I was just reading David Hawk’s piece on how affiliate marketing ‘killed itself’, along with some well written critiques by Kieron from UKOffer and Jason from Loquax.

David likens the affiliate channel to a concept called the tragedy of the commons.

Bear with me while I explain the concept, then explain why David is so far wrong.

The tragedy of the commons explains why any shared, finite resource is eventually spoiled by greed.

Imagine an acre of common land, 10 farmers each graze one sheep on it.

Then a farmer adds another sheep.

The greedy farmer has 182% of the grass he had before. The others have 91% of the grass they had before. Because the gain to the individual is greater than the loss to any other individual, the most practical action is for every farmer to just add more sheep.

Until the common land is over-grazed, and all the sheep die.

There’s a version here for the more right-brained

This is where David goes wrong. Affiliates are not fishing in a finite pool for the customers they send to merchants, if that were the case they’d just be parasites.

Good affiliate marketing raises awareness and demand for the merchant, it espouses the benefits of a merchant or a product to new pools of customers and it increases the overall pool. Affiliates can grow a merchant’s business, help speed the launch of new products and services and provide positive incremental ROI.

Price comparison, incentive sites and review sites can switch traffic from one merchant to another. Email marketers, bloggers and social media sites can create buzz around new and innovative products and services. Good content can increase conversion rates. Travel search sites are practically indespensable for the consumer nowadays.

There’s 8 ways and I’ve not had a coffee for over an hour.
The existence of bad apples in the crop doesn’t kill the channel, it just shows the need for better management. Stories like David’s who stopped his affiliate channel and lost almost no sales show me a merchant who failed to motivate and educate their affiliates, or who had a site that didn’t convert, or products that were plain unappealing. No merchant has any ‘right’ to a good affiliate programme unless they work at it, just like no company has any ‘right’ to a good sales force unless they work hard to retain them.

In the nine years I’ve been a full-timer in online marketing, I’ve seen crap advertising, crap email marketing, crap PPC and crap e-commerce sites, but it doesn’t mean any of those channels are dead, it just means there are good and bad practitioners in all walks of life.

So stop tarring everyone with the same brush David and take the effort to find some of the quality in the channel, the crap is easy to find, the quality takes a bit more effort.