Challenges of Affiliate Programs

I've alluded to a few challenges of using affiliate programs for search engine return on investment (ROI) tracking: the issues of same-channel conflict from your affiliates and the time required for setup. A few others warrant your attention, too.

Expensive Program Fees

Well-known affiliate management programs offering an ASP model are quite pricey. Yes, the value of tapping into an affiliate sales team and the account management is well worth the cost. However, are entrepreneurs willing to cough up a few thousand dollars for a setup fee? I doubt it. Add that cost to the ASP's monthly minimums, annual renewal fees, and transaction fees, and this is the worst ROI tracking tool choice if it's only being used for search engine advertising. Perhaps more ASPs will follow Be Free's example and offer optional search engine services (or tools) on a per-click or per-click plus revenue-sharing basis.

That being said, there's an alternative to the large-scale affiliate network service providers. Amen, right? Go for affiliate program software. For less than $1,000 you can buy software from My Affiliate Program, AffiliateShop, and AssocTRAC. There are no annual renewal or transaction fees either. Software programs generally don't supply a network of gung-ho affiliates to you, but that might be ok. For a fairly low investment, you'll own a program to grow your own affiliate team while having the ability to track the sales from your paid listings.

No Ownership of Your Affiliates

Do you own your affiliates? You'd better ask this question before you sign up with an affiliate network.

For example, the Be Free or Commission Junction affiliates belong to those networks. If as an advertiser you leave, you either can't or won't be able to take those affiliates to a new system you use. A couple of affiliate network providers prohibit this practice altogether. Others might send out an email alerting your affiliates that you're moving to a new platform, but keep in mind that those affiliates are often loyal to the network provider. Unless they're making a lot of money for and from you, they'll likely continue marketing the merchants in the network. Those affiliates have plenty of business opportunities to choose from.

Yes, you can personally woo your top-performing affiliates to your new system, but the network owners frown upon this big time. However, Marty Fahncke, professional revenue developer for FawnKey & Associates, shared that the network he used wasn't happy about him taking his best affiliates with him to a new system, but because he still continued to generate $100,000 per month through the old network, that provider whined more than they did yell.