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9.7 Advertising Strategies and Promotions 283

users register with vendors and agree to accept advertise- searching the Web with Bing and others. The HitBliss app
ments (see returnpath.com). For example, one of the pays you to watch commercials (but you must pay atten-
authors of this book agreed to receive a number of e-com- tion!). Consumers usually need to show some personal inter-
merce newsletters via e-mail, knowing that some would est in the material viewed and then they receive targeted ads
include ads. This way, the authors of this book, for example, based on their personal interests. Each banner is labeled with
can keep abreast of what is happening in the field. The the amount to be paid if the consumer reads the ad. If inter-
authors also agreed to accept e-mails from certain research ested, the consumer clicks the banner to read it, and after he
companies, newspapers, travel agencies, and more. These or she passes some tests to assure they read the content, the
include ads. The vendors publish and send valuable (and customer is paid for the effort. Readers can sort and choose
usually free) information to us. Note that, some vendors ask what they read, and the advertisers can vary the payments to
permission from consumers to send them other users’ recom- reflect the frequency and enthusiasm of the readers. Payments
mendations, but they do not ask whether they can use histori- may be cash (e.g., 50¢ per banner), credit, or product dis-
cal purchasing data to create the recommendations. counts. This method is used with smartphones, too.

Personalized Ads
Other Advertising Strategies
Since the Internet contains too many irrelevant ads, custom-
Many advertising strategies exist both for wired and wireless ized ads can help. The heart of e-marketing is a customer
advertisement systems. For examples, see www.opentracker. database, which includes registration data and information
net/article/online-advertising-strategies and ultracart.com/ gleaned from site visits. Companies use the one-to-one
resources/articles/ecommerce-advertising. approach to send customized ads to consumers. Using this
feature, a marketing manager can customize display ads
Affiliate Marketing and Advertising based on user profiles.

Affiliate marketing is a type of “performance-based mar- Advertising as a Revenue Model
keting” used mainly as a revenue source for the referring
organization and as a marketing tool for the sellers. Earlier in Many of the dot-com failures from 2000 to 2002 were caused
this chapter, we introduced Google’s AdSense. This is an by a revenue model that contained advertising income as the
example of affiliate marketing. However, the fact that the only or the major revenue source. Many small portals failed,
vendor’s logo is placed on many other websites is free adver- but several large ones are dominating the field: Google,
tising as well. Consider Amazon.com, whose logo can be Facebook, AOL, and Yahoo!. However, even these heavy-
seen on more than one million affiliate sites! Moreover, traffic sites only started to show a significant profit after
CDNow (a subsidiary of Amazon.com) and Amazon.com 2004. Too many websites are competing with limited adver-
both are pioneers in the “get paid to view” or “listen to” com- tising money. Thus, almost all portals are adding other
mercials also used in affiliate marketing. sources of revenue.
However, if careful, a small site can survive by concen-
Affiliate Networks trating on a niche area. For example, NFL Rush (nflrush.
A key to successful affiliate advertising is to have a good com) is doing it well. It generates millions of dollars in
affiliate partner network. An affiliate network is a network advertising and sponsorship fees by concentrating on NFL
created as a marketplace where publishers (affiliates) and fans, mostly kids 6–13 years old. The site attracts millions of
merchants (affiliate programs) can collaborate. Examples of visitors by providing comprehensive and interactive content
affiliate networks are Rakuten LinkShare (linkshare.com) and a chance to win prizes. It directs you to the NFL Shop for
and CJ Affiliate by Conversant (cj.com). For the Top Affiliate each team where sponsors such as Visa and U.S. Bank pay
Marketing Networks of 2016, see mthink.com/best-cps- for the free games and the prize.
affiliate-networks. An important component in a revenue model is the pay-
per- click (PPC) formula.
Ads as a Commodity: Paying People to Watch Ads Pay per click (PPC) is a popular Internet advertising
payment formula where advertisers pay sites only when
In some cases, people are paid by advertisers (money or dis- someone clicks on their ad. Payments are made to search
counts) to view ads (also called “ads as a commodity”). This engines and other sites (e.g., affiliates). For tips on how to
approach is used, for example, at Bing Rewards (get rewards economize the cost of using PPC, see advertise.com/ad-
for watching videos, playing games) at CreationsRewards solutions/contextual/overview.