Google recently announced an adword rule change that affects affiliate marketers. Is this a good rule change? As an affiliate manager and marketer myself, I see the good in this rule. Here is why.
Keep this fact in mind. The Google ruling affects affiliates that drive visitors direct from AdWords to the Merchant's site. If the affiliate has their own website, this property will remain within the visitors search results and are unaffected by this Google rule change. The rule is based on the Visible URL.
Relevancy for the visitor:
Yes, choice is good, it's the American way. However when one merchant is represented by dozens of affiliate links, this does not give visitors a choice of competing brands. This change enhances relevancy on search, with only the strongest affiliate (or the merchant site itself) being represented, based on their Ad Rank*.
"I think this is fantastic for the end user. It should lead to higher-quality sites being advertised," said David Lewis, president of 77blue, a private-label shopping site provider. "Advertisers are either going to have to build quality sites, or disappear altogether." source: clickz.com
Good news for Merchants:
For the Merchant, this policy may protect their investment in their own search marketing strategy. Why should a merchant compete with it's own affiliates? However, if an affiliate out-optimizes the merchants keyword, they can supersede the Merchant listing. However, most affiliates are not financially equipped or skilled enough to out-gun a merchant's listing.
"Finally, it takes the heat off some parent companies who don't like affiliates competing with them on keywords. Instead of needing to police those affiliates directly, they now have the option of bidding a bit higher, or getting off their duffs and optimizing their ads, or both. Most affiliates won't be able to compete." source: Traffick.com
In other words, affiliates will not significantly cannibalize potential sales from their existing search channel marketing by the merchant.
How does this benefit the affiliates?
For affiliates that create their own web sites or include banners on their eCommunity sites, or use email marketing, this policy will have no affect (even if they use search to attract attention to their sites).
Most "quality" affiliates add value by creating their own website or attracting traffic to their eCommunity. Clearly, this is the intent of affiliate marketing in the eyes of the merchant.
"For those affiliates who actually build their own websites, this policy change does not affect them at all. It's mostly aimed at the types of advertisers who are playing the "Google Cash" game of sending searchers directly from an AdWords listing right to a parent site, with an affiliate code on the URL." source: traffick.com
"Lewis said the move will benefit affiliates who add value to a merchant's marketing program by providing useful information, linking directly to specific, relevant areas of a merchant's site, and investing time in optimizing the message they are conveying." source: clickz.com
In other words, this rule change may help to enhance affiliate marketing, presenting quality web sites and well optimized search programs at the expense of those that play the "Google Cash Game".
* Google Ad Ranking is based on Click Through Rate (CTR) times Max CPC. The more your ad clicks through (effectiveness) and the higher you are "willing" to pay for that click - determines your ad rank.