Lammo.net: Affiliate Marketing Blog

Can you hear me now? - First of all, my apologies for the silence over the last two weeks. Things have been so manically busy as we approached the end of some major projects that it’s been very difficult to find even 5 minutes to post to the blog. Normal service will be resumed from here on.

Proud to be Fat More and More - No, I’m not talking about my ever-expanding “affiliate belly”, although I do believe there’s a link between the size of your stomach and the size of your commission cheques - All that time sat at your computer writing content and blog posts means both get a little bigger each day.

I’m not going to pretend that I’m a 100% fat affiliate, as over the years I’ve had around 50 “thin” affiliate websites that offer nothing whatsoever of value to the end user, all of which made varying amounts of money. I’ve still got a couple of “thin” sites now, and I do partake in Brand Bidding where allowed (I know, boo! hiss!), but I also know that those are not sustainable revenue streams that I will be able to live off in 5 or 10 years time. And for that reason, I’m also slowly building a couple of “brand” sites and publishing somewhere in the region of 100,000 words of unique content every single month.

The “thin” stuff pays the bills today, and enables me to concentrate my time on the “fat” stuff that will pay the bills for the rest of my life. It’s naive to assume that people will ignore the easy low-hanging fruit that brings in shedloads of short-term money, but it’s also foolish to ignore the benefits of building long-term, sustainable revenue streams. Maintaining a sensible weight is the key to a healthy affiliate lifestyle.

Call me Mr. Chairman More - Two weeks ago, I was a humble affiliate. Now, however I am co-owner of a football club, having invested quite heavily (£35) into Ebbsfleet United Football Club. I’m so pleased to have been asked to form part of the small consortium, and I’m sure I speak for the other 28,249 co-owners in saying that we’re sure this is the start of a very bright era for the football club, and we have complete faith in Head Coach Liam Daish (until we lose a few games, and then we’ll be ready and waiting with the dreaded “poll of confidence”)

Does AM need its own UK Magazine? More - It’s a tough one this - I subscribed to Revenue magazine, but soon found I wasn’t actually reading each issue as it was too US-centric. I’d certainly support anyone who took the risk and published a UK Affiliate Marketing magazine. I’ve known so many publications go bust due to lack of advertising/low circulation/high publishing costs that it’s a hell of a risk. But there hasn’t been a decent read for the UK Affiliate since Internet Works went pop, and the Industry is much bigger now, so perhaps the time is right? I certainly won’t be risking my own money to bring out a publication, but will happily support anyone who does.

Dragons Den looking for Entrepreneurs - If you’re unable to handle constructive criticism and think that your business that earned you £20.79 last year must be worth “about a million”, then why not apply for Series 7 of Dragons Den? The BBC are currently looking for entrepreneurs, and have specifically targeted Internet entrepreneurs this year as some of the biggest investments from last series went to online companies such as Hungry House and Gaming Alerts.

If you’d like to take part, then please email dragonsden@bbc.co.uk call 0870 200 3003 or visit their website for an application form. Will I be taking part? No chance - I’d be far too nervous!

Buy.at coming to Plymouth More - After mucho campaigning, the buy.at team are coming to Plymouth this Friday afternoon for a day of networking and fun. So if you fancy a day on the Sunny south coast, taking in some Clay Pigeon Shooting and an evening of fun with the guys and girls from buy.at (as well as the chance to talk turkey with them of course!), then make sure you email events@buy.at to register (it’s free) before Wednesday to grab your place at this top event.

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A real change from the usual format this week, starting with my usual few minutes of the lovely Nigella Lawson cooking a nice bit of fish in.. urgh! it’s Rick bloomin Stein! Where’s Nigella gone? A large chunk of the Den today was dedicated to some “Where are they now” stories from this series, which in theory is a great idea, as all the invesments are still fresh in your mind.

It doesn’t really work that well for “stories” such as Gaming Alerts. Their “where are they now story” was: They’ve met Theo and picked up the cheque. Erm, and that’s it so far… Why not just cut them, and show someone who’s actually done something since the den?

Anyway, we did have a couple of pitches first, kicking off with Tim Lloyd, who was looking for £150,000 for a 40% stake in his “Tidy Tree Sack” piece of cloth to dispose of your real christmas tree without so much mess. Not a bad idea in itself, but the retail price was as much as a tree itself, and that made it a no-go for the dragons.

We then saw a wide range of board games that didn’t excite the dragons, before Amanda Jones and James Brown (not that one) came up the stairs with ROSS, their reverse-osmosis sanitation system. Designed following a Uni project to investigate problems faced by Water Aid in third world countries, it allows communities to carry water from the nearest source (which is normally a lot closer than the nearest clean source), and it purifies the water as it is pulled along by the turning motion of the wheels. They were looking for a £50,000 investment in return for a 10% stake in the device.

Amanda and James gave a very strong pitch, and dealt with all the questions posed by the dragons very well indeed. Their only potential banana-skin was they didn’t have a working prototype at the time. That didn’t deter James Caan, who had worked in disaster areas like the Kashmir earthquake of 2005, and could instantly see the benefit of quickly sourced clean water. He offered them half the investment, in return for a 10% stake. James’ new buddy Duncan quickly offered to match the offer, so they could have the full £50,000 for a 20% stake. but the three other dragons were still in..

Deborah offered the full £50,000 for a 20% stake, Theo offered the full £50k, but didn’t know what percentage he might like, and finally Peter was also interested, offering them the exact terms they had pitched for - £50,000 for 10%. Theo then engineered a deal whereby all five dragons would invest at that rate, each taking just a 2% stake for £10,000. The deal was done, and Amanda and James walked away with the best deal ever seen in the den - All five dragons, and at the terms initially pitched!

That was the final investment of the series, so let’s have a look at the final investment league table:

1. Theo Paphitis: 6 investments, £457,500
2. James Caan: 6 investments, £345,000
3. Peter Jones: 5 investments, £310,000
4. Deborah Meaden: 6 investments, £242,500
5. Duncan Bannatyne: 4 investments, £185,000

Obviously with all dragons investing at the same level, there’s no positional change in the final week, but we do see that a total of £1.54m was “promised” over the series - I won’t say invested, as we all know that a lot of these deals fall through at the due diligence stage. It’s clear to see who the big guns are though - Theo invested well over twice as much as Duncan who wins the wooden chequebook for this series.

So, the where are they nows.. No real surprises - No-one’s going to appear on National TV and say they’ve failed miserably, so all success stories:

Youdoo Dolls (Deborah invested in episode 2) - Sarah Lu has moved the enterprise out of her back-bedroom into a warehouse, and the dolls are now being made in China rather than by her aunties. Sales have trebled, and Sarah puts it all down to having Deborah on baord.

Gaming Alerts (Theo invested, also in episode 2) - They picked up the cheque. That’s about it.

Cream Cutie (No-one invested in episode 5) - Now selling 12,000 bottles per month. Sales have doubled since getting the investment from a private investor.

Midas Touch (James invested in episode 1) - Now renamed”Gold Genie”, James has persuaded Laben Roomes not to go down the franchise route, and instead to focus on retail, which they’re doing with some success - The products are now being sold in Harrods, and they’re on course to make around £60,000 by the end of the year.

Tangle Teezer (No-one invested in episode 3) - Took Theo’s advice to get a distribution deal, and is now selling 1,000 a week. Seems to have turned into Alan Carr since appearing on the den.

Concentrate (Peter Jones invested in episode 3) - They are working on some new ranges. Not much else given away.

Cuddle Dry (No-one invested, also in episode 3) - They are glad they didn’t accept the offers, and managed to secure the investment privately at a much better rate. They are looking at expanding the range and are on target to meet First Year targets.

Fit Fur Life (James invested in episode 7) - Ordered 200 new treadmills, and fulfilled all existing orders. Currently being trialled by Guide Dogs for the Blind.

Ben the Bin (Theo and Deborah invested in episode 4) - Moved into larger premises and taken on staff. Feels the dragon’s contacts were worth more than the £50,000 cash.

Chocbox (James and Duncan invested in episode 8) - The real success story of the series. Sales have trebled to 3,000,000 per year. They’ve secured their first major retail order of 400,000 units, and there are International deals in the pipeline.

That’s almost it for another year - Don’t forget the Dragons Den Christmas special is on Christmas Day at 8:30pm on BBC2 - there’ll be no update from me on that one though!

Just in case anyone from the BBC is watching this whilst having planning meetings for Series 6, can I make a few suggestions?

• Nigella before the Den works a treat - Rick Stein doesn’t.
• Can we please have a new script for Evan? He uses the same one every week, it’s looking a bit worn by now - “Remember den rules dictate… It is the dragons own money… all think their product will make them millions…”
• Can we please have a swearbox that the dragons have to put money into every time Theo mentions his children’s inheritance?
• And everytime Duncan uses the word ridiculous.
• In fact can we just drop Duncan please?
• And bring back Richard Farleigh?

Merry Christmas Everyone!

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First of all, my apologies for the lateness and brevity of this week’s update - It’s due to a combination of being really busy with the Christmas sales, a dose of Man-flu, and taking the night off to go to a Madness gig. Normal service will be resumed next week..

Thankfully, the dragons ensured that there wasn’t much to write home about anyway, with only the 1 investment this week, a real no-brainer, with James and Duncan investing £75,000 each in return for an initial 36% stake in Chocbox, an electrical connector housing box. The company was already selling in excess of 1,000,000 a year for a GP of £300,000 stablised for the last three years.

The entrepreneur made it clear from the start that he was not after the dragon’s money, but rather their expertise in selling to retail and exporting to take an already successful business to the next level. He even went as far as to offer them a “money-back guarantee” that he would buy their shares back whenever they want for at least the price they paid. Not surprisingly, Duncan and James bit his hand off - Even if they do bu**er all for him, they should still see a very healthy ROI.

As much as that was an easy investment, it was clear that the other pitches were without a doubt ones best avoided, such as Jewellery for single people, magnetic light bulbs (good idea… few teething problems, but silly valuation), secret code clothing range, a high-tech hand dryer (did they watch the Syed from The Apprentice follow-up program?), a stripey ice-cream machine, a portable swimming pool alarm, an elasticated pregnancy support belt and breathable saddle pads for horses.

This is how it’s affected the Investment League table, with just one episode to go…

1. Theo Paphitis: 5 investments, £447,500
2. James Caan: 5 investments, £335,000
3. Peter Jones: 4 investments, £300,000
4. Deborah Meaden: 5 investments, £232,500
5. Duncan Bannatyne: 3 investments, £175,000

New dragon James Caan rises up to second place, leapfrogging Peter Jones. I don’t think Theo will be caught in the final episode, and whilst Duncan Bannatyne is closing in on Deborah Meaden, he may have left it too late to avoid the wooden spoon this series.

It’s interesting to see that next week’s episode will also feature a brief “what happened next” from some of this series’ investments - A great idea while the pitches are still fresh in your mind.

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