B10WH

I realize that almost everyone who’s maintaining a successful affiliate program would decide that the author of this article has lost his mind or just don’t know what he’s talking about, when they read its main thesis. But I’ll take this risk. In brief, my suggestion to online merchants is to destroy their affiliate programs or to fully revamp them. The main objective of such a destructive activity is to significantly increase the search engine rankings, website PR and visibility. And of course to reach higher conversion rate. Let me explain why do I make such a “crazy suggestion”.

The Search Engines (SE) use different methods to determine if any website page has to be displayed in the search engine results pages (SERP), on particular search term. Most site owners know that the linking method was (and actually still is) one of the main factors for the SE algorithms to categorize any web page as relevant to certain keywords and phrases.

A few years ago, when everyone, from a junior marketer to a representative of an entity that has a large marketing budget, decided that they should be buying ton’s of links in order to spam the SE algorithms, the search machines changed the way they rank websites. Now those who buy links to get ranked high, have a questionable success, and the results they achieve do not afford the money spent on this SEO method.

At the same time, organic inbound links to any website are priceless when they are placed as a part of the content published on a high traffic host website, which is an opinion leader in its niche. Now let’s see how does any average affiliate URL looks like, and to find out why the affiliate URL’s work worst than the organic ones.

Why affiliate URL’s harm any website’s visibility?

Affiliate links are artificial. As we know they are aimed to count the visits any affiliate send to the provider’s web pages. However this commercial relationship between two agents has nothing to do with any third parties. So, the affiliate URLs are important only for the commercial relationship between sellers and their partners. Anyone else, but seller and affiliate does not need to use affiliate URL’s.

Affiliate URL’s are unnatural and because of this they destroy consumer confidence. That’s why the most prestigious forums and social networking sites (including the Web Hosting Talk, the largest community in web hosting industry) prohibit their members using or posting affiliate links in the threads and posts.

There are different types of affiliate URL’s such as “http://www.the-name-of-the-web-media.com/hosting.php?m=HOSTNAME”, “http://www.the-name-of-the-web-media.com/go/to.cgi?l=pa_01_HOSTNAME” or even “http://www.a-combination-of-letters-and numbers.com/click-3264231-10356150”. The last example is typical for the URLs’ that affiliate networks give to their affiliates. As you can see on above examples, none of the URLs is a web address that shows where the users would go if they follow the link.

In many cases most internet users who click on a banner or a text link know where they would go because most sellers display their brand on the ad creatives. But when any website uses affiliate URLs, those who click on them never go to the original, organic web page address. The users are always redirected to the original web address through a URL which is created to track the visit.

Work For The “Productive Visitors”!

The average percentage of “Productive Visitors” of any website (those who buy services or products) is approximately from 1.5% to 2% higher for the group of visitors that come directly to the website, compared to the other, it’s members come from an affiliate URL’s. This data can be seen in the reports of the website visitors behavior. It comes from a DoubleClick survey conducted in 2007.

Let’s imagine that 75% to 85% of the traffic that any website receives comes from such URLs. In such scenario a large amount of website visitors come from non-existing web addresses, ones that do not represent any information and content. These visitors might purchase or not services and products on the host pages. But they don’t work in favor of the website’s Search engine ranking and its overall visibility on the web, the same way the organic URL’s do.

It Is All About Trust!

I would suggest any web hosting company (and any dot-com seller) to create an intelligent web statistics and analytic module, and to integrate it in its affiliate program. This will allow the company to kill the traditional affiliate URLs. It is much better to give your affiliates the original web addresses of the pages where you want to welcome your website visitors. Of course any dot-com business needs to have a credibility, so it would be able to persuade its website users that the Affiliate program it runs works. This also means that while revamping your Affiliate Program, to create a communication strategy which will demonstrate to your partners that it the program counts correctly each unique visitor they send to you.

It is not that hard to create an intelligent statistical module and to add it to your Affiliate program. If you make it, you will increase its relevance and will attract more customers.

Let me first tell B10WH.com readers that I met Peter Langenkamp at HostingCon 2009 where he were attending as exhibitor with his domain registrar company called Realtime Register. I liked the design of their booth. The dutch guys are good in design, I can tell you that. There were another company from Netherlands on the show and their boot was also on of the best in the exhibitors’ hall. The conference finished. I went back home and signed up on of my clients to Realtime Register and they told me they liked the way the company does business. So I decided to ask Peter, the CEO of the company to give me an interview. So here he is.

It was nice meeting you as well! Will we meet again next year in Austin Texas at HostingCon 2010?

Yes, sure. It was good to meet you at HostingCon. However, let me start  with the questions. I’m interested how did you decide to create a domain registrar? This is ugly business and there is huge competition. Why didn’t you create a web host or any other kind of website service provider that would give you a higher profit margins?

Actually we have a hosting company in The Netherlands. We started YourHosting.nl back in 2000. In 2003, we had sold over 30 thousands domains and bought them at different resellers. It was a full time job for two people managing those domains and we were still growing. We decided we needed a different solution. One channel to buy domains from, offering all TLD’s, at competitive prices, with a reliable interface and with API integration options. At the time, we couldn’t find any, so we decided to do it ourselves. That was when the idea for Realtime Register was born. We only buy at registries and sell to resellers. We have automated the whole process, so we can be competitive.

Realtime Register offers excellent prices on COM, NET and ORG domain names. They are €5.03/year for COM and ORG and only €4.03 for .NET. for those resellers who deposit €4,000 on account. The dollars is still poor compared to euro and this means that the best price of COM registration with you is lees than $7.50…? Are sure you aren’t killing yourself with this prices…?

We sell domains in the currency we buy them from at the registry. Our .com domains have a dollar price of $7.19. If you want to pay us in euro’s, we exchange it at the daily exchange rate. Our margins are very low, especially at the most popular TLD’s. It’s the numbers that count for us eventually. Because of our discount system, the best price can be reached only with the larger deposits. That way our resellers can decide their own discounts from day one they start with using our system. Eventually, when the reseller sells more domains, he automatically will need to deposit more and will therefore get a larger discount.

Let me ask you who do you compare to other domain registrars in Netherlands? Who are the main competitors of Realtime Register?

In The Netherlands we don’t have much direct competition. There are mainly hosting companies working with end users, but we consider those our potential customers. We focus on the world. We do have a lot of Dutch resellers of course.

I’ve seen a company called Hostnet.nl to offer a .NL domain registration at promotional price of €2.50/year. Is it usual in the Dutch web market web hosting providers to get accredited as ICANN and SIDN registrars and to underbid the domain market by offering free or very cheap domain names?

The competition in The Netherlands is very tense. Our own hosting company offers .NL domains for just €1.00/year as a promotional price at the moment. The margins are made with the hosting packages sold along with the domains, over the next 2 to 3 years. Dutch hosting companies have not yet taken the step to become ICANN accredited. They are better of buying .com at $7.19 using Realtime Register, it saves them a lot of work, time and money and they can still decide to sell domains under the market prices.

Who can own a .NL domain? Are the individual registrants required to be either a Dutch citizens or permanent residents?

Everybody can own a .NL domain nowadays. SIDN used to require a domicile address in The Netherlands, but they have now changed that.

What about the companies. Should they be a business entities incorporated or certified to do business in Netherlands to register and use .NL web address?

No, there are no requirements like that. Dot-NL has become one of the largest ccTLD’s, because it does not have a lot of requirements anymore.

Let me now ask you what happens when a registrant misses the deadline to renew their domain name prior to its expiration date? Do you impose redemption fee and if yes how much is it?

NL domains have something comparable to a Redemption period, called the quarantine period. It is expensive to get your domain back, the fee for taking a domain out of quarantine is EUR 56.

If any domain is in a redemption how many days has anyone to regain their expired  domain names?

The quarantine period takes 40 days, starting directly after a delete or expiration.

Another question about expired domains. When any web address expires  and the registrant didn’t renew it, what happens to the name. Are you keeping it for another year and trying to send it on aftermarket or just releases it. Most registrars keep it for an year and try resell it. What’s your policy?

We don’t do that at the moment.
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Tell me about your API. Is there anything specific your partner should know when they need to implement an synchronize it with their own websites and CRM’s?

No, we offer an XML API which can be integrated on any platform. We have some php example scripts using that as well. We also have modules for 3rd party software like WHMCS, HostingController and ClientExec.

I’ve seen during the HostingCon on your booth and on your marketing materials that you have associated any of the domain names you offer with a specific building. Liked very much the idea. How did you came up with this one?

That was an idea of one of our design/marketing staff. We were looking for a way to visualize all the different TLD’s, the famous buildings in every country perfectly represent that idea.
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I’ve seen in your blog that you sent a pretty big package with the booth elements to HostingCon. Wasn’t it expensive to send this over the Atlantic to New York and then to DC? Why would you do this to yourself. Is there anythings related with the quality of the booth and design materials. You probably should admit you didn’t trust Americans to design and build the booth ;)

Well, that was a bit of a disaster. We were supposed to have a very high-tech booth, with couches, espresso machines, refrigerators and orange carpet. We have used that before and it was always a great success. But unfortunately, our shipment got stuck at the US Customs. They released it on the afternoon of Wednesday August 12, the closing day of HostingCon. The booth you saw was improvised on Monday, we had some spare materials in our luggage. I’m glad you didn’t notice that.
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And when we said America I’ll ask you is the U.S. market is priority one for you or you count more on Dutch and European site owners?

We are looking at the whole world. The U.S. market is very interesting and also very competitive. We think we stand out because we have a lot of ccTLD’s at very good pricing, compared to US companies.

That’s it. We finished. The last question about plans for the future is always a silly one, so I’ll not ask anything like this. Of course you still should have some plans how to develop the Realtime Register so, don’t be shy and tell me anything that might be helpful for B10WH.com readers.

Thank you for your interest. About the near future… we are going to integrate more and more ccTLD’s in the upcoming months. We are also partnering with 3rd party software to make sure we are integrated with them. Don’t miss out on our SSL pricing as well! You will see more of Realtime Register, count on that! See you in Austin?

The San Francisco’s leading online daily SFGate reported that a federal jury in California has found two web hosting companies and their owner liable for contributing to trademark and copyright infringement for hosting sites selling counterfeit Louis Vuitton goods. The jury assessed damages totaling more than $32 million against web hosts Akanoc Solutions Inc., Managed Solutions Group Inc., and Steven Chen, the owner of the two companies.

In awarding the damages, the jury agreed with Louis Vuitton Malletier S.A.’s claims that the defendants knowingly allowed several websites they hosted to sell products that infringed Louis Vuitton’s copyrights and trademarks.

The U.S. District Court for the Northern District of California is expected to issue a permanent injunction banning the web hosting providers from hosting websites which selling fake Louis Vuitton goods in the future.

California Based Court Paved A Way Web Hosts To Be Sued For Their Customers Conducting Illegal Activities

Attorneys of the Louis Vuitton said that the case is the first successful application on the Internet of the theory of contributory liability for trademark infringement. Under this theory, any companies that know, or should know, that they are enabling illegal activities have an obligation to remedy the situation. Web hosts that fail to do so can be held legally responsible for contributing to the illegal activities.

Lawyers of Mr. Chen, the owner of both web hosting providers had argued that Akanoc Solutions, a company that enable Chinese citizens to launch enterprises in United States and Managed Solutions were protected under the Digital Millennium Copyright Act‘s (DMCA). This is a law that limits the liability of ISPs for activities by its customers that might constitute copyright infringements. The defense lawyers said that Steven Chen and web hosting providers could not be held liable for the actions of websites they hosted but did not directly own or operate.

However the Louis Vuitton lawyers claimed that Steven Chen’s web hosting companies were contributing to the illegal activities conducted by their customers by providing the infrastructure that enabled the sale of counterfeit goods. They further said that web hosting providers had been informed of the activity by Louis Vuitton but refused to implement a policy for removing the offending sites, which was their responsibility.

A New Standard For Trademark Infridgements

The verdict “establishes a standard” for trademark infringement complaints on the Internet. In an interview with Computerworld today Andy Coombs, Louis Vuitton’s counsel said the verdict shows why it’s important for web hosting providers and ISPs to enforce acceptable use policies. “It’s one thing to have these policies, but you’ve got to implement them when given notice of abuse,” said the LV lawyer.

In the above described case, Louis Vuitton showed that it had sent numerous notices to the web hosting companies, but they were ignored or the companies didn’t acte upon expeditiously.

Reactions

The verdict drew mixed reactions. A forums poster who signed the comment as Bret Clark said in a discussion thread among network engineers in the NANOG website, that ISPs and web hosts shall not being held responsible for “policing its customers. “I’m constantly getting called up from scammers trying to [offer] me bogus warranty insurance for cars I don’t own. Does that mean I can sue Verizon because they are letting scammers use their network?”, said the poster.

“Jamie”, another user of the forum said that web hosts cannot ignore notification about one of its customers indulging in possibly illegal activities.

“It’s the first one in an Internet case where a web hosting provider was found liable for trademark infringement for failing to shut down a website after being given notice” of trademark infringing activities, said David Johnson, a lawyer specializing in digital media law in Los Angeles. He called the verdict precedent setting.

Under existing precedent a claimant who is seeking to prove a trademark infringement needs to prove that a defendant intentionally and knowingly enabled another to infringe a trademark. In the above described case, the court was convinced by the evidence presented by Louis Vuitton that the web hosting providers knew about the infringing activity.