Personal homepage provider GeoCities signed an agreement with affiliate network Be Free Inc. to let merchants advertise products and services on Web pages set up by GeoCities' 3.4 million members.
Though at least one expert questioned how much money GeoCities' so called homesteaders will see, the program will let homesteaders select online merchants to advertise on their personal sites, in return for which they will receive a commission on any sales they generate.
“If they want to sell vitamins or apparel or flowers or whatever they want, they can do that,” said Bruce J. Zanca, GeoCities vice president of communications. “And what GeoCities will do is manage that relationship with them, so they'll get one check once a quarter.”
Mark Welch, president of Web advertising consultant firm Adbility, Pleasanton, CA, said he questions how frequently individual Web page operators ever make money by joining affiliate programs. Most affiliate pages see very little traffic, and their operators often must generate a minimum “threshold” amount of revenue for a vendor before they get a commission. And if, for example, two separate vendors on an affiliate's site have $100 thresholds, the affiliate usually must surpass the threshold amount for each vendor individually.
“The vast majority of these sites will never get a penny,” Welch said.
Zanca confirmed that a threshold will be in place, though its amount has yet to be determined. He declined to comment on whether homesteaders will have separate threshold totals they must exceed for individual merchants. However, he said affiliates receive other perks, such as product discounts on Amazon.com. Welch added that, in practice, Amazon.com sometimes writes commission checks for sales that fall short of its set threshold amounts.
The program is expected to go live March 1. GeoCities, Marina Del Rey, CA, which hosts more than 29 million pages of personalized content through its homesteaders, will charge retailers a marketing fee for the service. Prominent merchants that currently work with GeoCities include Amazon.com Inc. and CDnow Inc.
Be Free, Boston, will train GeoCities merchants, process payments to affiliates and give reports to both retailers and homesteaders so they can track the effectiveness of their advertising.
“We're going to provide the entire affiliate technology for GeoCities,” said Be Free president/CEO Gordon Hoffstein. The pact marks the first time the two companies have worked together.
Be Free specializes in affiliate networks, which are designed to place ads only on personal Web sites relevant to a particular merchant's products. The company began business in 1997, working primarily on a program for Barnes & Noble Inc. Affiliate networks have about double the response rate of regular banner advertising, which tends to get ignored by long-time Internet users.
GeoCities attracts homesteaders by offering free disk space and publishing tools that Web page builders might need to complete their personal sites. Affiliates aren't allowed to advertise products or services that aren't part of GeoCities' approved programs unless they opt to pay for the company's page-building services.
The company currently is growing at 12,000 new homesteaders a day, and www.geocities.com was the third most trafficked site on the Internet in December with 19 million visitors, according to Media Metrix. Only aol.com and yahoo.com were busier. The company's huge pool of affiliates might also explain why two companies like Amazon and CDnow — which now compete against each other in some areas — both turn to GeoCities for potential customers. The company also sells banner advertising space.
“GeoCities is in the perfect spot,” Welch said. “It's definitely a win for GeoCities all around.”
Be Free's Hoffstein declined to specify terms of the agreement between his firm and GeoCities, saying only that Be Free's income from the pact will be performance-based, partly factoring in revenue generated for GeoCities.
“The more money successful GeoCities is with this program, the more money we make,” Hoffstein said.