Granted, the application of statistical analysis used in baseball (specifically, Sabermetrics, invented by Bill James) seems to be a little “out there”.  And it is, kind’ve.  But using the data available lets us do more than simply report the measurement of observations of our campaigns.  You can take these observations and apply the numbers in ways that help you properly judge past efforts, and see what you need to work on to improve future performance.

For example…  Runs Created.  Bill James came up with a system that could grade a player’s offensive ability regardless of if he is a speedster who walks and steals a lot, a high-average singles hitter, or a low-average slugger.   the essential computation of Runs Created is:

RC=(H+W-CS)X(TB+.7SB)/AB+W+CS

Runs Created equals hits plus walks minus times caught stealing multiplied by total bases added to seven-tenths of bases stolen divided by the sum of at bats plus walks plus times caught stealing.  Sounds a little goofy (especially having Caught Stealing on both sides of the equasion).  But it woks.  The deviation from real life is a scant 4% and generally within 3%.  There are a couple exceptions, but overall you can take this formula, apply it to an entire team over the past 30 years or so it’s very, very close.  Which is to say after 20 or so games into a season you can begin using this to predict how many total runs a team will score for the season and get pretty close.  Not Vegas Bet close, but close.

Now, how do we apply this to Affiliate Marketing?  Let’s look at the information we have available to us.  We have Traffic, ClickThru, Sales, Visits, Pages Viewed, etc.  Traditionally we have all been measuring ourselves with CTR, CPC, etc.  Which are extremely simplistic measures.  What if we apply a little bit of Sabermetric thinking and come up with our own measurement for Runs Created?  How about Sales Created?

Let’s lay out a possible scenario:

SC=(Clicks-Bounces)X(Page Views+Uniques)/(Visits+Clicks+Bounces)

This would reward Clicks and Uniques, penalize Bounces, and rate it all against the total number of Pages Viewed.  Run some of your stats over this and see what the ratio of the resulting number (SC) is compared with the total number of sales made…  I’m seeing some results that are making sense.  The first site I compared this too was spooky. I had cleared 74 sales on an offer.  This example came out with  a score of 72.50.   Thus “predicting” the number of sales within 2% of actual.

I compared it with a few other sites, called a couple friends and got some example numbers.  So far, it’s doing a reasonable job of computing how many sales based on the numbers and statistics alone.  The interesting thing is that one of the examples was high traffic with high bounce rates, another had low traffic with very low bounce rates…  And the numbers held up.  I don’t believe this is the final form of this.  Let’s not kid ourselves, this is counter-intuitive and I spent less than a week on this.  But a logical conclusion to this little experiment is that we arn’t recording and analyzing the data we’re already gathering in effective ways.

We Affiliate Marketers need to start really looking at the data, the history, and figuring out better ways to measure what is really happening with our offers, etc.  Judging ourselves by the observations made (logs), and discovering ways to make ourselves better.

Over the past several months I’ve been attempting to go deeper than simple A-B testing with sites…  I’ve been applying Sabermetrics to Affiliate Marketing.  For the non-baseball fan, Sabermetrics is the invention of Bill James.  His utilization of standard reference observations of the game and logical analysis of real results has turned what everyone thought about baseball on it’s head.

For example, different stadiums have profound effects on an individual ballplayers production.  Stealing bases is unproductive.  Much of what we credit to pitching is actually defense.  His approach is to listen to what the game itself is telling us objectively.  Which is exactly the kind of analysis we need to be doing as Affiliate Marketers.

Here are some questions that the application of Sabermetrics can answer for us.  With identical websites does the use of one CMS over another affect SERPS?  Is there a difference in profitability in using your own dedicated server over shared hosting?  Does the selection of a particular offer show greater click-thru by using one network over another network that has the identical offer?  What elements (i.e. cart, banner, newsletter list, pop-up on abandonment, etc) are the most to least effective?

We all think we know the answers to these questions.  But do we really know?  How much is being left to random chance without a true understanding of what is really happening by measuring and analysing the results of more than a simple A-B test?  I think that we’re leaving alot of money on the table here.  I think we don’t really know what we’re doing..  We just think we know.  And I think I’ve discovered the way to find out for sure…  Sabermetrics.

By studying Bill James work with baseball statistics, and creating test scenarios, a baseline of information about affiliate marketing can be established.  In my own initial testing I took one of the eyeglasses sites created for an experiment last fall and started a series of tests.  Although not a large enough sample to be truly scientific there are some trends that I feel need further study.

Just as in baseball, the stadium affects individual player performance, the type of hosting affects an affiliate marketers site performance.  The more restrictive a host, the less money is produced from a site.  With the best production being on a dedicated server.  In other words, if the hosting (and the hosting tools) enable an affiliate marketer to make changes quickly, perform maintenance easily, has enough resources allocated that processor or database limits are never reached…  The site will perform better financially.

For every site you have, for every offer you run, you have a wealth of statistical data that you should be analysing.  From server logs, to your click report at Shareasale, banner displays from OpenX, commissions received, Google Analytics, and on and on and on.  And you should be boning up on Bill James and Sabermetrics so you can use all the details at your disposal and distill the basic truths available to you instead of relying on intuition or whatever some guru says.

But just remember my favorite quote from Bill James, “Information is not to be held accountable for every misleading claim that somebody can derive from it”,