Free Gift Card Marketing | CPA arbitrage

This CPA arbitrage method has been around since I first used the Internet in the 1990s, except it wasn’t as developed as it is right now. This method is used to build lists of audience categorized based on detailed demographics, pushing the prospects through marketing funnels before they end up on a highly targeted mailing list.

I’ll explain it with an example so that it will be easier to understand because we all have seen this example. It’s the “free Walmart gift card” email that we all received in our junk mail folders. This free gift card is offered by many marketers trying to build a list of a special kind of audience. I’ll explain this in a sec, just bare with me a little.

The funnel goes like this:

An offer of a free Walmart gift card that appeals to a wide range of audience. The marketers hire CPA affiliates to get their offer in front of as many people as humanly possible. The value of the card ranges depending on who they want to target. Usually $50-100 gift card is used if they want to target realistic audience who will immediately spot the fraud in a $1000 gift card offer.
When a prospect responds to the ad they are asked an easy question that could be answered by selecting from multiple choices. This question is used as a shopping behavior classifier.

The prospect is then taken to a landing page that congratulates him/her for entering to get a free gift card and the landing page goes over the many “free” offers that could be filled by the participant in order to qualify for a free $50 Walmart gift card.
Usually the offers page has other CPA offers that pay anything between $12 and $30 for a free trail lead. Based on which offer the prospect will respond to they are classified according to their shopping interests and behavior.

So right off the bat the CPA arbitrage marketers are making money from those free trial offers on the landing page.
If they don’t respond to any thing they are taken to another set of offers that doesn’t require any credit card info (usually pays around $1-2 per lead).

Now the marketer has a list of people that he knows their demographics because before any cards could be sent to them they need to enter their shipping details. And here comes the interesting part.

The marketer has to deliver on the free gift card promise, or else. The FTC is waiting for any complaint and they will get the marketer no mater where he/she hides.

The offer page always has a fine print somewhere says that it’s a draw and the participants need to qualify for the draw by responding to some free trial offers. So once the prospect is done making the marketer some money already as a commission on generating leads for the free trial offers, they receive a message that they entered the draw advertised on the main free gift card offer page.

Do you remember the qualifier question at the beginning of this process of list building? This qualifier is an indicator of what the prospect might be interested in buying right now. And based on that they will be receiving emails promoting exactly what they expressed interest in. All of the other qualifiers are used to decide what offers to be sent to this particular prospect.

So the marketer built his/her own list using someone else’s offers to finance the list building process. Genius, isn’t it [grin]?

Brand Names Are Taking Over

During the first quarter of 2010 it was obvious that the biggest names in affiliate networks are flirting with brand names. And although these networks are criticizing the Google slap and it’s impact on the affiliate marketing industry, they are doing the same.

Small affiliate marketers are now having their accounts terminated or suspended for low volume. This means that small affiliates are now facing the challenge of either growing into big boys or losing their business. This challenge is time sensitive. And affiliate marketers who are just starting and those who lost their Adword accounts are supposed to find an efficient way to grow their business according to a plan.

The picture is not different on the other side of the coin. Small advertisers are now facing the challenge of being crashed by the big brand names. Some networks,  like hydra, is now moving on this new trend: brand names. If you don’t have a well known brand name your offers are facing the threat of elimination.

Which brings us to the point of this article. Branding is the key to succeed in 2010. And it works for both advertisers and affiliates.

What I expect to see during the rest of 2010 is as follows:

1. Advertisers will be spending more on branding their names. This will open the door for new positions in those small companies that will focus only on media placement and getting their name in front of as many people as they can, for as long as they can. Fly-by-night businesses will be having hard time getting their offers accepted to rotate on big affiliate networks, and as a result scams artists will be very busy finding a way around the new situation.

2. Affiliate marketers will also try to brand their names, or turn their small home “commission-based-sales” businesses into registered marketing companies with their own trademarks. This will put the marketers in a position that they will have to be picky on what to promote in order to maintain a good reputation for their trademarks.

3. The very limited liability of affilaite marketers will be a history due to the new FTC regulations, and the branding trend they have to take in order to succeed.

4. The small affiliate networks that deal with small advertisers will have a lot of work to do due to the increasing demand from the small advertisers who can not, or are not willing to, brand themselves, and due to the termination/suspension of low-volume affiliate marketers by the big networks. It’s pretty obvious that the quality of offers on these networks will be questionable and this will push their affiliates to work hard on protecting their anonymity.

As have been seen before in the offline world, small business will shrink, or be forced to the back alley, while big brands will be expanding. Good for the consumer, good for the super affiliates, good for the affiliate networks either way, and bad for the scam artists. New and low-volume affiliate marketers have to take it seriously from now on.

The “Not So Secret” of Super Affiliates

If you have been around doing affiliate marketing for a while you must have noticed that there are some names that are always at the top of the list of super affiliates. And since you have been around for quite a while you must be at the same time on some of the lists of those super affiliates.

Whenever a new product is about to be released you’ll get emails from those top super affiliates giving you heads up about the new product, warming you up and preparing your mind set to be in the buying mode. And when it’s time for the launch you’ll receive an email (or several ones) telling you about their bonus for you in case you buy through their affiliate link. Sometimes, actually most of the time, the bonuses value is way beyound the commission that you’ll earn from buying that product through your own affiliate link, and difinitely more than what you are going to pay for the actual product.

That makes it look like a better deal for you to buy through the super affiliate’s link than when you buy directly from the seller or through another affiliate link (including your own link if you are allowed to).

And that IS the “not so secret” of the super affilaites. Build a targeted list, keep in contact with your list with bonuses and free information (keep moving the free line), and give incentives for them to buy through your affilaite link.

The real secret though is how to engineer this process. You’ll need to prepare a list building system that is engineered to funnel in a certain demography, subniche … whatever your target is. But first you’ll need to study this market and be aware of the past and the forcasted trends, the products that serve this market, and evaluate your share “to be” from this market and how to get it.

There are resources that will help you with engineering your list building system. In addition to the basics (the hosting, autoresponder or list management system, tracking software etc …) you’ll also need to have at your disposal a stock, or a source of, master resale rights products that you can use as bonuses (in case you don’t have your own products).

If you find this process intimidating it is recommended to get yourself a coach who knows the ins and outs of this business and can hold you accountable for your business building tasks as scheduled.

Unforunately I have too much on my plate to think about coaching, besides I don’t see my previous students doing any good (perhaps because I am not harsh enough or easy going). But don’t hesitate to ask any questions using the comment feature below.

The good news is that there are super affiliates out there who are willing to share with you their secrets, for a fee of course. And those super affiliates are the only ones you can trust in this environment of deceptive misguidance (to rob you off your money and minimize the competition). And at the top of list is Jennifer Ledbetter (aka potpie girl). In her private training she teaches how to use free resources to generate cash as an affiliate. She also teaches how to expand on a successful free campaign into a serious source of income they professionals do.

Her methods are time proven and have been generating cash for me since 2009.

Click here to get a free taste of her training.