Commission Junction Affiliate Advertising Review

My company ran its affiliate program through CJ for many years. We recently shut the program down. Originally, we ran the program in-house with moderate success. In 2005 we switched to CJ because of their advertised volume of affiliates, success stories, promises, fantasies and high-gloss veneer that allowed us to overlook the chincy sounding name ""Commission Junction"". We never really recovered from where we were. The problem with CJ is that they let anyone and everyone who has a website, web page, web idea, or hope for someday having a web idea, become an affiliate. These people then blanket-apply to any and all affiliate programs, hoping beyond hope that they will be accepted, and some day if they ever get around to publishing a web page, that someone lost web browser might accidentally click a link they created late at night in a near-comotose state, and buy a million dollars worth of merchandise so that they ""earn"" an 8% commission, and can then waste another 2 years of their lives doing nothing. For every hard-working, legitimate affiliate in CJ, there are 1,000 of these half-effort types. The problem this creates for the affiliate program owner is that every day there are applications from hundreds of would-be affiliates to page through. If you blanket-accept them, your program is buried in noise. If you page through them, you invest 8-12 hours each day to find perhaps one real, serious, qualified affiliate who, over a month, might drive a one or two hundred dollars in revenue to your site. Not a good return on your 8-12 hours. Further, the problem created from your hard-working affiliates is that once you let them into your program (which is the point of your program), they immediately go compete with you on AdWords, syphoning off the traffic on your inexpensive keywords, and driving up your CPC on your remaining traffic! You are not getting their existing traffic to your site, rather they are buying traffic to deliver to your site because they have figured out a nice arbitrage opportunity, where they can buy a click for, say 50 cents, deliver then to your site, and for every 20 visitors on average ($10 cost to them), one will covert to a $75 sale on which they earn a 20% commission, or $15. This is the math they do. But let me point out the obvious, just in case it is missed: you are much better off buying that traffic for $10 ($0.50 per click) than for $15 (CJ commission)! In 2007, disappointed in the CJ performance we considered switching again to Linkshare. Their value added proposition is that they screen all affiliates so that each day you may have only 1-5 affiliates wanting to join your program, but 80% of them are qualified, legitimate affiliates. This was key. However, Linkshare's buy-in price was really quite breathtaking, which is why we nickel-and-dimed ourselves into CJ in the first place. So we sought out the managers of successful Linkshare affiliate programs to do some due diligence, and were pleasantly surprised by the candor with which they shared their experience. What we learned should have been obvious: the affiliate program model was dying. Skipping forward to 2011, if anyone out there is considering starting an affiliate program, don't waste your time. It is one of the lowest ROI investments you can make today. Because of the proprietary tracking URLs engaged today, it gives you NOTHING in terms of incoming links. Absolutely nothing. Our CJ affiliate program, with 5,000 affiliates, was not generating enough in commissions to cover the $500/mo minimum CJ fee. In 2010, we killed the program only to learn that we still had to pay $500/mo for the remaining months on our contract. Which we gladly did, rather than suffer the depressing anaemic experience that is CJ. A year later, with absolutely no negative impact from killing off our affiliate program, our only regret is not having done so earlier. We wasted a lot of money and time from 2005-2010 trying to make CJ work in a dying business model. Today's reality, with the liability caused by affiliate programs creating tax nexus in dozens of states, starting an affiliate program is a bad business decision. If you don't heed this advice and open up that sales tax liability anyway, whatever you do, don't bury yourself in the waste of time that is CJ.

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