Search Agency V Search Affiliate - The Great PPC Debate.

Affiliates V Agency, who should conduct your search activity? The simple answer is both of them, using strict terms & conditions in which to operate.

Firstly you only need to be concerned about PPC conflicts if you have a brand. A brand is simply a set of associations that; are linked to a product or company name or reside in consumers' memory. If you are a new e-tailer, it is unlikley that you have any brand value at this time. If you have limited resources I highly recommend you work with affiliates in the search environment and have an open policy.

So if you are still reading this article, YOU have a brand. You currently invest a % of your marketing budget into paid search. You have seen a number of advertisers bidding on similar terms, which you see as a conflict of interests.

Your first assumption is that the other ads are from affiliates in your affiliate program. Your solution, put a no PPC policy in place. Well in some cases you are right, but there are other factors at play. "Search Arbitrage" is the process of paying for traffic to a site through adwords and low CPM networks, yet converting it back out through adsense. This would result in an EPC (Earnings Per Click) high enough for you to make a profit on the conversion. The other adverters bidding against you probably fall into the Search Arbitrage group - who you have no control over.

Working with search specialist affiliates can be beneficial to your business. Having worked for a number of media agencies, i have often seen them struggle to make a profit on search management. This has proven more evident with the introduction of reduced agency kick back commissions. Bearing this in mind you have to question whether your search agency are delivering all possible keyword combinations. They may well be hitting their targets, but are they delivering the best possible campaign for you?

Affiliates don't earn a day rate, they don't have big agency targets for profit, so are in a perfect position to tidy up on search.

My solution to working with search specialist affiliates has been proven, it will put affiliates on an even platform with your search agency which reduces the competitivness between them yet delivering the ROI you need.

I will now take you through potential areas of conflict and how to address them.

Brand Names;
If you own the trademark to a given brand name, file for the right to restrict any advertiser. Remember this is not just about stopping affiliates in your program, but all advertisers who are trying to cash in.

Brand Name Misspellings & Combination keywords;
You cannot protect these legally. You can stop your affiliates bidding but you cannot stop other advertisers. So why not work with affiliates to ensure traffic is going to where you can control it?

Brand Associated Terms
Some brands have high profile sub brands which may but not protected by trademarks. These can be as valuable as your brand name, especially with clothing companies.

Generic Terms;
Affiliates have 1000's of combination terms and can work with multiple clients so can have a broader understanding of consumer search trends. Your agency may only be able to work with a small set of clients within a given industry, they may also include a small level of keywords to reduce management.

So in short there are really only 3 groups where there is a potential conflict. This step by step guide will take you through the process of creating a solution for all parties.

Step 1 Work with no more than 6 paid search affiliates, you will find some affiliates have different search network preferences e.g. Miva, Yahoo!, MSN or Google. This means you have a controlled group of people to work with and can easily identify who does and doesnt have permission to bid.
Step 2 Based on the above your standard program Terms & Conditions will be:
Partners/Affiliates who are accepted into this program DO NOT have permission to conduct search activity on our brand name, brand name misspellings of combination search terms. Partners/Affiliates are NOT PERMITTED to use our brand name or brand URL in any paid search advert. Any commissions generated as a result of unauthorized search activity will not be paid
Step 3 So now you need to chose your affiliate partners. Consult your network, or drop me an email at helen @ tigerstep . com and i would be happy to recommend people.
Step 4 You now need to devise a set of Terms & Conditions for these guys to work from. To do this you need to understand the commission impact from your own search activity by reviewing CPC & CR% for each group.
Here is an example of Terms & Conditions for your chosen group
Brand Name - No Permission to bid
Brand Associated Terms - Commission Payable 4%
Brand Name Misspellings, Combinations - Commission Payable 6%
Generic Terms - Commission payable 15% (which is more than the basic program commission of 6%)
Your network can set up the filters to ensure correct commissions are paid. To devise the above you have to calculate an affiliates resulting EPAC (Earnings Per Actual Click). To do this look at the conversion rate from your own search activity for the above 3 groups. Based on an average order value you can work out how much commission an affiliate could earn per click. By setting variable commissions you can ensure that the resulting EPC an affiliate earns is inline with your own search activity.

End result is you have a tight group of affiliates working WITH YOU not AGAINST YOU, if your affiliates are outbidding your own search agency you don't loose on ROI.