Research Question 1
How do content providers perceive advantages and disadvantages of affiliate marketing compared to other forms of online advertising?
Interviewee considers easiness of use as a main advantage of affiliate marketing. He claims that one only needs a computer and internet connection - there is no capital needed to start with one's own business.
Affiliate marketing also enables earning higher revenue than displaying ads of advertising networks. The difference is so significant that it is beneficial for content provider to pay for contextual ads at such networks in order to attract visitors to his websites and display affiliate marketing ads there.
Further advantage is good tracking, which enables determining very precisely visitors' behavior at the website and after leaving the website. Thanks to this, the interviewee can modify his website to achieve higher conversion rate.
He also values low switching costs and no obligations - when a program does not perform as expected, switching is very easy especially due to the large amount of available affiliate programs in the financial sector, which is his main domain.
On the other hand, there are several disadvantages of affiliate marketing. Deception is claimed to be the worst one. According to the interviewee, it is very easy to cheat on content providers, as they don't have any control over the fact whether a sale was made or not. Interviewee should be paid for every lead that he generates through his financial websites. However, in some cases the leads are not accepted by merchants, who claim that the customer, who filled in application for a specific product, was not interested in it.
Some affiliate networks unfortunately do not help content providers with this issue, because they are too afraid to lose the merchant. Moreover, affiliate networks do not have more control over the merchants that content providers themselves do. When leads are rejected by the merchant, it results in financial loses, because content provider still has to pay for visitors coming to his websites from advertising networks.
Especially in the financial sector, interviewee claims that payment certainty is very low. Apart from possible deception or lead rejections, it is also not uncommon that a merchant goes out of business.
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