Tag Archives: Affiliate Marketing

Don’t Bite the Social Hand that Feeds – The @Klout – astrophe

26 Wednesday Oct 2011

Posted by in Business - Affiliate Marketing

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Okay, I confess to being a people watcher.  You know that game some couples play when they are bored and just make up stories about the people and things they observe?  Yeah the same game that Tina Fey and Steve Carell play in the movie, “Date Night”.

To me I guess that is part of the appeal of Social Media and social analytics.  Watching all these normal people and trying to figure out their story and what makes them tick.  Then apply that to marketing and competition and I am quite admittedly in statistical heaven.  This is how sites like http://hotornot.com got big when people used to rate people looks. It is also how Mark Zuckerberg got started with Facebook only this rating system is based on more than looks.  Why is he rated higher than me?  Why is she rated higher than her?  Why do people find him interesting?  You get the picture.  Now that people are putting their lives out there selectively on Linked In, Twitter, Facebook and Google +, the question of: “I wonder what [Insert Name Here]  is doing now?” is being answered with regularity.

Because of the rise in social interaction and personal content management, the idea of personal branding has become a larger topic on the web.  It is the opportunity for people to have the vanity plates and bumper stickers on their lives that they choose to have.  Yes I am a fan of the San Francisco Giants!  I watch reality TV! I drive a VW Beetle!  And then you can hide the things you don’t want people to see such as your age, the embarrassing name of your high school (Lick Wilmerding) and any other guilty pleasures in your life (the fact that you listen to Debbie Gibson and new Kids on the Block when you are depressed).

A few years back I worked for Fair Isaac, creators of the FICO score which tells potential lenders (mostly credit card issuers and auto financiers)  if you are credit worthy.  People started paying attention to their FICO scores.  Your FICO score was a handy thing to have, but it wasn’t something people openly shared.  It isn’t as if people go around sharing their salary information.

Klout Score Dashboard

Well enter the age of Social Metrics.  The simple math tells you how many people follow you on Twitter, how many people “like” you on Facebook, or how many people you are Linked to on LinkedIn.  Since not everyone plays on all of these social channels, we have the introduction of companies like Klout and PeopleBrowsr / Kred.  Both companies have admitted that they are in beta and that they are always working to improve the metrics around their scoring so sharp swings in scores are not unexpected.  People on Klout for example, have seen their score go up when they add new networks such as Google+ to the network.  If that adds a whole new set of friends and interactions to their overall social scene, then their score would likely see an irregular bump.  Klout is not perfect and people knew that.  Weight was heavily skewed towards Twitter activities, no real reasons were given for sudden shifts, people with lower scores were considered more advanced than others, people were considered influential about topics that they knew nothing about (see @QAQN and Gary Johnson).

Kred Dashboard

The art of scoring people’s social prowess is a tricky one.  Once you give people a little candy they can get addicted.  People learned that if you wanted to increase your score, you couldn’t just tweet a lot, you had to get people to mention you more.  You needed to create more links, retweet others posts (give them credit for good content), and not just use Klout as a channel for clogging the digital airwaves.  This gave way to Follow Fridays, Twitter Tuesdays, and such where people saw their scores rise.   It also saw that when you were inactive for a couple days for vacation or a holiday that your score took a dive.  Imagine!  You go on vacation and somehow you aren’t as important or influential to your followers!  Take a week off from your podcast or your blog and suddenly less people follow you?  Doesn’t the saying go something like “Absence makes the tweets grow fonder?” Well you get the picture.   Oh well, nobody is perfect.  Your score would dip a couple points and suddenly your score would jump again.

This morning Klout changed their scoring method.  It was of Google Pandaesque or Netflixesque proportions.  Suddenly it appears that the social behaviors that Klout was encouraging are now discounted.  It’s like telling your wife of 15 years that you like that she colors her hair blonde because it makes her look younger and then suddenly the next day you tell her that you think that brunettes have more fun!

The jury is still out but here is what we know:

  • Klout says they are being more transparent about what affects your score, but people are stil speculating on what actually made their score go up or down.  Was there more weight put on Facebook actions?  Were certain influence types now given more weight?
  • Klout gave a bell curve shaped diagram showing a pretty even distribution of scores going up or down.  Yet it seems that those who saw their score go down heavily outweighed those who saw a rise.
  • Even social media celebrities Scott Kleinberg (@Scottkleinberg), Katrina Hill (@actionchick), and Michael Brandvold (@michaelsb) who were once touted in Klout’s blog saw their scores go down by 8 points or more each.
  • It seems that those people who saw their scores rise were those who had scores in the teens, 20s and 30s.  People in the 50s through 70s and even 80s saw their scores decrease
  • People saw their True Reach score increase (this is a subscore that basically tells you how many people follow you) as it used to be discounted.
  • Assuming that their other subscore, Amplification, is a product of your Actions/True Reach many large podcasters and online conversationalists saw this score decrease significantly.  This score appears to be weighted more heavily than in the past when it comes to your overall Klout score.

Klout Distribution of Score Changes

Let’s take a step back a second.  Was Klout right in trying to make their scoring more accurate?  Definitely.  But we are a society looking for affirmation and the Klout score was the best proxy.  Scoring on a scale of 100 had people asking wondering if they are above average or passing the “test”.  Incidentally, Klout’s closest competitor, Kred, which is physically located on the other side of the block in an adjacent building scores people on a scale of 1000.  People following their Klout scores most heavily are bloggers and other social media early adopters.  The “Twitterati” if you will.  These were people are also the largest advocates of Klout and encouraging their friends to check out their scores.  At a recent social media conference I  overheard someone tell their friend kiddingly that they would let the other person follow them only if they had an acceptable Klout score.

The backlash has been predictable.  People woke up to find their scores dropped by 10% or more.  I received a tweet from @ActionChick (the ex-Klout star) saying “Those @Klout numbers are so wrong”.  People are claiming they will boycott. Others are claiming they’ll not get social media jobs when their interviewers ask and they tell them their score is below 50 (that’s a little dramatic).  Mostly, you’ll find people with scores in the 80s (that’s a B in school) with scores in the 60s now (that’s a D in school).  Nobody wants to get a low grade in the area they call themselves an expert.  Even moreso…nobody wants to be called a social failure, but that is what Klout is doing.   They created a monster and today that monster is growling back at them heavily.

So you are asking if they are so screwed up, why do I care? I want this model to succeed.  Social analytics are important as Social search takes over Portal search.  It is more important to know if Suzie Smith is an important influencer of a certain product than Jack Martin.  Klout has some great tools and they were heading in the right direction.  Every company makes mistakes, but you don’t want to slap the hand that feeds you.  Coke survived the whole New Coke debacle.  Some people tried it, didn’t like it and went back to the old coke. We shall see how this plays out.

Author’s note:  Personally my score dropped from 61 to 53.  To me this means I’m barely in the 50th percentile.  Maybe that is right, I don’t know.  What bothers me more is that Klout has their version of a Myers-Briggs grid.  They group people in from Celebrities to Thought Leaders to Conversationalists to Listeners, etc.  That analysis has me listed as a “Dabbler”, someone who just isn’t that into social media and should try using it more.  What?  If I tweet or Facebook any more, my own mother might disown me.  Hey did I mention that my 80 year old mother now has a Klout score not far behind me and she has only tweeted twice?

HELPFUL LINKS

If you’ve never heard of Klout, sign up here: http://www.klout.com

If you’d like to get a Kred score, sign up here: http://www.kred.ly

To read the post about the change announced by Klout: http://corp.klout.com/blog/

If you’d like to follow me and boost my Klout score (shameless plug), you can go here: http://www.twitter.com/Route53

The Ugly, the Bad, and the Good from Affiliate Summit 2010

07 Sunday Mar 2010

Posted by in Business - Affiliate Marketing, Route 53 - Life is A Highway

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Half the money I spend on advertising is wasted, and the problem is I do not know which half

Lord Leverhulme 1851-1925, British founder of Unilever and philanthropist

 

I was recently asked to recap my thoughts on this past Affiliate Summit for colleagues in my Company as many are new to the business and we are going through a reogranization .  It was pretty remedial and I wished I could have elaborated more.  The industry has come a long way but it still has a long way to go.  The good thing is that it has been two months, so nobody will read this anyway.

When I posted before I left for the annual Affiliate Summit, I had lots of thoughts about the industry and its direction. And while the Affiliate Summit gave me many more things to ponder, I think many of the assumptions I had going in were answered or at least became a little more clear to me.  I have to say that I probably find myself on the more conservative side of the industry, but since I work in the more corporate end of the affiliate marketing industry that is probably where I get my opinions.  That said, as an affiliate marketer industry veteran like most in the industry, we are rogues, entrepreneurial thinkers, outside of the box workers, and sometimes just plain troublemakers.

This year’s Affiliate Summit keynote was delivered by Dr. Robert Cialdini, psychologist and author of Influence: The Psychology of Persuasion.  I’d actually heard Dr. Cialdini before and thought his speech would be rather interesting with this crowd given that the last time I’d heard him was in a room full of MBA alumni in our local Commonwealth Club.  Online affiliates are a crazy mix of people.  Most are on their second careers.  I’ve met ex-lawyers, ex-dcotors, empty nesters, etc.  But if there is one way to describe them all in one, it’s tenacious marketers.  these people sell all day long and thus Dr. Cialdini’s speech while maybe falling on virgin ears to many was a rallying call to them.  “How can I influence people and make them buy from me?”  So why is this relevant and why am I rambling? Well one of the psychological influencing tools that Dr. Cialdini uses is to tell you the good news last.  And that is why I reversed the title of this entry to The Ugly, the Bad & the Good”.

The UGLY – Given that I’ve been in the affiliate marketing world for 12 years now I expect to see change.  How long is 12 years in this business?  Scott Jangro just received the industry “Legend” award which I think qualifies me as a dinosaur (my boss so aptly called me a relic).  Well there has been change, but we are still getting a lot of new people in the industry.  I stomp my feet and smile when standing in front of a big sign that says “Ticketmaster” and someone asks me what we’re selling.  There are lots of people new to the industry and patience (lots of it) goes a long way.  I actually think that the most interesting person I met at the conference was a new first time attendee that I met at the blackjack table at 2 in the morning (Yes the conference was in Vegas, and part of why this was Ugly).

So what’s ugly?  It’s that this industry has become more complex in its problems.  It still struggles for the respectability and recognition of the contributions that it provides to the online world, and many of the basic understandings of the industry are still questioned and not being practiced in a respectful manner.  This is not the fault of the industry but the greater understanding of affiliate marketing in general

THE BAD?  The bad is that while there is innovation, there needs to be more.  There appear to be a lot of businesses which are varations of others.  The exhibit floors are aisles of networks peddling the same things.  Everyone claims their network or platform is better than the next.  As a merchant one could just look at all those networks and say forget it.  In speaking with other merchants, many said that they couldn’t fathom the commoditization of networks.  Sure, some had unique propositions such as video or mobile implementaions, but there was very little else different between the models.  While the idea of belonging to multiple networks turns off many people because of the lack of control, publishers are left to play with many of them, not being able to really differentiate one vs. the other.  That doesn’t mean that merchants are any better.  The lack of representation from merchants such as Amazon, the leading merchant innovator, as well as traditional brand names leaves the publishers very little choice but to deal with the networks who try to act on the behalf of these merchants.  It also shows a bit of concern about the lack of interest by management of these companies.

 THE GOOD  Well for all the issues, there are still some cornerstones that enable the industry to thrive.  Affiliate marketing continues to be the most economical marketing online tool.  ROI driven companies are starting to notice how efficient  these programs are in terms of sales.  As Gary Vaynerchuk said, affiliates are the hardest working people on the web (the also are the hardest partying).  Many of the original pioneers in the business have done very well for themselves and many veterans in the industry (Todd Crawford) continue to innovate and develop new businesses to adress many of the problems that have plagues the industry for the last decade. 

The industry doesn’t  have as much low hanging fruit as it used to but there still exist lots of opportunities to innovate There are people still focused on financial gain or first mover advantage. We have to move beyond that.  As this past year’s speaker (@copyblogger) mentioned, those who work at it longer will win.  There is still a lot of opportunity to win in social media, feeds, APIs, etc.  when you combine with affiliate marketing.

In the end though, what makes the industry is the people.  It is one of the best parts about the affiliate market industry and as long as it attracts more smart and knowledgeable people. And if it retains the learnings of the past 12 years, it would become a staple in the arsenal of all successful online marketers and not just an afterthought.

Affiliate Marketing – Why Now? Why Me?

08 Saturday Aug 2009

Posted by in Business - Affiliate Marketing, Route 53 - Life is A Highway

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“No matter how much pressure you feel at work, if you could find ways to relax for at least five minutes every hour, you’d be more productive.”
– Dr. Joyce Brothers

When my mother asked where I was heading this week, I told her I was going to the Affiliate Summit. “What’s that?” , she said?  When I told her it was an advertising/ marketing conference, she looked at me oddly.  Not unusual for my mother.

“But I thought you sold tickets”, was her reply.

Telling parents what you do in this day and age is always difficult to explain if you are not a lawyer or a doctor and especially worse if you are involved in technology. My mother once asked me when I was an investment banker on Wall St. if I knew the teller at her local bank on the other side of the country. So you can see my mother’s confusion, or at least the difficulty that I have in trying to explain what I do.  In fact, it has taught me patience as well as an understanding of the need to break it down more simply.

When I told her it was like being an Avon lady except you could promote whatever you wanted online, you didn’t need to buy the product on consignment, and it was done strictly online, she pulled out her laptop and made me show her (I first sat her down with the video above). So after a 30 minute explaination of what affiliate marketing is, she was hooked and then started grilling me. Despite my mother’s “flightiness” she is pretty tech savvy for a 70 year old grandmother. In fact I would have to say she tends to be an earlier adopter of of retail than I am (as long as it is her idea). Not your typical geriatric mother, but she is one of the most productive people I know. So much so that she has started telling her friends about affiliate marketing and unfortunately they are now telling me daily about all the things they’ve helped to sell online for Amazon, etc.   I am amused though as these women are all widowed friends of my mother who have Facebook accounts and blogs about their health which they started via an elderly technology class taught at the University of San Francisco’s Fromm Institute. They used to share information with each other during their Scrabble nights and now talk about how much product they sold on the Web. I must caveat all of this again and say my mother is a bit unusual. She was the first to put alfalfa sprouts in our sandwiches as kids, she wears a wooden fish around her neck (just so you know she is a Pisces), and has had many successful business ventures (before they were called ventures) in the gifts, confections and tourism industries. My mother is always selling something whether it was personal alarms, water purification systems , or vitamins, I think I heard all of her selling tactics. Afterwards, my mom hit me because I have been doing this for over 10 years and had never put her onto this. Truth be told I did, but my mom never listens to me (but that is another story).

So why am I telling you this about my mother? Well recently I’ve been looking at the attendance levels at the Affiliate Summit (ASE09) and saw how it has risen. As a mentor to first time attendees I was also assigned to 2 mentees this year which indicates that there are many people getting into the industry or learning more about it. As someone used to say, “it is the economy, stupid”. My feeling is that if my 70 year old mom can do it, so can you.

And why do you need to do this? Right now everyone is trying to make up for lost income due to the recession and the biggest beneficiaries are MOMMIES. I hear about moms offering massage therapy, holding clothing sales in their homes or helping as a doula. Some moms are strictly going back to work and restarting their careers. My sister has restarted her speech pathology consulting again. Women from single income families are earning income in as many ways as they can. An interesting side note, many of these women right now would be still considered unemployed and not reflect against the rising unemployment rate. Mommy blogs and moms (check twitter) who have started businesses online are extremely successful. MyBargainBuddy.com and SunshineRewards are two companies started by moms who are very big in the affiliate marketing game, work from their homes and make a very comfortable living while mainintaining household. One mom, Tricia Meyer, of Sunshine Rewards, even has her young daughter video tape some of the video for her blog.

So now many people might thing that this industry might be mature and that they have missed the boat. Au contraire. The affiliate marketing world is ripe for you. Many large companies are looking for the lowest cost for acquiring sales during this down time as their marketing budgets are getting trimmed left and right. Affiliate marketing has long been the cheapest way of advertising online.
Secondly, social marketing in the affiliate world has not yet been fully tapped and my guess is that it won’t be for a while. This is because the power is in you,the individual. It is your ability, just like my moms, to influence people just like you do in the real world. While there may be people who think they can help you tap into people like my mom and help sell women’s shoes for example, they might have no idea how poor of a seller of shoes my mother might be. In fact my mother might be the best at recommending chocolates and movies, but if you’ve seen my mother’s attire, she is not the one who should be giving advice (sorry mom, just my opinion).

So if you are new to the game, and are looking for some way to make a little money, think about what it is that makes you an expert about something. Figure out how you can use that knowledge and help your friends and their friends fins what they need and earn you some income based upon referrals. For example, I spent quite a few years in the travel industry visiting the most luxurious hotels in the world both in the US and abroad. I have many people ask me where to stay and where to go and if I wanted, I could send them to my website and link them straight to those hotels , cruise lines, etc and make a profit, just like a travel agent. Travel and music (the industry I’m in) are two industries that people seek personal advice from people based upon individual opinions. Some other good ones are health and financial.

For more information, I suggest checking out some of my affiliate marketing links on the right. I would also do some reasearch and possibly attend Affiliate Summit in Las Vegas in January 2010.