Shopping.com and Arbitrage
Brian at comparisonengines.com made a post asking if shopping.com are breaking AdSense terms and conditions with an incentive to click button. It’s worth a read here - http://www.comparisonengines.com/2007/12/21/shoppingcom-encouraging-users-to-click-on-adsense-ads/
I felt there were a few innacuracies so I’ve posted a reply [currently awaiting moderation]. It may be of use to any other shopping comparison affiliates so here’s what I said.
Brian - you made a post the other day about shogging.com and made reference to an admission that pepperjam called it arbitrage. We all know that shopping.com and every other comparison engine have exactly the same model. The above example is slightly innacurate in the way you have described it. Shopping.com do not use AdSense. They may show the same Google ads but they have an entirely different deal with Google through their syndication team. Their contract will be very different to a standard AdSense contract. In your specific example, their system will first check to see if they have merchants on the term “buy nintendo wii” [we know that merchants stopped using the comparison engines on this term due to stock issues]. So, rather than pulling their AdWords advertising [very difficult if you bid on millions of terms] they pull in their Google feed and send that same term to Google to show these results. It basically stops them losing money through sending the user to a page with nothing on it.
Blurring lines between CPA and CPC
As our main focus for the last 12 months has been price comparison I thought I would make some notes as to how the landscape has changed for affiliates working in this area. 12 months ago we were fairly new to the game so we didn’t have a previous Xmas season to compare with. This year has been good overall for our network of sites and we’ve generally seen good return on investment. Our 2 and bit years in CPC have passed rather quickly and we’re now starting to think what we should be doing for 2008. More on what we come up with when the next frantic 8 weeks has passed us. Needless to say, we have some ideas and generally think there’s plenty more life in the comparison space for affiliates with the right balance of skills and experience. A large cash pile to fund £300k a month spend is also handy!
One of our key partners this year has been shopping.com. Once we figured out where the sweet CPC deals were, we enjoyed a period of strong growth and consistent returns. Playing a CPC game is what we know and it’s been good enough that we have totally avoided CPA. After all, there are so many people that are much better than us at it. The point of the post is that the rules are changing. From a merchant point of view it makes sense that not all clicks are created equally. In 2007, both Google and Yahoo have generally made changes to ther PPC programmes to reward partner traffic with better conversions. This is exactly what shopping.com are doing with what what they term “value based pricing”. In other words, we reserve the right not to pay you as much for your clicks if they don’t lead to sales for our merchants. Fair enough you might think. But…how transparent is it. Do we really know what’s going on behind the scenes and is this going to do damage to shopping.com’s partner channel? What it comes down to is that traffic needs to convert. If it doesn’t then the model will fail. As an affiliate we have to ask if it still makes sense to pursue CPC. If our traffic is good, and converts for a merchant, would we not be better making a percentage of the sale rather than 25p off the click? Time will tell.
iBooking.com make the search engine marketing game easy for hotels with free pay-per-click marketing offer
iBooking.com, the experts in online booking and ticketing engines have today announced a new service aimed at encouraging more independent hotels to adopt online booking direct from the hotel web site. The company is a market leader in online hotel booking with their iBooking Hotel product offering secure bookings direct from the hotel web site. The product is in use around the world with around 400 hotels accepting secure, confirmed bookings in 6 languages. It’s a plug-in solution that automates the booking process on the hotel web site and frees staff time in dealing with repetitive email booking enquiries. It also allows instant publication of new rates, promotions and allows the hotel to take full control of their direct marketing strategy.
Commenting on the latest announcement from the company, Marcus Cent, founder and Marketing Director says “Hoteliers are infinitely more net savvy than they were just a few years ago. They recognise that online booking is a necessity but choosing the right provider to work is no easy task. We know it’s not enough that we offer a great booking engine if the hotel is struggling to attract traffic to their own site”.
The iBooking Hotel product is used by small to medium sized hotels and chains all over the world. It can be integrated quickly and easily with any web site allowing the hotel customer to book online without the need to link to any 3rd. party sites. The next link in the chain is driving traffic to the web site and funnelling them through the booking process. That is partly achieved by offering a best-rate guarantee on the hotel web site and moving more bookings away from 3rd. party channels and discounters. Says Marcus Cent “Many hoteliers don’t yet understand all the pieces of the jigsaw that have to fit together to maximise the online booking opportunity from the hotel web site. Our new offering is aimed at taking away some of the headache. We take all the risk away by picking up the ad bill. The hotelier has nothing to lose if uses iBooking as his booking engine provider”
The service is based on iBooking’s knowledge of the pay-per-click marketplace. The company looks at each customer individually, to understand their offer, any USP’s relative to the competition, and prepares a tailor-made marketing plan based around pay-per-click. They undertake to reinvest a proportion of the revenue made from commissions as a way to increase the traffic flow to the hotel web site and in turn, generate more bookings.
“We think it’s a unique offer”, says Cent. We have a great booking engine and we already work on a pay-for-performance basis by charging no monthly fees, and no set-up fees. It’s a 100% commission model and the hotel only pays after the customer has completed their stay. Offering to reinvest our profit in marketing is just the next step. It makes sense for us and it makes sense for the hotel. ”
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Affiliata are a UK based web consultancy with a long track record in the development of web technology, affiliate marketing solutions and e-commerce. We work on a partnership basis with our customers and enter into commission-sharing arrangements where both the risk and reward are a key part of the project.
