Supernatural Agency: Online business tales » marketing

The beginning of the end for affiliate marketing?

martin — Fri, 30 May 2008 20:35:31 +0000

We’ve had three major brands for whom we are affiliates end their relationships with us because we are located in NY State. Never mind the fact that our servers are somewhere on the West Coast and that these retailers have no brick and mortar presence in NY. Our totally dysfunctional and short-sighted state government decided that out of state e-commerce companies selling on the web in NY should pay our insane (8.5%) sales tax even though the law for mail order companies states that they don’t have to charge the tax as long as they have no physical presence in the state.

Apparently a website that does not even sell the products and does not physicaly exist here is now a cause for ordering merchants to pay sales tax. So, what about the millions of paper mail order catalogs sent into our mailboxes from out of state companies- aren’t they a physical presence? And since when are online media that advertise services on a commission basis (very common in print, radio and broadcast) a cause for claiming a physical presence?

I do not think this will hold up in the courts as it is a poorly though-out law filled with loopholes. In the meantime don’t plan on building an affiliate marketing business in NY.

Update: Two more merchants have sent notices specifically detailing that the NY law was the reason they were removing us, hopefully temporarily (as they said). Interestingly, Linkshare followed with a generic notice saying we had been removed for unstated reasons- I think they’re worried about losing a lot of other merchants if they get wind of this.

So, if Google has PayPerAction (PPA) programs in which they get paid when a conversion takes place should they be paying taxes? They have a big physical presence in NY.

This is the lid coming off a big can of worms…

Valuing a top Google ranking

martin — Sun, 04 May 2008 18:43:45 +0000

Aaron Wall has done it again with a very detailed analysis of the value of a top ranking in both organic and paid Google search results. This is a long read but should be required for anyone working to drive traffic and conversions via search

Tracking Habitual Information

martin — Fri, 25 Apr 2008 20:17:28 +0000

I’ve been a number of conversations lately about data-mining and semantic search (or ‘discovery’ as one company’s CEO told me she preferred- not sure I know the difference…). In one of those exchanges I brought up the idea of tracking ‘habitual information’, a phrase I’ll take credit for originating (my five minutes of fame?). The idea struck me- there are many kinds of information I track on a habitual level: certain stock prices, weather, environmental economics, usability, etc. I am sure that there are many others who share a similar pattern of habitual information.

As a marketer I see behavioral targeting potential in this information. In a previous post I wrote about iGoogle as a potential source of behavioral data for Google. This idea of habitual information takes that model further. If you know my information habits, as opposed to simply tracking what I do while surfing, then you could target me more precisely when I do surf. So if go daily to Techcrunch, NYTimes Business section, Science Daily and have a Google Alert set for Apple Inc., I’m guessing there’s quite a few people like me out there. The ads served up on these sites collectively could target my interests.

I haven’t quite got my arms around how this might work but I’m guessing the data-miners at Google and the ad networks have got something like this on their radar- I’ll be watching for it.

Are search algorithms viruses?

martin — Mon, 21 Apr 2008 12:50:33 +0000

“I think computer viruses should count as life. I think it says something about human nature that the only form of life we have created so far is purely destructive. We’ve created life in our own image.”
- Stephen Hawking

I think I respectfully disagree with Hawking about whether these ‘lifeforms’ are all malevolent. You could certainly argue that the algorithms and search index bots created by the Googles of the world are in fact very similar to viruses: They travel the web from link to link gathering as much information as possible and transmit that information back to a private company that profits from it. Is this technically different from a virus that travels to your hard drive and transmits your personal information back to someone whose intent is to profit from it? The intent is the same but the word ‘personal’ is where the difference lies. When you get personal you break the law.

There is a lot of debate among online marketers about the tracking of individual behavior on the web. Behavioral targeting and retargeting use your surfing history to assemble a profile of what you’re interested in and then use that profile to serve up ads that they think you will be interested in. These ads appear in sites you are expected to surf to. For advertisers these ‘targeted by intent and relevance’ ads are far more valuable than taking a shotgun approach to a campaign. So is your privacy being invaded? Are they related to malicious viruses? Again, no, because they only know your IP address, not your identity.

This is where the line is drawn in the sand in online marketing. As long as they can’t identify us personally these techniques should be legal. To use personal information we must have opted-in or given permission for that use. As regulators look at the world of personalized marketing online this should be the standard benchmark for defining the difference between legitimate targeted marketing tactics and spammy illegal attempts to acquire personal information without permission.