How Government Regulation Can Affect Affiliate Markets
Based on the success I’ve had with College Crunch, I recently hired one of my friends to develop a new, more laser focused, edu affiliate site from scratch called The Best Degrees. I’ve learned a lot by running College Crunch. It’s a big site. Too big. Too unfocused. The conversion rate sucks.
That’s why I wanted to try a site that’s built around the affiliate product. And so we got started on March 1st.
For better or worse, I hadn’t read this news at the time. The gist of the story is that student loan default rates are at an all time high and the government is poised to do something about it. They’ve identified Community Colleges and For Profit Colleges (read: online colleges) as the main culprits. Regulation is most certainly on it’s way.
So what’s an affiliate marketer to do?
Initially, I was upset. If people can’t get access to loans for these kinds of colleges, then the market will surely dry up. And it probably will dry up a bit. But the fact remains that our society still values college education as one of the highest ideals… the best method of self-improvement. And another fact remains: higher education is one of the most profitable business sectors in the United States. And yet another fact remains: the colleges who market the best are going to be the ones who get the most business.
It’s hard for me to picture a United States without a massive higher education infrastructure. For most people, higher education is the platform to a career. And jobs are the bedrock of our economy. And higher education is one of those things that people just do. It’s a once or twice in a lifetime investment that most people agree is worth the cost and effort. So unless the economy goes completely to hell, there’s going to always be a demand for degrees.
Nonetheless, I do see regulation having an effect. I just don’t think it’s a game changer. The market will slow, but it won’t virtually disappear like the credit card market did about a year ago. That is unless the fundamentals completely disappear and too many students are unable to pay for their education. But the profit margins on higher education are so extreme (each student can bring in tens of thousands of dollars per year) that I suspect that schools can absorb some defaulting and also possibly restructure their “quality” measurement for affiliate leads to require a certain degree of proven credit worthiness.
In any case, “for profit” colleges will always have to market their product, and that’s what I’ll be here to help them do.
Share your thoughts!!!