Why Trust and JavaScript go Hand in Hand

March 21st, 2012
Ooops, our bad.  When the below article was recently published in our March newsletter, we used the term ‘java’ rather than ‘javascript’.  We’re now eating crow and have made the correction to reflect that we are, in fact, talking about javascript.  Thanks to those of you that called us out!

We all remember that day when our parents reluctantly handed over the keys to the car and told us to be home by midnight – one of the benchmark gestures of trust in our life.

Just as our parents did for us, we have moments when we must turn our trust over to someone else. It’s not always easy, and often we don’t even recognize when we are put in such a situation.

A perfect example is the popular use of javascript to support a number of offers in the space today. While the benefits are exciting, we often over-look the inherent risks that come with javascript, which is why it is so important to trust your partner.

Benefits:

  • Speed to Market - generally one or two lines of script and you’re rolling
  • Low Maintenance - changes can be pushed with little to no effort on your part
  • Experience - consumer stays on your site and sees the branded experience you want to present

Risks:

  • Visibility - you reveal every location it’s served including search campaigns supporting the offer, and lose your own insight with lack of tracking pixels
  • Control - you don’t have the ability to test various layouts to improve conversion, you don’t own the consumer data, and you don’t have the ability to test additional monetization on the Thank You page
  • Conversion - average industry conversion has been reduced to 25-35%, primarily driven by heavy lead scrubbing
    • FACT: The Insurance.com form was 7 pages with a minimum of 45 questions and converted 50% on average

With any offer you weigh the pros versus the cons and decide what is best for your business. At the end of the day, if you trust the partner supplying the offer, your risk is minimized and you can take advantage of the benefits with more confidence.

If you are willing to take the risk, be sure to protect yourself - write into the agreement how data will be used, define the guidelines for a lead to be scrubbed, etc…

Trust is a natural part of business.  As long as both parties disclose how the program will run, ask the right questions and do their best to align interest things should run smoothly.  But, if you don’t have that warm and fuzzy, protect yourself!

Talk to your Moss Account Manager; gather more information and do your part to change the industry.

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4th Annual Moss Golf Tournament and Dinner February 27th, 2012 (the day before LeadsCon West) in Las Vegas!

January 18th, 2012

Ladies and Gentleman -

I am excited to officially announce the 4th Annual Moss Golf Tournament and Dinner on February 27th, 2012 (the day before LeadsCon West) in Las Vegas! This is year is going to be the biggest and best year ever so reserve your spot today.  Do one or the other or both!  Just let us know.

Last year we filled up both golf and dinner - so please RSVP by Jan 26th to secure your spot in this year’s events.  If you have told us in passing you are attending, please officially reply to this email to confirm with the information requested below..

And a huge thank you to BrokersWeb for co-sponsoring the event with us.  They have gone out of their way to ensure we have everything needed to put on a wonderful event for you.

Golf Details:

Bears Best
Comprised of Jack Nicklaus’ 18 favorite holes around the world - I have heard this course is phenomenal.  Remember, this is best ball scramble, so you don’t have to be good at golf to have a ton of fun.  We will pair teams according to networking and skill level.

Buses leave Mirage Hotel at 12:00 (high noon) sharp.  Golf is from 12:30 to 5:30.  Should allow east and west coasters time to arrive, please let us know if you are going to be a little late so we can plan accordingly.

$125.00 a round paid the day of the tournament – credit cards will be accepted (receipts available). Golf clubs are available for rental at only $50 (note they just replaced their rental clubs so they are in great shape) and a box lunch will be waiting on your cart if you chose to have one ($15 includes wrap, chips, fruit and a drink)

Dinner Details:

Revolution Lounge in the Mirage 7:00pm – 10:00pm

Come get your Beatles Groove on at the Revolution Lounge in the Mirage - Drinks and a fantastic dinner will be served. Last year we had over 175+ A list people in the industry and it was an amazing time for new friends and old to spend time together. We hope you will enjoy the atmosphere to mingle, eat and drink.  This year you will have the ability to walk around the room rather than sitting in one spot the whole time.

Please email pmoss@mosscorps.com to reserve your spot for both events or just one of them.  Please include:
Name:
Company:
Title:
Golf $125):  Yes / No
Clubs Rental ($50):  Yes / No
Box Lunch ($15):  Yes / No
Intend on taking the bus:  Yes / No
Dinner ($0):  Yes / No
Shirt Size:  Mens/Womens  XXL/XL/L/M/S

Can’t wait to see you there.
Paul

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Iron Sharpens Iron

December 6th, 2011

While I am not a religious person in a traditional sense, I do hope there is a higher calling for all of us.  I really do believe in people and that there are many deeper ways we can interact.  But of course, you don’t read this blog to understand my personal philosophies on life, so I‘ll talk about people and business interactions.

Perhaps you are aware of the Tim Tebow phenomenon that’s sweeping the nation.  For those who don’t know, Tim Tebow was an incredible college football player who recently went pro.  Supposedly his mechanics were not going to translate to professional football, despite how good he was in college…so Tebow sat on the bench.  Six weeks into this season, his team was losing — and losing badly. Out of desperation, the coaches put him in.  Since he started playing, his team has won 5 games and lost 1 – pretty impressive!

Now, Tebow is a deeply religious man.  But I don’t think his higher calling really cares whether or not the Denver Broncos win or lose every Sunday.

So, why is this guy winning?  It’s simple. He leads.

Tim Tebow inspires everyone on the team to play their best and this masks his flawed fundamentals enough to get victories.  Before his first game, he gave a motivational speech and the one thing in particular that stood out to me was his statement: “Iron sharpens Iron.”  That statement — at least as old as the King James Bible — really resonated with me about our industry today. You need to align yourself with iron if you are iron.

Our industry has a lot of dirt.  It wasn’t always that way – but it is now.  So how do we change that?  So often I hear people in our industry using the term ‘necessary evil’.  If you are working with a necessary evil are you sharpening iron?  Are you making changes for the better?  Are you helping the consumer?  Are you a catalyst for removing the dirt from our industry?  If enough of us hold ourselves accountable and quit taking the easy way out — we really can make a sustainable difference and start to get rid of the dirt.

This isn’t the easiest approach, and this may not be the most comfortable approach, but it is the right approach.  It’s the approach that in the long run will make you significantly more money.

I will say that I am guilty of taking the ‘easier’ path myself, I did it when choosing technology partners.  As a result, I treaded water for a year and a half and certainly didn’t sharpen my iron.  We made money, but we didn’t do the industry any favors.  We didn’t contribute.  We weren’t able to execute on our big ideas that would truly instigate the paradigm shifts that we believe are necessary for the sustainability of our industry.  So shame on me, and I offer my deepest apologies.

Those who know me know that I am not one to perpetuate my mistakes.  Since recognizing the error of my ways, I have gotten back to focusing on sharpening iron.  That said, the proof is in the pudding…

I am very excited for the next several months, and really, the foreseeable future.  We are launching several initiatives that even if mildly successful, will start to provide far more value to customers, affiliates, and lead buyers.

We will take our industry back and restore it to the glory days of $35-$40 a lead.

We will get the “shit” traffic into the silo it belongs in.

We will get proactive feedback loops in place.

We will deliver the consumer an experience they actually want.

We will sell more policies.

We will set better expectation.

We will put the control back into the supply and demand side where it belongs.

Hopefully, these changes will put our industry on notice, and others will further the mission.  I know there are several of you out there trying to do the right thing.  Your day is coming, and soon.

Friends, I implore you… look around.  If you are dealing with ‘necessary evils’ and not sharpening your iron, figure out how to get back to sharpening.  You will enjoy your job more and ultimately make more money.  Keep in mind that the opposite of sharpening your iron is becoming dull.  Don’t fall into that category.

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Are Your Offers Meeting Your Goals?

October 26th, 2011

In the insurance vertical there are many different types of offers, each with its own set of pros and cons. The type of offer that is best for you depends on several factors including your marketing efforts, the degree of control and autonomy you desire, and of course your goals. The goal of this article is to highlight the 4 different ‘types’ of offers most prevalent in the industry and help you to understand which is best suited to fulfill your needs. Maybe you’ll discover you’re right on target with your current campaigns, or maybe you’ll find there is an alternate solution out there that is worth testing against what you are currently doing.

Hosting vs. Redirect

Hosting an offer simply means you are hosting the entire interview form on your site, rather than redirecting the consumer from your landing page to the advertiser’s page to complete the form and submit a lead. There are two different ways in which you can host an offer, either by placing javascript from the advertiser on your site or by integrating to the advertiser’s actual schema. First let’s talk about the pros and cons of hosting vs. redirecting, and then compare the two hosting options.

Redirect

Pros:

  • Easy set up - start boxes, banner ads and other creative normally provided by the advertiser
  • Low maintenance, once set up it’s easy to step back and let it run

Cons:

  • Search Engines are penalizing affiliate sites that utilize a bridge page and redirect the consumer to 3rd party site
  • Lack of control over the offer
  • Limited ability to differentiate from others in the space
  • Harder to hold your buyer/advertiser accountable

Best Suited For:

  • Affiliates driving traffic via: Email, Banner/Contextual Display and PPV

Hosting

Pros:

  • Offers SEO benefits including increased time on site, no bridge page, etc
  • Ability to differentiate form from others in the space
  • Additional control over consumer experience
  • Opportunity to own consumer data
  • Increased opportunity for monetization

Cons:

  • More resource intensive for set up and maintenance

JavaScript

Pros:

  • Set up is easy, normally just pasting the code to your site
  • Offers some SEO benefits

Cons:

  • SEO benefits are limited as you are unable to differentiate your form from others hosting the same form
  • Security concerns around placing 3rd party code on your site
  • No control over form length or ability to optimize to conversion

Best Suited For:

  • Lower volume SEM/SEO affiliates with limited resources,

Integrating to Advertiser’s Schema

Pros:

  • Ability to fully customize the form, allowing for maximum SEO benefits from differentiation, unique content, increased time on site, no bridge page, etc.
  • You own the consumer data and can remarket at no additional acquisition cost
  • Owning the consumer data also allows for a deeper analysis of the data and the ability to understand and better market to your demographic
  • Full autonomy and control over consumer experience and conversion optimization

Cons:

  • Takes a deeper investment in time and resources to fully reap the benefits

Best Suited For:

  • Higher volume SEM affiliates with programming resources and the desire to fully optimize an offer

Click vs Lead

Traditionally, payout on a lead is higher than payout on a click because the paypoint is farther down the funnel so the advertiser is assuming less risk. However, with the increase in social and incentivized traffic in the market we’ve seen lead pricing steadily fall. Given this recent trend it’s more important than ever to take the time to do the math and understand which model works better for you. Conversion is the key factor in determining which payout type is most profitable for your business.

Below is an example of how a $8.00 per lead offer could net you the same as a $4 per click offer based on 100 visits to your site.

Per Lead Offer
Payout: $8.00/lead
Conversion: 35%
100 visits X 35% = 35 leads
35 leads X $8.00 = $280
$280 / 100 visits = EPV of $2.80

Per Click Offer
Payout: $4.00/click
Conversion: 70%
100 visits X 70% = 70 clicks
70 clicks X $4.00 = $280
$280 / 100 = EPV of $2.80

Tie everything back to visitors to ensure you are making an apple to apples comparison.

Flat Fee vs. Revenue Share

Another payout model to evaluate is being paid a flat dollar amount per lead vs the variable payout of a revenue share. While a flat fee provides you with security, ultimately it may provide far less upside for you vs. a revenue share model. As you work to optimize and drive increasingly higher quality traffic that demands a higher sold price, you will reap the benefits with a revenue share.

All In vs. Sum of Parts

Many advertisers paying on a flat fee per lead combine the sale price of the lead with the back end revenue they are also able to generate from that lead on a thank you page marketplace or cross-sell. We consider that ‘all in’ pricing as opposed to being paid separately for all revenue generated from the lead. Pros and Cons of each:

All In

Pros

  • Provides a guaranteed payout on leads accepted
  • Less optimization required
  • No need to invest resources in finding and testing multiple marketplace or cross sell offers

Cons

  • Limited upside as you may be able to earn more by controlling the backend offers yourself
  • Held to your advertiser’s appetite for leads accepted
  • Quality is not reflected in increased pricing

Sum of Parts

Pros

  • You have more control over consumer experience
  • Opportunity to earn more by managing and optimizing the back end offers yourself
  • Increased quality is reflected by increased pricing

Cons

  • Optimization is more time intensive
  • Returns and earning take patience and investment

Take some time over the next few weeks to evaluate whether your current offers are best suited for your business, and if they are setting you up for success in 2012. For example, if you are currently using a redirect offer, but one of your goals is to increase your SEO ranking in the New Year, you may consider testing an offer that allows you to host the form. It’s important to start testing now, so that you are fully optimized for the increased January traffic. Our November newsletter will give you a rundown of all Moss offers, you may see something new! Or ask your Account Manager what we have available today.

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September Tip of the Month – 4 Key Tips to Achieving Your Goals

September 23rd, 2011

Make a plan to accomplish your goals.  Create action steps and identify a critical path that defines key accomplishments along the way.  If your goal is to grow revenue by 30% in Q1, then identify specific revenue goals for each month and what levers you will pull to hit those numbers.

Keep track of your progress.  Do it with a goal tracking worksheet, a goal management tool or method of your own.  The key is to regularly check in on your progress and take note of where you need to go before your next deadline.  Track your revenue or profit weekly and compare your actuals to your goals.  Try to forecast your month end totals based on how you are trending so you know ahead of time if you are falling short and need to make adjustments.

Be willing to revisit and revise.  When you are tracking your progress, also consider if the path you are taking to accomplish your goals is the best approach.  It’s OK to make changes and modifications as long as they support what you set out to do.  Maybe one of your newest sources isn’t driving the quality traffic you need it to and so your revenue is suffering, can you eliminate that source and test another?

Celebrate Every Success.  You can’t expect yourself to work steadily toward a goal without any type of reward along the way.  Not only is it bad for your morale, but it can diminish the power of the entire process.  Take time to celebrate every success for every goal. It will build your confidence and commitment, making it easier to keep pushing.

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Preparing for 2012 – What Are You Trying to Achieve in the New Year?

September 21st, 2011

What are your goals for your business?  When we talk to affiliates, the number one response we hear is ‘to make money’.  But what does that really mean?  Do you want to make money at any cost, regardless of consumer experience or your control over the offer?  Is one dollar in profit enough or do you want to put your child through college?  Are you willing to work 100 hours a week or is this a secondary income source? Before you can start preparing for 2012, you first need to define what you are preparing for.

Therefore, this first newsletter in our ‘Preparing for 2012’ series focuses on helping you determine what you want to achieve in the New Year.  Even if you have set your goals, now is a good time to take a step back and consider whether they are still relevant and pointing you in the direction you’d like to head. In addition, do they follow the S.M.A.R.T formula – specific, measurable, achievable, realistic and time-targeted?

To help get you started, below are some key areas you will want to think about, as it applies to your business.

Volume vs. Margin
Are you solving for volume or for margin? Are you willing to sacrifice one for the other?  Knowing the answer to this question will help you determine what kind of offers and marketing efforts are right for you.

Understand Your Key Performance Metrics
Do you have a list of key performance metrics?  If so, do you monitor them regularly? Here are a few you might want to consider:

  • Revenue or Profit per Visitor
  • Conversion
  • Growth Rate

Do the Math
Don’t assume because the payout is higher or conversion is better, a program is better for your business.  Take the time to do the math.

Below is an example of how a $8.00 per lead offer can actually make you more money than an $11.00 per lead offer, based on 100 clicks to your site.

Offer A
Payout: $8.00/lead
Conversion: 35%
100 clicks X 35% = 35 leads
35 leads X $8.00 = $280
$280 / 100 clicks = EPC of $2.80

Offer B
Payout: $11.00/lead
Conversion: 20%
100 clicks X 20% = 20 leads
20 leads X $11.00 = $220
$220 / 100 = EPC of $2.20

As you can see, lead payout isn’t always the best measure of success.  Even though Offer B has a significantly higher payout, because conversion is lower it nets you a lower payout per click. Tie everything back to clicks or visitors, to ensure you are making an apple to apples comparison.

Defining Success
How do you determine success?  Do you have a growth goal?  A margin goal?  A volume goal?  Whether you’re talking about percentages or absolute numbers, know what you are trying to achieve.

Evaluate and Test
Evaluate if your current offers are in line with the goals you have defined. And ask what additional things you can be doing to further improve performance.

  • Have you A/B tested other offers to ensure you are earning the highest EPC?
  • Are you sourcing your traffic and measuring results on a granular level?
  • Are you making the most of your existing traffic through incremental revenue sources?

Talk to your Account Manager
Think you have your goals? Or are you still lost?  Either way, talk with your Account Manager.  Not only can we help you set a course for your business, but the more we know about your objectives, the more help we can be to you as new opportunities and offers become available.

Watch for our October newsletter, where we’ll help you determine if your current offers are best suited to meet your goals by discussing the pros and cons of different models such as click vs lead or revenue share vs flat fee payout.

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MAM Welcomes Harold Dahringer as CFO

September 21st, 2011

I am very excited to be joining Moss Affiliate Marketing!  Paul has gathered an extremely talented and dedicated team, many of which I’ve been lucky enough to work with in the past.  My role at MAM is to develop and lead the financial and accounting functions for the company, as well as help out wherever I’m needed.  Luckily, my background is fairly diverse. I’ve worked for CPA firms, public companies, and fam-2privately-held companies in a variety of roles within the finance function.  I learned the affiliate marketing industry from the time I spent leading the accounting and finance department at Insurance.com.

I’m based out of the Cleveland area where I live with my wife and two children.  I may live in Ohio, but I am die-hard Pennsylvania sports fan (We Are…Penn State!). I look forward to meeting all of our partners, and I can be reached at hdahringer@mossaffiliatemarketing.com.

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Think Outside the Box and Challenge the Status Quo

August 9th, 2011

If you read our Summer Series, then you know that MAM is working to shift the industry paradigm in an effort to increase lead pricing and help you earn what you deserve for quality leads.  And if you read the series, you know that helping us shift that paradigm may require some creative thinking on your part.  So, here are some tips to start thinking outside the box and challenge the current status quo in our industry, or even in other aspects of your life.

Often times, when faced with a difficult situation, many people default to what they know and think about problems through a traditional frame of mind.  While this approach can be helpful, you often exclude better alternatives.  The key is taking a step back and approaching the problem from different angles, ensuring you cover all possibilities and arrive at the best solution.

Take a fairly common situation in affiliate marketing, when the price of a keyword goes up the traditional line of thinking is to:

  • Figure out how to pay the new price– by taking less margin for example
  • Resort to cheaper and lower quality traffic sources

While these are both viable solutions, neither are in your best interest. Instead:

  • Think about new niches within your current marketing channel such as targeting more specific keywords or geographies.
  • Re-examine your backend process to improve throughput
  • Brainstorm new ways to generate revenue from your existing traffic.

The other aspect to successfully think outside the box is to challenge the status quo.  Often times, it is easy to fall into the trap of running an offer at face value and not challenging any of the assumptions.   Ask yourself what the assumptions are and why?  By doing this, you may find a way to be more effective.  In looking at an offer, here are some ideas to optimize and earn more:

  • Work to get your traffic right priced by talking to your advertiser about bifurcating your quality traffic from other’s junk
  • Segment your traffic by source in an effort to benefit from an increased payout on your highest quality sources
  • Consider redirecting to different offers based on certain criteria
  • Think about additional ways to generate revenue such as a catch page or cross sell opportunity
  • Improve efficiencies of the process by redesigning your marketing creative, your landing page or even your form

When approaching a problem, below are a couple steps to help you think outside the box.

  • Define the problem you are trying to solve
  • Understand what elements impact this problem and which of those elements you can control
  • Ask yourself what assumptions you are operating under and why. Which can you challenge?
  • Brainstorm different solutions
  • Understand the upsides to your solution or the potential issues
  • Decide on a course of action, implement and test

Thinking outside the box doesn’t have to happen in a vacuum and may take numerous iterations until you find a solution that works – but that is part of the fun.  Hold brainstorming sessions with your business partners, your Account Managers and even your family and friends.  The more people you have helping you critically think about the situation, the better the ultimate solution.

Not sure where to start?  Talk to your Account Manager today!  Whether looking to solve a problem or just improve the efficiency of your offers to maximize your revenue, your Account Manager can help.

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The Keys to Increase Pricing – Hold Your Provider, Yourself, and Your Consumer Accountable

July 20th, 2011

Life is pretty funny.  Starting this summer series I worried it would cause me to lose business or potentially isolate myself from others in the industry, but it has done the exact opposite.  People are coming out of the woodwork, agreeing with the need for change in our industry and willing to make some of the sacrifices necessary to right this ship. If you are one of those who feels there’s nothing wrong with the industry, you are dead wrong. Proof you ask? The most expensive keyword in Google is the term ‘insurance’ and it costs $55 per CLICK. There are pure organic and paid search affiliates getting less than $10 per LEAD. Do the math- let’s fix it.

This final segment discusses what you need to do to start increasing pricing - hold your provider, yourself, and your consumer accountable.

Let’s begin with your consumer, because some of you may be scratching your heads on that one.  One of your goals is probably to increase throughput of quality leads to your pay point, implement the below tips to help acheive that goal.

  • Market in a way that gets the millions and millions of legitimate insurance consumers through the front door.  Consumers fill out lead forms for two reasons, tailor your marketing message and value proposition to meet these needs:
    • To find a better insurance policy than the one they currently have
    • To validate that their existing policy is the best one
  • Give consumers the best opportunity to enter valid data.  To borrow a phrase from the courts, don’t lead the witness.  Carriers and agents know that not everyone is going to switch policies, but they want the chance to show the consumer their most accurate and competitive rate based on their underwriting.  To do that they need correct consumer information.
    • Be cautious of which form fields you default.  Many are important rating variables for the carriers and should not be defaulted.  Ask your Account Manager for information regarding specific fields.
    • Tighten up validation on key fields like contact information, address and zip code.  Don’t let customers knowingly or unknowingly cheat!!

Next let’s talk about holding yourself accountable.  This can be hard because it’s always easier to point the finger at someone else.  If you go to the business section of any bookstore you will find hundreds of books about empowering yourself.  Why?  Entrepreneurs don’t start a business to be a slave to someone else’s dictatorship.  You have to get back to being your own boss – diversifying, empowering, dictating to others, creating wins.  You have a social responsibility to play within ethical and honest parameters, but those should be your ONLY parameters.  Get away from playing the victim and take charge of your business.  No more handcuffs, extricate your foregone conclusion mindset.  America wouldn’t be one of the most advanced nations in the world if our leaders (you) accepted the status quo.  I am as guilty of this as anyone, and when I changed my philosophy to shift industry paradigms rather than be a victim of our current industry state – work became fun again!  Life is too damn short for work not to be fun (and profitable).

Personally, I feel the above paradigm is the hardest to shift, but many of you may feel this next one is your biggest challenge. The battle is as old as time.  How to get what you want without biting the hand that feeds you?  I mean, shit, at the end of the day that is the real issue here.  Based on the comments you have flooded me with, we all know something is broken.  But why are so few actually doing something about it?

So, to do that, and really the crux of this 4th segment: Quit using your quality traffic to subsidize the industry and make the people buying cheaper, shittier traffic rich. YOU NEED TO GET YOUR TRAFFIC BIFURCATED FROM THE JUNK.  Separating the good quality traffic from the junk will increase conversion and limit dilution.  With conversions up it means the customer is getting what they want, more money flows in, so everyone wins.

Right now our industry is so convoluted we would be embarrassed if we took our case study to a Business 101 class, because the answer is so transparent even they can see it.

We are currently packaging leads with an actual value of less than $1.00 and selling them for $8.00.  We are also packaging leads with an actual value of $16.00+ and selling them for $8.00.  Some might think “So we have median pricing, is that such a bad thing?”  THE ANSWER IS A RESOUNDING “YES”! Not just yes, “HELL YES”.  Because, so many companies are stripping their margin out of this pricing, so the $8.00 median falls to $6.00.  And guess what?  Marketing to consumers who have intent to buy a policy costs more than $6.00.  Then, as those poorer quality leads infiltrate the market, $6.00 goes down to $4.00.  So the downward spiral begins and the carriers/agents get increasingly crappier traffic.  Also, when lead buyers don’t have to pay a premium for quality leads, they get fewer conversions.  Then there is no hope of pulling out of the death spiral unless changes are made.

You need to get your provider to separate your traffic from the masses and get rewarded for your customer’s intent.  Get your traffic right priced, PLEASE.  It is a process and a paradigm shift, but it will get our industry back to the pride lands we so desire to get back to.

Get your provider on the phone, not email, and ask them explicitly to set goals so that you have something to drive to. Then, hold them accountable.  If you deliver and they don’t, it’s time to move on.

Enjoy the rest of your summer.  Please email me if you have any additional subjects you would like me to address, you know I am a straight shooter.  Also, I will be in NYC for LeadsCon and Affiliate Summit.  If you want to catch up email me at pmoss@mossaffiliatemarketing.com or psmoss76@yahoo.com.

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Social Media & Incentivized Traffic - What it Means to You

July 7th, 2011

The comments, questions, and inquiries keep coming so I will keep writing…

First, I hope you had a fantastic holiday weekend and that you have time in your summer schedule to get away from your computer to spend with family and friends.

My summer has been pretty exciting.  I have been on a whirlwind tour, working with industry leaders to move the insurance vertical in the right direction.  Right now our industry parallels a rip current.  On the surface everything looks normal as waves are crashing on the beach.  Similarly, lead pricing continues to crash.  But, beneath the surface the rip current is moving the other direction, just like behind the scenes our efforts to improve quality and pricing are beginning to take hold. Paradigm shifts take time, and this one is gaining momentum.

So, let’s discuss social media and incentivized traffic.  Initially, social media didn’t have a great impact on our industry.  It didn’t convert well, and it was better suited for branding rather than the conversion our industry requires.  But it was a cheap way to subsidize more expensive traffic like search and email.  Some affiliates would do a blend, like 80% search and 20% social media.  This was an affordable way to increase volume levels while keeping their overall quality and conversion higher.

Over time, as lead pricing started to drop, search and other more expensive traffic sources became prohibitive to affiliates.  Concurrently, lead buyers began compensating affiliates based on agent coverage and lead demographics rather than consumer intent. The combination of these two events gave the affiliate very little incentive to pay top dollar for quality sources.

What happened next is really what hurt our industry.  There were affiliates, who were not held accountable, that began sending disproportionate blends of traffic.  The 80/20 started slipping to 50/50.  And then FarmVille and MafiaWars came along, and the rest you could say is history.

Consumers were being incented in droves to fill out insurance lead forms for “points”.  I’ve even heard that some advertisements told the consumer “if they informed the agent they were calling for points, they wouldn’t receive their points.”   Many companies explicitly forbid this type of marketing behavior, but others turned a blind eye.  Some weren’t able to source traffic and couldn’t police it even if they wanted to.  So, social and incentivized traffic became a much more prevalent source than anyone wanted.  I know this because unfortunately we are all feeling the repercussions now, whether or not you were an active participant.

The extreme rate at which this traffic infiltrated the industry caused high agent turn over, diminishing returns, lower conversion, and increased supply to decreased demand. Adam Smith would be slapping his forehead.  In this frenzy, folks lost sight of the fact that policy sales are what ultimately fund this industry.  Social and incent traffic is just a distracting noise that allows those with very little value to steal from the legitimate affiliates.

If it’s not obvious by now, I don’t believe social media or incentivized traffic to be sustainable sources.  At MAM we are in the game for the long haul rather than short term gains, and are working to extricate this traffic from reaching lead buyers. In the final Summer Series newsletter next week I will talk about how to manage your business against the trends of increasing social traffic. I will include what we are doing to ensure your quality traffic isn’t getting lumped in with other’s social traffic, allowing you to ultimately get paid what you deserve.

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