Will Outsourcers Rule?

About 5,000 merchants now offer affiliate marketing programs. But there is an increasing disparity between best-of-breed and also-ran programs.

I estimate that today fewer than 500 merchants get meaningful productivity from their affiliate marketing activities. Even so, the other 4,500 merchants probably still find that affiliate marketing is among their most cost-effective marketing initiatives; they’re just looking for ways to rev things up.

The solution for many underperforming merchants is to get professional help. And there’s lots of help to choose from. Today we’ll take a look at some of the firms offering outsourced affiliate program management.

In Alphabetical Order

AffiliatePeople.com. A service of NuMedia Internet Inc., which also operates AffiliateWorld.com and AffiliateRecruitment.com, AffiliatePeople.com provides outsourced program management. This includes strategy development, ongoing affiliate communication, targeted affiliate recruitment, and technical integration support. A dedicated affiliate program manager spends 40 hours per month marketing each client program. Fees start at $2,995 per month for basic outsourced program management. Clients include gifts.com, Good Catalog, Moreover.com, ShareBuilder, and Sygate.

eAccountable. Along with search engine optimization, permission marketing programs, and viral campaigns, eAccountable offers affiliate program consulting but has moved away from day-to-day program management. “I don’t think we priced them well enough to make money,” remarked eAccountable’s president, Durk Price. “And we were too performance oriented for our own good.” It now favors direct marketing opportunities and existing brick-and-mortar companies over dot-coms. Perhaps its less hands-on approach is working. It claims to have taken one program from 4,000 registrations per month to over 48,000 per month — in four months.

EComWorks. Maurice Bretzfield founded EComWorks in October 1997. As a LinkShare partner, it had such clients as Cooking.com, Disney Store, and J&R. Drawing on its “many years of merchandising and marketing experience,” EComWorks aims to turn affiliates into productive retail channels. By working with a client’s affiliates, it maximizes product sales. Other services include creating strategic marketing plans, integrating network providers into client systems, and recruiting a database of productive affiliates.

FlightPath Marketing. After a stint at Be Free, Rob Flynn started FlightPath in August 2000 for customers looking to run a Be Free-powered solution at a lower cost. Full services run $4,500 per month. In some cases, performance deals are available at a lower monthly fee, with FlightPath sharing in the program’s success. Project-based capabilities include segmenting affiliates and designing affiliate-base analysis. Fees range from $250 to $2,000, and clients include VistaPrint.com, Stockbrokers.com, and RealHome.com.

i-traffic. Now owned by AGENCY.COM, i-traffic was founded in 1995 and has offices in New York (its headquarters), San Francisco, and Chicago. It claims to be the “only company that has worked with the three main affiliate solution technology providers.” (Note: E-Base is currently running programs for its clients on all three as well.) Its Affiliate Marketing Services Group helps clients establish, manage, and grow affiliate networks. Clients include Bookspan, ConsumerInfo.Com (an iPlace company), and Make-A-Wish Foundation. (pro bono). Fees range from $4,500 to $17,000 for a full implementation. Ongoing monthly fees are similarly priced.

LinkProfits. Operated by Jim Gribble from the D.C. area, LinkProfits bills itself as “The Affiliate Program Management Specialists.” Its Total Program Management is a turnkey affiliate program management package. It proactively works to optimize every aspect of a client’s program from strategic planning to daily contact with affiliates. The package includes program setup and initial launch, product merchandising campaigns, offer development and refinement, creative services, new affiliate acquisition, affiliate program development, and affiliate review and approval.

Molander & Associates. Jeff Molander is a former VP for Dynamic Trade. Last fall he left to consult again. Clients range from Reading Glasses to Eastman Kodak. The Molander team claims to guide clients in the development and planning of customized strategies, from launching a new performance marketing initiative to taking an existing affiliate program to the next level. Molander helps clients leverage his team’s expertise in revenue sharing and collaborative e-commerce models that go “beyond affiliate networks.”

TargetMarket Interactive. Digital Coast-based TargetMarket Interactive offers implementation, optimization, and reporting of partnership development, affiliate marketing, search engine optimization, and direct email. Its affiliate marketing staff has assisted programs for AltaVista, LowerMyBills.com, U S West, and others. Services include planning, development, implementation, training, and reporting.

Winterhalter Affiliate Management (WAM). Run by brother-and-sister team Stephen and Elizabeth Winterhalter, WAM has a nice roster of clients, including mySEASONS, SellerFinances.com, Witness Wear Inc. , and Zing. It also has a range of partners, including Commission Junction, Dynamic Trade, and LinkShare. Elizabeth was formerly with MobShop and ShopNow and was a VP of sales and marketing for a dirt-world sports apparel manufacturer. Stephen was with the San Francisco office of LinkShare working with such companies as Mattel, Adobe, AltaVista, and Healtheon. In the dirt world he too was a VP — for a snowboard manufacturer.

I’m running out of space here. I’ll pick up this overview in my next article.

In the meantime, you might want to check out the page I’ve put together that lists all the outsourced program management providers I’ve learned about. If you want to be listed, email me with contact info, partners (e.g., Be Free, LinkShare, etc.), pricing, and sample clients.