The Affiliate Site That Sold For $48 Million

This was originally posted at VentureLevel.com and has been re-posted with permission.

I am pretty sure you have heard of "affiliate marketing" before, but if you have not, it is basically where you get paid upon delivering a certain action. I won't go into that into too much detail, so I don't bore most of you, but if you really don't get it, search for the term online.

There are a lot of affiliate marketers in the space today, regardless of if they make $0.05/year or 7 figures, they are all the same. It is just how one decides to present affiliate offers.

I'm going to tell you about a specific example of how a business was created from affiliate marketing and sold for about $48 million.

I can't go into detail about the specific company because I told you the amount that it was roughly sold for, but I will tell you everything that the business was about. It was basically a website promoting affiliate links in the travel industry. If you are the least bit involved in affiliate marketing, you will know that hotels.com has affiliate offers as well as other travel sites. This affiliate site was created from hotels.com and expedia.com affiliate offers. For quite a long span of time it was the number one performing "affiliate" for expedia.com.

To be a number one affiliate for any program, it takes A LOT of sales. In order to make sales, you have to be putting the right amount of money in advertising and even have repeat customers to your site. But it is all easier said than done, quite frankly.

I won't discuss how much the company was cranking in on a daily basis, but I'm sure that you can figure out some estimates by looking at the sale price of the company.

Everyone wants to learn the affiliate business, but it is hard to learn from a lot of resources on the web, since they are mostly restating same concepts and there is a lot of risk when you want to try out a new business with your own money involved.

Jeremy Schoemaker, also known as "ShoeMoney" is giving away his knowledge in a 12 week course, which is again, completely free. The course originates from his major book deal, which has been canceled, but it is all worthy information. All you have to do is sign up and you will receive emails of how to's and detailed information on getting into the affiliate business. Jeremy is also getting vouchers from ad networks, so you can experiment with advertising, without risking your own money. If anyone in the industry know's their stuff, it is Jeremy. I wouldn't promote him if I didn't think he was giving beyond expectations.

I encourage you to sign up and really learn what he has to teach, even if you decide not to become an affiliate marketer or create a business from it, you will get a very thorough understanding of the industry, for the future.

P.S. - Please don't contact me to ask about the company I discussed in the article because I cannot say much due to a NDA.

Sign up for the ShoeMoney Internet Marketing Course here.

Monetizing The Future

Everyone loves to have free services instead of even paying the slightest money for subscription. But the reality of the future, from what I see, is that GOOD content will come with a price tag. Whether it might be small, it will still come with a price. Just like watching cable TV versus the free local channels. If you want that quality, you will probably end up paying for it. Here is my two minute take on monetizing the future of web content.

Privately ran blogs, will turn towards selling paid subscriptions, which will end up being the majority of revenue even if they continue to sell advertising space. I don't think that public news corporations will sell subscriptions to their online properties, but you never know.

On another note, people will probably stop visiting average blogs, with no reader benefit all together. There is just too much worthless information on the web these days, and the days for that information are numbered. Charging for awesome content will end up wiping the worthless content off the grid too.

People will pay for this content also because we will all be used to paying a dollar or two to watch that favorite online TV show of ours. Of course there will always be those who get upset over paying small fees to watch or read their content, which is when the stolen content and distribution issues will end up being a problem, also known as piracy.

You may argue that sites or content providers won't gain new viewers or readers, but there will probably be some free stuff still given away- kind of like trailers to movies.

Oh and if you don't believe me, some have already started to charge. Just check out Loren Feldman's 1938Media.com. His content is obviously top notch- and he is charging for it- AND people are willing to pay the small price tag.


What do you think about the future of web monetization?

Start-Ups Would Fail Without Twitter

I'm pretty sure you have noticed that the "top dogs" are desperately into gaining all the Twitter followers they can possibly get. For example there was recently an offer by Jason Calacanis from Mahalo for $120,000 to Twitter, Inc. to get on the top 20 recommended follow list which shows up to new users after the sign up for the Twitter service, for a term of one year and he was willing to pay $250,000 for two years AND he is also willing to pay it up in ADVANCE.

Michael Arrington wrote a post on TechCrunch about how he views the "value" of Twitter traffic. He does go into detail of how many page views TechCrunch is getting from these followers and they are pretty interesting numbers to ponder upon. In the post, Michael states that Jason said he believes that acquiring all those followers, he could pull in $1 million more in revenue for his company. Now let me just say this- $1 million from Twitter traffic would require A LOT of spamming AND retweets. These are just speculative numbers, but I think that a lot of people seem to be turning Twitter into some business resource or a "game" of who can get the most followers and publicity.

As many of you probably know, Guy Kawasaki has a new start-up under his belt- Alltop. If you go check out his Twitter timeline, there is a lot of Alltop promotion throughout the day- each and every day. According to this Alexa the current rank for the site is at about 61,000. Keep in mind that there is A LOT of Alltop promotion going on all day and with Guy's 83,000 or so followers and all that promotion, I would expect the site to be gaining more traction. I personally think Alltop is a great start-up and like the service a lot, but I'm just stating some thoughts here. I also think everyone can learn a lot from Guy Kawasaki.

You have probably seen a lot of contests on Twitter as well. Starting from people giving away Flips to other gadgets, in an attempt to gain more followers. The reality of the situation is- most people are probably just following for the prize and then unfollowing once they win- or lose.

But here is the even more interesting thing to think about. It doesn't really matter if you have 1, 100, or 1 billion followers on Twitter because after a certain point it is all about what you have to offer. Sooner or later people are going to figure you out- well those of which are actual followers and not bots. If they like what you have to say, they will keep up with what you are saying, but if you keep promoting to them all day, every day, and it is mediocre information, followers aren't going to click your links.

I guess it all comes down to the risk factor. If you are willing to take the risk to build up your follower count to whatever number actively, you better be prepared to DELIVER to people and not just market some 1/2 baked service. Eventually the true useful products and services always win, with or without Twitter.

Why YouTube Will Stick Around Forever

In the online world, there are always ups and downs in the lifetime of a service being offered. Hypes create services to be the center of attention and then comes the time when something better steals the thunder. But there is a reason why YouTube will stick around for a long time to come, even though there are numerous other platforms to share videos.

1) There's far more content on YouTube than elsewhere- It probably goes back to the phrase "content is king," but honestly, YouTube has tons of videos on it, of which a lot might be senseless, but there is still a bunch of great clips on there.

2) Usability- YouTube is probably the easiest site you can use, next to Google. You type in virtually any term and you can find a video related to it. Compare YouTube to another video platform, I don't think you will find one that is any easier to use. I've even seen a 5 year old use YouTube.

3) Integration- Sure you can stream live from your iPhone using Qik and maybe not YouTube, but who cares about live streams? If you truly think about it, nobody outside the social media space probably cares about live streaming videos. More people care about watching or reading content than producing it. YouTube has been there since the iPhone came out.

4) Hard to copy- Social networks are always "stealing" their competitors user base, but the YouTube user base is hard to "steal." With a social network if one friend goes, two will go, five will go, and so on. YouTube has the ability to subscribe to people's videos and all, which is in a way creating friendships, but the service really can't plummet as fast as some other services could.

5) It's a brand- It seems that everyone who knows what online video is, knows what YouTube is. The brand has a strong reputation. It is what keeps the people coming back day after day.

6) Many have created a business around it- A lot of people make money from creating YouTube videos in one way or another. If you look at how many people are doing this and then add all of those people's audiences, you end up with a large user base. Unless the people making the videos switch platforms, the people following those videos aren't going anywhere.

7) The Google touch- Google is huge, since they own YouTube, the chances of them keeping an upper hand in online video for a long time to come is extremely high. Big companies usually know what they need to do to stay ahead.

Facebook This, Twitter That

Everyone seems to be so upset when some big social network or online service does something to cover themselves from legal trouble, or even benefit from a business prospective. I just don't see why people need to be "upset" with the recent changes in the Facebook TOS or any other changes that social networking sites make. It's all part of the "biz." From a neutral standpoint, I think anyone that is truly upset with the whole privacy aspect of Facebook, should just close their account...and probably never join another social network again. I mean... don't they all lack privacy after a certain point? Plus, do people really have a "right" to complain? Facebook is a free service which nobody pays to use, if people were paying I would understand that their "demands" should be met.

With the known fact that nothing rides high forever, if users keep up the negative vibe towards Facebook, this is probably the start of the end for Facebook. No doubt, there will probably be a new "Web 3.0" social networking site arising soon.

On the other hand, it also seems that people are thinking too much into social networking sites. For example, just about everyone has figured out how to monetize Twitter, except... Twitter, Inc. From the be-a-magpie or whatever deal, to selling your background through Twittad, to the recent "gain more followers" game. If people keep using Twitter for ways it is not meant to be used, the value of Twitter will be lost, quicker than ever.

In my opinion, MySpace users look like the only- "go with the flow" type, since you don't really hear any "mass-hate" towards News Corp. or MySpace from its users...even though I think MySpace is one big advertising campaign.

Sometimes people just cannot be pleased, but if people stopped trying to dig deep into issues that they don't need to, there would be less time wasted after unnecessary discussions and more people would be able to move on in their lives to the finer things. - Like quality time away from your computer.

Economic Thoughts

1) It seems like every large corporation could use a bailout, could you?

2) If you could give out $1 Trillion, how would you do so, (to "stimulate" the economy)?

3) Where will fuel prices be in one month?

4) What corporation will be the next to go bankrupt?

5) Will the "sale" at Circuit City stores ever be a true "sale?"

Internet Thought

1) If you could register any domain in the world, what would it be and why?

2) The internet was just discovered, what would the first service you sign up with be?

3) Since the internet was just discovered, would you pay $100/month for broadband internet?

4) Are your grandparents (or parents) writing on your "WALL" yet?

5) Are you spending more time on Twitter than you do talking to your significant other?

Write Scanable Content

Lets face it, most people don't read each any every word of a post now-a-days. When I visit many sites, I try to find something I like to read and briefly read through the article to get the main points and thoughts of the writing. Chances are most of your readers are just skimming through your content as well. The main idea is to get the point across to your readers whether or not they read the entire post, so how can you write content that can stand out, without being dull?

-Use headlines- If you are using bold headings and showing the main thoughts of each idea, people will be able to scan through your post and read what the main idea is.

-Break stuff up- This can potentially increase readership time spent on your blog. If content is split up then you can help the reader, read through things in parts and come back to a post at a later time either if they don't have enough time to read the whole thing in one sitting or if the post just has a lot to say and they choose not to read it all at once.

-Post videos- Users have a tendency to want change. If you just keep writing, writing, writing, chances are that people might end up getting sick of it. Instead try posting a video.

-Pictures can say a 1000 words- A picture can truly speak to every person in a different way. Many thoughts can be expressed in one picture that 5 pages of text might not be able to explain. Posting pictures through your posts can ease the readability.

-Post audio- Some people like to listen, while they surf the web, do the dishes, or even go for a jog. You might want to explore the thought of having podcasts on your blog or just posting simple audio segments of what you usually end up writing, if you think it will deliver the same or higher experience for your readers.

-Combine thoughts- If you are trying to say two similar things in different sections of a blog post, see if you can mix them into one and combine the thoughts to make the read go a little bit faster and less repetitive.

-Use bullet points- Bullet points can outline the main thoughts of what a blogger wants to express to a reader. A reader can also simply follow through on batches of bullets instead of reading a few paragraphs.

-Write two or more posts- If something is going to take a lot of explanation, sometimes it is best to write posts in different parts. For example you can do "part 1 of trip to Mexico," "part 2," and so on if need be.

-Simplify thoughts- When you are writing something in 10 words that can be said in 5, chances are it will help the reader stick through your content and have the read go easier. You should try to make a blog post as easy as possible to read.

Mixing up your writing/vlogging/speaking style can keep things fresh for the reader and yourself, as the blogger. Always try to deliver a change to readers to not only help them change the mood, but draw in new thoughts and emotions as the blogger, as well as trying to catch the eyes of new readers.

Social Media Is Changing? It HAS Changed.

All over the web, you hear talk about how social media is changing for 2009, but I already think things have changed. It used to be that everyone relied on search traffic, etc. to get traffic to their websites, but now I personally believe the focus should be on other presences. Everyone knows how Twitter can help grow your site, but that is a side issue. Same thing with Facebook. The problem with these two “tools” is that you can only do so much and people can only see what’s up if you are connected to them as well.

I think the new focus should be on services like Guy Kawasaki’s very own Alltop. Getting your feed on this service is where it is at. I have no doubt that Alltop is going to evolve for the greater good of its users over the course of the future, but what is Alltop providing that other sources of traffic cannot? It used to be that everyone was involved with the SEO of their website and how to play games with search engines in order to rank #1, but that is no longer the case in the internet world. I think SEO is okay to play around with, but after a certain point it is just a waste of time and money. Instead, spreading content and connection to your audience over useful and meaningful services like Alltop, will essentially be the winner.

What the heck am I talking about?

Twitter was good and is still great to connect with your audience. I have 8,000 or so followers, but I would still rather have my feed on Alltop if I had to choose between Alltop and using Twitter. People don’t know to come look for “Romil Patel” or “Venture Level” or “Blab Web” when they are looking for something I am talking about. Instead, people look for key terms like “business” or “entrepreneur” or “blogging” when they would be looking for the type of information that I am writing about. The problem with Twitter is that only people who have read my content or know me will follow me and that isn’t a way to spread content. When people search for something in Alltop, chances are they will visit a new site, of which they have never heard of before. This is what makes services such as Alltop great.

Why do I keep saying Alltop, when there are so many other options?

Alltop is a growing service. Numerous people are visiting it on a daily basis and essentially if your feed is being presented on Alltop, you are growing as well. It basically takes the marketing aspect and multiplies it by 10 or more because your blog will be featured under relevant searches. I am pretty sure that there will be an ability to personalize your “daily reads” soon on Alltop, so users will be able to really sync all their news or blog sources in page. So I can’t stress how beneficial it could be to be on Alltop.

Will you get on Alltop?

The answer to that is quite simple. Alltop was named after being a service that takes “all of the top” feeds on the internet and presents them in one place. If you are not the top, don’t expect to be on Alltop quite just yet. Work on developing your site so Alltop would want to put your feed on their site.

Anyways...

All in all, the web HAS already changed. It will keep changing, but people need to move their focus off of the little things and look at the big picture. The sooner people realize that there is more to marketing their blogs than Twitter or Google keyword searches or even Facebook for that matter, the faster they will potentially grow. In fact, I wouldn’t even classify Facebook as a way of connecting. It is just something that people have manipulated into making a marketing tool.

In the end, it is extremely important to grow a brand so you can rely on yourself being the #1 tool that you use to continue to grow. While it is natural to use other tools to establish your brand image, you shouldn’t rely on these resources forever. What if any of the services you use were to shut down? Your brand would drastically be affected and potentially collapse altogether. By becoming less dependent on 3rd party services, you help your brand stick around for a long time, more often than not. In other words, BECOME THE NEXT GOOGLE...or at least the next Yahoo! ;-)

Digg Traffic

Have you ever thought one of your blog posts should receive more attention than it has so far?

As most of us know, Digg is a great way to spread content and really popular content can get to the front page of the site and drive a lot of traffic to your site. I have heard of Digg driving about 40,000-50,000 visits to a site if it is on the front page. Most of the traffic is in the first hour or so then it gradually decreases as it has been on the front page for a longer time. The whole point of getting on the front page is to get more attention to a particular post, you shouldn't assume that it will drive a steady amount of traffic to your website for a long time to come. In this case, for the most part, it is quantity traffic and not quality. However, any main-stream attention is usually good for the upbringing of a site as a whole.

Now that I have established the goods of getting on the front page and what not to expect, I want to tell you how exactly you should play out your Digg game. If you are running an A-list site, chances are you will have enough attention to drive Digg's out of the roof just by placing a button saying "Digg this" within your blog post. If not, then you will have to be proactive and think 10 steps ahead.

If you truly believe that one of your posts will be among the more interesting or worth-spreading posts on your blog, then you should place a "Digg this" on your post. There is a simple piece of code provided by Digg tools that helps you give the ability for readers to Digg right from the post. The code is:

and will look like:

By putting the button on your post, potentially every reader that uses Digg, will think about Digging the post if it is awesome. Often times readers don't think of Digging a post if they don't see a button, but if they do, they might as well Digg something since it is convenient for them in just a click. Also, any new attention that comes to your site by your readers spreading your content, will also know that the post is on Digg and might give it a Digg also if they see the button.

Next, you should personally drive more attention to the post. Make sure you tweet the post on Twitter, tell anyone that reads your blog regularly to read and ask if they will Digg the post. Driving traffic manually is one of the most effective ways to get a post Dugg more often than not.

After you have done those two simple tasks, you just sit back and wait. If the post is really great, you will see the Digg's increase. If it gets enough Diggs, your site just may be featured on the front page of Digg!

What influenced me to write this post?

I recently wrote a really interesting piece of information on my blog at Venture Level. The post was about Slumdog Millionaire's Business Model. Alone, the post page generated about 3,000 views and aside from that people that read the posts on the front page of my blog without click through to the post page is probably higher.

What I didn't do was- place a Digg button within the blog post from the start. -I did this, I believe it was the next day, when the traffic to the particular post page was substantially less. I think my biggest mistake was not placing the "Digg this" button on the post from the start or I really believe it would have received enough Digg's to be on the front page of Digg. The article was quite interesting as I got numerous emails complimenting my on the post, so I have no doubt that each person that was on Digg, would have Dugg my post.

A last note:

There is no secret to getting featured on Digg, anyone who says that is just messing with your mind. A rule of thumb to go buy is: if a particular post is stellar, it will show itself, by receiving enough Digg's. And a last thing to remember is, if nobody reads your site, even if you have the greatest content on the earth, it won't get Dugg, so you have to tell people about it!