AMWSO Proves Distance is No Object in Affiliate Management Success

A good affiliate manager is hard to find. It is not just a matter of having the right contacts, but also a matter of managing merchant expectations while enabling growth in the affiliate channel that is both ethical and sustainable.

The recent glut of new OPM firms who provide third party affiliate management services for merchants is a direct testimony to those challenges. One firm that has been doing it right for a long time is multi-award winning AMWSO. I sat down with Chris Sanderson, Director of AMWSO, to discuss the challenges of being an OPM.

AD:What brought you to affiliate marketing?

CS:As part of Web Studio One, I was working on Mondera back in 2001. During one of my off periods from web development, I was invited to look at the site and see if I could help out the marketing programs. That’s when I first took a look at this thing called affiliate marketing and I thought to myself, that’s kind of interesting.

At that time their affiliate program was on BeFree and was doing approximately $50,000 a month, which was a pretty big chunk in those days. I kind of looked at it, saw opportunity and decided to play with the program since no one was working on it. I dug in and the first thing I noticed is that the BeFree platform actually required a software application for you to be able to login. Being that I was based in Thailand and it was a painfully slow process to even look at the reporting. I’m unsure if it was a BeFree issue or a distance issue but being the client we couldn’t have something slow down interaction with our affiliates so drastically. Plus BeFree support would hardly give us the time of day. In terms of what issues we were having it seemed that in their mind any technical problem was our fault.

So I looked around for a new network but CJ wasn’t very open. That was the reason we ended up moving Mondera over to LinkShare because their response was very friendly and helpful. At that time my direct contact at LinkShare was a woman named Lisa Hass.She helped me with affiliate issues and she was the one that recommended I check out ABW. I joined and learned a lot. Over time the Mondera program grew significantly from around $50,000 to $400,000 sales a month which became a healthy portion of their overall marketing effort.

As I say it was kind of accidental, our stepping into affiliate marketing. It really grew out of playing around with a client’s program and our company ended up adopting affiliate marketing as kind of like a lost child. Things just sort of grew from there.

AD:At what point did you think about becoming an OPM firm?

CS: At that time I was the general manager of Web Studio One which was actually owned by the same company who owned Mondera. I kind of took on the affiliate program, as I said, for fun. At the time we really didn’t think of it as a business model for Web Studio One. But then as we were more successful we started getting calls from merchants who saw what we were doing with Mondera and wanted us to help grow their program.

Sometimes it takes someone banging on your head enough times with a baseball bat before you realize what is in front of you. Despite multiple requests we really didn’t think of it as a potential new business. We just sort of took on new clients like KegWorks, and Forzieri. Again we hadn’t planned this growth and didn’t really realize how big it was until we found ourselves six-months down the line with several clients in tow.

AD: What does AMWSO stand for?

CS: I get that question a lot. What’s funny is it stands for Affiliate Marketing by Web Studio One. That was the brand that grew out of our former web development business. As the brand became well known there came the question of whether we should change the name but our brand recognition was already so strong that we stuck with it.

AD: What is the biggest challenge when dealing with merchants?

CS: These days, our biggest challenge is probably in closing the deal with a new client. When we first started there weren’t many companies in the OPM business. When we contacted merchants or when merchants came to us the distance factor of being in Thailand wasn’t an issue. They were happy to have a company that knew what it was doing in affiliate marketing space.

Nowadays there are a lot of new OPM companies in America and in Europe. When we pitch to American clients the common question is why we should work with you since you are overseas. That has become the primary barrier for us. In many ways this is just a perceived barrier on the part of the client because once things are set up everything runs very smoothly. We get some firms that are surprised to hear we are in Thailand. The bigger companies especially seem to want to have their firms local. For example it’s often easier from them from the legal aspect in terms of contracts and many prefer bringing in vendors for meetings on a regular basis.

AD:What is the biggest challenge when dealing with affiliates?

CS:I think the biggest challenge as an OPM is to maintain a privacy curtain between the different programs you manage. You tend to want to pitch out a new client program to all of your affiliates. You got to realize sometimes that isn’t the right or ethical thing to do. To try and recruit them very swiftly across new clients isn’t the best course.

First of all, it’s not really the right thing to do in terms of your relationship with the merchants; using their program as a recruiting pool for another program especially when the affiliate signed up specifically for a particular merchant. At the same time even when an affiliate has been working directly with an OPM for a long period they don’t necessarily want you to move their information from client to client in terms of the kind of niche they occupy. Especially if they haven’t given you direct permission to do so. There are of course affiliates that don’t mind and are quite happy to hear that you have in a new opportunity for them. In many cases however an affiliate can feel that it is a violation of their privacy that you are suddenly sharing their information or using information about them and their tactics on programs you run but that they haven’t shown interest in.

Of course a merchant comes to you because you have those relationships so you need to make sure you don’t abuse them relationships and have it backfire on you. Finding that balance between leveraging your contacts and making sure you are not unethically taking advantage of the information is the biggest challenge in being an OPM.

AD:Is there a success story you would like to highlight?

CS:For us Forzieri is a huge excess story. They were one of our very first clients and they’ve been with us for almost five years now. In this very competitive industry when you’ve had a client with you for five years that kind longevity is a big success in and of itself in a.

When we took over the Forzieri program in 2003 it was riddled with fraud. There were many overseas affiliates running fraudulent orders to claim the commission and then reversing the orders after the commission was approved. We went in there, cleaned up the affiliates and drove increased sales year-over-year with the program, helping Forzieri expand in the US and the UK. For us that’s a great success.

What’s funny is that we’ve worked with them for five years but we just recently met Andrea Forzieri, the owner, for first-time. So when we talk about the ways relationships work in this industry and the challenges of working overseas in many cases we haven’t actually met many of our clients in person. Andrea happened to be on holiday with his fiancée and Thailand was one of his stops in Asia. It was great after all these years to meet him and put a face to the voice.

AD: It’s funny that anybody can go to a meeting in New York or Las Vegas, but if you have a meeting in Thailand you might be on vacation. Do you find advantages being overseas?

CS: At first we never saw any clients in Thailand but lately there has been a spade of people that are heading over to Asia. Bangkok is a very central place geographically. Sure, some come because they are on vacation but a large part of it is that companies are looking at Asia in terms of how they can expand their business overseas. They want to know how they can get into Japan and China and the other Asian markets. In the US the OPM market is very crowded but in Asia it is still pretty empty. Being in Bangkok has become an advantage because many US firms are looking at ways to expand in Asia. A lot of merchants are heading in our direction.

AD:What changes do you see in the affiliate industry?

CS:Personally, it would be nice to see better integration between the social media side of things and affiliate marketing. Whether that’s going to happen or not I’m not sure but there is definitely experimentation where people are seeing if affiliate marketing can really generate sales in the social space.

I see this being a big challenge because many social media sites are very anti-selling. They don’t want to see ads, they don’t want to see links, and they often don’t want to see people’s products. It would be nice to see developments that smoothly integrate affiliate marketing in such a way so social communities will accept them and social media can be a viable outlet for affiliates and merchants.

Technologies like video have been hyped up over the last few years but still present a challenge in terms of making the process easy enough so the majority of affiliates can be involved. ShareASale has launched their video system recently which helps make it easier for their affiliates. I think what you’ll see is continual refinement of tools that will generate sales through social media.

AD:What about Google’s impact on the affiliate industry?

CS:A lot of people are concerned about Google stepping into the affiliate space, wondering if they are going to flex their muscles and how that will impact things. They could easily say we’re doing affiliate marketing now so how do we block off everyone else’s affiliate programs within our search engine results. Do they suddenly block affiliate sites who are not promoting Google affiliate programs? Of course people are concerned about it.

As an OPM I think it’s great to see Google in the affiliate marketing channel because it will help them to understand better exactly what affiliate marketing is. People in our industry remember Google cracking down on affiliate sites in the past, pushing results for those sites to the side and pushing down their rankings in search. I think now with them more involved it will give them more understanding about what affiliate marketing is and what we do and hopefully improve results in terms of Google search for everyone.

AD:What about future plans for AMWSO?

CS:We actually have an investor coming aboard this year. It will allow us to open a sales team within the US for the first time. This will get rid of the perceived overseas issues with potential new clients. Myself, unfortunately  will still have a VISA issue to resolve but what’s important is that we will have an AMWSO team in the States. We hope to get that set up in the next six months.

Our goal is to help merchants reach new markets. We are also looking at growing our Asian clientele to take advantage of the trends I mentioned earlier. We see a lot of talk about mobile marketing in the US while mobile marketing in Asia has been massive for years. So we are looking at how we can help US clients get involved in the mobile commerce overseas. We see a lot of potential growth for us in that sector.