Last week I had the opportunity to attend Affiliate Summit East (ASE11) in NYC. (Yes, I did feel the VA quake in Manhattan.) After seeing the influx of affiliate marketers that have set out to promote the penny auction industry, and thanks to being able to win a free pass, I decided I’d check out what the buzz was all about.
I found that contrary to popular belief, not all affiliate marketers promote “scammy” offers, there are legit products out there and I’d say affiliate marketing is actually a really smart way for merchants to promote products because they really don’t have to pay up front, affiliates do it for them.
It’s concerning that many penny auction sites close so shortly after launching. One of the pitfalls is greatly due in part to penny auction sites not understanding how to market, or not having enough money to market their penny auctions.
I’ve learned that affiliate marketing is actually a good way for business owners to get the word out about their products and services. It does comes with a few precautions, merchants really need to keep track of the affiliates and how they are marketing their brand’s product.
Unfortunately, we’ve seen many promote penny auction sites in ways that are dishonest. Some don’t care if they employ tricky tactics such as not clearly disclosed rebels or trial offers that claim to be free but really aren’t. Make sure your marketing is FTC compliant and you monitor how your affiliates are marketing. A fake consumer review site and spamming comments, e-mail is not cool and may violate laws such as CAN-SPAM.
While I was at the conference I had the pleasure of meeting Mike Kolb, founder of Sellmoo.com, and his business partner Steve. I also had the chance to meet with other penny auction site owners, which I’ll cover in upcoming posts.
Steve & Mike, we met at Starbuck
I interviewed SellMoo back in November of 2009 when Mike launched the site, that was back when penny auctions really were only about a year old. I’m pretty impressed to see that SellMoo is back in the running after being down for a period, despite the 150+ penny auction sites that have shut down and aren’t coming back.
I enjoyed discussing the penny auction industry and Sellmoo.com with both Steve and Mike.
An updated interview was definitely in order!
Penny Auction Watch: You launched back in November of 2009, but you were down for a little while for improvements, right?
Mike/SellMoo: Correct, we launched Nov 2009 and ran into quite a few problems and were up and down for a few months after that, we managed to iron most things out by early 2010 and we launched our new site mid this year.
It hasn’t been easy, we didn’t have the advantage of deep pocket/venture financing like some of the larger sites (some of which no longer exist).
Like any business, maintaining a good relationship with existing customers is crucial. But even more so than a typical business, acquiring new customers is especially critical. One pitfall most of the 150+ closed auctions fell into, is not accounting all the moving parts involved with penny auctions.
Getting people to your site is one thing, but managing orders, customer service, employees, social media accounts, developing new features, as well as making sure your server technology is a step ahead to avoid down time are some of the things you will deal with on a weekly basis.
PAW: You’re definitely right about that, glad to see you’re back up now! Based on your experience, do you any tips for bidders or site owners?
SM: The only thing I can add for potential or existing site owners is this is not a business to make a quick buck, as for bidding advise, that’s what PAW is for!
PAW: You still have relatively cheap bids, right? When you first launched they were $0.50/each, what are they now?
SM: Our bids are now $0.60.
PAW: What type of items do you currently offer and do you have any other types of items in mind for the future?
SM: We offer items from $25 gift cards all the way up to iPads. We plan to add more high ticket items as we grow including vacation and experience packages.
PAW: I’ve heard good things about SellMoo’s new buy it now option from bidders, can you tell us more about this feature? (Buy it now is definitely a favorite feature of mine.)
SM: With our buy it now, we apply the full value of your bids placed towards purchasing the item.
PAW: Since I met you at ASE11 I know you’re committed to growing your site, a huge mistake that new penny auction startups make is that they fail to really invest time and money into marketing their site. What got you interested in promoting Sellmoo this way? Steve helped you with this, right?
SM: I brought in my partner and marketing director, Steve, in June for his background in internet marketing. Steve’s focus is managing our advertising campaigns and relationships. Since then we have launched our new site and expanded our customer base tremendously. Our goal is to grow Sellmoo into one of the top names in the penny auction world while still maintaining quality.
Thanks guys, it was a pleasure to meet you!
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