Building an Online Affiliate Network
Small start-up costs yield big subscription results for Outside.
For Outside, online affiliate marketing has provided a vehicle to generate hundreds of new subscriptions every month with no heavy lifting and negligible start-up cost.
The magazine for outdoor enthusiasts continues to pursue readers through traditional industry means, like home page banners and subscription agents, but affiliate marketing seemed a natural progression. “The next step for us was to take those same banners and text links and find a way to distribute them much, much more broadly,” said Paul Rolnick, consumer marketing director for Mariah Media, publisher of Outside. “It’s been an incredibly cost effective way to get to an incredibly broad audience.”
Outside launched its affiliate marketing campaign last fall, partnering with two primary networks, Converge Direct and clixGalore, which have placed Outside subscription offers on hundreds of Web sites and blogs, and in countless inboxes though opt-in e-mail lists where consumers agree to receive commercial offers.
Casting a Wide Net
The strategy is to cast as wide a net as possible and reach people throughout the Web, from sites that directly attract active lifestyle enthusiasts to unrelated sites that may attract like-minded users. It’s the network’s job, with the publisher’s guidance, to promote the offer to affiliate members; performance drives success or failure since the magazine publisher, affiliate network and Web host share revenue.
For Outside, start-up costs were about $3,000 and took about three months, much of that creating and refining the format and offer strength. Rolnick estimates the marketing has generated about $25,000 to $30,000 in nearly six months, averaging 400 to 500 new subscribers per month. What makes the marketing strategy so valuable, Rolnick said, is that the new subscribers are individuals the magazine would have had a difficult time reaching any other way.
When a new order is placed, the publisher collects the sales revenue. Some is sent back to the affiliate network, which keeps its cut and sends the rest to the Web site where the sale originated. Commissions are negotiated, and Rolnick declined to reveal the terms, but said the publisher’s revenue share is “far more favorable” than in traditional marketing, where subscription agents can take up to 95 percent of often deeply discounted rates.
It’s A Balancing Act
The key to success, Rolnick said, is creating a compelling offer that serves the need of the publisher to drive new subscription volume, but also provides the revenue stream that network affiliates expect from each sale. It’s a balancing act, notes Rolnick. On the one hand, the publisher wants to make the subscription pricing attractive enough to sign new business, but not too attractive that it squeezes the value for the affiliate partners. “The offer isn’t discounted, which is great for us because we want people to pay full price for our magazine because it’s worth it,” he said. “You have to find your own sweet spot between your pricing and the (revenue) volume your offer is going to produce through the affiliate.”
Based on Outside’s experience, Rolnick expects that volume to continue to grow. “It’s a way to take your message and spread it out to an infinitely large space,” he said. “In marketing terms, this is a huge win for us.”
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