Last week the affiliate space was abuzz with news that Commission Junction ousted AzoogleAds from its network. Because AzoogleAds is a CJ affiliate that grew into it’s own revenue sharing network, many industry watchers claim it was just a matter of time before CJ wised up. Others say that the heyday of CJ and the other big networks is officially over. Still others claim it was a matter of ethics or maybe spite.

Since the news came out, I’ve spoken with most of the parties directly involved, a few who claim to know what went down, and others that are best-known for giving their opinions on the implications of such matters. I think there’s a little bit of he said/she said going on and each party is definitely putting it’s own spin on the story.

Joe Speiser, co-founder of AzoogleAds called the move by Commission Junction “flattering,” adding that his company was clearly “dangerous enough from ValueClick’s point of view” to warrant giving up the “nearly 80 percent of traffic we brought in on the eBay campaign.” EBay is CJ’s biggest campaign. Speiser also commented on a blog that CJ was threatened by Azoogle’s growing presence.

However, the word from the CJ camp is that Azoogle had multiple violations of CJ’s code of conduct, therefore giving CJ plenty of ammunition to end the relationship. Still, insiders call CJ’s move shrewd – waiting to end the relationship until Dec. 27, thus making sure it gets all the holiday revenue Azoogle is sure to book.

I’m still digging to get to the whole story. What I know for sure is that I’ll have a more fleshed out version of the story for our next monthly newsletter. It will be delivered directly to your desktop (if your signed up of course) on January 4, 2006.

And I expect the issue of alternative networks to remain on the front burner well into the New Year. The topic of the rise of alternative networks was already on our editorial calendar for our May/June issue when the CJ/Azoogle situation went down. Talk about good timing (for me at least). Since our deadlines are far in advance of that delivery May date, I’ll be reporting that story all next month. If you want to chime in on the issue, give me an email jingle (lisap@revenuetoday.com).

And for those of you attending the Affiliate Summit 2006 in Las Vegas in January– expect some fireworks on this topic. A session titled “the Future of Affiliate Marketing” will put Todd Crawford, vice president of sales at Commission Junction, who some say was key in CJ’s decision to drop Azoogle (along with some top ValueClick brass), on a panel along side of Azoogle’s Speiser. Hopefully, moderator Peter Figueredo, CEO of NETexponent will only have to light the match on that can of gas. Steve Denton, of LinkShare, Rob Jewell of Gratis Internet, Beth Kirsch of LowerMyBills.com and David Lewis with 77Blue will also be on hand to share in the fun. I wouldn’t miss it.

Meanwhile, enjoy the holiday fun. Lisap@revenuetoday.com

Only nine shopping days left until Christmas. So, while I’m listening to the final Howard Stern show on terrestrial radio and surfing online for some last minute gifts you’ll have to amuse yourselves. That means today my gift to you is a baker’s dozen of interesting news, happenings and things that impacted the world of online marketing this week. Enjoy!

Google Launches Music Search
http://publications.mediapost.com/index.cfm?fuseaction=Articles.san&s=37571&Nid=17217&p=298004

AzoogleAds Calls Claims “Disingenuous”, Challenges CJ’s Affiliate Loyalty
http://www.thoughtshapers.com/index.php/azoogleads-calls-cjs-claims-disingenuous-and-its-acts-against-interests-of/

Fortune 500 Blogging: 5 Steps for Major Corporations Launching Blogs
http://www.marketingsherpa.com/sample.cfm?contentID=3142

Jupiter: Automotive Industry to Help Drive Online Advertising Growth
http://www.marketingvox.com/archives/2005/12/15/jupiter_automotive_industry_to_help_drive_online_advertising_growth/

Experian, as Expected, Indeed Grabs PriceGrabber
http://www.marketingvox.com/archives/2005/12/15/experian_as_expected_indeed_grabs_pricegrabber/

Rising Energy Prices Driving Consumers Online
http://www.informationweek.com/internet/showArticle.jhtml?articleID=175002768&pgno=1

Online Display Ads Dip
http://publications.mediapost.com/index.cfm?fuseaction=Articles.san&s=37520&Nid=17186&p=298004

Search Grows, Google Leads
http://www.marketingvox.com/archives/2005/12/14/search_grows_google_leads/

Online Retailers Step Up Discount Offers
http://www.nytimes.com/aponline/technology/AP-Holiday-Online-Sales.html

Study: Stand-Alone RSS Ads See Higher Click-Throughs
http://publications.mediapost.com/index.cfm?fuseaction=Articles.san&s=37478&Nid=17158&p=298004

Microsoft May Share Search Ad Revenue with Users
http://www.mediabuyerplanner.com/2005/12/12/microsoft_may_share_search_ad/index.php

Micropayments Proliferate
http://www.emarketer.com/Article.aspx?1003723

Largest BlogAds Buy Is from MSNBC
http://www.marketingvox.com/archives/2005/12/12/largest_blogads_buy_is_from_msnbc/

Let me know what’s happening in your world. lisap@revenuetoday.com

This morning I’m off to the Syndicate conference here in San Francisco. I’m hoping the sessions will yield lots of great fodder for future stories since the show hones in on many subjects that are becoming critical to online marketers. I’m particularly interested in the session “Advertising in Blogs & RSS.”

Recently many of you have told Revenue Magazine how RSS is a key method to establish relationships with consumers, to deliver content, and also that RSS has become one of the primary mechanisms for getting creative and updates from the affiliate networks and other partners.

Actually, you can read more about RSS in our new January/February issue, due out just after the New Year. In that feature article you’ll get the latest information on RSS from a technical standpoint and innovative ways that marketers are using it. In addition, the story focuses on how to combat the rash of spam blogs (splogs) cropping up due to the proliferation of RSS. I’m hoping these sessions at today’s conference will also spark some good ideas for new ways to syndicate Revenue’s content.

Meanwhile, back at the Revenue ranch, when we’re not eagerly anticipating the office holiday party later this week or sneaking in some online gift buying, we are hard at work on the issue for March/April. Some of the topics we’ll be tackling include a look at bounty sites, a comprehensive cover story about the battle between Microsoft and Google, the rise of word of mouth marketing, how social shopping is spreading, why targeting the Hispanic market is a huge online opportunity, and much more.

If you have anything to say on these subjects drop me a line at lisap@revenuetoday.com and I’ll forward you contact information to the appropriate writer on each story. But hurry, our deadline is coming fast - just like the holidays.

Earlier this week I mentioned that I was recently the victim of identity theft. It was far from a pleasant experience, but it was nothing compared to some of the horror stories I heard once I told people what had happened to me.

I seem to have gotten off easily - relatively speaking, of course. But I can’t stop wondering how someone got my critical information. I thought I was very good – some might even say a little anal – when it comes to protecting myself both online and offline.

Offline, I shred everything and I mean everything. Certain documents are shredded then burned (but that’s a whole other story). I never lose anything. Okay, about once every seven years, I misplace something insignificant within my own living space and I always end up finding it within a short period. So, I feel very comfortable saying that don’t lose things - important papers, documents, keys, wallets, etc.

My wallet hasn’t been stolen or lost – ever. About two years ago someone broke into my car and stole only my vehicle registration and a tin of Altoids. You can do your own criminal profiling on that one. But that was two years ago and I immediately took steps to stop any potential threat including placing a credit fraud alert, stocking up on curiously strong peppermints, and making a trip that very same day to happiest place on Earth – the DMV.

Online, my antivirus protection is always up-to-date. I have great software to rid me of the scourge of adware and spyware. I’m constantly in the process of changing many of my numerous passwords. I have a firewall. I also try to shop only at websites I have come to trust. I like to think that I’ve taken the necessary steps to insure I have a secure home computer and that I’m protecting my identity.

Every now and then, I do a little online shopping from the comfort of my office (shh, don’t tell my boss) but I also trust that our IT department has put in place everything to prevent any fraudsters or nefarious activity from impacting our company.

Still, I my first instinct was to think this crime against me had been the result of an online transaction. I went over and over in my mind and in my bank statement what I’ve purchased recently via the Net. And while, I haven’t been able to pin the ID theft to any specific transaction, it’s interesting to me that the first thing I suspected was that this occurred as the result of shopping online.

When I think about this logically, I know any ID theft could have just as easily occurred when I ate some hole in the wall place with fabulously cheap eats. Someone could have swiped my credit card twice to keep a copy of the numbers and my signature. It’s unlikely I’ll ever really know how this happened.

Despite all my knowledge about e-commerce, my belief in online retailing and marketing, and my passion for shopping online, I haven’t made any purchases over the Internet since “the incident.” One reason is that I’m still recovering (getting new credit cards, bank cards, checks, etc. issued) so making any purchases lately has been interesting. It’s been all about the cash for me over the last two weeks. I’ve been into the bank more times in 14 days than I have in the last 14 years.

The other reason is simply that I’m nervous or maybe just a little gun-shy at this moment. I think that’s a natural reaction. However, I’m confident that will pass quickly when it’s December 20th and I still have no Christmas gift for Uncle Bud or nephew Nicky. Then I’ll be hitting the “Buy” button with glee.

There will always be a certain percentage of consumers that are fearful of making purchases online and they shouldn’t be ignored. Making them feel secure is as important to the growth of this industry as continuing to evolve tools for delivering, monitoring and measuring the impact of online marketing and advertising.

Recently, I asked some industry leaders for their thoughts on some of the biggest hurdles for online marketing going forward. Many of the replies focused on the issue of security and credibility for consumers.

According to Ola Edvardsson, the CEO of Performancy, the biggest problem is “the constant abuse of the end user experience.”

“As a marketer you always need to ask your self: Is what I am doing really benefiting the end user? Is this the way I would like to be treated myself? The golden rule does apply in online marketing as well,” Edvardsson says.

Rachel Honoway, vice president of sales and marketing at KowaBunga agrees.

“Consumer perception is always going to be a hurdle. People are programmed to be untrusting of marketers and people are still wary when it comes to the Internet. I think that it will still be a few years before we see the majority of consumers saying that they feel “comfortable” using the Internet and buying from online merchants.”

And Greg Rice, affiliate manger for Commerce Management Consulting, says, “One of the largest hurdles is to stop the decline in credibility of online marketing. From years of cheesy pop-up ads and the millions of computers infected with all types of parasites and adware, online marketing is turning away the very people they wish to attract.”

Wayne Porter, associate editor at ReveNews and senior director greynets research for Facetime Security Labs, also notes that the Internet pollution caused from haphazard marketers, spammers, scammers and spyware companies are a huge issue.

“We see search engines glutted with spam ruining the user experience, trick banners that can land nasty programs on people’s computers slowing them down, and the onslaught of spam and spim never seem to stop,” Porter says. “Unfortunately technology often moves far faster than legislation can keep pace. It is like trying to hit a bull’s eye at thousand yards from a moving train. Marketers must, on their own accord, start thinking about stewardship and leaving the Web as good or better as they found it. Short term gains frequently carry negative consequences and companies must thing long term.”

I feel better knowing this is a top-priority for many in the online marketing community and I’m confident they can help make shopping online a more safe and secure experience for me and others in the future.

Let me know what you think. lisap@revenuetoday.com

My apologies, again. I haven’t had time to compose an original entry that is thought provoking or even mildly entertaining. My time has been occupied with a little identity theft problem. I’ll write something about that soon.

Meanwhile, it’s Chris Henger to the rescue. He’s the senior vice president of sales and marketing at Performics and he took time out of his crazy schedule to respond to some questions about where online marketing is headed.

I couldn’t fit all of his responses in my story that is due out in the printed issue of Revenue coming in January, but I wanted to share his insights with you. So, here’s what Henger had to say about the state of online marketing:

Revenue: What’s been the biggest change in affiliate marketing over the last two years?
Chris Henger: It’s hard to say this when the entire interactive industry is just 10 years old, but affiliate marketing has become mature. People in the online world know what affiliate marketing is, whether they have an e-commerce driven site or any type of destination site that benefits from eyeballs. How can I enlist the help of other Web sites to drive traffic and customers to mine? I’ll use an affiliate program to do this, and only pay for results. It’s a very compelling proposition. With maturity, has come increased focus on quality. Advertisers expect quality customers, quality networks, and most importantly quality service. And quality service is more than just being responsive to inbound questions. It’s about being proactive with strategic recommendations, additional measurements and analyses and a deep understanding of how the affiliate channel works for a particular business or category. The real value now is how the advertiser optimally leverages the affiliate channel within their entire online marketing media mix. Publishers benefit from the maturation of the affiliate marketing industry because it’s reached a very professional and sophisticated level with many programs available; there is truly something for everyone. And since mainstream advertisers have embraced the affiliate marketing channel publishers can count on payments and a steady stream of great products and promotions to share with visitors.

Revenue: What’s been the greatest development in online marketing during the last 24 months?
CH: While it’s been around longer than 24 months, I have to go with search. The impact of search on all aspects of online marketing is unparalleled. Performics first launched a search marketing campaign for a major retailer back in 2000 but in the last 24 months we have seen a tremendous upswing in spend, eCommerce volume and overall traffic. We sponsored research using the ComScore panel and confirmed that search plays a role in at least half of all online purchases. And Yahoo showed in a similar study that search plays a role in 80 percent of offline purchases in the consumer electronics category. Search plays an important role throughout the purchase funnel. We are seeing more and more opportunities to discuss the branding impact of search with advertisers. Think about a consumer’s response to a major brand when they conduct a search on Google, and the brand doesn’t appear. I’m convinced that has a negative reflection on the brand equity a marketer has spent years (and millions of dollars) building. We also believe affiliate marketing plays a role in the awareness and research phases of the purchase funnel too but it doesn’t always get the credit it deserves. Search has changed every aspect of online marketing. And with the data, control and volume available through search the development has helped the industry overall.

Revenue: How would you describe the state of online marketing right now?
CH: A few words come to mind: exciting, noisy and competitive. The future is brighter than ever. We are excited about the commitment to online marketing and specifically performance-based online marketing vehicles like affiliate and search. There are major budgets being committed, and that spend will fuel growth over the next 5 years. Noisy is a term that comes to mind because this is an extremely dynamic environment. There is noise in the marketplace everyday, with announcements of new products, acquisitions, dozens of relevant newsletters and hundreds of blogs to read that delve into the juicy issues in online marketing. We have to think, learn and stay ahead of the curve everyday to protect the interests of our advertisers and publishers. There is noise around products, new companies, new competitors, channel conflict, ad blocking, effective promotions, taxation, and trademarks, basically something for me to lose sleep over every day. And its our job as industry leaders to absorb the noise, educate our clients and allow them to develop marketing strategies around their business and products and not be consumed by this incredibly dynamic ever-changing industry. Do what they do best – be marketers. And finally, competitive. Advertisers are competing for placements on publisher sites, prices are climbing, vendors make wild promises and everyone (advertisers and publishers) is competing for traffic.

Revenue: What are the largest hurdles for online marketing going forward?
CH: Online marketing is no longer an after-thought, a new idea that needs incubation or the marketing flavor-of-the-day. It’s a viable (and becoming critical) channel for all types of advertisers. The challenge is for an industry in hyper growth, to meet customer expectations while infrastructure, process and standards mature and develop. There is a lot of growth to come online but we are way past the “lets set up an eCommerce site phase” Now, everybody is online and the smart marketers win, just like they do offline. It’s back to the basic 4 P’s of marketing again. You have to have a good product to sell (but you also have to make sure its in stock and understand real-time inventory), you need a competitive price, online marketing is promotions on steroids so you need to be smart with your customer incentives (free shipping isn’t the only answer) and finally placement, being found where people either expect you to be or discover you because the interactive industry is a sit-forward, active medium, rather than a passive (broadcast to me) medium. So the hurdle for online marketers is to be as sophisticated in their only marketing tactics as consumers are in their consumption. We believe there is tremendous upside in the online marketing tactics around the 4 P’s, and one of the reasons were are committed to focusing on the execution and offering strategic counsel. We want to worry about the industry (the noise) and help our marketers focus on marketing.

Revenue: Where do you expect online marketing to be two years from now?
CH: The industry will continue to mature and develop, and the smart advertisers and publishers will get more sophisticated and separate themselves from the less professional. It’s not going to get easier, but it will keep getting better. In affiliate marketing I expect we’ll see a continued focus on quality, reach and the overall integration with a marketer’s online media mix. And fueled by the continued growth of search I think we’ll see online marketing take a larger share of the overall media mix

Let me know what you think. lisap@revenuetoday.com

AAAAAAHHHHHH! That was my big sigh of relief. The January/February issue is finally done and on it’s way to the printer. The issue commemorates Revenue’s second anniversary by looking at the state of online marketing.

As part of that coverage I asked industry leaders, gurus, experts, affiliates and lots of people in the performance marketing trenches to chime in with their opinions on where the market is now, where it’s headed and some of the potential hurdles to getting there.

So many people took time out of their busy schedules to send thoughtful replies, but I couldn’t include all of the responses (there were just way too many). I thought I would use this space to share what didn’t fit into the printed copy of Revenue.

Kathryn Finney of TheBudgetFashionista.com has a new book coming out(How to Be a Budget Fashionista, published by Random House/Ballantine) and she is doing some interesting cross marketing things with affiliates. Here’s what she had to say about the state of online marketing:

Revenue: What’s been the biggest change in affiliate marketing over the last two years?
Kathryn Finney: The emergence of the blog. Now you have everyday folks - like myself - becoming experts quickly. And you have us successfully developing our own little cottage industries and successfully marketing to several channels at once.

Revenue: What’s been the greatest development in online marketing during the last 24 months?
KF: The introduction of new forms of media like RSS feeds and podcasts has changed the way bloggers and content-based sites like
TheBudgetFashionista.com interact not only with our readers but also with our advertising/affiliate partners. The Web, which used to be consider just one channel, now have several sub-channels in which to market your product or yourself.

Revenue: How would you describe the state of online marketing right now?
KF: What I find to be very interesting is that in other forms of media like television and print publications traditional celebrities rule the marketing roost as evidenced by how celebrity focused magazines like US Weekly have done quite well, while other “news” focused magazines like Time haven’t faired as well. However, online we have cyber-celebrities like myself who really influence online purchasing. So readers who pay attention to Paris Hilton for advice on what to buy offline, then turn to me for the online advice.

Revenue: What are the largest hurdles for online marketing going forward?
KF: Learning how to integrate the new technology and new ideas into a viable business model. Bigger businesses are learning what motivates bloggers like myself to evangelism their products. It’s more than simply sending me a sample.

Let me know what you think about the state of online marketing. lisap@revenuetoday.com