Media

How Skimlinks can write a publisher a monthly $300,000 check

Skimlinks, a U.K.-based startup that tries to make it dead-simple for publishers to earn a cut of every product sale they drive, launched a product that automatically turns all product references in stories into affiliate links.

Publishers and bloggers typically earn advertising revenue through one of two ways — from the number of times an ad is exposed or the number of times that a visitor clicks on an ad.

But there’s also a third way. Publishers that happen to write about goods and services for sale can earn advertising revenue through affiliate links, which offer them a cut of every sale on Amazon they drive, for example. That commission can range from 4 to 15 percent of the price of the product.

The problem is that it can be time-consuming to input the special affiliate codes and links to earn affiliate fees. Skimlinks takes over that part, setting a publisher up with multiple affiliate networks, inputting affiliate links and even suggesting products to reference. It takes a 25 percent cut of the affiliate fee in return.

Its new service today, Skimwords, hunts for direct product references. It will turn a term like Canon Digital IXUS 130 into a link. (But it won’t take something more generic like “camera” and turn that into a link.)

Skimlinks has been part of a four-year journey for co-founder and chief executive Alicia Navarro. She originally started with an idea around social shopping but pivoted to focus on affiliate revenue on the advice of investors.

Since then, the company has grown to support 27 employees and has raised just over $2 million from investors including Sussex Place Ventures, the Accelerator Group and the U.K.’s National Endowment for Science, Technology and the Arts. Its competitors include Google Ventures-backed VigLink.

Commercialization of affiliate links isn’t an easy business model. It requires massive scale, since the company is effectively taking a tiny cut of a tiny cut of revenue. And of course, only a fraction of people even bother to click on a link to a product to begin with. Then an even tinier fraction of them buy the good.

But with the right audience size and content, affiliate fees can translate into meaningful revenue for a publisher.┬áNavarro said Skimlinks’ biggest check so far has been $300,000 to a publisher around the holidays, when visitors were looking for just the right gift to buy.

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