Chris Johnson: Welcome (back) to Bristol and A4u HQ, Steve. It’s a chance for many A4u readers to learn more about your background. Let’s start with your time before buy.at - how you were led into the affiliate channel?
Steve Brown: “Before buy.at had materialised I worked at KMPG as an accountant. 3 of my 5 years there were with BMW and before my time at KPMG I was a research physicist.
“My time working as a research physicist was the job that introduced me to the internet. I was working at a national physics lab in the UK and we were starting to use the internet and communicate via it in 1994, using whatever the browser was back then – Netscape probably – actively using, viewing and appreciating web pages, all in the name of physics research! You could say I’ve been well versed with the web as during attaining my PhD at Liverpool University in 1989 I had my first e-mail address so effectively I’ve been online for 23 years.”
CJ: And officially in 2003 you launched buy.at – where did the idea come from?
SB: “There were a few catalysts that played a part in the creation of buy.at as an affiliate network. Initially my brother and a few of his friends were looking into a url-shortening business based on Austrian domain names – read.at/myblog buy.at/mysite etc - and these links would then redirect to a geocities or yahoo websites long URL. In a ‘bit.ly-esq’ way, so they were actually quite ahead of the game here!
“That eventually led into affiliate marketing because we started using affiliate networks to grow our userbase for the url-shortening business. I can also relate some of the buy.at conception back to my time at BMW and KPMG – I knew the senior managers at the brands would be horrified at the concept of blind networks and I was also amazed at their pricing structure. We developed our own in-house affiliate technology that morphed into being an open network and we quickly started working with brand-name clients because we were accountable for where their advertising appeared.”
CJ: What do you think the main drivers were for buy.at? What made it so successful as a network?
SB: “We wanted to be honest and treat people the way we expect people should have been treated. We always said affiliates should get paid for commissions on sales they’d reasonably expect to be paid on, likewise merchants should aim to pay out on sales they’d reasonably expect to pay out on, and intellectual property should be respected.
“The first two are self-evident but where intellectual property is concerned, we ensured we would be privy to affiliates’ keywords that they might have been putting into tracking code as an ‘LID’ (unique identifier) – the keyword IP wasn’t ours and thus we couldn’t tell the merchant what keywords were working so we respected people’s commercial and confidential information, but equally we were balanced between affiliates and what their rights were, and for merchants what their rights were. We weren’t too affiliate friendly and weren’t too merchant friendly either. If the affiliate deserved to get paid, the affiliate got paid, whether we took the hit or not.”
CJ: In terms of the big challenges you faced during your time at the height of running buy.at, what were the notable ones?
SB: “It was about how we juggled all the balls, really. Buy.at never missed a payment run and that was incredibly challenging, so getting merchants to approve commissions, to reject sales on a timely basis, plus the addition of occasional tracking issues so to put in commission compensation also on a timely basis was always incredibly challenging. And then the fundamental challenges of building a network from a small number of employees to growing a business of over 60. At times of growing a business you need to ensure you have good people who want to be challenged within your organisation, those who make a really positive contribution to the company and you also have to nurture everybody – so there’s a few of the challenges!
CJ: Why did buy.at grow so successfully?
SB: “Buy.at grew in a number of ways. One reason was that we could win clients from competitors; another way was winning a client who had never utilised affiliate marketing before. The latter was actually easier, so I think all the networks worked well together to grow the industry and move forward affiliate marketing as a positive channel, so I was definitely focused on making sure our slice of the pie whilst all networks were working to ensure the overall ‘affiliate marketing’ channel pie was getting bigger every year.
CJ: Education has always been a discussion topic for a relatively new industry. How did you train the staff that joined you at buy.at?
SB: “There was a lot of investment in senior people in mentoring others within the business. So for example we started off with myself and Paul (Fellows), Malcolm (Cowley) then joined, followed by people such as Warrick (Lambert) and Roz (Fenwick) early on. All of them had an important role in educating the up and coming people within the company.”
CJ: And during your time at buy.at, what would you say was your personal highlight?
SB: “I think looking back I’m really proud that so many of the staff hold prominent places in the UK online industry. We gave buy.at employees a good introduction to online and the workplace, something I’m very proud of.”
CJ: And who inspired you when you were in the industry during the early days of the market?
SB: “In the early days, Tradedoubler and DGM were great businesses, and we wanted to either overtake or capture their market share. We overtook DGM and gave Tradedoubler a run for their money too, with buy.at quickly becoming one of the leading UK affiliate marketing brands.
CJ: With the growing number of UK networks and new solutions – what do you think Networks need to do to differentiate and continue to thrive, if anything?
SB: “I think networks are like any other business and they have to add-value and be seen to be adding value as competition and other solutions for agencies and companies to offer affiliate services increase."
CJ: Moving on, it's over 4 years since the acquisition of buy.at by AOL. What were you doing in your spare time?
SB: “So I left about 3 months after the acquisition [of buy.at by AOL]. Everybody who knows me will know that I had a house renovation project that dragged on a bit too much and I have also done some Angel investing, and some working with entrepreneurs. I very much like Coull as a business, then UK Web Media and ShareMyPlaylists and two further businesses I have spent time with these over the last few years.”
CJ: What makes you decide on a company to invest in? What are your reasons for investing – what do you look for?
SB: “I like an exciting management team and I think if the business has got potential to be big, and it also has potential to achieve an exit, it becomes an attractive proposition to me.”
CJ: Some of your investments are heavy in technology. Coull are very seasoned within the market who are innovating and ShareMyPlaylists are using Spotify’s music technology. Where do you think technology sits within marketing as a whole – how far can you take it?
SB: “All of online is fundamentally underpinned by technology. Pinterest in some ways is a very simple idea, but it’s executed brilliantly, and so it has high technical needs to deliver. I guess the consumer is starting to expect products personalised to them more regularly these days, so if you want to engage the consumer you need some sort of ability to personalise your offering to that person. Therefore technology becomes important to make a process slick, which thus means the underlying technology is very important within the industry at the current day.”
CJ: So you’re hovering back around the market now, you launched Linkdex, described as ‘world class data inside an enterprise seo platform’ – what was Linkdex set up to achieve?
SB: “I initially joined Linkdex as an investor, became an NED, and then following discussions with the founder John Straw I now sit as CEO. John had surrounded himself around good people and has managed to do something very complicated, very well. Matt Roberts and Martin Armstrong are two of the great guys there as well.
“John’s background was that he had a SEO agency around about 2003-2004 that was purchased by another business and ended up being part of LBi. He always had a thought that “If I had this product when I had my own agency, wouldn’t it have been so much better?” – which is where Linkdex came from – providing data to allow people to conduct SEO better. In some ways his initial vision was ‘SEOmoz on steroids’ – and today we’ve taken Linkdex to the enterprise level, selling into the big corporate and large agencies, but also allowing the specialist agencies to utilise it as well. In some ways, it’s very comparable to what affiliate networks were, serving the largest people but also catering for those with a finely-tuned need.
“Overall we’re serving the people in competitive sectors who need good quality data to help them achieve their goals.”
CJ: And what kind of data does Linkdex work with?
SB: “Linkdex provides four sorts of data. One area is quantifiable data – for example how you are performing in natural search. So you might know that you rank #1 on this keyword or over the 500 keywords you’re interested in, you rank on an average of position X. Actually to be able to form a strategy if you work in an agency and take that to an MD or FD of a client they’ll say “that’s nice, but what’s the financial implication of that?” – we quantify the size of a vertical and calculate the worth of the natural search in that vertical, telling you where different players lie within it.
“If you realise you’re at the top of your game then we help you stay there and this is something you’re able to see visually through the platform. If you’re in the chasing pack we can actually show you where you are and then month-on-month you can see your market share improvements. This helps clients to start making ROI decisions on natural search. “As an example of the size of natural search if you consider just 50 verticals in the UK alone, and we look at just generic terms - so for example ‘Car insurance Liverpool’, not looking at terms like ‘Aviva’ or ‘Moneysupermarket’ – for those generic terms, natural search in the UK is a $4bn industry, which is pretty much the same size as paid search – and also no coincidence. We believe businesses should be investing into natural search what they invest in paid search – and that’s why I find Linkdex so exciting.”
CJ: That’s interesting as the paid search model is such a highly utilised model?
SB: “It is, but that’s because it’s understood and quantifiable – that’s one of the keys for the Linkdex product. We’ve got 4 sets of data, the first set is quantifying your position as mentioned earlier. The second is the one we’re probably best known for – very good quality information on who links to who. But the challenge of that is you’re looking at actually what someone has done before to get you competitive advantage. Therefore the 3rd bit of data we’re in the process of launching is ‘who are the influential authors within your sector’ – reaching these authors can get you the first opportunity of them writing about the topic you wish to publicise within your industry. The author identification is massive for us and is attracting a lot of interest.
“The 4th area at Linkdex is an on-site crawl to identify issues with how your site might be structured from an SEO perspective.”
CJ: In terms of the relation to the affiliate marketing landscape – is the insight you can gain from Linkdex similar in their outsets?
SB: “Both industries are about getting traffic to your clients’ sites, and affiliate marketing is very well understood on how you do that – you give someone a CPA, the traffic gets routed and a transaction occurs. In search, clients actually approach agencies or ourselves direct with their objective of getting more traffic to their website – which is very similar to the affiliate channel.
“They need publishers and people who publish content, they need to get the links and the mentions on their sites, and so both SEO and Affiliate are about engaging with publishers. We can give information on publishers that is useful to both channels.”
CJ: If, after Search, Affiliate is next on the list, where will the platform enable you to progress within the channel?
SB: “We have looked at some of the key issues in the affiliate channel, one of which is finding new publishers, and this goes back to the days we started buy.at. We then went out and talked to some of the networks around at the moment, not just your traditional affiliate networks but some of the networks doing Video publishing or more content-focused businesses, asking them what they needed.
“What they and traditional affiliate networks are interested in is not just finding new publishers but good quality publishers, along with access to competitor analysis information. We structured the Linkdex Publisher Discovery product around the responses from those three areas. We know that good quality publishers link to good quality publishers – they form what we call a ‘publisher circle’ and one of the ways that we can use Linkdex to grow the publisher base is to look at the publisher circle and see who’s participating in that circle that you didn’t already know.
“The next area is publishers with an affiliate bent; they’re typically going to link to similar sites – some may be merchants, but some may be news sites in their industry. If you’re in the broadband industry you might link to bbc.co.uk/technology for instance or the superfast broadband help sites that are around. If you look at the link structure of these broadband industry sites you can see whose referring into them and you’ll find publishers who are not actually using affiliate marketing at the moment, resulting in another source of new publishers.
“The third stream is looking at which publishers are sending links through the affiliate networks, keeping a check on ‘do I have the right publishing universe in my network?’ – for example if you’re a retailer in the ecommerce space you can look at what publishers other ecommerce players have, and can also check that the high volume ones are your publishers too. Combining all three of these streams make up the Linkdex Publisher Discovery product.”
CJ: Finally – is there anything that you would have done differently during your time at buy.at?
SB: “That’s a hard question! I mean I’ve been asked it many times before, and the answer is not a lot to be honest! We weren’t the first to market so we had to execute very well to get good market share, something I think we did very well. We focused on the best experience for all our partners and I think buy.at was known, and I think still is, remembered for that ethos.”