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Affiliate Marketing Pitfall

Posted on Wednesday, Nov 2nd 2005

Affiliate marketing has been a popular marketing mechanism online for almost a decade now.

These days, however, in the age of Google Adwords and Yahoo Overture, be careful about your Affiliate marketing strategy. It is likely that between you and your affiliates, you are bidding up keywords for the same search terms, making none other than Google richer, and increasing unnecessarily, the marketing cost of your own channel.

I have been seeing this phenomenon in some of my recent online marketing clients, and it made me wonder how long it would take for the merchants who are heavy online ad spenders to figure this inefficiency out, resolve the channel conflicts, and finally, the question that is the MOST interesting: how much revenue would Google be losing from the resolution of this anomaly?

Today, Google is reaping the benefits of ineficiency and lack of knowledge in the market. But SEM optimization tools are gaining in momentum. When does the double and triple counting stop?

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