Why The Traditional Advertising Agency Model Is Broken
This is a guest post by Ad Hustler
Not long ago “Traditional Advertising Agencies” ruled the advertising landscape. Companies would hire these traditional agencies as their “agencies of record” and the agency would put together their media plans, do their creative work and negotiate their media buys. Advertising agencies would do all of this for a 15% commission of the monthly media buys. To give you insight as to how traditional advertising agencies make money here is a little tidbit of info.
Most traditional media sources have 2 prices. The net price and the gross price. Traditional media is supposed to give advertising agencies the net price and advertisers asking for pricing directly from the media source are supposed to be given the gross price. The difference between net and gross pricing is 15% and that is the agency profit margin.
The problem with this model is that the ad agency and the advertiser do not have their interests aligned. In order for the agency to make more profit, they have to push more advertising on their client. They have to encourage the client to spend more whether or not that advertising is actually effective. If they don’t encourage their client to spend more money, they aren’t acting in their own self interest as an ad agency.
Affiliate Networks & Affiliate marketers already see the future. The reason that the model works so well and is so efficient is that everyone’s interests are aligned.
Advertisers make more money when Affiliate Networks make more money.
Affiliate Networks make more money when Affiliates make more money.
Affiliates make more money when everyone else makes more money.
No 1 party makes more money without all of the others benefiting as well. The model works because interests are aligned.
FTC Publishes Final Guides Governing Endorsements & Testimonials
Posted today on the FTC website:
http://www.ftc.gov/opa/2009/10/endortest.shtm
If you know anything about the Acai Berry or the Google Bizops going around then you will know that most of the landing pages that affiliates are creating have several testimonials included. Here are some exerpts from the new amendment to these rules. These were last updated in 1980!
Under the revised Guides, advertisements that feature a consumer and convey his or her experience with a product or service as typical when that is not the case will be required to clearly disclose the results that consumers can generally expect. In contrast to the 1980 version of the Guides – which allowed advertisers to describe unusual results in a testimonial as long as they included a disclaimer such as “results not typical” – the revised Guides no longer contain this safe harbor.
Also this:
both advertisers and endorsers may be liable for false or unsubstantiated claims made in an endorsement – or for failure to disclose material connections between the advertiser and endorsers.
Do we have to state that we get a commission per sale of a product? This can be very interesting. Will we now hear Oprah say “Acai Berry X paid me $1 Million to tell you their product ROCKS!” ???
Top 5 September Posts
Well… Its October 1st now so I thought I would get this out to you right away :)
Here are the top 5 posts in September.
- 40 Minute Video on Niche Research- Once again… This is a hot hot video. I frequently get told about how people are refered to this video by their affiliate managers. This is an EPIC video! It’s a great video that covers some very basic techniques in researching your niche before you jump in to it. Watch it… and please leave a comment!
- CPA Offer Search- This is a new one to the top post list. It’s actually not a post but a tool for searching CPA offers. Here you can compare different offers in the same niche. There are currently over 25,000 different offers that can be search with this nifty little tool!
- Check out Revolution 202 Right Now- This is a post I wouldn’t have expected to make the list. But it did. With a couple thousand visitors too… I was surprised. Anyways, this post is short and just explains how the Tracking202 team has started their own CPA network. Not only do they provide you with quality tools to use in your marketing efforts, but now they provide you with a place to find offers.
- 9 Marketing Methods- I think this is the only post from September that made the list. This was posted on 9/9/2009 so I had to play on the 9s theme and post 9 different methods for marketing. This post very briefly touches on PPC, SEO, Media Buying, Social Marketing, and more.
- The Landing Page Example-Just a simple little example of a very basic landing page. This isn’t rocket science, but you can get an idea of some of the landing pages that I use and have success with. The biggest contributor to this post is 5 star affiliates. Thank you Linda for sending people to the blog :)
My Interview with Clickbooth!
9 marketing methods
In homage to the date today (9/9/09) I am going to post 9 of my favorite marketing methods. This list is in no particular order. I even threw in a little about offline marketing for your CPA offers. Who knows… Maybe I’ll even take some time over the next week to explain some of these methods for marketing.
- Pay Per Click- This is the most widely known method for Internet marketing. It is super easy to jump onto Google, Yahoo, or Bing, and create an advertisment. There are other networks that you can use as well. Don’t just stick with the big three. One of my most profitable campaigns ever came from a second tier search engine.
- Media Buying- You may or may not have heard of Media Buying before. It’s where you advertise banners on other websites, blogs, or forums. This can be one of the most profitable forms of advertising that I have ever seen. It can also kill your bank account if you don’t do it right. They key (as with any advertising) is to match a sites demographic with the banner you want to place.
- Social Networking- I’m sure we all have a facebook or myspace account. What about a twitter account? Anytime you can use your “friends” to make a quick buck you should give it a shot. Leveraging the power of the social networks can be very beneficial to your long term success. It’s all about the power of the “word”… word of mouth that is. What are other people saying about you?
- Mass Mailing- Not the spammy type of messages. I’m talking about building your own list. Or even renting a list from someone who has done the leg work for you. Of course it will be more profitable if you build the list yourself, however, you can always make money from someone elses list. Building a relationship with the reader is the #1 way to get them to buy what your selling!
Top 5 August Posts
Hey guys and gals. I totally forgot to share up the top posts for June and July so I’m going to jump in and do the August ones right now. The last set of tops posts was shared in June for the top 5 May posts. So with out further adieu… Here are the tops posts in August.
- 40 Minute Video on Niche Research- I get more comments via email about this one video. It suprised me how many people didn’t know about Google Insight. I’m also amazed at the lack of using Google Sponsored Search. It’s a great video that covers some very basic techniques in researching your niche before you jump in to it. Watch it… and please leave a comment!
- The Famous Question- In all honesty I didn’t remember this post… Until I read it. I still get asked the question posed in this post. Now that I remember this exists… I’m going to begin referring people to read it when they ask the question. The main point of this post can really help you grow your business 10 fold.
- $25,000 drawing – What would you buy if you won?- This is the only post actually written in august that made this top 5 posts list. Here I was giving some information on a contest we are running with Karaktr Media for $25,000. Everyone can win. This isn’t one of those contests that is slanted towards the “biggest fish” in the industry. The great thing about this contest is that the sign-up forum is now even shorter!
- The Landing Page Example!- This post is always in the top somewhere. This is a very basic example of a landing page. I’ve provided a link to download the actual landing page from within the “Free Reports” section of the blog.





Moving Servers
Just giving you a heads up.
I’ll be moving servers here in the next 2 days. So if the site goes down for a second then it will be back up shortly!
Kris