Say what you’d like about Microsoft Cashback, but they seem to be getting the numbers right…

Microsoft Cashback: The Traffic Needle Is Still Stuck, But The Ads Are Rolling In: “Microsoft is reporting that according to Comscore, Live Search referred 12% of all commercial transactions across the web - a number that is much smaller than Google’s referral share, but one that is also significantly larger than Live Search’s market share, which hovered around 9% during the same period. This makes the Live Search user base very appealing to advertisers, as it shows that they’re more likely to purchase goods than their Google counterparts.”

I’m still not sold on the long term veracity of the program since Microsoft faces two serious challenges to Cashback if it is going to be seen as a reliable income stream: 1) affiliates doing this are smarter, more nimble and will eat into Cashback’s market share little by little every month 2) this won’t get (or sustain) the “Oprah crowd” that makes cashback sites successful because the lack of a community and/or branding for that purpose (I’m not being a Microsoft hater… just saying).

Still, the numbers are impressive. Glad to see Microsoft using Jellyfish for it’s potential and perhaps this will spur more companies into investigating the direct response space as the economy continues to stumble around like a stoned hippy at a Grateful Dead show.

Last week, Mahalo CEO Jason Calacanis announced the search/discovery startup was cutting 10% of its staff (or 6 people) as the economic downturn continues to cause nervousness in Silicon Valley.

It looks as if Mahalo is searching around for revenue channels to accompany the $20 million raised in venture capital funding.

While playing with the new Mahalo interface I noticed that there is now a Mahalo loyalty program that seems to be based on visits alone…

The text on that page reads:

“We track the number of pages people view and reward our most loyal visitors with prizes. We don’t track the specific pages people view.

The number of pages you’ve viewed is right below the search box in the upper right corner of the Mahalo homepage.

If you’d like to opt out of this program, click here.”

While this seems like a novel idea in the Valley, affiliate-minded companies such as UPromise, eBates, Cashbaq, Fatwallet, Microsoft’s JellyFish, iGive, ValueClick’s MeziMedia, etc have been in the loyalty space for years and have come close to perfecting (or at least experimenting enough to find a profitable margin) the loyalty paradigm.

Rather than basing the Mahalo Loyalty program solely on such an easily manipulated metric as visits or pageviews, Calacanis and Co would be wise to look at what these affiliates have done and how the combination of pageviews plus action committed produces a much better result than just pageviews.

Even Microsoft seems to be “getting it” with their Cashback platform (which is actually doing well according to the analytical sites). Of course, Microsoft and the loyalty affiliates rely upon a conversion of a purchase or subscription for success, but Mahalo could very well find paydirt by leveraging a loyalty program composed of its massive amount of content with a developing loyal user base and affiliate programs.

We’ll see how they develop things.

Mahalo Loyalty Program - Mahalo

YouTube has passed Yahoo to become the #2 search engine…

TG Daily - YouTube surpasses Yahoo as world’s #2 search engine: “ComScore’s most U.S. search engine Rankings for August 2008 suggest that YouTube achieves a greater level of search traffic than Yahoo. If you were to consider YouTube’s integrated search a regular search engine, you would have to hand Google the top two spots for search engine traffic. In combination, Google has about four times the search traffic of Yahoo and more than ten times the search traffic of Microsoft’s MSN sites.”

What does this mean for affiliates?

Here are three initial thoughts:

1) Affiliate marketers need to be supplementing content with video (hosted on YouTube).

2) Affiliates need to be making sure that their video endeavors are viewer and keyword friendly. In other words, although it is great to load up your videos with highly sought after terms, you also need to make your video enjoyable, memorable and personable. Are you not that interesting? Hire someone or start reading blogs about marketers using video (like Jim Kukral’s).

3) Think outside the text paradigm and implement (YouTube hosted) video anywhere you can in your affiliate campaigns.

I know affiliate marketers who spend tens of thousands of dollars a day on Yahoo and MSN, which are now behind YouTube in terms of search volume. You might not have thousands of dollars to spend on search, but you do have the time and creativity to make good (and even viral) videos. Be creative and explore. You never know what will catch on.