it’s rather too late. We’re often in the front of the room pitching new business models and technologies to clients and having to persuade them that new ways aren’t bad, that they shouldn’t play defensive and always be retreating on their marketing, and that figuring out what the “next big thing” is doesn’t include doing the same thing you’ve done for the last 5 years. We’re a technology company, so for us it’s easy for us to have an idea in the back of our mind one day, and a working advertising platform to play around with the next; creativity is our lifeblood, and so we’re always trying to preach the religion of change.

6) What do you think is the impact of the “new” media on today’s generation? Are they leveraging it effectively and more importantly – are they leveraging it for the betterment of our industry? A lot of the time, today’s generation is creating the new media and leaving others to leverage it! The business news section is filled with an incredible amount of innovation shown by tons of young technology and marketing firms and their subsequent acquisitions by industry behemoths, and the fact that this growth and creativity hasn’t let up and continues to attract advertiser dollars is a testament to its positive effect on the industry. These newcomers create new technologies, leverage other technologies to create new products and services, and then incidentally create huge public demands for all these new things. It all adds up to more methods of reaching consumers, some in more meaningful ways than the “old media” that came before it. Even when there are speed bumps, there have always been community-minded companies and professional organizations that step up and help develop industry guidelines, best practices and even lobby for changing the legal and regulatory atmosphere to better serve society and business together.

7) Being a minority myself, there are constant stereotypes that I have to overcome, have you ever experienced this? Yes and no. I try to combat those stereotypes before I ever have to face them, so it’s mostly preparation and a little bit of luck that has limited my exposure to any negative stereotyping. With the reputation that certain rings of Asian “marketers” have, I have always prepared well ahead of time to defend my ethics, traffic quality and goals and beliefs in a coherent fashion. That job gets easier and easier as time goes on, as the reputation I’ve built for my company can now speak for me.

8) What are some effective tools and products that help you keep your life organized? We use a lot of internally designed software to manage our marketing campaigns, financial accounting, quality control, etc. We designed them to streamline, centralize and automate as many of our tasks as possible, so it ended up being more efficient, decreasing the amount of repetitive daily tasks and leaving us time for R&D, and saving us a ton of money that would have otherwise been spent on hiring out some third-party applications. For my own life, I go simple. The calendar on my phone keeps my schedule intact, OneNote holds my “Giant List of Stuff to Do and Look Into”, and Google Docs was the easiest way to coordinate development projects and issue tasks to my team.

9) If you had a money tree in your back yard and could purchase anything for your business tomorrow, what would it be? A few motivated and dedicated programmers are worth their weight in gold. That’s what I’d get – you can never have too many programmers.

10) Any words of wisdom for my readers looking to get into this space? As a technology house, we are a fan of marketers who really know the mechanics of their tools. Put your time and effort into figuring out the products and services you use. You should always have an edge, and being intuitive and improving efficiency can always make you money – whether you’re creating your own products and software, or trying to streamline campaigns for clients, or just fiddling with landing pages and driving leads. Knowing your stuff is always good for the sales pitch!

$4.8 Million FTC Action against Swish Marketing

By

Richard B. Newman

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2011-07-25

2

At the request of the Federal Trade Commission, the U.S. District Court for the Northern District of California has ordered Swish Marketing, Inc. to pay more than $4.8 million for misleading hundreds of thousands of payday loan applicants into paying for an unrelated debit card. For some time, the Commission has been closely monitoring payday lending and other financial services in order to protect financially distressed consumers.

According to the FTC’s complaint, Swish Marketing and three individuals operated websites advertising short-term, or “payday,” loan services that allegedly matched loan applicants with lenders. The websites included an online loan application form that tricked online loan applicants into unknowingly ordering a debit card.

On many sites, clicking the button for submitting loan applications led to four product offers unrelated to the loan, each with minuscule “Yes” and “No” buttons. “No” was pre-checked for three of them, while “Yes” was pre-checked for a debit card, with inconspicuous disclosures asserting consumers’ consent to have their bank account debited. Consumers who clicked a prominent “Finish matching me with a payday loan provider!” button were subsequently charged for the debit card. Additional websites represented that the card was a “bonus” and disclosed the fee only in inconspicuous fine print below the submit button. Consumers were each improperly charged up to $54.95.

The Commission charged Swish Marketing, VirtualWorks LLC (the seller of the debit card), and principals of the operation with deceptive business practices in 2009. The FTC filed an amended complaint against the Swish Marketing defendants in 2010, including allegations that they sold consumers’ bank account information to VirtualWorks without consumer consent, and that the principals were aware of consumer complaints about the unauthorized debits.

Three principals, as well as the VirtualWorks defendants, settled the charges against them.

The court order announced last week requires Swish Marketing to pay more than $4.8 million and bans it from marketing any product with a “negative-option” program, in which a consumer’s silence or failure to reject a product is treated as an agreement to make a purchase. The order also requires the company to obtain consumers’ informed consent before it can use their personal information collected for a particular purpose for any other purpose or by a different entity, and bars the company from: (1) misrepresenting material facts about any product or service, such as the cost or the method for charging consumers; (2) misrepresenting that a product or service is free or a “bonus”, without disclosing all material terms and conditions; (3) charging consumers without first disclosing what billing information will be used, the amount to be paid, how and on whose account the payment will be assessed, and all material terms and conditions; and (4) failing to monitor their marketing affiliates to ensure that they are in compliance with the order.

Richard B. Newman is the premier Internet Attorney and FTC Compliance and Litigation Defense Lawyer at Hinch Newman LLP. He has made a name for himself in the interactive advertising and affiliate marketing industries and can be contacted at rnewman@hinchnewman.com

Lead Generation Can Drive Job Growth

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Kevin Wallach

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2011-07-22

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My company is focused on generating consumer leads on the Internet. My typical client is a company selling their services or products through a call center. If my explanation seems elementary it’s just a consequence of trying to explain to family members, friends, and perfect strangers what I do for a living.

I often consider how my company is part of an online and offline marketing ecosystem. As out of fashion as it may be these days I’m just wired to be concerned with other people, particularly the ones I work with. Lately this concern has led me to think quite a bit about how I can help be a part of the economic recovery that everyone in the U.S. seems to be waiting, hoping, and working for.

How can one small business in a rather niche marketing business help? What impact can realistically be expected? To me these questions are just seeds of procrastination and defeatism. So perhaps the real question is, what am I going to do and will it work? The first part I have a good answer for but the second one I’ll just have to get back to you about later.

Here’s my very humble idea. In the next year I plan to do everything in my power to see to it that the leads that I generate wind up in the hands of sales representatives working inside the U.S. Sound trivial? Perhaps it’s not going to create that many jobs but consider the jobs it can create under the right circumstances. Many of my clients are holding fast on any ideas to hire new sales people and some may at some point consider farming out the call center work to other countries. But if I offer incentives to those clients to increase their U.S. call center staffing or at least maintain it then in a small way I’ve contributed to helping U.S. workers gain or at least hold their ground. What sorts of incentives am I talking about? In many ways the incentive is as simple as addressing the lead price concerns of the client. If I can keep the clients’ lead prices at a comfortable level or attempt to exceed their desired value per lead then the incentive has already been given. Another question is how do I police the clients to ensure they keep their side of the agreement to use U.S. call centers? Many lead generation companies are already accustomed to the need to keep tabs on the behaviors of their lead buyers. So keeping up with the clients is not a big problem in my estimation.

I’m sure that some very accomplished and respected business people would see price incentives as a rather foolish move when the company offering them doesn’t directly reap the benefits. I respectfully disagree. I’m believe that selfishness and self-serving attitudes got us where we are and they will keep us here longer than need be. This is not to say that business must be philanthropic in order to be ethical or effective. But helping each other dig out of the hole we’ve stepped into can’t hurt.

I’m sure that there are many direct and not-so-direct ways that my company and others like it can help to stimulate job creation in the U.S. In my humble opinion it has to be a focus for everyone who is in a position to be a part of it. Hopefully goodwill and American ingenuity will see us all through.

The FTC Targets Scam Flogs But Ignores Media Companies That Promote Them

By

Pesach Lattin

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2011-07-14

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Technorati – The Federal Trade Commission has gone to war against all the fake news sites. If you’ve visited almost any real news site recently, you’ve most likely seen these advertisements that advertise a “special report” from some news station you never heard of, has discovered the cure to belly fat or a special new secret to working from home. First these fake news sites completely ticked-off the public, who filed complaints against the owners with everyone from the FBI to the FTC. The FTC took the complaints seriously and earlier this year filed several lawsuits against those involved in these practices.

However, while this is progress, the FTC has completely ignored the actions of the large companies that allow these types of advertisements.

The issue here is simple: while the advertisers, and affiliate networks are being targeted by the FTC for compliance actions for creating these deceptive websites, the large advertising networks, including Pulse360 and AOL’s own network continues to run these ads, knowing that they are deceptive and causing harm to consumers. Worse, the companies that run these ads are major news organizations, where the ads seem like real news stories embedded in the content.

When I was talking to the writer for this AdAge article, I pointed out that the VP of Sales at MSNBC, Kyoo Kim has recognized this as a problem and said almost 18 months ago that they would no longer allow these advertisements. As the reporter of the AdAge story pointed out, the original story, also run by MSNBC was still actually flanked by these advertisements. They knew that these ads were a problem, admitted it, but then went back on their promise and continued to make money from it.

Simiarly, as ADOTAS editor, and my friend, Gavin Dunaway, points outin his article, that Washington Post was running a story on this, and “that WaPo is guilty of running the ads as well — he asks his own publication why it ran the ads and a representative says they are investigating the situation.” Whatever that means, it shows that the publishers are well aware of what is going on.According to Richard B. Newman, an Internet attorney at Hinch Newman LLP in New York City, if regulators genuinely want to pursue those ultimately responsible for health-related deceptive advertising on the Internet, the perceived scope of responsibility must be broadened. Also an attorney for the Executive Council of Performance Marketing, Newman states that “neither the media companies, nor the digital media buyers should be automatically exempted from the regulatory scrutiny of unfair and deceptive trade practices when there is some degree of willful blindness, which often exists.”This means simply that these companies, from MSNBC, Washington Post to the networks that run these ads need to be proactive and look at their policies. More importantly, since they are all aware of what is going on, their current defense that they are “just a publisher” doesn’t fly, and their ignoring of how they are making money is at least questionable and unethical. As news sites, they need to really stand up and be “better” than the rest of the industry, not defend themselves with legalize and excuses

Has Google+ Already Beaten Facebook

By

Pesach Lattin

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2011-07-13

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Just within the last two years Facebook overtook Myspace as the king of social networking. Myspace has been relegated by the technology and advertising community to the garbage heap of websites. Now has arrived what everyone knew would come, Google+, the newest best “social network” to compete in a crowded pack, dominated significantly by Facebook. Many people see that Facebook has a stranglehold on the social networking, and that nothing will take away its crown. I see completely the opposite that Google+ has already won, and within a year will easily take away any dominance that Facebook has, quickly sapping Facebook’s influence and value.

For the last few years, I’ve made the argument to friends and colleagues that Google should be buying Facebook, it was only a natural progression. Instead of selling to Google, Facebook felt that it was a long-lasting company that itself needed to buy other companies and become the next Google. In this, Facebook has made a complete miscalculation and they’ve already lost the war, barring some miracle — and here’s three reasons that I feel confident in my prediction:

1) Google has everything already Facebook has and more. While Facebook is attempting to buy or partner with companies like Microsoft, Google already have competitive features for almost everything Facebook wants. From mail, to video chat, to embedded search, these features are seamless within Google and in many cases superior. Now when you login to Google+ you are connected to all these features and will be able to use it as part of your social networking experience. If they don’t have it, rest assured they will get it.

2) Advertisers love Google. Despite Facebook’s enormous growth in advertising, Google is still the main source of advertising money. Google has known for a long time that everything is interconnected in interactive advertising and has been building and buying solutions that will connect with their Google+ technology. The universal login that Google+ will become, combined with mail, calendars and much more will provide targeting feature that no other network, no other behavior targeting company can even come close to duplicating. Pretty much, with Google+ turned on, most of what you do, from networking, to search, to mail, to surfing non Google websites will have you somehow connected eventually to their back advertising and targeting systems. Advertising prices will rise, Google’s income will double, and many other advertising solutions will have no way to compete, including Facebook.

3) Facebook cares too much about “social networking.” Social networking as a stand-alone solution is gone. With Google, everything will become on function of the internet. People have made for a while the argument that Facebook is really just another extension of the internet, and that “social networking” is nothing more than another word for what we all do on a daily basis – just made easier by software solutions. However, with Google+ all these interests, all of the networks and groups that we create will be more integrated into every other function of the internet. Remember that Google is often the first site, the main site that everyone uses on a daily basis to connect to everything else they want to know. Search will become a social tool and social networking will become a search mechanism. There will be no distinction perceived or in reality. When you are connected to the Internet, for most of us, you will always be connected to Google.

That last point really wraps up all the points together. Technologists have been claiming for a while that at some point the Internet will be more than just a destination on a computer or phone, but instead a part of everything we do. Microsoft knew this many years ago and has been trying unsuccessfully to have a universal login that will log you into everything. Even before that America Online (AOL) wanted to be the login to the internet, but never even came close to converting from an ISP to a destination. Facebook has been quickly addressing this, with integration into blogs, login for everything, but they still aren’t anywhere near the daily influence and reach of Google. That’s what Google has over Facebook, and what will make Google dominate the market. The pure integration potential of Google is just amazing. Since most users on the internet chose the easiest solution, whatever is put in their face (or the first page of Google), that is where they will all eventually go.

If Facebook doesn’t like it, they also have another reality to face: Google generates somewhere around 30-times as much revenue as Facebook and they can easily buy all the new users they need.

FTC Announces Accelerated Review of Six Rules & Guides

By

Richard B. Newman

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2011-07-10

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On July 7, 2011, the Federal Trade Commission (“FTC”) announced an updated regulatory review schedule of numerous rules and guides in order to keep pace with the current technological landscape and rapidly evolving marketplace, while at the same time promoting greater efficiency and transparency. For the first time, the FTC is seeking public comments on how the regulatory review process can be enhanced to better serve consumers and businesses, including how often it should review rules and guides and how it can modify its regulatory review program to make it more responsive to the needs of consumers and businesses.

The updated regulatory rules and guides review schedule for the next decade was published concurrently with a hearing on potential rulemaking reforms called by Rep. Cliff Stearns (R-Fla.), who chairs the House Energy and Commerce Committee’s Oversight and Investigations Subcommittee. The initiatives are intended to ensure its regulations are current and not overly burdensome, including launching a new regulatory review web page. The FTC’s healthy regulatory review docket includes thirteen (13) rules and guides currently under review, as well as ten (10) additional rule reviews scheduled to commence sometime in 2011. In sum, more than one-third of the FTC’s sixty-six (66) rules and guides will be under review, or will have just been reviewed, by the end of 2011.

The FTC is currently in the process of assessing its Children’s Online Privacy Protection Rule. Particularly relevant to eCommerce business, the FTC plans on reviewing several of its guides in 2012, including the interpretation of just how Section 5 of the FTC Act applies to specific trade practices, its Guides Against Deceptive Pricing, Guides Against Bait Advertising, and Guides Concerning Use of the Word “Free” and Similar Representations. It is anticipated that the FTC will revisit its Telemarketing Sales Rule in 2013.

The FTC’s agenda in 2014 is expected to include a review of its Standards for Safeguarding Customer Information, followed by its review of the CAN-SPAM Act in 2015. The FTC will review its identity theft Red Flag rules in 2018. In 2020, regulators plan to revisit the Use of Endorsements and Testimonials in Advertising Guidelines, Privacy of Consumer Financial Information Rule, Health Breach Notification Rule, and Affiliate Marketing.

Richard B. Newman is an highly-respected Internet Lawyer and FTC Defense Lawyer at Hinch Newman LLP. He has made a name for himself in the industry having been the lead attorney on several well known cases. He can be contacted at rnewman@hinchnewman.com

Social Media Hacks to Increase Conversions

By

Pesach Lattin

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2011-07-06

12

Zuck said it best, “By giving people the power to share, we’re making the world more transparent.” Pardon me for saying it, but I know you’re thinking it – how can we monetize the simple idea of online sharing?

Sharing Versus Selling
As the wedding bells ring and search and social tie the knot, there will be many skeptics out there. It could get very sticky, because social media and affiliate marketing are two completely different beasts. One generates conversation and focuses on building and maintaining meaningful relationships, while the other has mastered the art of overnight sales, and online profit prostitution. The trick is finding a balance between the two and playing up their strengths. Challenge yourself and become a master in balancing the act of engagement and sales.

Purposeful Linking Building
First, leverage the conversation generated among social media communities and become an active participant. If you find the right people who want the product or information you have, then you’ve just met your match. Just don’t drop affiliate links to any random user, but build confidence in your brand with a strong social media presence. Next, consistently provide your friends and followers with relevant, useful information and reviews where you can strategically place your affiliate links. Rule #1 of dating? Never be too available. The same thing applies to link building. Don’t spread yourself too thin. Build links where it matters the most. Quality over quantity definitely wins you a second date.

Social Rankings Do Matter
Here it comes. The social media, affiliate, and online user threesome. As you build credibility among your following the more exposure and higher your search rankings will climb. Now, get your o-face ready. Google and Bing both take into consideration social signals in deciding how pages rank. So, tweet big and tweet hard. No really, use Tweet Big. It’s a great tool for finding relevant users (those who will re-tweet your reviews and articles.) Want to generate hype for a specific product? Tweet Big will provide you with a targeted audience that actually wants to listen and share your links.

Connections Increase Conversions
People want to feel like their talking to a face not a brand. That’s why it’s important to show that you’re real. Whether it’s answering questions in a timely manner or actively engaging in conversation, you will come off as authentic and establish the driving force behind your sales – trust. If your product or service has any backbone, being a human is the easy part. Remember to mix it up a bit with your content. If you constantly are trying to push a sale, followers will drop off. Be mindful of the sensitivity factor that’s linked to social networking. People take this shit way too seriously.

Tracking Your Social Media Efforts
If you want to truly monetize your content and increase your conversions, you should be tracking your social media efforts and building your lists. The bread and butter of your marketing efforts should be your emailing lists, so take the time to grow and maintain them. Argyle Social can track how many conversions come from your social media marketing efforts. Unlike many analytics programs, Argyle Social takes into consideration the importance of both engagement and revenue generation.

Don’t Abuse The Privilege
Let the spamming begin. Just kidding. This is where social media and affiliate marketing can literally butt heads. AM says MORE MORE MORE FASTER FASTER FASTER. And SM says, let’s take it slow and get to know each other. Please don’t cheapen the nature of social media by going on a following spree, and certainly don’t whore your brand to anyone or anything that will bite. Remember, you have something they want – a specific product and they have something you want – the power of influence. What your followers say about you matters. Who gives a shit about your feelings? You will, especially when it affects your rankings, quality of content, and conversions.

Divya Patel finds her Voice

By

Ricky Ahuja

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2011-07-06

4

Divya Patel has taken a full turn in her career since college. Having obtained a degree in BioChemistry, she’s taken a turn to business. In the beginning it was an adventure, working as a consultant in companies where she was able to gain all sorts of experience. Going through the ‘dot com’ era, struggling through the ‘bomb’ she regained herself and put herself back in the market. What she discovered, is now booming industry. She landed in an online marketing company and started her never ending learning process, and it still hasn’t stopped, and it never will.

Passion drives her, the abundant amount of knowledge, the challenges, and seeing the results.

Divya’s also one of the founding members of Glam Interactive Group. A company which has recently had to revamp its brand, and is getting a facelift as we speak. Glam Interactive is built to be a networking forum for women in the online marketing space, consider it a LinkedIn + MySpace. Recently we have seen more women entering the affiliate space, but not many are finding the confidence to stand up in the male dominated industry. The goal is to help these women network, and eventually build their confidence to go head to head with the men in the industry. This confidence builds over time, and eventually starts to come out naturally. The network started in 2007 with 12 members and now has reached close to 1000 members.

When she’s not negotiating and crunching numbers, she’s counting out reps for ab crunches in the fitness studio. She’s a fitness instructor for Mona Khan Dance Company, banging out Bollywood filled aerobic routines.

Whether as a marketing professional or an instructor, Divya’s always looking to make a difference. Whether it be just a chat, or an intense cardio workout, the end result should be beneficial. This is her story:

Divya, if you would be so kind, please tell us about yourself and what you are currently doing. Currently, I am working for Unbent Media, an newly developed affiliate network. I am THE Marketing Manager for the company, bringing on new advertisers and affiliates, along with representing our Agency of Record campaigns. The focus on the network is subprime financial, i.e. cash advance, payday loans, installment loans, debit cards, credit cards, etc.

How did you find yourself working in the Affiliate Marketing industry? Many, many years back I was starting a new phase in my life after going through the ‘dot com bomb’ era. I put myself back in school, and started looking for new opportunities where I was able to get my hands dirty. I started interviewing and landed a job in an online marketing agency, like any other during that time, the company focused on Mortgage and was building out Online EDU. Low and behold, I had to start reaching out and learning about the online industry. What had been labeled as ‘online marketing’ is not known as ‘affiliate marketing’.

How have you found this industry to be? Was it what you thought it to be? I didn’t know what to expect from the industry as I had entered it as it was just being born. What the industry has developed itself to be, is nothing I could have imagined. There is a constant flux of ideas, everyone pushes the limits of technology. Many companies have stuck to what works, but there is an ‘out of box’ movement going on. There are companies that are starting to look beyond the norm, and open up the online marketing space.

There are more and more women playing a significant role in this industry, what do you attribute that to and more importantly – do you think that to be the case going forward? For an industry that is very male dominated, women are starting to stand up and prove themselves. I attribute this to their work ethics, women not only ‘sell’ they ‘do’. We’re multi taskers by nature, managing home and personal lives, children, husbands, and everything in between. The women that are playing a significant role in the industry have had the confidence to stand up and take more prominent roles. Being in the industry for over seven years, I have seen a greater number of women work their way to the top, but still feel there are many looking to find their voice.

Who was or is a major influencer for you? Hands down, Marissa Mayer, VP, Consumer Products @ Google. Her passion, enthusiasm, and dedication can be seen in everything she puts her hand on. Hired as one of the first female engineers at Google, she has quickly become a major influence to the company and to her peers. Now, I can’t compare our industry to Google. We have progressed fast and far beyond expectations years ago, but we have a lot of growth ahead of us. Marissa is a full package deal for Google, someone that I strive to be at a company one day.

What are your favorite must read industry blogs or websites (brownie points if you mention RickyAhuja.com)? Of course I am always on RickyAhuja.com. But I’m also on Adotas, Association of Marketing, LeadCritic, PaydayBrokers, Media Post, etc. Trust me I don’t get bored sitting on the computer, there is always something that I’m reading on.

Where do you see the affiliate marketing industry heading with social media in the next year? Do you think that micro blogging platforms like Twitter, Four Square and FB have the potential to change the entire landscape of presenting information to the public? This is a hard one to answer. Several years ago the affiliate space was just tapping into the search market. Companies like QuinStreet were dominating search within Mortgage. Over the years, many one man companies started emerging and started running search campaigns from their basement offices. Then emerged email marketing, which led to affiliate marketing through other traffic sources. The whole industry had to learn who their customers actually were, what made them ‘tick’ and how could we grab them with a tag line. In a sense, it was all about hitting them emotionally. Now we hit a new mode, social media. With the dominance of Facebook and Twitter we have been thrown a curve ball. It’s not just about the emotions, it’s about what do my friends think, how are they making their decisions. With social it seems to be about the influence and enticement. What’s a good deal, who is recommending who, and how can we get their attention. Customers are not reading the ads, they are reading their friends comments, posts, and opinions. Blogs are great, they have become research tools now. But Facebook and Twitter are moving at a much more rapid pace. In my opinion, this is going to be a challenge for the affiliate industry. We move fast, but can we get any faster? Or is it best to keep to what we’re doing and find a way to use these platforms as resources, and not primary tools?

You are given a free pass to Affiliate Summit, Ad Tech or Leads Con – where do you go and why? At this point in time, where I am career wise, I would go to LeadsCon. For what Unbent is doing across verticals is lead generation. I feel the audience LeadsCon attracts is more in tune with the lead generation side of business and I’m able to walk away from every meeting feeling as it was a success. There’s more forward thinking, and the panels, when we get a chance to sit in, are valuable to what we’re doing now.

If you could pick the brains of anyone – dead or alive, who would it be and why? Obama, why not? What was he thinking and what is he up to? Being such an influential speaker during his race, I want to know what runs through his mind and how, or if, he uses his words to influence decisions now. Trump, he has that ‘it’ factor. Everything he’s gone through, all that he’s doing. I want to know what makes him tick. Martha Stewart. She’s been through a lot and doesn’t cease to stop. Her sheer efforts in self improvement, confident, and still being a respected figure in the industry is utterly amazing.

What advice do you have for my female readers who are looking to get into affiliate or online marketing? Love what you do, whatever it may be.

Rusell Rockefeller

Retargeting and Behavior Targetting works for Affiliates

By

Pesach Lattin

-

2011-07-04

5

Perhaps one of the least used technologies in the Affiliate and Performance Marketing game is behavior & re-targeting. Outside of the brand side of the industry, there are very few people who talk about behavior targeting, and its not always understood by the industry in general. Perhaps one of the reasons is that not a single CPA network has an internal system that works on behavior targeting. Another factor might be the large deposit requirement from some of the behavior companies and also the fact that many of them don’t want to work with performance marketing companies, let alone affiliates, seeing them as “low lying fruit.”

However, behavior targeting can be one of the most effective ways of affiliates take barely profitable or even unprofitable campaigns and turn them profitable.

A quick explanation of what we are talking here. Basically, behavior targeting at its simplest level is using a pixel placed on a page to re-target users again. Most of the behavior targeting is done on a display level, but more and more PPC engines are allowing this method of targeting.

The principle is simple: if someone is interested in one specific product, they may be interested in another similar product. It’s simple, it works and I recommend everyone learn more about it.

There are several ways that this can be used for Affiliate and Performance Marketers. First of all, one can easily buy a target from a display network that they feel will best fit the profile of the product that you are selling. While contextual targeting uses a URL or keywords to target, behavior targeting uses the demographics of the users based on the users experience. For example, anyone who visits pet sites frequently might be targeted as a “Pet Owner” and would make sense for a company such as PetFlow.com, of their affiliates to use that target.

However, at another level, this is very effective for affiliates who have already made a purchase. Imagine if you are an affiliate of a pet product, and you place a behavior targeting pixel on the purchase page of that product. You’ll know immediately that everyone who bought the product (or showed interest) was a pet owner and thus more likely to continue to buy pet products. If you could target based on what they bought (cat vs. dog food) you’d know what other product to show them. If you were an affiliate of a another pet product (such as lets say a pet dating site – hey you never know) you could then target those people again.

The value in this is building data of users and then re-targeting them with ads across display networks. That initial target may be profitable, or barely profitable, as I mentioned, but that ability to “upsell” later in the future to the same consumer is extremely valuable. Since the ads would only go to those other users, they would be hyper-targeted, cheap in comparison and most likely provide very high conversion rates.

One you have this data, of a specific user, the possibilities of what to do with this data and how to monetize it are endless. Additionally, don’t forget that you can re-target based on one medium to another. For example, you don’t have to get the consumers interest originally based on display. You could have had people who clicked on a pet PPC advertisement come to your landing page, and then re-target them on display.

The best thing about re-targeting is that you can be extremely creative. A person expressing interest in a car loan might also need car insurance, a consumer who buys a book about travel might also be interested in airline tickets.

Again, thinking outside the box, re-monetizing consumers is the key here.

Companies who can behavior target recommended for affiliates:
Fetchback: http://www.fetchback.com/
Media Shakers http://www.mediashakers.com/
Audience Science (a bit pricey and very strict guidelines) http://www.audiencescience.com/

Why are Gurus claiming that the CPA Industry Dead?

By

Pesach Lattin

-

2011-06-28

7

One of the common themes I’m hearing about all the “super-affiliates” of the community is that things aren’t what they used to be like. If you noticed, all those guys who used to be super affiliates are now focused on trying to sell you programs on how they made money. All those guys who used to show you checks of how much money they made on Google, Facebook, and so on are aren’t posting checks anymore. I’ve never paid much attention to those “experts” even when they supposedly were making money, and pay them a lot less attention now that most of them are on the rocks trying to sell you their crappy programs and systems. However, since some of them have come out bashing the affiliate industry, claiming that the industry is “dead” and only their programs, their systems work (if you pay them $5k to listen to them and their friends talk about chicks and how to waste more money) I thought it was time to address some specific issues and then talk about what really works.

First of all, you are not wasting time being an affiliate, and the industry is thriving more than ever. As someone who knows personally the CEO of almost every major CPA network, I can tell you that things are better than ever for most of them, and there are dozens of new networks that are doing wonderful, providing new insight and new ways of revenue production.

Here’s a few things that most of the gurus don’t want you to know, and what most of them are hiding from you:

1) None of them made a lot of money ever. Most of them have never made more than a few hundred thousand dollars, ever. All those gurus that claim that they were making millions, creating companies left and right are mainly liars. When you do a little research into their background, you’ll find that the things don’t match up.

2) What little money they did make was usually using one trick or scheme. They claim to be marketing gurus, but they were more like one hit wonders. Almost all of them manipulated systems to make a bunch of money at once, have spent it all, and now are desperate for you to pay them attention by selling you their programs.

3) They don’t know how to make money on CPA. That’s why they are claiming that the CPA industry is dead, that’s why they are promoting their programs and their own “affiliate systems.” You’ll see them all over AffiliateSummit this year, speaking, claiming that they have a new product or system that is better than any CPA Network. They’ll lie to your face claiming they are multi-millionaires (then why are they still living in a trailer in middle-america?) and that you can have a life like them. Ask the networks and you’ll find that many of them never made a dollar in the industry, let alone millions. Their claims are completely fraudulent.

Here’s what these gurus don’t want you to know, it’s simple tricks to being a great affiliate, stuff that current amazing affiliates use:

1) Learn about all the technology. Do not depend on one secret technology to make you money, but instead try everything out. This means that just because a bunch of guys on a message board says that one tracking system works better than another, doesn’t mean that they are correct. If they are on a message board promoting a tracking system, there is usually a reason. Try everything from Tracking202 to Bevo Media. Do your own research and never trust anyone to tell you, including myself, what is the best. What is best for someone else, doesn’t mean its best for you. Guides are just that, Guides, not the law and the set-truth.

2) Always follow-up. Whatever you do, make sure you have some type of follow-up. One of the most common methods is auto-responders, which allow you always provide another option for your users when the first option does not work: this means that if you don’t sell a product, get someone to sign up, you then try to get them to join your email list so you can monetize them later. Remember that if you are doing “real” marketing (not just tricking people) then those people are interested in the product you are promoting. (Best AutoResponders are still AWEBER and ICONTACT)

3) K.I.S.S. Keep it Simple, Stupid. The best sell is still the simplest sell. Getting the product in front of the consumer, presenting the reasons to buy, signup etc, using the power of three. Simplicity always works better than complexity in marketing, but especially on the internet. Make things as simple as possible, present a clear concise message. If it’s too complex, users will go elsewhere.

More on the Auto Insurance Lead Crisis

By

Pesach Lattin

-

2011-06-28

0

Last week, we talked about a growing issue within the auto insurance lead-generation market. The crisis as we describe is the influx of fraudulent leads into the system, but not just a small number. These fraudulent leads are like a denial of service attack on those who sell leads to agents directly.

A group of initially well-intentioned middle men began sending along already passed over leads, tweaking them slightly and frequently trying to trick the filters of those aggregators who have agent bases. Like many attacks, this happens in real time, and the systems of the aggregators are for the most part dumb. They will look at anything sent their way, reject those that don’t match the criteria, accept those that look right.

Complex systems but dumb as to their ability to pick up on certainly unnatural changes, e.g., a huge spike in leads being reviewed, the similarity between leads reviewed, rejected, and accepted. These aren’t neural net machines, and so there will be a natural limitation in their ability to make predictive decisions.

We left off with a simple question. What will happen now that more and more companies are realizing so many of the leads they bought were fraud? The simple answer would be to find a way to turn off those sources, to do a better job of uncovering which leads coming in are fraud and, as a result, cleaning up the system.

By all intents and purposes, that is exactly what should happen. But, that isn’t what is really happening. The question is why? To answer, we must first look at exactly what the rise in fraudulent leads has done and how it began.

As one of these aggregators with an agent base shared, it took a while to realize that the problem was fraud. At first, the only empirical evidence they had that something didn’t look right came from the return rate. Agents return leads for a variety of reasons, and companies will more often than not push back on agents for some of those reasons. In this company’s case, the return rate started to creep up, and in the span of a few months time was double what it was before.

More disconcerting, the number of agents no longer buying leads started to creep up. Their agent base started to shrink rather than grow. When they asked the agents returning leads for the reason, they noticed an increasing trend.

The agents said the leads did not match their buying criteria. This actually happens to some degree quite regularly. Agents will say I wanted drivers with this filter, and this lead didn’t have it. What made this situation different was the percentage of returned leads with that reason.

Usually, when an agent returns a lead because of incorrect filters, the biggest source for incorrect filters is in lead mapping. For those who have worked with any lead buyer directly in a host/post scenario, mapping will sound familiar. The words we see on the form as a user are not how the buyer necessarily calls them. We see “First Name,” but when the seller must post that data, they will have to translate that into “FNAME” for example. If the field has values, such as Credit Rating, Good might be 3 not “Good.”

Do that with enough fields, and there are bound to be mistakes. Each person buying leads from the exchange has different ways of handling these errors, many end up sending them off to buyers they shouldn’t. They just don’t know that they do.

This, though, was not the source of the returns. The only conclusion after looking at the data, is that the leads themselves were changed. That made leads which were originally rejected all of a sudden worth purchasing.

The right thing to do is not buy fraudulent leads or to sell leads to companies who are known to modify data. Similarly, in an efficient marketplace, the economics of bad leads would force a change. Of course, the right thing is not always what is done, nor is the most efficient thing. The numbers tell why.

Fraud leads add more “revenue” into the companies. The ones with agent bases may have seen a rise in returns, for example 10,000 instead of 5,000 leads, but they saw an increase of leads sold by more than the 5,000 they returned.

If an agent base company wanted to, they could buy a lead they know to be bad. They would pay a much lower rate, because no one else really wants it. They might pay $2.50, whereas before they paid $8 and made $10. Now, they have a 75% margin not a 20% margin. In the past, they saw more than 20% returns, so they lost money.

Now, as long as less than 75% return they can make money off these bad leads. They are basically taking advantage of the fact that not all buyers will get in touch to know the leads aren’t good.

If enough people knowingly buy fraud leads and price them to make money, the auto insurance lead industry will enter into its own race to the bottom, continually adjusting price to stay ahead of returns and diminishing agent base. The hardest part now comes from forcing oneself to accept lower, real revenue numbers.

If companies don’t, you’ll still have some good short-term gain, but we’ll wind up with a lead bubble that when it pops takes an industry down. And, unlike education or mortgage, it will have been done internally and not externally.

Ugly is best for Landing Pages

By

Pesach Lattin

-

2011-06-28

0

Who knew ugly could covert so beautifully? Rebecca Black’s ‘Friday’ is a prime example. Butt Paste is another. And Craigslist is most definitely puke-worthy. So, what do a rising teen star, an ass ointment, and a classifieds website have in common? Hmmm…that’s a tough one. We’re talking about people, pages, and brands that convert like crazy. But, why on earth are consumers so attracted to this viral decay?

Last week, I read a great article explaining how ‘ugly’ landing pages often times convert better than ‘beautiful’ landing pages (meaning your typical designer’s design). Two very valid statements. However, marketers and designers continue to duke it out over the color of a button and font type. What they need to do is leave their egos at the door and join forces. Landing pages are dynamic creatures and aren’t meant to be aesthetically pleasing. They are meant to be effective.

Create a Checklist

Don’t bank on using a single ad format. Your initial landing page should not look the same after a few months of being live. That’s how you’ll know if you’re doing a good job optimizing and evolving your offer. Landing page creation is not a linear process. In fact, over time you’ll be able to add, remove, and swap out certain elements based on performance. Whatever you do, do not scrap a page that isn’t initially converting, just adapt it. You can start by creating your own checklist specific to each vertical. As I said before, there really is no exact formula that will guarantee conversions. As you’ll see, a combination of elements that works for one page, might bomb for another. Just be mindful of testing minor components on your page, as opposed to a major remodeling.

Keep It Ugly

Alignment (let it slide!)
Logos (web 2.0!)
Call-to-action button (easy to find!)
Above the fold (grab their attention!)
Overall Design (slap your designer!)
Testimonials (proof is in the numbers!)
Before & After photos (real results appeal!)
Fonts & Colors (goodbye color palettes!)
Headlines & Copy (short vs. long!)

Keep It Pretty

Load time (decrease drop-off rates!)
Customer support (put a face to your brand!)
Security verified logos (inject trust!)
Browser Compatibility (test your browsers!)
Spelling/Grammar (no typos please!)
Terms & Conditions (make sure you have them!)

Hold The Ugly…

Keeping it ugly doesn’t mean make your page a total disaster. It means finding a balance between ugly and functional. Unfortunately, humans are inclined to jump on the bandwagon and beat certain concepts to death if they are seeing results. It’s important not to get carried away with ‘uglifying’ your pages. Certain elements like load time and functionality should always run beautifully. Let’s take a look at the landing pages below to see how to properly balance ugly and functional.

iPad Offers

“Keep It Simple & Visual” – Large headlines, Large imagery, and simple sign-up. They convert!

Insurance Offers

“Keep it Drab” – Functional form, minimal colors, play up savings. They convert!

Dating and Weight Loss Offers

“Keep It Real” – Real people, real testimonials, and really ugly designs. They covert!

What’s Your Landing Page Strategy?

In an industry that thrives on measurable results, quantifiable data, and revenue generation, we need to stop thinking that there’s a clear cut formula for top-performing landing pages. We’ve got to start thinking differently. No more cranking out average designs. No more cheapening of brands. And absolutely, no more thinking that huge profits come overnight. Any successful Internet marketer knows that it takes time and effort to make legitimate and steady monetary gains. The question is, how can you secure your long-term success in an industry that breeds money-hungry hounds? With thousands of people like yourselves running offers, optimizing, and looking to increase conversions, you need to ask yourself what it is you are lacking. Take a look at your overall strategy. Is there even one that exists?

Free Traffic Generator here

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Investors Leery When Affiliate Nexus Tax Bills Pending

By

Pesach Lattin

-

2011-06-28

0

Many online marketers are looking to take their businesses to the next level by seeking outside investments. However, pending legislation in many states – especially California – has venture capitalists, angel investors, institutional lenders and potential merger partners concerned about putting money into companies that might be legally constricted from reaching their potential and their limit the investors’ ability to recoup the investment.

According to a new study from the Pepperdine Private Capital Markets Project (PPCMP) this week, most business owners and lenders remain concerned about familiar difficulties – uncertainty, taxes and regulations.

When asked about emerging issues facing business both lenders (22 percent) and business owners (31 percent) see government regulations and taxes as the top issue.

“Uncertainty surrounding the debt limit, future taxes and implementation of newly passed regulations are likely to be driving the concern by private businesses and lenders,” says Dr. John Paglia, lead researcher of the Pepperdine Private Capital Markets Project and associate professor of finance at Pepperdine University’s Graziadio School of Business and Management. “Policy makers need to look towards implementing policies that will help lower the debt while providing stability and predictability to the market.”

Affiliate turned app developer Keith Posehn has seen firsthand how this uncertainly about taxes has impacted his business. Posehn, who is currently trying to raise additional funding for his mobile app start-up AppZorz, says it has been rough with the pending legislation in California that threatens to stifle his ability to partner with other companies.

“I’m making the rounds trying to get funding and venture capitalists keep asking why I am starting a business in California and then suggesting I move out of state,” Posehn says. “Investors are not so keen on the risks associated with these laws and how they could hamper my ability to do business.” Hear more from Posehn on the the PMA Industry Report Podcast.

The pending legislation includes three bills being proposed in California (AB 153, AB 155 and SB 234). The first two bills seek to use affiliate marketers to establish nexus for out-of-state retailers in an effort to force those retailers to collect sales tax for online purchases from residents of California. Rather than jump through the hoops to collect that sales tax, out-of-state merchants are simply cutting ties with affiliate marketers. This means they can still sell to California residents and not collect sales tax. But it also means that those affiliate businesses lose a significant portion of their income. In addition, the state never gets the additional sales tax revenue that was projected and the state also loses a portion of the income tax that was being paid by the affiliate business.

SB 234, which does not specifically use affiliates to establish nexus (a physical presence in the state) looks to give California’s Board of Equalization discretion over determining nexus, which could be interpreted by the BOE to mean that if a company posts data on server, uses consultants, does advertising or partners with an out-of-state merchant, that company would establish nexus for that out-of-state retailer and this makes the merchant liable for collecting sales tax in California.

Similar laws are pending in other states including Massachusetts, Minnesota, Louisiana and Pennsylvania.

Oliver Roup, CEO of Google Ventures-backed VigLink, says that his investors are very concerned about how these laws will impact his business if passed. Roup is seriously considering moving to another state if the laws are enacted. He already moved his 6 person office in Chicago to Indiana when a similar law passed in March.

“It is a real concern for investors. They don’t like the uncertainty. And we need to consider all options in order to keep our business growing.” Roup says. Hear more from Roup on the PMA Industry Report Podcast.

San Francisco-based VigLink is on track for a record year of growth and continues to add employees. The company has 16 employees and just hired two more earlier this month. There are plans to have a total of 20 workers in San Francisco by the end of the year. However, Roup estimated that his revenue could be cut immediately by 35 to 50 percent if the bill passes.

These laws threaten to hamstring the online marketing space at a time when outside investments in businesses are at levels not seen since 1999 before the tech bubble burst. Fueling the investment fever are high-profile IPOs such as LinkedIn along with Facebook and Groupon announcing they are preparing for mammoth IPOs as well.

A new report by Fenwick & West, a nationwide top law firm that specializes in representing technology and medical companies, showed that of all Silicon Valley venture capital backed sectors software as a service and mobile app topped the list. Also ranking at the top were digital media/Internet, computer hardware and clean technology.

What Google’s Anti-Trust Woes Mean to Advertisers

By

Pesach Lattin

-

2011-06-28

0

ADOTAS – It was recently announced that Google is going to be investigated for anti-trust issues by the Federal Trade Commission. This action joins the already underway investigation of Google in the EU (U.K. excluded). Clearly Google’ success, like that of IBM and Microsoft before them, is attracting all sorts of unwanted attention. What are the issues and what do they mean to advertisers?

The complaint is that Google uses its market position to create an unfair marketplace. Search is such an important source of revenue and traffic for retailers, publishers, travel companies, and nearly all advertisers with a web presence and Google is the provider of nearly 75%-80% of this traffic in the US, and 95% in Europe (according to studies done by Covario), that this concentration of power is considered a major risk to the advertisers. The complaint does not specify the specific competitive issues for paid search versus natural search – however both areas are of concern to the investigation.

For paid search, there is no doubt that Google commands the lion’s share of the market – in Europe particularly. Anti-trust suits are brought when market power leads to monopolistic pricing. The interesting issue with Google is that its ability to enforce monopolistic pricing is very limited given the way its system works – the auction allows the advertisers to set pricing – and Google, for the most part, stays out of it.

They are quite transparent when it comes to how they determine Quality Score –and advertisers who do not benefit from this understanding either have not put in the work, or are simply unhappy with the result (they are bidding on irrelevant keywords, which hurts quality score, which raises price – those are the publicized rules of the auction – play or don’t play).

This issue was under hot debate in 2007 and 2008 by the Justice Department in the U.S., and Covario was asked to comment at the time. Google does have some subtle ways to impact their ability to monetize inventory – but nearly all of these processes include feasible consumer benefits as well.

Take Google Instant. Our belief is that it has two goals. One, it provides useful suggestions to consumers, from which they find value. Two, it also helps create more clicks for paid search which increases revenue for Google.

Is that monopolistic? It is impossible to make that claim, as the auction makes the ramifications of this process completely transparent and the impact one that the advertiser can control.

Our position then, as it is now, is that there is no anti-trust case in paid search due to the way pricing is set in the market for paid search keywords. Google acts as market facilitator, not market enforcer.

On natural search, the argument is slightly different, and this is where we believe the anti-trust case in Europe and the U.S. will focus. Google has one objective for natural search – to return relevant answers to the consumer. It will be this concept of what relevancy means that will determine how this investigation goes.

Relevancy is a debatable standard and the relevancy goals of the consumers (represented by Google) and the advertisers (represented by themselves and the U.S. Congress in this case) are going to always be at odds.

Google makes all sorts of changes to the underlying natural search algorithm. Panda was the most recent significant example – which was designed to address reductions in the quality (read relevancy) of search results due to programmatic processes being run by large advertisers that Google considered against its standard of what constitutes relevancy.

Two things can happen – the process can play out and the governments in the U.S. and Europe can find that Google is or is not creating an unlevel playing field. If found to unlevel, the remedy might be that the government will regulate what relevancy means, and take that out of the hands of Google.

Or the governments might force Google to disclose its algorithms and algorithmic changes more fully so advertisers can see what is going on more effectively than they can today and enforcement of abuses by Google may be reduced.

Again, our point of view on this is that Google is going to be a more effective arbiter of their algorithm and relevancy than the government, and that any action that would allow information to be disclosed that allows advertisers to game the system against those with truly relevant content is bad for advertisers, bad for consumers, and bad for the search industry.

Google is incented to be good at this, and to put the needs of the consumer above the needs of the advertiser. Google provides a service to the market – it organizes information more efficiently than anyone else out there right now, and makes it available to consumers and to advertisers. And they should be allowed to do so unfettered.

Advertisers should expect that the ability of Google to continue to innovate through the acquisition of other technologies and companies will slow. The EU and the U.S. Congress are putting in place the same types of scrutiny that IBM and Microsoft before them have faced. The Yahoo search alliance from two years ago was the first casualty. The furor over their acquisition of ITA is the latest example.

Advertisers should expect more of the same – which will create a more fragmented market over time.

UrbanObserver

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Divya Patel finds her Voice

Retargeting and Behavior Targetting works for Affiliates

Why are Gurus claiming that the CPA Industry Dead?

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Investors Leery When Affiliate Nexus Tax Bills Pending

What Google’s Anti-Trust Woes Mean to Advertisers

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