Vinny Lingham’s Blog

CJ parent company, Valueclick has just announced that it will acquire Fastclick.

I personally think it’s a brilliant move, as it helps them to consolidate their position in the industry. ValueClick is really coming into it’s own.

However, this latest acquisition opens the door to another question:

Who is going to acquire ValueClick? My best guess is eBay! Why?

1. eBay needs to get into search. ValueClick owns Search123
2. CJ runs eBay’s affiliate programs in many countries.
3. Valueclick offers eBay the media platforms it needs to expand with.

Or maybe I’m just crazy

The cost of rising CPC’s are making a dent in the affiliate world! ROI’s as a result are declining, especially on Search Traffic, which inspired me to take the streets in an effort to convince merchants to provide us with higher commission!

Please distribute freely without modification:

Online marketing is becoming more and more similar to offline shelf space. To draw an analogy:

Currently, if you walk into a supermarket, you will maybe 20 brands of washing powder, all owned by 2 or 3 companies. These companies realise that in order to compete, the more brands that they own, the higher percentage of shelf space they dominate. If for instance, there are 20 slots on the shelf, and Company A has 10 slots with 10 different brands, they effectively will control 50% of the shelf space of that supermarket. By having more shelf space, it is a proven way to increase your market share.

Online is no different!

With over 8 Billion pages already indexed in Google, capturing users interest is becoming more and more difficult. The Internet is growing at a rate faster than the number of new users coming online. This simply means that previously, if you had a hobbies site selling very specialized widgets, and you had 9 competitors, with a potential market of 1 million consumers, within the next few months, your potential market might only grow to 1.1 million consumers, but the number of competitors in your space will grow to 13.

So, previously, you would have had 100,000 potential customers per website, now you’re sitting at about 84,000. Over time, you will be diluted more and more.

Sounds scary, right? Well, there is hope, and planning way in advance definitely helps! Here are potential solutions to the impending doom problem:

1. Build a bigger, better brand - but you will always have leakage, and a declining potential market size.

2. Compete on price - but this will lead to price wars and is not advisable. Compete on value, not price.

3. Deploy new clone websites (highly advisable, we do this for alot of our clients), to increase market prenetration. Mostly white labelled to create unique user experiences. Do NOT use the same content and graphics - this will create an impression of search engine spam.

4. Build a strong affiliate program and catalog feeds to power affiliate portals and distribute your content far and wide through the Internet (for instance, our portal - ThatShoe).

5. Invest in website building software for your affiliate base - eBay & Amazon already offer such solutions.

The number of new websites coming online in recent months is incredible, it’s seriously outpacing the growth in online users. No matter what your business is, you’re going to find yourself competing with more and more websites - if you’re smart, you’ll probably own them!