Google is launching an affiliate marketing network, aka Google Referrals. It works like this:
This is not a new idea, companies like Commission Junction, Linkshare, and Performics all have programs like this. Even Google has had something like this setup with their GooglePack and Firefox downloads. Just as Google bought DoubleClick, I wouldn't be surprised if they bought one, or several, of these existing affiliate marketing network.
Referrals or Pay-per-click?
The pros? Commissions are usually higher than pay-per-click ad revenue, there is less risk of "click fraud", as the "clicker" has to actually buy something. The cons? They don't happen as often, as the visitor actually has to buy something. Other drawbacks include the difficulty of ensuring a seamless session of click-to-purchase. Web publishers may feel that they led a referral to a purchase, but the "tracking code" used to make the connection was ineffective, and the publisher is left out of the equation. I've personally seen this happen numerous times with the online shopping site FatWallet where I will make a purchase in a seemingly seamless transaction process, even taking notes of the transaction, but for some reason there is a disconnect between my browser and the servers involved. Obviously, this model is far from flawless.
Google Checkout
Google has something that none of the other players in this arena have: the Google checkout process. This could play an important role in how well their referral program performs, for all parties involved: Google, customers, and website publishers. So what does the future hold? Will Google get into drop shipping by buying Walmart? Now THAT would be blogworthy! :-)
- Visitor clicks on site link featured on a website
- Performs a specific action on target site
- Website of origin is paid a referral fee for making the connection
This is not a new idea, companies like Commission Junction, Linkshare, and Performics all have programs like this. Even Google has had something like this setup with their GooglePack and Firefox downloads. Just as Google bought DoubleClick, I wouldn't be surprised if they bought one, or several, of these existing affiliate marketing network.
Referrals or Pay-per-click?
The pros? Commissions are usually higher than pay-per-click ad revenue, there is less risk of "click fraud", as the "clicker" has to actually buy something. The cons? They don't happen as often, as the visitor actually has to buy something. Other drawbacks include the difficulty of ensuring a seamless session of click-to-purchase. Web publishers may feel that they led a referral to a purchase, but the "tracking code" used to make the connection was ineffective, and the publisher is left out of the equation. I've personally seen this happen numerous times with the online shopping site FatWallet where I will make a purchase in a seemingly seamless transaction process, even taking notes of the transaction, but for some reason there is a disconnect between my browser and the servers involved. Obviously, this model is far from flawless.
Google Checkout
Google has something that none of the other players in this arena have: the Google checkout process. This could play an important role in how well their referral program performs, for all parties involved: Google, customers, and website publishers. So what does the future hold? Will Google get into drop shipping by buying Walmart? Now THAT would be blogworthy! :-)
