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Peter Koning: Hi. This is Peter Koning from Affiliate-Software-Review.com with an exclusive interview with Cecile Estheimer, the Affiliate Sales Coordinator for 1&1 and Christine Skiffington, who is 1&1's Social Media Communications Officer. In this call, we'll explore why the affiliate program is critical to 1&1's growth, how they manage their international affiliates, where theY focus their recruiting efforts to attract more affiliates and the secret ingredient to building an army of 15,000 affiliates in the USA, alone.

 

This interview is part of my "Hosting Affiliates Secrets" series of interviews, which you can find at Affiliate-Software-Review.com. Just sign up for a free subscription today to be instantly alerted when more blog postings are made. Now sit back and enjoy this 23-minute call as I grill Cecile and Christine on their affiliate program management secrets.

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Peter: Hi, It's Peter Koning from Affiliate-Software-Review.com and today I'm excited to be talking with Cecile Estheimer, the Affiliate Sales Coordinator for 1&1, and Christine Skiffington, the Social Media Communications Officer for 1&1. We're going to be talking about 1&1's affiliate program and getting a little deeper into some of the success and challenges that they have managing their huge affiliate program. Welcome to the call, Cecile and Christine.

Cecile Estheimer: Well, thank you.

Peter: Let's get started. I'm curious to learn more about your affiliate program. Can you just give a brief history on it, why you have the affiliate program, and where it is today?

Cecile: Sure. 1&1, as a company, has been in the US for sometime now. The affiliate program itself launched in the US in 2003. We are quite a large program, we have over 15,000 affiliates in the US. In the last year, we paid out more than $40 million in commissions -- now that's global, that's not just the US. We are a rather large program. Our affiliates have actually helped make us become the world's largest web host by known servers.

 

We have the affiliate program in place to help ourselves and also to help the affiliates out there who are looking to make money very easily with our program.

Peter: So how much would you say the affiliate program is now contributing? You mentioned that it has really helped 1&1 grow to the size it has. How much has it helped? Is it bringing in 50 percent of your new customers? Is it more or is it less?

Cecile: To be honest, I don't have that kind of figure. I know it's a very strong component and we are looking to continue aggressively growing the channel. It's a very important channel and a valuable resource for 1&1 Internet Inc.

Peter: OK. So basically, it's giving you a good return on your investment, if you look at it from that point of view.

Cecile: Yes. I would agree with that.

Peter: I was researching a little bit about your program. I was noticing that you allow customers to be affiliates. You also have Commission Junction. I believe there's Commission Junction, and a couple other networks, including Zanox. So I'm just curious, why are you on all these different tracking platforms and how do you manage all your affiliates across all these different platforms? Does it get confusing?

Cecile: Well, a lot of our affiliates... We have a lot of affiliates and we obviously do have them in all four different areas in the internal program as well as Commission Junction, PepperJam and Zanox. We noticed there aren't a lot of affiliates who cross over. So we have a different audience, I would say, for each of those networks. So it doesn't get confusing in that regard. As far as managing, we do have a two-person in-house team for managing the affiliate program. There's myself, the affiliate sales coordinator. We also have Kem Odike, who is the affiliate program manager.

 

So we do have a dedicated team that our sole job is provide support and manage the affiliate programs. So it's a task, but we're up to it.

Peter: OK. Is the main reason that you're in those different networks, is that because you can address different types of affiliates or is there some more technical reason why you happen to have multiple platforms in use?

Cecile: I wouldn't say it's technical. I would say it's more the audience. Commission Junction, obviously, is very well-known. Zanox is also very well-known. It's more international, I would actually say. PepperJam Network brings its own unique services to the table, as well. Which I believe we mention on the affiliate portal, that they have different tools on PepperJam, that perhaps they don't have in CJ or in Zanox. But it's more about the type of affiliate. Just trying to reach out to the broadest range of affiliates possible to bring them in.

Peter: OK. What are some of the unique things about your affiliate program versus other hosting companies that you're competing with?

Cecile: I would say, actually, a personal touch, because we are a two-person team. We really do have the time to dedicate ourselves to being available to our affiliates on a one-on-one basis for many of the affiliates. Where they're Monday through Friday, normal -- Monday through Friday we're available by email, by phone. We actually do have a live chat service that we offer on our website that's quite popular. I would say our personal touch and our availability is quite unique.

Peter: Also, I noticed you have quite a few tools available to the affiliates. You can do free business cards for them.

Cecile: We do. We like to provide a lot of extras and bonuses to make earning money with us as easy as possible. We have the business cards that we offer free. We have an affiliates sales page banner that basically creates a display for the affiliates to put onto their website. We have a domain checker tool -- it's also a widget they can add to their website. So we do offer them quite a bit of tools and benefits.

Peter: Are these tools coming out because they're asking for them? Or are you keeping in touch with what's happening in the industry and bringing them out accordingly? How do you come up with these tools? Because I haven't seen so many tools before. Different hosting programs.

Cecile: I would say it's a mix of both. We are very active with trying to stay active in affiliate marketing. For that reason and others we go to Commission Junction, their events that they have every year. We also go to Affiliate Summit, East and West. We try to keep up with the latest trends. We also do receive feedback from affiliates making requests. "Hey, can you do this? I'd really like to have this function on my website to help promote your program." We look into it. If it's something we can do, we're happy to go ahead and do it for them.

Peter: OK. You mentioned the Affiliate Summits. I, also, was at Affiliate Summit West. I didn't have a chance to meet up with you there, but I'm curious. There aren't too many other hosting companies that are participating, as far as having a booth and I noticed you had a booth. There was maybe one other one that I noticed. What's the reason you go to Affiliate Summit? Do you find that particular show is worthwhile for recruiting affiliates or are you going there for other reasons?

Cecile: Well, recruitment is definitely a high priority when we go to Affiliate Summit. We want to make sure that affiliates out there know who we are and know how easy it is to earn money with our program. Also, it gives us a chance to touch base with some affiliates. If they're already in our program and they're going to be attending the event, it makes it convenient to have one-on-one meetings. To personally talk with them and see how we can help them, since they're going to be at the event anyway.

 

Most of the classes are -- the classes are also a value component. Anybody in the industry knows how important it is to stay current. Going to these events is a great way to see what's hot, what you should be doing, what you shouldn't be doing, and just to learn a lot about the industry as it's going on.

Peter: OK, great, yeah. I think there are some -- there is definitely a buzz, always, at the Affiliate Summits. I've only been to the Affiliate Summit West, and I think all the Affiliate Summits recently have been selling out. It's definitely one of the top affiliate conferences out there. Are there other ones you would recommend to companies that are starting or managing their own affiliate program?

Cecile: I mean, Affiliate Summit is the main one that we focus on. We also do go to the Commission Junction event, which is CJU. That, I believe, takes place in the fall. If you're with Commission Junction, obviously, I think that's a great event to go to. If you're not, obviously not so much. It's a great event also. It's a great way to connect to, specifically, your CJ publishers, your CJ affiliates.

Peter: Are conferences the main way that you recruit affiliates? Could you maybe give a little bit of information on how do you actually recruit affiliates?

Cecile: We do use the conferences as an valuable tool. Otherwise, we do have relationships -- specifically in Commission Junction, we have a relationship with an account manager. They can identify certain, say, groups of affiliates who -- maybe we aren't optimizing them. If they can give us that heads up, then we can reach out to those affiliates and let them know they should be in our program. We usually work together with our networks in a lot of recruiting efforts we do.

Peter: OK. Do you find that there are some other ways that you recruit affiliates? For example, there are all kinds of online directories and other methods, or at least is it mainly the face-to-face at these events?

Cecile: I would say face-to-face and word of mouth. Since we are such a successful program, the word spreads and we have a lot of affiliates. As I mentioned, I believe the number is over 15,000 in the US alone. Since we are global, we do have the global element to our program. We're pretty well-known, so recruitment is a lot of word-of-mouth, and people just know 1&1 as a great brand.

Peter: Right. I'm going to ask Christine a question here. I know you wanted to just be quiet and listen, but I'd like to ask you a question, if you don't mind.

Christine Skiffington: OK.

Peter: I'm curious. How does social media fit in with your overall affiliate strategy? That is kind of blending in two emerging markets, like affiliate marketing and social media. I'm just curious how you view your affiliate program? What sort of things are you doing to either recruit or manage or stay in touch with your affiliates from a social media point of view, if I can put you on the spot? Sorry.

Christine: [laughs] OK. Well, we did just recently start going more in-depth into social media, so we're still working on putting together the optimal mix of how to incorporate the affiliate program fully into our social media efforts. We do publish also information about the affiliate program on our 1&1 blog, which just launched today. We also put information out on Facebook and on Twitter, which is a good way to keep in contact with our affiliates every now and then if they have a quick question or they're -- right away, we respond very quickly through any of our social networks.

 

It's a good way to keep in touch with them that way, if there are quick and easy questions. Also, with urgent news, it's good for our affiliates, also, to hear our most recent news so they can use that to their benefit as well.

Cecile: And if I can add...

Peter: So you see it as making yourself more available to the affiliates through social media, that's one of your main thrusts, it sounds like.

Christine: Yes.

Peter: OK, well on that topic, I'm curious. What sort of affiliates make your best affiliates? There are all kinds of different types of affiliates. There is pay-per-click, there are ones with their own websites, there are review affiliates, there are ones that maybe are offering complimentary products, like maybe graphics designers or whatever. I'm just curious, what are some of the types of affiliates that do well with your services?

Cecile: I would say that the strong ones are a lot of pay-per-click, and also the comparison some of our top affiliates do. Obviously the combination of a comparison website, and they do have a strong pay-per-click element to their own marketing, but I would say those are the two strongest. Also, bloggers. If they have a blog that is relevant to the hosting industry, obviously that helps, but also bloggers, in general, are some of our strongest performers as well.

Peter: And do you have, maybe, any little success stories you could share with us, as far as maybe some new affiliates that really knew nothing or that came from a different business and started becoming quite strong contributors to your affiliate sales?

Cecile: Two of our success stories, as they like to call them, are Commission River and 101 Consulting. They started out, and they really wanted a more personalized touch with their affiliate program. They wanted to be able to get in touch with us through phone, through email. They've gotten very strong in our program. They actually are both in our Commission Junction program -- they started out and they were fairly good performers, but their sales have just taken off since we've gotten in touch with them and managed to have a working relationship.

Peter: It's a lot about the relationships, isn't it?

Cecile: It is. But you can't overestimate how important it is to just have a conversation with an affiliate, to have that access both ways.

Peter: Yeah, I agree. I'm an affiliate for over -- I don't know how many, I'm thinking 100, 150 different vendors, and when I think about the ones that -- where I'm successful and actually enjoyed promoting them, and there is definitely some relationship there. That doesn't mean hounding me every week with a phone call. It's more like -- it's not that -- the ones that are hounding every week I tend to shy away from, but just speaking as an affiliate, I totally agree that the relationship is very important here.

 

Now, one question that I have for you is I've noticed -- I mean, I know that you're also offering 1&1 in different countries, and you have, even, some country top-level domain listing for your website.

Does your affiliate program extend the affiliates in those countries and if they are promoting in those countries, do they then promote the localized version of your website or are they free to promote anyone they want. How do you structure that?

Cecile: Well, as a global company, we do have presences in several different countries besides the US. For example, Spain, UK. Each of those countries actually have their own affiliate program that is for their own -- 1&1 UK, 1&1 Spain. They would be considered separate companies, and so they're a separate affiliate program. If you're an international affiliate, you're more than welcome to join the US program and you're more than welcome to direct traffic to 1and1.com and anything with going to 1and1.com, would be considered part of the US program, even if you're international. But, for those countries that we do have presences, that we do have companies in those countries, there are separate affiliate programs for them.

Peter: OK. And are they also run on all the platforms that you list on your site or are they on different platforms?

Cecile: It's a variety. It's a variety depending on the different country. I don't believe PepperJam is anywhere but the US, but I think Commission Junction is, and Zanox, I believe also is in other countries.

Peter: OK. That answers that. I was also wondering about reselling versus affiliate programs because I found on your site you have strategic partners, but that's more strategic. Those aren't really resellers like [indecipherable 16:58] and various strategic partners that are in different industries. Then, you have your affiliate program is quite prominent on your side. It has fantastic support pages. Everybody should really check those out.

 

Then, what about resellers? Do you have some sort of intermediate program where you offer a discount and then they handle the payment and support? Or is it purely just for affiliates and strategic partners that you work with?

Cecile: It's purely just the strategic partnerships and the affiliates, 1&1 does not have a reseller program.

Peter: Did you have a reseller program at any time?

Cecile: Not to my knowledge, no.

Peter: Oh, OK. What else can I ask you? You're giving me all these great questions. I'm sorry, all these great answers to my questions. One question I have is about the challenges. As you know, there's a bit of a dark side to affiliate marketing and there's quite a bit of fraud out there with -- I can only imagine with hosting.

 

If possible, I'm sure there's people out there that will find different ways of signing up, and giving their friend the commission and then canceling somehow. I'm just wondering what sort of challenges do you have and then how to you manage to keep the fraud to a minimum?

Cecile: Obviously, there's going to be fraud in affiliate programs, unfortunately. It's just an unfortunate fact. We do have a longer, than some, company correction period. We don't pay out until after 60 days, so that does allow our internal systems to weed out some of that fraud and keep it to a minimum. The other challenge; we have very successful pay-per-click affiliates, as I mentioned. They're one of our top-performing groups of affiliates. But, one challenge that we face with that is we do not allow brand bidding or direct linking.

 

So, they do well and obviously the majority of the pay-per-click affiliates, we have no problems, but that is one challenge we face is controlling -- monitoring and controlling so that there's no brand bidding or direct linking.

Peter: How do you monitor that? Are there some tools you use or do you have to just [crosstalk] ?

Cecile: Oh, we do have tools that we use. We actually have another member of the team who is our online campaign manager, who has more of a finger on the pulse of what's going on there. Also, just when we review affiliate sites, if we notice that something is going on, we can check and see if our suspicions are confirmed.

Peter: OK. It sounds, basically, you're just trying to stay on top of it, and you try and make it so that these people that are trying all the little tricks, that it's not worth it for them to go on with you. They'll move on somewhere else, right? They can't make it if you set the threshold high enough that it's just not worth it.

Cecile: Right, because so many of our affiliates who are successful use pay-per-click and use it well. There are no issues for the majority of them, but every once in a while, if something happens, we are able to find it and identify it, and correct the problem quickly.

Peter: OK. One other question I had was on a daily basis. Well, what's a typical day like for you, as far as managing your affiliates? Is it more reacting? Is it proactive, you're calling out to them? Or a mix of both? What sort of support are you typically giving the affiliates on a daily basis?

Cecile: I would say it's a mix of both. Obviously, affiliate questions come in by phone, by email and by live chat on a daily basis, every day. There's a lot of reacting to those questions that come in. But then, we also like to reach out to our affiliates and review their websites, see if we like how they're promoting us, or see if we have any way that we could optimize it. We reach out to them, then, and say, "Hey, we noticed that you don't have our current offer, " for an example. "You might want to change that because that might be hurting your conversion rates if you don't have our current offer."

 

I would say it's a mix of both reacting to the questions and concerns that come in, and also reaching out to help them succeed.

Peter: Are you also active in any of the affiliate forums? I'm thinking of ABestWeb and some other ones?

Cecile: I poked my head in a few times, but I'm more of a lurker, just reading them more than posting.

Peter: Right. They also have channels that you can set up as a merchant, right? If you're managing your own affiliate program, they do have that option. I don't think I've seen too many hosting companies in there, setting that up.

Cecile: Right. That's not something that we've explored.

Peter: Yeah. I don't know if there's that many hosting affiliates. I'm sure there's hosting affiliates that refer to that forum, but it seems to be a lot of physical products, apparel and clothing-related discussions. Maybe it's just there's not a big enough community there for hosting services.

Cecile: Yeah, I'm not sure. Hosting is unique in its industry. It's a little different than the retail affiliates, clothing, etc.

Peter: Right. I wanted to thank you both for this call, and I'll try to get this up on the blog as soon as possible. [music]

Peter: I look forward to getting the word out to the affiliate community about your program. Kudos for taking such an active role in managing it, because it sounds like that's really been the key to success -- to stay on top of it, and keep building those relationships with your affiliates.

Cecile: Well, thank you.

Peter: I hope you enjoyed this interview. To discover how you can profit as a 1&1 Affiliate, simply visit 1and1affiliate.com. That's 1and1affiliate.com. To receive instant alerts when more interviews like this are available, and to get valuable industry tips and strategies on affiliate marketing, please sign up to my free, affiliate industry newsletter at affiliate-software-review.com.

 

Thanks. Talk to you later.