While sites can measure how many visitors and clicks they receive and send on through affiliate links, that's only part of the story when making decisions on maximizing your revenue potential. There is still that magical "conversion rate" -- how many of the visitors that you send to a merchant actually buy something? What kind of linking (from banner bars to email mentions) send the most potential customers to the merchant, versus just the most traffic?

While doing case study interviews with affiliate program managers, I've asked a lot of questions about what kinds of affiliate activities generate the most sales. Uniformly, they report that text links (from inside the contents of an article, for example) and testimonials produce more sales than simple banner bar and search box linking. As you can imagine, though, they seldom want to discuss the specifics of conversion rates for their program.

In March of 1999, LinkShare provided all of us participating in (and running) affiliate programs the best glimpse of "industry average conversion rates" we've had yet. LinkShare is one of the largest affiliate networks out there -- combining over 100 merchants, 61,000 affiliate sites and millions of impressions a day. They recently began sharing their analysis of the effectiveness of different types of links used by affiliates across their network -- and sharing that information with their affiliates through the LSN Newsletter:

In LinkShare's analysis, they looked at "conversion rate" as the percentage of people clicking through an affiliate's link who then actually purchase. In a way, they are looking at the same "quality of pre-screening" process I described earlier -- not how many people get sent by a linking technique, but what percentage of those become customers.

What affiliates choose to use the most often, however, isn't exactly the most effective.

What LinkShare's affiliates are doing doesn't exactly match up with what they've found is the most efficient -- for example, banner bars (a sub-one-percent convertor) are still the most popular linking choice of LinkShare's affiliates:

It is worth noting that not all LinkShare merchants provide "storefront linking" or "product linking" options, so at least some of the above ranking could be influenced by what is actually available.

In their Part 2 newsletter, LinkShare summarized what these numbers show:

Though we have always encouraged the use of different linking types beyond just banners, the information we found provided us with proof that the use of links other than banners can be more effective. In fact, we have found that storefronts and links to individual products have the best conversion to sales ratios. Textual links within content also perform well. Banners are the most used type of link but least performing. Conversely, storefront links are the least used but most effective.

While the results of this data are fascinating, they raise the question of "at what price comes conversion?" For those of us operating websites like publications, integrating income generation with our editorial requires serious caution (despite the proven greater effectiveness in sales.) My journalism professors from college would describe it as "the line between editorial and advertorial" that is key to credibility. There's a reason why even a site like ReveNews.com (which is all about affiliate programs) doesn't mix affiliate income into the editorial: we want you to know that these articles are meant as resources for you as a reader, not a vehicle for selling you something (as so much of the Web has become.)

The beauty of the Web, however, is that not all sites think of themselves as "publications," creating both a crisis and a debate as to where that "editorial/advertorial" line should be redrawn. In the end, each of us (as participants in affiliate programs) need to find where that line is for our websites.

This article is copyright (c) 1999 ImagineOne, Inc. All rights reserved.
Used by permission.