Web Marketing Strategy Update

After Linda Buquet picked up on my previous post, Webmasters, Could Firefox Be Bad For Your Health? and put it out for discussion on her 5 Star Affiliate Programs blog and the WebProWorld forums, I decided to write a follow-up in an attempt to address some of the issues raised in more detail.

As I mentioned on WebProWorld, Firefox is already used by somewhere between 10 and 14% of all surfers.

That’s a LOT of people.

It’s true that only a percentage of them will make use of plugins at all, but nevertheless, with Google promoting Firefox and paying Adsense publishers for every download, their number can be expected to increase rapidly. This, and the wide range of scripts makes Firefox a potentially bigger problem than Norton’s ad blocking software.

At WebProWorld, southplatte said:

“I need the content I need, when I need it and don’t have time, money or the want to have to scroll past three banner ads in the middle to two side sections and the four adsense ads that separate the paragraphs of how-tos, news or other content I am reading.”

Whilst I don’t condone the over use of ads, that’s largely because it’s against the website’s own best interest, although I agree it’s poor etiquette. There’s a balance to be struck, otherwise you risk visitors feeling you are “overcharging” for your offering, or making them work too hard for it.

However, the rules online should be no different from those of life in general: pay what the seller asks, or move on. So if you do “need the content,” either except the website’s ads as the price to be paid, search elsewhere, or buy a book on the subject.

Whether or not you have money to obtain the information elsewhere isn’t the webmaster’s concern. The website owner owes you nothing more than to behave ethically. Although they may choose to do so, they are not obliged to give you anything at all for free. Why do so many people not get that?

I don’t understand why people have difficulty in accepting that the ads on a website are the price charged for the content provided. Personally I’m grateful for advertising: what could be better than someone willingly underwriting the cost of providing the information you want, just for the opportunity of catching your attention on a related topic?

And just as offline, even if you think the seller is asking too high a price, that doesn’t make it acceptable to steal his or her offerings. When you purposely block advertising, you defraud the webmaster by getting the content without paying the “price” of seeing ads. If the price IS to high, the market will make it clear by obtaining what it wants elsewhere.

The notion that you are doing the webmaster a favour by having their site on your computer is erroneous. As I’ve said before, the surfer CHOOSES to download it from a remote server to their computer to view because it offers something THEY WANT.

Nobody is going to visit a site about my big toe, no matter how much I advertise. Why not? Because it isn’t of value to them. Simple as that.

Webmasters running businesses don’t invite surfers because they seek fame or have some philanthropic urge, they provide a commodity and make money when people who want it search them out. Like cinemas — many may see their ads, but they only invite the qualified: those willing and able to pay the price of admission.

It also needs to be remembered that these Firefox scripts don’t just block ads. Some of them block all images that are the same size as ads. That could be your header graphic, or your subscription sign-up button.

Others enable the downloading of content only meant to be viewed online, or unblock other protected content, or skip redirects to go directly to the destination. One even “prefetches” Google ad links — that means it effectively clicks on all the ads. Think that might put you under the spotlight at Adsense?

Since numerous analogies have been made between website and television advertising, I should mention there are also Greasemonkey scripts to strip ads from streaming video content such as FoxNews and Yahoo.

The analogy to television is inaccurate, but the comparison is interesting.

People tend to have a possessive, territorial attitude with respect to their computers, often making a point of the fact that websites are on THEIR computer, e.g., “It’s MY computer and I have the right to block whatever I want!”

Strangely, people don’t express the same passionate feelings when it comes to television programs on their TV set. Why is that? In respect of rights and ownership a TV and a computer are essentially the same, right? Is it simply the extra degree of end user control with a computer that leads to this irrationality?

Paradoxically, in terms of the receipt of content the two are often viewed as basically the same, yet this is where they are most dissimilar.

Television programming is PUSHED out to your TV, whereas you PULL websites in to your computer.

This makes it doubly strange that people insist on talking in terms of webmasters putting their websites on your computer. They do no such thing, and that is the physical fact.

Another poster, nerdbyte comments:

“I believe the answer is to find other ways to serve ads. Or other ways to refer products. Shouldn’t we be giving people what they want? Pushing against them only seems to make us the losers.”

I think there’s some truth in that. But on the other hand, how less intrusive can you get than adsense text ads? And as for giving people what they want, what about a book review a user searches for and loads into their browser because it’s of value to them, yet feels quite happy using a script that changes the link to deny the writer any recompense for his / her work, but pays them instead?

I think the root cause of the problem is more one of some people feeling they have a right to do and have whatever they want, and that others should be obliged to accept the fact and give it them, with no reciprocation or sense of obligation on their part.

Just because you CAN do something and get away with it doesn’t mean it’s acceptable to do it. I could pilfer from my local shop with ease. But what about the shopkeeper? Is it OK for me to — in effect — take that money out of his pocket?

When it comes to pop-ups, except where scripts are used to auto-spawn multiple windows and in so doing rob users of control over their own web browser (”pop-up hell”); I feel a website has right to use them. It’s part of the package, and if the surfer doesn’t like them, they can go elsewhere. If the website later decides that such a stance is not the most profitable, it can remove them.

However, I also feel there is nothing wrong with the use of pop-up blockers. You may find that strange, even hypocritical. But my reasoning is simple:

Pop-ups that load automatically are not the result of a REQUEST by the surfer. Unlike when a surfer clicks on a link, the content is PUSHED out, not pulled in. The user loses a degree of control over their computer, since the nature of the Internet means the only way a website can push out content is to force the user’s browser to request it. A line is crossed.

Personally, I’ve seldom had problems with pop-ups, and I have the blocker turned off in Firefox, but I guess it depends on the neighbourhoods you surf. Most sites I visit only have a newsletter pop-up, which saves me searching for a subscription form, and is dismissed in a click (or command/alt – w) if I don’t want to sign-up. I actually have certain sections on my site that rely on pop-ups to display content (made long before blockers were even thought of), so those using blockers can’t access it at all.

I’ve been online full-time since ‘97, and from what I remember, pop-ups only really became a terrible scourge waiting to trap us at every turn after marketers of pop-up blockers (and scumware) repeatedly told us they were. Now everyone knows it’s a “fact” and must have a blocker. In my experience, apart from a minority of internet marketers, the only real heavy abusers of pop-ups were and remain porn, gambling, coupon and similar websites.

But whatever your position on all this, if we get to the point where most surfers can and do block ads on websites, subvert links to pay themselves or skip redirects, etc., the Internet will shrink dramatically and almost all sites will be pay-to-view.

We all lose.

The way forward would seem to be to remove access to these scripts from mainstream, high-profile sites like those of Mozdev.org and it’s affiliates, which both implies their acceptability and provides the visibility to facilitate mass adoption.

Whilst it’s not possible to stop people from writing such scripts and making them publicly available, it should possible to limit where they are hosted and force them out of sight of the average surfer, by classing such scripts as warez or similar.

I’m sure Mozilla backers like AOL, Google and Sun among others wouldn’t like to see the use of these scripts proliferate any more than I do. It may even be possible to persuade the Firefox developers that the actions of certain types of scripts should be blocked.

There are a lot of emails going around at the moment promoting a new service for product sellers and affiliates called PayDotCom. Here’s a taste of the marketing blurb:

I am sure you have heard of ClickBank (R)

They are a great marketplace but limited to many restrictions to sell products or earn affiliate commission…

Well, there is a new FREE marketplace to sell any product you want. Yours or become an affiliate for any item in the marketplace.

This site is going to KILL all other marketplaces and I bet in the next 3 months EVERY SINGLE online marketer will have an account…

I must confess PayDotCom is interesting concept, and fills a gap in the market. But whether it will “KILL” other marketplaces remains to be seen.

Personally, I doubt it.

I actually set about writing a piece to explain the key differences in PayDotCom and ClickBank, but whilst going over the site for more details I came across the table below and decided it would be far easier just to post it so you can see the bulk of the information at a glance:

*There is no set-up fee to open basic PayDotCom Vendor or Affiliate Account. You are only allowed one free Vendor Account to sell products. To sell multiple products you must pay a onetime $29 lifetime activation fee. ** If there is no affiliate, then the Vendor pays the fee in full.

PayDotCom charges the following processing fees per sale:

As indicated above, the PayDotCom’s fee is split between the vendor and affiliate responsible for the sale (if no affiliate, the full fee is charged to the vendor) and automatically deducted from affiliate commissions.

PayDotCom’s fee to the Affiliate is $0.50 to $1.50 for each transaction (Based on the sale price of the product/service sold.) The Vendor’s account will automatically deduct this amount from your commissions each month.

If you’re an affiliate you probably don’t like the sound of that. But the problem for PayDotCom is trying to make the cost of what is basically an “add-on” service attractive to vendors in comparison with ClickBank.

PayDotCom wants to position itself as a better option than ClickBank by claiming it offers more features and is cheaper.

From the site:
Other companies charge $1 plus to 7.5% of the sale price. All you pay is our fee plus the cost of your PayPal or StormPay fees.

So how does the service actually stack up in terms of cost?

At first glance it seems very attractive, as can be seen from this table on the site:

But let’s take a look at what you will be paying in total once your PayPal (2.9% + $0.30) or StormPay (6.9% + $0.69) fees are included.

Using PayPal:

Using StormPay:

When using PayDotCom with PayPal, the fee on the sale of a $50 product is $4.75. The fee on a $50 product sale through ClickBank is also $4.75.

PayDotCom is only cheaper for products priced over $50.

Note: These examples are for US users only. For non-US accounts, PayPal rates are 3.4% + $0.30:

(In addition, PayPal also charges non-US users a small fee to withdraw funds. Varies with currency exchange rates but in the region of $0.50-0.60)

However, the examples above don’t take into account the situation where the fee is split with an affiliate.

When there is a referring affiliate, fees for vendors using PayPal would be as follows (I’m not going including figures for StormPay, since we have already seen that if coupled with PayDotCom it’s far more expensive than using ClickBank):

But what about the referring affiliate?

The table below shows how the affiliate’s commission is effectively reduced:

What we can see from all this is that a vendor who’s sales are mainly driven by affiliates (and this after all is PayDotCom’s target market) will find PayDotCom slightly cheaper than ClickBank. They can save on per sale costs whilst (on the surface at least) still offering the same commission as at ClickBank.

Kinda like having your cake and eating it.

If you make most of your sales yourself (i.e. not through affiliates), then PayDotCom will cost you more than ClickBank for all products under $50. However, if you are not intent on building a large number of affiliates to make your sales you’ve no need to use PayDotCom at all, and can simply use PayPal alone.

Of course, there’s no set-up cost with PayDotCom. But that is only as long as you are selling a single product, so it is unlikely to apply to most sellers for very long. If you want to sell more than one product, the set-up fee is $29. Still substantially cheaper than the $49.95 ClickBank charge for a single product account, although it’s also worth mentioning that there are several scripts available that enable the sale of multiple products through a single ClickBank account.

Another plus for ClickBank users is that affiliate payments are taken care of by ClickBank, completely hands off. Whilst PayDotCom does provide sellers with PayPal Mass Pay files to pay affiliate commissions, the vendor still has to log in to their PayPal account, upload the file and go through the Mass Pay process. It doesn’t take long, but it’s still an additional task.

Nevertheless, vendors using affiliate marketing may find PayDotCom’s extra features, plus the lower overall cost per sale and cheaper setup more attractive than ClickBank. Let’s face it, there’s currently no other service at this price point that enables you to do recurring billing or sell physical goods with a 2 tier affiliate program.

It’s a different story for affiliates though.

The generally negligible benefit of 2nd tier commission potential aside, affiliates are better off with ClickBank. At ClickBank a 50% commission means half the sale price goes into your pocket, not half the sale price less $1.50 (incorrect, see comments below). I’m afraid the idea of charging affiliates for the pleasure of using a service catering for the vendors they make money for sticks in the throat somewhat.

Look at it how you want, but basically, the vendor pays PayDotCom a commission on every sale, and the PayDotCom system legitimizes the affiliate commission advertised not being the true commission paid to the affiliate.

But then the PayDotCom site makes the position pretty clear:

Vendor Does Not Pay Affiliate The Full Commission Earned.
Vendor charges to fee to the affiliate (automatically calculated) and pays it on the affiliates behalf to PayDotCom.com at no additional cost to the Vendor.

The Vendors Net Profit Stays The Same.

This is done this way because PayDotCom has a better relationship with Vendors then we may have with come and go affiliates that do not have products with us. This simplifies billing for all parties involved.

The Vendor is responsible for the full fee but the Vendor gets to split the fee with the affiliate by withholding it from their commission. This is all automatically calculated by PayDotCom for all parties involved.

Nevertheless, assuming it proves to be well run and reliable (still some website “issues” evident when I was last there), PayDotCom is likely to become popular over time. It’s a vendor driven site being heavily promoted, and inevitably the mass of affiliates will follow the products they want to promote, even if they are losing out in the process. I may even end up trying it myself if that happens and see if the pain is worth the gain. Although then again, a service that disparagingly calls one of the parties it depends on for its existance “come and go affiliates” gives me the urge to suggest affiliates simply, “go”…

Of course, if PayDotCom does start to take a significant slice of business away from ClickBank, it could well lead to the long overdue upgrading of the ClickBank offering so that it provides the services users have been requesting for years, and possibly with a revised rate structure. There’s nothing like a bit of competition to stimulate a company into listening to it’s customers and providing more benefits to the end-user.