CS28310CS28310

International TradingInternational Trading

The OpportunityThe Opportunity

Level Playing GroundLevel Playing Ground– SME looks like Multi-NationalSME looks like Multi-National

Vast MarketsVast Markets– GlobalGlobal

Speed to MarketSpeed to Market– Used to be yearsUsed to be years– Now monthsNow months

PitfallsPitfalls

PaymentsPayments– Not all companies want to use credit cardsNot all companies want to use credit cards– Banking ArrangementsBanking Arrangements– Exchange rate variationsExchange rate variations– EscrowEscrow

Cost of TransportationCost of Transportation– Can get high. Sea cheaper than air.Can get high. Sea cheaper than air.– RiskyRisky

AgentsAgents

If in existenceIf in existence– Keep or removeKeep or remove

KeepKeep– Local knowledgeLocal knowledge– Local customsLocal customs

RemoveRemove– They may work against youThey may work against you– CheaperCheaper

ExportingExporting

Do you know about?Do you know about?– Local taxesLocal taxes– Local lawsLocal laws– LanguageLanguage– Local trading practicesLocal trading practices

Some gaffesSome gaffes

When Kentucky Fried Chicken entered the When Kentucky Fried Chicken entered the Chinese market, to their horror they Chinese market, to their horror they discovered that their slogan "finger lickin' discovered that their slogan "finger lickin' good" came out as "eat your fingers off”.good" came out as "eat your fingers off”.

Clairol introduced the "Mist Stick“, a curling Clairol introduced the "Mist Stick“, a curling iron, into Germany only to find out that iron, into Germany only to find out that "mist" is slang for manure."mist" is slang for manure.

Cultural DifferencesCultural Differences

LanguageLanguage– The world speaks more than one language!!The world speaks more than one language!!– Use of first namesUse of first names– Use of “you” versus old English “thou”Use of “you” versus old English “thou”– Use of titles – Mr, Doctor, Engineer etcUse of titles – Mr, Doctor, Engineer etc

ReligionReligion– Really need to learn to respect differencesReally need to learn to respect differences– Dress codes (especially for women)Dress codes (especially for women)

Good mannersGood manners– Shaking hands, bowing, dress codesShaking hands, bowing, dress codes– Eating and drinkingEating and drinking– Business cardsBusiness cards

Visit UK Government web sites for Visit UK Government web sites for informationinformation

CS28310CS28310

Affiliate programsAffiliate programs

AdvertisementsAdvertisements AdsenseAdsense Affiliate ProgramsAffiliate Programs

Affiliate ProgramsAffiliate Programs

Two LevelsTwo Levels Main Supplier - MerchantMain Supplier - Merchant

– E.g. Amazon (started affiliates in 1996)E.g. Amazon (started affiliates in 1996)– Pays, say, 15%Pays, say, 15%

AffiliateAffiliate– Small web site owner (One of 900,000)Small web site owner (One of 900,000)– Places special link to AmazonPlaces special link to Amazon– 40% of sales through affiliates and 340% of sales through affiliates and 3 rdrd party party

sellerssellers

PaymentsPayments

Pay-per-salePay-per-sale– Here the merchant site pays an affiliate when the affiliate sends Here the merchant site pays an affiliate when the affiliate sends

them a customer who buys something. them a customer who buys something. Some pay-per-sale schemes pay on a percentage of the sale and Some pay-per-sale schemes pay on a percentage of the sale and

others pay a fixed amount per saleothers pay a fixed amount per sale

Pay-per-leadPay-per-lead– These programs pay the affiliate based on the number of visitors These programs pay the affiliate based on the number of visitors

they refer who sign up as leads they refer who sign up as leads i.e. the visitor fills out some requested information using a form at the i.e. the visitor fills out some requested information using a form at the

merchant site, which may then be used as a sales lead merchant site, which may then be used as a sales lead

BenefitsBenefits

Merchant gets higher trafficMerchant gets higher traffic Affiliate gets payment for running siteAffiliate gets payment for running site

All relationships require management All relationships require management systems…systems…

ManagementManagement

How many people clicked on the advertising How many people clicked on the advertising link to the merchant’s sitelink to the merchant’s site

How many people bought something on the How many people bought something on the merchant’s sitemerchant’s site

How many people saw the advertising link How many people saw the advertising link on the affiliate site on the affiliate site

SystemsSystems

Merchant run affiliate programMerchant run affiliate program– AmazonAmazon

Affiliate networkAffiliate network– Commission Junction

Checks 1Checks 1

The company (merchant)The company (merchant)– Are they reputable and financially sound?Are they reputable and financially sound?– Do they offer assistance with promotion? Do they offer assistance with promotion? – Will you get paid? Will you get paid?

Compatibility with your site Compatibility with your site – – – Do the products/services match the content of your siteDo the products/services match the content of your site– Will your visitors be interested in them? Will your visitors be interested in them?

Opportunity for earningsOpportunity for earnings– Difficult to earn reasonable revenue from one-time purchasesDifficult to earn reasonable revenue from one-time purchases– Earn commission from your referred customers on an ongoing Earn commission from your referred customers on an ongoing

basis is more profitablebasis is more profitable

Checks 2Checks 2

Commission structureCommission structure– Compare different programs/commission structures. Compare different programs/commission structures. – Also check the frequency of paymentAlso check the frequency of payment– Minimum commission you have to earn before you Minimum commission you have to earn before you

receive a payment; receive a payment;

Free to join Free to join – – – it is usually free to join most programs so be wary any it is usually free to join most programs so be wary any

that charge a fee, many of these are scamthat charge a fee, many of these are scam

FinallyFinally

Revenue Revenue – 5% - 15% books5% - 15% books– 5% - 7% electronics5% - 7% electronics– Some as low as 1% Some as low as 1% !!!!– Credit Cards best – fixed feeCredit Cards best – fixed fee

Too many affiliates per site may be messyToo many affiliates per site may be messy Concentrate on VisitorsConcentrate on Visitors