New Years Resolutions for the Interactive Advertising World

It’s that time of year again, when you make promises you can’t keep, over commit to Gym time, work hours, and time spent on that novel you started Freshman year in College.   After setting to work on my own list of New Years Resolutions, I thought it may be valuable to scour the Internet and aggregate a few of my favorite lists from the on line advertising world.  Take a look:

Click this link to check out MediaTwo – Interactive Ad Agency‘s resolutions.

Media Post did something different this year, and offer New Year’s Resolutions for Hispanic Marketers; HERE

Adotas is always insightful.   Take a look at their resolutions.  All of which I agree with. If I were to put them in order of importance, I’d list

Better Engage Users Through Social Interaction as my number one

Kudos to the team at Adotas. I believe their list is one of the most comprehensive I could find.

Here are my 5 Resolutions for 2009:

1. Listen to our users more. The Alot.com brand is a phenomenal product.  We need to break down walls and allow our users to give us feedback about the product.  This will allow for champions for the Alot.com brand, and provide a forum for us to share information.

2. Continue to be the “white hat” provider of downloadable toolbars.  We have a strong relationship with Google, Truste Certification, and will continue to develop and cultivate strong working relationships.

3. Test, test test.   Our team has so many great ideas that will enhance our users experiences that it behooves us to test everything.

4. Continue to pay attention to ROI.  It’s easy to get caught up in big deals attached to big dollar signs.  If there’s no attention to ROI, we’re shooting ourselves in the foot.

5. Stay focused.  As we grow and continue to generate revenue, it’s easy to rest on your laurels.  We need to stay focused and push each other (especially in such a volatile economic environment.

The Fatal Flaw of Pay for Performance

Here’s a copy of my article that appeared in Adotas:

The Fatal Flaw of Pay for Performance

The Harvard Business Review, however interesting, is not always at the top of my reading list for a seven-hour flight to the UK. I’m more of an Esquire kind of guy, but I recently relented and forked over the cash for good old HBR (I still bought an Esquire to keep me entertained). While flipping through the articles, it struck me that the issues discussed on those pages transcend industries and are widely appealing because they affect any business. The contents seemed to be custom produced by writers that perhaps had been listening in on my team meetings and brain storming sessions over the past six months. This reminded me that some dilemmas – strategic, operational, motivational and ethical – are universal.

One piece in particular sparked my interest immediately, as it resounded for the performance-based online marketing industry yet had little to do with it. Odd. The title of the article was something along the lines of “The Fatal Flaw of Pay for Performance.” I immediately devoured the article, quickly realizing that it had nothing to do with online marketing. It was, however, fascinating and perfectly applicable.

The article discussed how rewarding a CEO for performance may satisfy certain critics so they don’t get swept away with backdating stock options, or the like. One of the main points addressed in the piece, which I felt was perfectly appropriate for our industry, is that when people (or in our case publishers/affiliate marketers) are rewarded for performance only, there is a fatal flaw – the temptation to cheat.

We open the system up for fraudulent activity because the one responsible for performing is so desperate to meet a certain benchmark that they loose site of the bigger picture. The article listed examples of CEO’s who had “cooked” the books. In my mind, I thought about rampant fraudulent leads I’ve seen over the years – affiliates forging applications, entering fake emails, even using stolen credit cards – all with the intent to be paid for performance.

The bottom line is, however appealing it is for advertisers, if not properly regulated, this model is flawed. You don’t want a CEO to be rewarded for something he or she didn’t really do. Nor do we in the performance-based marketing industry want to reward someone for performance they didn’t achieve on behalf of our advertisers.

The model shouldn’t be just pay for performance, but rather pay for performance with integrity. Let’s be honest though, there are too many affiliates and publishers to cut out all of the shady guys. So, how do we solve this dilemma? The first step is to be AWARE of the issue, and then monitor, regulate and participate.

Once you’ve recognized the existing threat, it’s important to monitor your affiliates and the manner with which they generate leads for your advertisers. Have a task force assigned to not just monitoring, but identifying and then terminating the relationship if the publisher is seen to be doing anything out of the ordinary. It’s also crucial to regulate the publishers that join your network. It’s your integrity as well as your advertisers’ at stake, be in charge and lay down the law. Finally, participate in removing these publishers actively as well as educating your advertisers about the pitfalls of pay for performance (i.e. Don’t allow incentivized traffic on lead generation offers).

My trans-Atlantic encounter with HBR ultimately reminded me that pay for performance is flawed – a dilemma that echoes across all industries. For those of us in performance-based online marking, particularly affiliate marketing, it should be clear that pay for performance with integrity is always better, albeit difficult to execute, and therein lies the differentiating factor for the best networks.

In Response to;Are Ad Networks Dying; article on iMediaconnect

Ad Networks are not only alive; we’re thriving and evolving along with the ever changing interactive space. For successful performance based marketers there are certainly additional sensitivities that networks must consider which may have been ignored in the past. The adoption of performance based marketing by larger brands has cast a spotlight on the industry as a whole, and this is good. No longer can networks remain “blind” to advertisers. No longer can we demand payment on pixels firing. We’re at a tipping point where those networks that survive will continue to cater to global advertisers that seek much needed hand holding, and networks must acquiesce and service these brands. Those that ignore the needs and wants of larger advertisers will suffer. Agencies will only add networks to a media plan if they’re confident that their partner can service an account with the level of integrity and service they promise their client. The “net-net” is that the model works. Especially with our declining economic climate, “pay for performance” is highly appealing.