Study: Apps and Content Startups Miss Out Because Affiliate Model Is Broken

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Skimlinks, the platform which gives publishers greater control over affiliate links and content monetization, releases some major research today which could well concentrate the minds of online “publishers”, and that includes apps, startups and bloggers.

It’s white paper reveals that while editorial or social websites can point a user towards a product they might go on to buy, publishers rarely receive the financial reward for doing so because of problems with the “Last Click” attribution model used in affiliate marketing. Now, while the study is clearly a ploy to get apps and content publishers to run their affiliate programs through Skimlinks rather than through traditional affiliate platforms, the research itself does bear examination.

The study found that content sites were the first place users read about a product 27% of the time, and were in the first quarter of the user’s path to purchase 36% of the time. And when a user started their journey to a purchase with a content site, she or he was a new customer 55% of the time. However, content sites were the Last Click only 6% of the time and 94% of the time, the content affiliate was NOT awarded the sale. Plus, 65% of the time when a content site is the first click in a purchase journey, sparking purchase intent, another channel is the last click, taking all the credit for the sale.

They also found that content sites drove nearly 30% more new customers to brand sites than the average of all other channels. In addition, when consumers started reading about a product on a content site their desire to purchase grew over time: in this case, 9% of the sales would occur within one hour, 16% within 24 hours and 31% happened within 3 days.

In other words, if online marketers shifted their affiliate strategy away from the Last Click attribution model towards online publishers, apps and social sites, they’d basically get faster and more robust sales.

This would be music to the ears of many social and content sites.

Alicia Navarro, CEO and co-founder of Skimlinks says: “The general view is that better attribution is required – that distributes the cost-per-acquisition across multiple parties responsible for creating and driving purchase intent. By only remunerating the last-click publisher, you create the wrong incentives, and end up with a ton of low-value deal/coupon sites, rather than rich apps and content, who have less incentive to link out to merchants because they don’t get paid for top-of-funnel activity via affiliate marketing.”

Ryan Jones of Shop Direct, where the study was based, points out that it’s a two-way street: “Retailers are probably missing out on exposure as commercially savvy content sites tend to promote the brands they earn more from.”

For the research Skimlinks analyzed data provided by Shop Direct’s ecommerce site, Very.co.uk, which spanned all orders between July and November 2012 that included a click from a Skimlinks content site.

Skimlinks clients include Conde Nast, Gawker, AOL Europe, WordPress, Hearst Digital, Haymarket Consumer Media, Telegraph Media Group, among others.

Skimlinks’ main competitors are the Google-backed VigLink and the seed-backed startup Yieldkit. This year it completed an undisclosed growth financing round led by Greycroft Partners and others.

Wunderlist Pro Gets File Sharing And Business Plan Pricing As Wunderlist Nears 5M Users

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Berlin-based 6Wunderkinder is adding more features to its new Wunderlist Pro paid tier of service today, answering the number one request of its users with the addition of file upload and sharing. Users can add files to tasks and synchronize them across devices and team members for collaboration purposes. That, along with newly introduced pricing plans for Wunderlist Pro aimed at businesses, should help growth of the revenue-driving service skyrocket, says 6Wunderkinder founder and CEO Christian Reber.

“We had large corporations contacting us the first day we launched Wunderlist pro and ask us ‘Can we use this in our business, what can I do to sign up my entire team of 250 people?,’ etc.” he said in an interview. “That was exciting for us but unfortunately we didn’t have the business accounts yet, we didn’t have the dashboard to manage those people.” This change will help them sign on these new customers who have just been waiting for an opportunity to get on the platform.

The changes today aren’t only aimed at business customers big and small, however; Reber says that file sharing is something that should appeal across its user base, and drive up the value perception even for individual Wunderlist users who have been considering the paid option. “We think that files is a feature that everyone wants, and we think that we will see a very high conversion rate of free users to premium users also, because it’s a feature that everyone just asked us to build,” Reber explained.

Reber says they “quadrupled” their own internal expectations for new user growth with the introduction of Wunderlist Pro. The entire user base of nearly 5 million Wunderlist users (including free and paid) is around 29 percent U.S.-based, he said, but 40 percent of the paid customers come from the States. Over 40 percent of paying customers are businesses, too, which is why the business plan rollout is designed to unlock more of that potential market.

Ultimately, 6Wunderkind’s strategy is to become just as essential and widespread a productivity tool as a Dropbox or an Evernote, Reber tells me. Those have validated their business model, he says, though they target a completely different market. The aim is to grow from a simple to-do list to more full-featured collaboration software, while retaining focus on both individuals and business customers, instead of just one or the other.

Reber wasn’t ready to share specifics about conversion rates on Wunderlist Pro just yet, but he says that 6Wunderkinder does plan to be much more transparent about that kind of data with future releases, since it believes there’s value in showing other startups how it’s doing building a business, so expect to see more granular detail about how Wunderlist’s monetization strategy is working out in the near future.

Flea Market App Stuffle Raises Seven-Figure Cash And “Media For Equity” Funding

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Flea market-style mobile apps are both a dime a dozen and refreshingly straightforward. Upload a photo of the item for sale, write a description, set a price, and wait for nearby interested buyers to make a purchase. That level of simplicity and transparency, however, isn’t to be found in Stuffle’s latest funding round.

The German startup, which competes with a host of similar “flea market” apps, including Shpock and Depop in Europe, or Rumgr and Yardsale in the U.S., has raised a “seven-figure” founding round led by Tivola Ventures, and Leverate Media. Nothing out of the ordinary there – an undisclosed funding round is very European.

But where things deviate somewhat from business as usual is that Leverate Media’s involvement consists of what’s being called a “media for equity” deal in which it will provide Stuffle with a media plan and premium advertising worth several million euros, in return for 20 percent of the company.

And while the overall funding amount isn’t being disclosed, beyond that “seven-figure” mention, Tivola Ventures is said to be taking 25 percent equity. It has to be said that it’s unusual for what is otherwise an opaque funding round to break out equity numbers, but, with a mixture of cash and “media equity,” this deal is nothing if not convoluted.

That said, Leverate Media isn’t the only operation to be touting premium advertising reach for a stake in a consumer startup with high-growth potential. London’s Squadron Venture Media offers a similar arrangement (or, alternatively, media buying in return for a future revenue share).

Along with Stuffle’s two new “investors,” existing investors Heiko Hubertz, Tim Schumacher, Mehrdad Piroozram and High- Tech Gr nderfonds also participated in this round.

Commenting in a statement, Sebastian Erasmus, CEO of Leverate Media, said: “We are looking forward to helping Stuffle generate more reach by setting up a media plan. It will specifically address the needs of the young company while delivering long-term and sustainable growth. Together with Morten and his team, the existing investors and of course Tivola Ventures we have found a setup through which Stuffle can realize its growth strategy at an optimum rate. “

When asked, a representative for Stuffle was unable to breakout any further numbers for the app, or be more transparent in terms of the investment figures. What we do know is that prior to this latest round the Hamburg, Germany-based startup had raised 975,000 (~$1.23m). Meanwhile, as of late January this year, Stuffle had been downloaded approximately 147,000 times since it launched the previous May, seeing 75,000 items listed and 12,500 successful sales at a total value of 1.2 million. We’ll update this post if and when we receive updated metrics.

Update: And just like magic, updated stats provided by Stuffle:

Downloads so far: 400,000
Listed items: 275,000
Successful sales: 35,000 with total value of 3.6 million
[Total] Investments (cash and media combined): Over 10 million

Update 2: I’m told that in this latest funding round alone the cash and media combined is worth “more than 2 Million Euro’. So, that means, according to the update above, and including prior disclosed funding, nearly seven million Euros of investment is unaccounted for! Confused? Me too.

Reminder: The London Pitch-Off+Meetup Is Monday

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In preparation for TechCrunch Disrupt Europe I’ve been running around the Continent for more than a month, hitting the Balkans for a huge tour and Warsaw for an amazing meet-up. Now I’m back for a meet up+pitch-off with our own Mike Butcher and the rest of the UK team. Tickets are free so grab yours now.

There will be great networking opportunities, and a battle to the death to see which entrepreneurs can dazzle and excite in under 60 seconds.

PitchOff details:

LONDON INFO HERE

  • Participants interested in competing in the pitch-off will have 60 seconds to explain why their startup is awesome. These products must currently be in stealth or private beta.Application form for London is here or simply enter below.

    ONLY FILL OUT **ONE** APPLICATION.


Office hours details

  • Office Hours are for companies selected for the Pitch-off, these 15 minute 1 on 1 talks will be held on the day of the event. We’ll hear about your company, give feedback, and talk about the best pitch strategy for the 60-second rapid-fire competition. More information on Office Hours will follow in a post on TechCrunch.

Pitch-off winners

  • We will have 3 judges who will decide on the winners of the PitchOff. First place will receive a table in Startup Alley at the upcoming TechCrunch Disrupt Europe in Berlin. Second Place will receive 2 tickets to the upcoming TechCrunch Disrupt. Third Place will receive 1 ticket to the upcoming TechCrunch Disrupt.

Venue in London

  • Ground Floor – CAMPUS LONDON, 4-5 Bonhill Street, London EC2A 4BX
  • Event runs from 3 p.m. – 5:30 p.m. on Monday July 29th, 2013
  • We will de-camp to a local bar afterwards, sponsors welcome to support (email sponsors@techcrunch.com)

Remember we are holding our Berlin meetup later this week so if you don’t want to wing your way North we’ll come to you. Application form for Berlin is here.

Questions about the events? Please contact: events@techcrunch.com.

How To Become A Sponsor

  • For more information on sponsorship packages and to discuss becoming a sponsor, please contact sponsors@techcrunch.com.

And whether you’re an investor, entrepreneur, dreamer or tech enthusiast, we want to see you at the event, so we can give you free beer and hear your thoughts. Come one, come all.