affiliates4u performance marketing guide 2011
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2011
[PERFORMANCE
MARKETING GUIDE] Created by Affiliates4u.com and their supporters; a guide for anyone involved or considering involvement within the Performance Marketing Industry.
Performance Marketing Guide 2011 In Association with Commission Junction
All rights reserved. Existem Ltd grants you to store and print from this material for your own personal and commercial use. No part of this publication may be reproduced without prior permission from the publisher. Copyright © Existem Ltd 2011
Page 2
CONTENTS
Contents ..................................................................................................... 2
Foreword by Chris Johnson ................................................................................. 8
Foreword by Florian Gramshammer ....................................................................... 9
Foreword by Matthew Wood ............................................................................ 10
Search Marketing ......................................................................................... 16
PPC V’s SEO ............................................................................................. 17
PPC ...................................................................................................... 18
How PPC Works? ....................................................................................... 18
Why Use PPC? .......................................................................................... 19
What Is SEO ............................................................................................. 20
Why Use SEO? .......................................................................................... 20
Which Keywords? ...................................................................................... 21
Performance Analysis .................................................................................. 22
Display Marketing ......................................................................................... 25
What Is Display Advertising? ........................................................................... 25
Why Would You Use Display? ......................................................................... 26
Reach And Targeting ................................................................................... 27
Where to buy ........................................................................................... 28
Merging affiliate marketing and display advertising ................................................. 28
The future: .............................................................................................. 29
Email Marketing Produces Results .................................................................... 32
Technicalities Of Broadcasting ......................................................................... 32
Email Marketing Essentially Boils Down To Three Things: Acquisition, Retention And Growth. .. 33
Working With Email Affiliates ......................................................................... 33
Lead Generation Networks ............................................................................ 34
Mobile Marketing ......................................................................................... 36
Why Bother With Mobile? ............................................................................. 36
How Will This Affect Performance Marketing? ....................................................... 36
Will Mobile Traffic Actually Track With Affiliate Networks? ......................................... 36
Performance Marketing Guide 2011 In Association with Commission Junction
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Designing For Mobile Users ............................................................................ 37
Understanding Your Mobile audience ................................................................ 38
Mobile Applications .................................................................................... 39
Should I Build An App Or A Mobile Site? .............................................................. 41
Mobile Search .......................................................................................... 42
Looking to the Future .................................................................................. 43
Social Marketing........................................................................................... 45
Performance In Social Media .......................................................................... 45
Retention Vs Acquisition ............................................................................... 45
Facebook & Social Plug-ins ............................................................................. 46
What Is The Future For Performance In Social Media? .............................................. 48
Behavioural Retargeting .................................................................................. 51
UK Online – The Business Opportunity ................................................................ 52
Changing Consumer Behaviour ........................................................................ 52
What Is Retargeting? ................................................................................... 53
Static Retargeting ...................................................................................... 53
Segmented Retargeting ................................................................................ 54
Retargeting Gets Personal ............................................................................. 54
Benefits Of Retargeting ................................................................................ 55
Right Message At The Right Time ..................................................................... 55
Display A Personalised Message To An Ultra Qualified Audience ................................... 55
Taking The Guess Work Out Of Messaging And Delivery ............................................ 56
Tailoring The Message - Acquisition Funnel Management ........................................... 56
Cross-sell / Up-sell ...................................................................................... 56
Sequential Retargeting ................................................................................. 56
Comparable To Search Marketing ..................................................................... 57
Immediate And Measurable Results .................................................................. 57
Implementation ........................................................................................ 58
Where Do The Ads Appear? ........................................................................... 59
Reach ................................................................................................. 59
Flexibility ............................................................................................. 59
Performance Marketing Guide 2011 In Association with Commission Junction
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Privacy ................................................................................................ 60
Conclusion .............................................................................................. 61
Affiliate Marketing ........................................................................................ 63
How Does Affiliate Marketing Work? ................................................................. 63
Top Tips For Running A Successful Affiliate Marketing Campaign: .................................. 63
About Affiliate Marketing .............................................................................. 64
Affiliate Marketing For Advertisers .................................................................... 65
Case Study .............................................................................................. 67
Cashback / Loyalty ........................................................................................ 70
Overview Of Cashback Sites ........................................................................... 70
Affiliates Within The Sector ............................................................................ 70
Typical Site Users ....................................................................................... 70
Where Cashback Works Best .......................................................................... 71
Increased Conversion Rates Through Cashback Sites ................................................ 72
Dispelling The Myths Of Cashback Sites ............................................................... 72
New Customer Acquisition ............................................................................. 73
Working Effectively With Cashback Sites ............................................................. 73
Affiliate Networks ......................................................................................... 76
Benefits Of Networks .................................................................................. 76
What Are Affiliate Networks? ....................................................................... 76
Tracking .............................................................................................. 77
Technology ........................................................................................... 77
Affiliates And Merchants ............................................................................ 77
Affiliate Reach And Long Tail ........................................................................ 78
Control & Fraud ...................................................................................... 78
Commissions ......................................................................................... 78
Communications ..................................................................................... 78
Account Management ............................................................................... 79
Product Feeds ........................................................................................ 79
Affiliate Payment .................................................................................... 79
Tracking Methods.................................................................................... 81
Performance Marketing Guide 2011 In Association with Commission Junction
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Page 5
Flash Cookies ......................................................................................... 82
IP Tracking............................................................................................ 82
Etag/Cache Tracking ................................................................................. 83
Voucher Codes ....................................................................................... 83
Database Tracking ................................................................................... 83
Cookieless Tracking Performance................................................................... 84
When is Cookieless tracking used? ................................................................. 85
The Future of Cookies ............................................................................... 86
Commission Types ........................................................................................ 88
Setting Your Objective ................................................................................. 88
Choosing Your Method ................................................................................. 88
CPM (Cost Per Mille)................................................................................. 88
CPC (Cost Per Click) ..................................................................................... 89
CPA (Cost Per Acquisition) ............................................................................. 90
PPL (Pay-Per-Lead) ..................................................................................... 90
Hybrid ................................................................................................... 91
Best Practice Policies ................................................................................... 93
Introduction .......................................................................................... 93
Voucher Code; code of conduct .................................................................... 94
Ethical Merchant Charter ........................................................................... 95
Behavioural Retargeting ............................................................................. 96
Other work of the AMC ............................................................................. 97
Conclusion ........................................................................................... 97
Voucher Codes .......................................................................................... 100
About .................................................................................................. 100
Advantages Of Using Voucher Codes ................................................................ 100
Voucher Code Guidelines ............................................................................ 101
Case Study: ‘Controlling The box’ And Enabling URL-Based Deals (IntelliLinks) .................. 102
Affiliate Reach ........................................................................................ 104
Product Feeds ........................................................................................... 106
Why Do You Need A Product Feed? ................................................................. 108
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Page 6
What Are Product Feeds Used For? ................................................................. 108
Who Needs To Produce A Product Feed? ........................................................... 108
What Are Feeds Used For Within Affiliate Marketing? ............................................. 109
How Much Of My Affiliate Revenue Should Be Generated By Feeds? ............................ 110
Are There Differences In Feed Structure For Different Retail Categories? ........................ 110
Where Can I Go For More Professional Guidance On Product Feeds? ............................ 110
Which File Format(s) Should I Use To Create My Feed(s)? ......................................... 110
Should I Send Affiliates Products That Are Out Of Stock Or Available For Purchase In-Store Only In
My Feed? ............................................................................................. 111
How Should I Apply Tracking To The URLs In My Feed? ............................................ 111
What Should I Do If I Have Products That Are Restricted To Adults, Or Adult Products? ........ 111
Since Feeds Are Being Used Extensively In Fashion These Days, Do I Need To Include Gender
Information In The Feeds? ........................................................................... 111
What About Specific Attributes For Particular Vertical Categories? How Do I Include These? .. 112
Case Studies .......................................................................................... 112
Deeplinking .............................................................................................. 114
Analytics ................................................................................................. 122
The Importance Of Great Analysis ................................................................... 122
Process And Objectives Of Web Analytics .......................................................... 122
What Good Analysis Can Do For Your Business ..................................................... 123
Identification And Organisation Of Business Goals ................................................. 123
Goals And Targets Help Web Businesses: ........................................................... 123
Identifying KPIs ....................................................................................... 124
Analysis Of KPIs Needs To Be: ....................................................................... 124
Creating Historic Factual Evidence .................................................................. 125
Confirmation Of Instinct ............................................................................. 125
Market Research And Competitive Intelligence Analysis .......................................... 126
Analytics Packages ................................................................................... 127
Website Traffic Analysis .............................................................................. 127
Packages Available ................................................................................... 128
Affiliate Statistic Analysis ............................................................................ 128
Performance Marketing Guide 2011 In Association with Commission Junction
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Packages Available ................................................................................... 129
Next Steps ............................................................................................ 129
In-house affiliate campaigns ............................................................................ 131
In-house Methods .................................................................................... 131
Benefits Of Utilising 3rd Party Technology........................................................... 132
Case Studies ............................................................................................. 135
Mazda Knows Affiliate Marketing Is More Than Just Voucher And Loyalty ....................... 135
Introduction ........................................................................................ 135
Objectives .......................................................................................... 135
Strategy And Execution ............................................................................ 135
Setting-Up Defined Processes That Support Decision Making .................................. 135
Implementation Of End-To-End Tracking Functionality To Monitor Lead Quality Offline ..... 136
Adopting An Open Approach To Affiliate Business Models ..................................... 136
Allowing Test Phases At Higher Commission Levels ............................................. 136
Facebook Arbitrage: Beyond Demographic Targeting ........................................... 136
Giving Publishers The Tools They Need To Do The Job .......................................... 137
Results And ROI .................................................................................... 137
Case Study #2 .................................................................................... 138
Performance Marketing Campaign Drives 22% Sales Increase For Simply Electronics ........... 138
Introduction ........................................................................................ 138
Approach ........................................................................................... 138
Results .............................................................................................. 139
Quotes .............................................................................................. 139
Case Study #3 .................................................................................... 140
Increasing Growth And Customers For Online Footwear Retailer ................................. 140
Background ........................................................................................ 140
Approach .............................................................................................. 140
Results .............................................................................................. 141
Performance Marketing Guide 2011 In Association with Commission Junction
All rights reserved. Existem Ltd grants you to store and print from this material for your own personal and commercial use. No part of this publication may be reproduced without prior permission from the publisher. Copyright © Existem Ltd 2011
Page 8
FOREWORD BY CHRIS JOHNSON
PERFORMANCE MARKETING has, for the most part, become the ‘buzz-
word’ surrounding Digital Marketing throughout 2010. Having worked
within a ‘pay-per-performance’ model for numerous years, the wider
digital market has notably embraced the world of ‘affiliate’, partly due
to the tightening of budgets and scrutiny of spend from all quarters.
It is how affiliates have adapted, innovated and expanded their reach into other Performance
Marketing channels that has opened the eyes of many a marketing director’s budget within the
digital marketing arena.
Our aim with the inaugural Affiliates4u Performance Marketing Guide is to provide a ‘one-stop’
overview of digital channels perceived to be under the ‘Performance’ umbrella. We have in-depth
sections on Search Marketing, Display Marketing, Mobile, Social, Retargeting and an expanded
section on Affiliate Marketing.
The extended section on Affiliate Marketing is a useful resource for anyone starting out or becoming
increasingly aware of the affiliate channel. It also increases the awareness of the role of Networks
within Performance, and what they can offer Advertisers and Publishers alike – ranging from
Vouchers, Product Feeds, Deeplinking, Analysis and Tracking Solutions.
The Performance Marketing Guide can also be used as an insight for Advertisers on the
considerations needed when launching within one or more of these dynamic marketing channels.
Chris Johnson, Publisher, Affiliates4u.com
Performance Marketing Guide 2011 In Association with Commission Junction
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Page 9
FOREWORD BY FLORIAN GRAMSHAMMER
PERFORMANCE MARKETING is still a new concept to many
marketers. Driven by online marketing, with new tracking and
measurability functionality available, performance marketing was an
innovation 12 years ago and continues to be so today.
Performance marketing is now truly a multi-channel discipline. It has
broadened considerably beyond affiliate and search - it now permeates all forms of online
marketing . In addition to this evolution, another change has been happening in tandem: namely the
broadening of ‘online’ marketing to ‘digital’ marketing. A captive audience is now not just chained to
a computer: they can be in their homes, engaging in interactive advertising through their TV’s; when
using their credit cards in-store, or on the go through their mobile phones. What marketers are
dealing with now are multiple options of multiple channels. So it is easy to understand why there is
confusion and why performance marketing isn’t always used to its full potential.
As with all marketing, each brand (and product) will react differently to the marketing mix. Different
companies will also have different internal set ups making it easier or more difficult to adopt
changing marketing practises. This guide is essentially a list of all options available – the right mix
and balance of which absolutely will make a difference to marketing returns. Almost all brands now
engage in some form of performance marketing and we expect to see this grow with the early
adopters paving the way for other marketers to follow.
This is a very exciting space to be in, who knows what it will look like in another decade? What is
certain is that it will continue to evolve and become the norm for all marketers, across the board.
Florian Gramshammer, Country Manager UK, Commission Junction
Performance Marketing Guide 2011 In Association with Commission Junction
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Page 10
FOREWORD BY MATTHEW WOOD
COLLABORATIVE work between Advertisers, Publishers and
Partners continues to drive innovation within Performance Marketing.
Included in this guide are Innovations, technologies or strategies that
are being put into action today that simply did not exist for us this time
last year. It’s imperative in this ever evolving, incomparable channel that those working within it
understand the complexities and opportunities of these new and existing internal channels. By doing
so they will be able embrace each one effectively within their activity and with sound execution
maximise their own effectiveness.
At Affiliates4u, we are excited to be launching the Performance Marketing Guide with the support of
Commission Junction as a complimentary resource, and fully intend to expand and make the guide
an annual must read ‘Performance Marketing Bible’. Eventually becoming the first point of call
when looking to understand the complexities of Performance Marketing, and importantly stay ahead
of the curve.
Matthew Wood, Founder, Affiliates4u.com
Performance Marketing Guide 2011 In Association with Commission Junction
All rights reserved. Existem Ltd grants you to store and print from this material for your own personal and commercial use. No part of this publication may be reproduced without prior permission from the publisher. Copyright © Existem Ltd 2011
Page 11
Performance Marketing Guide 2011 In Association with Commission Junction
All rights reserved. Existem Ltd grants you to store and print from this material for your own personal and commercial use. No part of this publication may be reproduced without prior permission from the publisher. Copyright © Existem Ltd 2011
Page 12
FROM AFFILIATE TO PERFORMANCE
Affiliate marketing has come a long way since the launch of Amazon’s associate programme all those
years ago. It has evolved from a young, entrepreneurial network of eager individuals seeking out
new ways to earn money online, to a fully fledged multi-billion pound industry in its own right with,
according to a recent market evaluation, more than £4.5billion online sales expected to be
attributed to the channel in 2010 alone.
Where once it may have been viewed as a quirky way to drive a few extra pounds in the early days,
affiliate marketing now plays an integral part in the majority of online marketing plans, and over the
years its evolution has driven both significant ROI and marketing perception, contributing to the
growth of many organisations, including Amazon, eBay and Google.
On closer inspection, the channel’s own success can be attributed to three key factors:
- the adoption of a very simple, yet effective, pay-for-performance model
- the ease of access to networks of affiliates willing to work as an extended, commission-
based sales team
- the innovation and agility of the affiliates themselves to continually evolve new ways to
reach out to prospective customers
Whilst paying on performance is not an invention of affiliate marketing per se, there is equally no
denying that the adoption of this model online pioneered the way for digital marketing to become
truly accountable. It allowed advertisers to pay against a very specific metric; work to budgets
where they could calculate ROI to the last penny; and have explicit control over their customer
acquisition budget. In turn, it also led to the birth of affiliate networks to facilitate relationships
between brands and their ‘virtual sales force’, and to provide advertisers and affiliates with
platforms to not only connect, but to track and manage payments down the line as well.
However, responsibility aside, affiliate marketing’s own delivery has continued to evolve and
mature. It is not just about gap-filling or reaching the long-tail of online marketing (albeit it facilitates
these areas exceptionally well), this is now far from the case. The channel has propelled online
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Page 13
advertising into a new era, one of strategic, intuitive and innovative marketing. No longer a silo
business that once revolved around a few banners, websites and reports, affiliate marketing now
represents a broad spectrum of media channels, spread far and wide, with new and emerging
platforms such as mobile, social media and even offline promotions all playing a bigger part in it
now.
So it’s fair to say that affiliate marketing has pioneered a whole new way of looking at the digital
space, if not the wider marketing arena; opening marketers’ minds to the realms of possibility across
all digital media channels and, most importantly, for the whole delivery mechanism to be held to
account. From Affiliate Marketing, we now embrace Performance Marketing.
Performance Marketing is about truly being able to measure contribution; about understanding
what instigated, facilitated and converted clicks to a merchant site and rewarding accordingly,
whether it be through the traditional last click earns or through value attribution. However, although
the model is now firmly in our grasp, I do believe we are only just at the tip of the iceberg for
Performance Marketing - there is still so much more to come from this channel. In fact, I suspect the
next year or so will play out three-fold; through convergence buying, niche selling and continued
innovation.
And, okay, we’ve talked about it long enough, but Mobile will also continue to grow from strength to
strength as an abundance of smart phones continue to enter the market, mobile networks are
offering more affordable web packages, improving 3G coverage and more wireless hubs are
materialising in social environments. Affiliates are already profiting on a CPA basic across Mobile,
from search marketing and voucher codes, to site-builds and apps. But, more recently, niche Mobile
agencies have also emerged to target this one sector more specifically. Perhaps the next step will
be the launch of a Mobile affiliate network?
But it’s not only sector-specific networks that may appear. I believe we will continue to see more
and more multi-media platforms emerging; positioned primly to manage all aspects of Performance
Marketing, uniting the business model across all forms of media, both on and offline. If the industry
is prepared to shift in how it has habitually existed, these technologies will then give advertisers
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Page 14
even greater control of their campaigns and relationships, and will once more exemplify the whole
performance model ethos.
Drilling down specifically into other possible areas of growth, the recession has no doubt helped to
channel users down the voucher code/coupon path; however I still expect more to evolve from this
space, from more group-buying opportunities to demographically-driven voucher codes and
availability-driven real-time deal placements. As access to advertiser data further improves, along
with media partners’ ability to facilitate automated updates, real-time search and placement will
also start to flourish.
So to conclude, there’s no denying that the web is getting more complex and multi-faceted.
Companies are all striving for the next platform to advertise on, the next sector to emerge and the
latest partner to work with. However, alongside this, our focus on full return on investment
continues to get stronger and stronger, with measurement of cost and impact along the way
becoming more and more integral to each and every marketing plan. Performance Marketing is
therefore an open door for digital marketing to be truly held to account.
Performance Marketing Guide 2011 In Association with Commission Junction
All rights reserved. Existem Ltd grants you to store and print from this material for your own personal and commercial use. No part of this publication may be reproduced without prior permission from the publisher. Copyright © Existem Ltd 2011
Page 15
Performance Marketing Guide 2011 In Association with Commission Junction
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Page 16
SEARCH MARKETING
Search Engine Marketing (SEM) is made up of Pay Per Click (PPC) and Search Engine Optimisation
(SEO). The aim of these processes is to better engage customers who are looking for information
related to your products or service. It is about making your website visible within the online Search
Engine powered spaces to attract new customers.
The online search space is a highly valued area for merchants to achieve strong visibility in and with
Google holding approximately 80% of the market share in the UK, it is a prime selling space for
marketing managers to focus on. The image below indicates how the search space is split into Paid
Search (PPC) and Natural Search (SEO), the red boxes show paid listings and the blue box show
natural listings.
Search marketing is constantly evolving, search engines continue to develop new innovations and
change the way that they classify websites and display the positioning of your site, mix this with your
SEO
Listings
PPC Listings
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competitor’s development activity and the influx with new advertisers who continue to enter the
search space and you have a situation which is constantly changing and means that your own search
strategy needs to evolve to maximise your visibility in the search space.
PPC V’S SEO
PPC and SEO gives you a better chance of maximising the search space. The image below gives an
indication of where users click on a search page. Through a combined strategy you are more likely
to drive a higher proportion of users. PPC search is straightforward and easy to understand, SEO is
essentially free you don’t pay for clicks however it takes longer to achieve results and needs
commitment.
PPC can work as a test ground for SEO - through PPC you can understand if a keyword drives traffic
and if the traffic is right for your website only implementing it into the SEO strategy once its worth
has been evaluated.
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Page 18
PPC
Pay Per Click (PPC) is instant and reactive, giving the opportunity to drive traffic quickly. Google,
Yahoo & Bing have extensive interfaces where PPC campaigns are built and optimised. The search
interface is just one form of PPC. The system has extended through display networks which are
websites that place ads within their pages. PPC is also known as “sponsored links” and as per the
name an advertiser only pays when someone clicks on a link.
HOW PPC WORKS?
Advertisers bid on keywords and enter in to an auction to try and secure placement. The order of
the listings depends on other advertiser’s bids and the quality score of the ads shown for a given
search.
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Some of the areas included in the quality score are indicated in the image below, the exact formula
is not publicly known, however search engines are aiming to give the users the best possible search
experience.
Associated with the target keyword is the ad copy which you are able to use to highlight features or
benefits of the product/services, Creative Ad copy helps make sure you stand out against your
competitors and ensures that users are aware of the key facts about the item you are advertising.
It’s a great way to promote special offers such as discounts, sales or new customer offers.
WHY USE PPC?
Paid Search can help you quickly achieve a range of online marketing objectives, as you are able to
publish your adverts in prominent positions in a matter of minutes and it is focused on customer
acquisition and promotion. Essentially, Paid Search can drive sales and increase your brand
exposure as your ad could be seen by millions of consumers who use search engines every day.
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PPC is highly measurable. You can analyse your ads and keywords to review visitors, click trends and
conversion rates, evaluating the performance and adjusting accordingly. This can also be analysed
further with the use of additional tracking solutions to help fully understand exactly what value a
PPC user brings to your site.
WHAT IS SEO
Search Engine Optimisation (SEO) is the process of getting traffic from the “natural” listings on
search engines. The major search engines, Google, Yahoo & Bing have these results where web
pages and other content are ranked based on what the search engine considers more relevant to the
users’ search term.
SEO is the process of developing a websites visibility in the natural listings by improving key areas of
relevance and making them more search engine and user friendly. The next image outlines the key
attributes of SEO however this is not an exclusive list.
WHY USE SEO?
Natural traffic sources are a great way to drive free traffic to your website. There is no cost
associated from the search engines for each click delivered and as such this marketing vertical
becomes very cost effective for your website. Large volumes of similar keyword traffic can be
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Page 21
covered with the same optimisation strategies, due to the way that the search engines calculate
ranking positions, thus you are able to cover a large user base with minimal effort
WHICH KEYWORDS?
‘Keyword’ and ‘key phrase’ research is imperative to the success of an SEO & PPC campaign.
Extensive research should be undertaken to understand which phrases should be included in your
strategy. The research puts you in the shoes of the customer helping us to consider what search
terms or phrases typed into the search engines could potentially put them on the path to your
website and brand.
Mind-Mapping is a great way to develop an initial keyword bank which you can then develop on.
The table below helps develop ideas of where the keywords may fit into a structure, the competition
and number of estimated searches.
There are keyword tools available that help you develop further keywords you may not have
considered along with developing a list of keywords you do not want to appear for example if you
only sell women’s shoes you will not want to appear for the term “mens shoes”. Your initial
keyword bank will develop and evolve as you develop more knowledge about how customers
interact with your website.
If you have search functionality on your website this can be a great way of helping to develop your
keyword list by identifying what customers are searching for when they reach your site.
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Page 22
GENERIC TERMS REFINED TERMS NICHE TERMS (‘LONG
TAIL’)
Customer’s mindset Researching
Learning
Browsing
Comparing
Confirming choice
Purchasing
Nature of keyword Information terms
Product descriptions
Features
Brands
Product IDs
Merchant names
Level of competition Highest Moderate Lowest
Traffic volumes
generated Largest Intermediate Smallest
Traffic quality Low Higher Highest
Probability of
conversion
Less likely More likely Most likely
PERFORMANCE ANALYSIS
Unlike other forms of media every action on the internet is recorded allowing any SEO or PPC
strategy to be evaluated at each stage. There are a variety of tracking solutions available and Google
has its own free system Google Analytics. This free analytics package has a wealth of information
about how users have reached a website and what actions they took when landing on the site. The
data collected is vast, however core data such as:
Clicks via natural listings and paid listings
How long users spent on the site?
Where do users exit the site?
Conversions?
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Page 23
This enables you to optimise campaigns and generate higher returns through analysing the ROI. ROI
and measurement is unique to every strategy, you need to determine your goals and the value of
them this in turn will help you measure the success of the campaign.
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Performance Marketing Guide 2011 In Association with Commission Junction
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Page 25
DISPLAY MARKETING
Back in the mid-nineties; when marketers realized that they had a fast-growing, captive online
audience, display advertising was the most natural translation from offline marketing to online. In
the grand scheme of things this still remains the case and display still continues to flourish – albeit in
a much more sophisticated form.
According to the IAB H1 2010 online ad spend report , display advertising made up 19% of all online
ad spend (a total of £380.9 million) which showed a 6.4% year on year growth. Not bad in a
recession? The key to the success of the industry has been the constant innovations and adaptations
it has made in response to a growing market and pioneering technologies.
WHAT IS DISPLAY ADVERTISING?
Simply put, display advertising is when a marketer pays a publisher to display their advertising.
Similar to offline advertising, online marketers have a target audience to reach with a certain
message or call to action and they use display advertising in order to do that.
Publishers: tend to be high-quality content sites selling their white space on a CPC/CPM and,
increasingly, on a CPA/CPL basis – (see ‘Commission Types Section – Page 74 for
information)
Creative: is of paramount importance. They IAB’s standard creative sizes are here:
http://www.iabuk.net/en/1/iabdisplaystandards2010.html
Buying points: advertisers can choose (and usually mix) a number of methods in which to
buy their display advertising: display networks; ad exchanges or individual site buys
Measurement: is dependent on the objectives of the campaign. For branding campaigns,
survey tools are often used. Ad networks will provide all reporting data which marketers will
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often cross-reference with third party ad servers if they use them
Brand protection: in 2005, leading ad networks teamed up with the IAB to form IASH -
http://www.iash.org.uk/AboutIASH/204359/the_role_of_iash.html - to regulate and assure
advertisers about ad placement on the internet.
WHY WOULD YOU USE DISPLAY?
Marketers would tend to use display advertising as part (or all of) a specific campaign. They would
identify their target audience and their objective; and incorporate online display advertising into
their overall media plan for this campaign. Quite often this media plan will be designed and bought
by media agencies although more and more marketers are now handling this internally. Many
marketers will measure their online display advertising within their econometric modelling.
CAMPAIGN OBJECTIVES:
Obviously the key to measuring the success of a campaign is to clearly mark out objectives.
Objectives within display advertising can be split into two categories: branding or direct response
(although the marketer usually hopes for a combination of the two). As this guide is about
performance marketing we will focus on direct response.
With direct response, marketers are expecting their advertising to result in some kind of definite
response from their audience, so it is essential that they design creative which has a strong call to
action within it. This could be ‘fill in this form’, ‘click here to find out more’, ‘special offer, buy now’.
Of course, this call to action is dependent on the campaign objectives. Also obvious is the fact that
the more people see the campaign and the better-targeted the campaign is to the audience most
likely to respond, the better the campaign will perform in line with objectives.
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REACH AND TARGETING
Dependant on the type of campaign a marketer is looking specifically for a big but targeted audience
so it is important when buying a display campaign to get both of these things. Partnering with an ad
network or ad exchange should ensure reach however it is also important to drill down to your
target audience using a range of methods:
Demographics – publisher websites will give information about their user base. Marketers
can use this information to choose which sites to put their ads on
Geographic and time – if a marketer only wants to target certain regions or at certain times
(a fast food advertiser may want to advertise just before lunch and not just after) then this
can be managed by the marketer or network
Frequency capping – marketers can set a top limit on how many times a user sees a specific
ad so as not to bombard or frustrate them
Contextual – this could either be in a channel of sites which complement the advertising
creative or on sites which are similar to the context of the ad
Re-targeting – this is when a marketer re-targets a user (using non PII) which has interacted
with their creative or site. This can be done across an ad network and if done in conjunction
with dynamic messaging can give the user relevant messages to go back and re-engage with
the marketing, ideally to complete a transaction or to fill out a lead
Behavioural/Predictive Targeting - this is when data is used to predict how an anonymous
user will interact with creative, allowing marketers to target the user as opposed to work in
channels or target demographics.
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WHERE TO BUY
It used to be that marketers could just buy from an advertising network (like our sister company
ValueClick Media) or from direct sites which were particularly targeted towards a certain brand,
demographic or product.
Now there are many more products available for marketers to use. As opposed to affiliate
marketing, many marketers will buy and manage their display activity through a media agency which
will manage a campaign holistically. The options are:
Demand side platforms (DSP): agencies will often use these incorporated with real time
bidding technologies in order to buy publisher inventory on behalf of their advertisers
Publisher-direct: publishers will often have internal sales houses or optimizers to ensure
that they get the best value for their inventory
Ad exchanges: advertisers can bid for inventory that they want
From an agency: remember that some agencies will have their own media so marketers
need to take this into consideration during purchase as agencies may be taking a
considerable margin
From a network: our sister company ValueClick Media is an international display network of
publishers which sells to marketers on a CPC, CPM and CPA basis. There are different kinds
of networks: some which buy and then re-sell inventory or some like ValueClick Media which
has its own network
MERGING AFFILIATE MARKETING AND DISPLAY ADVERTISING
Over the past few years display campaigns and affiliate marketing have merged to an extent. For
example, if an existing Commission Junction merchant wishes to do some additional short term
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activity around a new product launch, they could roll that into their affiliate marketing programme
by using ValueClick Media as a publisher.
Marketers may also want to do short-term affiliate-type activity, for example a lead generation
campaign where they pay on a CPL-basis. Over the next few years we expect to see these merging
more, although display advertising will always have its own unique place, particularly when it comes
to branding campaigns.
THE FUTURE:
The future looks bright for display advertising as it continues to offer both branding and direct-
response solutions for marketers. Technologies are emerging in marketing and at the moment a lot
of them are in the display space which bodes well.
Currently there is a lot of change in the marketplace – there has been mass media fragmentation
and consequently technology has converged with a flood of new entrants (DSP’s, ad exchanges etc)
to the market. These new technology providers are all vying to be the ‘one-stop-shop’ solution for
marketers or planner/buyers whose lives have been made more complicated by this media
fragmentation.
Whilst the use of data is hugely important and will play a massive role in all future display activity (it
gives marketers the opportunity to target their audience on a very granular basis) the role of
experience and service is currently being underestimated in this market.
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So, with that in mind, marketers will be well-advised to keep up with new technologies which will
save them money whilst buying their inventory but they should also seek the advice of experts who
will ensure that they see greater ROI from the display advertising.
“Display advertising is the online channel closest to traditional media channels, and often
the easiest to understand. But the key difference of course is visibility – thanks to tracking! We can look at the all the same metrics as TV or Outdoor, but relay them back to physical actions and response in a digital environment. Regardless of the campaign KPI’s a display strategy can be developed to achieve a brand’s objective – whether it’s focussed on brand awareness or direct response. We’ve run campaigns that see uplifts in brand awareness and favourability by over 40%, and campaigns that utilise targeting including retargeting to invoke uplifts in conversion rates by over 48%. Display advertising doesn’t just work in isolation; Comscore reported that using display in conjunction with search can increase site visitation in the 4 weeks after exposure by up to a massive 65%”
Fiona Robertson, Head of Affiliates & Performance, bigmouthmedia
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E-MAIL MARKETING
EMAIL MARKETING PRODUCES RESULTS
According to research conducted by the Direct Marketing Association, email marketing generated an
ROI of $43.62 for every dollar spent on it in 2009. It outperformed all the other direct marketing
channels examined.
While email marketing may not be the newest Kid on the Block and therefore lack the sexiness of
some of channels explored later in this guide, its on-going capacity to generate high returns for
relatively low outlays are without question.
For that reason some of the top performing affiliate marketers are emailers. You’ve got the
specialists who have been in the email game for many a moon, but in recent times these have been
joined by affiliates in other genres, be they former Pay Per Clickers or voucher code or cashback
specialists, who have finally cottoned on to the value of building large mailing lists and now have
subscriber bases of many hundreds of thousands.
TECHNICALITIES OF BROADCASTING
Email marketers will either utilise their own servers or use an Email Service Provider for deployment.
If an emailer has a large database, there can be challenges in terms of getting into inboxes and
therefore considerable technical expertise is required to gain the highest deliverability. This includes
using the optimal HTML; cleansing the data; authenticating the send domain names; ensuring one
has pre-warmed, high quality broadcast IPs; and utilising delivery platforms with excellent
reputations with ISPs such as Hotmail, Yahoo Mail, Gmail and the like.
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EMAIL MARKETING ESSENTIALLY BOILS DOWN TO THREE THINGS: ACQUISITION, RETENTION
AND GROWTH.
Acquisition
It goes without saying you can’t send out emails if you don’t have any email addresses to broadcast
to. And therefore email marketers utilise an array of means to grow their databases, some more
salubrious than others. It’s given rise to the plethora of ‘Win an iPod’ and ‘Win an iPad’ campaigns,
but there are a multitude of methodologies to get people to opt-in to databases. These can be via
websites, but also many emailers utilise other mailing lists to grow their own.
Retention
Once email marketers have got people to sign-up to their databases, the name of the game is to
keep them. And that means broadcasting interesting and useful mailings to them.
Many affiliates have weekly newsletters they send out to their subscribers with the latest offers.
Some affiliates also broadcast solus emails to their members, which are emails dedicated to
advertising one company or offer.
Growth
Email marketers want to grow their databases and get the word out about their mailshots to as
many people as possible, and they will utilise a variety of means to do. This includes techniques like
‘forward to a friend’ links in their emails.
WORKING WITH EMAIL AFFILIATES
Advertisers can enjoy substantial volumes of leads by being featured in broadcasts which can go out
to very large numbers of people.
Email publishers who send out newsletters will often feature advertisers if they are offered
incentives such as higher commissions or exclusive voucher codes to offer to their readers. Bigger
brands are naturally more likely to be promoted.
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As these newsletters recommend several advertisers, the only type of creative that is usually
required is a small logo of the advertiser in a 120 x 60, 125 x 125 or 88 x 31 pixel size.
Solus emailers are always screaming out for high quality email creative, which very few advertisers
provide, and any that have it readily available have a significantly higher chance of being promoted.
LEAD GENERATION NETWORKS
Specialist email publishers generally focus more on Cost Per Action and Cost Per Lead affiliate
programs as these tend to generate a significantly higher Revenue Per Member than Cost Per Sale
programs.
As the kind of campaigns that perform well on email marketing are usually quite different to those
via PPC, SEO, display, and other online marketing channels, there are a number of networks which
specialise in providing email marketing advertisers. These networks are often referred to as CPA or
Lead Generation networks, and most of leading players with UK campaigns have their roots in the
US.
These networks often utilise the DirectTrack tracking platform, an advantage of which is campaigns
can be cross-syndicated to other networks utilising DirectTrack of which there are many hundreds.
Unlike traditional affiliate networks, the campaigns on these platforms usually have the tools that
email marketers need, which includes email creatives, recommended subject lines, and suppression
lists.
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MOBILE MARKETING
WHY BOTHER WITH MOBILE?
The next twelve months are being hailed as the long-awaited Year of the Mobile. By the end of 2011,
smartphone shipments will exceed shipments of PCs (PC World) and there will be one billion heavy
mobile data users worldwide by 2013 (Morgan Stanley). Consumers are embracing all things mobile
at a rapidly increasing rate, from iPhones to Android and apps to augmented reality. The shift to
mobile is changing everyday behaviour and critically, the percentage of mobile users who purchase
through their phone hit 13% in 2010 (eConsultancy). Here at Top10.com we’re certainly considering
Mobile as a vital part of our strategy for 2011.
HOW WILL THIS AFFECT PERFORMANCE MARKETING?
The biggest change to the affiliate community will be the rise of applications as opposed to
traditional sites. It will also be critical to understand the effect of mobile browsers on search
campaigns and the suitability of both publisher and merchant sites for mobile traffic.
WILL MOBILE TRAFFIC ACTUALLY TRACK WITH AFFILIATE NETWORKS?
The short answer is – yes! A lot of publishers have expressed this concern, but Chris Giddins,
Product Director of Digital Window, says:
‘Most mobile devices now use web browsers that are very similar to those
found on a PC. Whether you're using Android or iPhone, all of these devices
use a browser that allows JavaScript to run and cookies to be set. This
means that the network’s standard tracking technology will work and track
transactions successfully. If the browser doesn't support JavaScript, then
basic pixel tracking will always be there as a backup. Apple Safari and
Google Chrome both support HTML5 so shouldn't have any issues with
advanced affiliate tracking.’
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DESIGNING FOR MOBILE USERS
Although the tracking might be up to scratch, the merchants’ sites may be another question! Only a
third of advertisers have a mobile strategy in place (Forrester), with a very small minority actually
having an m-commerce site.
Mobile sites require a completely different design approach to regular websites according to Harry
Jones, Creative Director at Top10.com: ‘The most obvious difference is the smaller screen of mobile
devices which forces you to focus on only the essential features and calls to action. Although this is a
constraint for designers it can also prove refreshing, allowing you to create much simpler and clearer
products.
“Touch input also has a big influence on how we design for mobile. A finger is much bigger and
clumsier than a mouse so buttons and interactive elements need to be larger and you should
minimise text input wherever possible, such as in the checkout process and on order forms. On a
technical level the site should be rigorously optimised to load as quickly as possible and tested on as
many devices as possible – not just iPhones.’
Take this example from Amazon:
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Although screen size and load time can be restrictive, working on a mobile platform offers a wealth
of opportunities that are simply not feasible on a desktop due to legacy browsers. Additional
features available to mobile designers include access to device position through an accelerometer,
user orientation from a digital compass, precise location via GPS, scanners and imaging from a
camera. Use of these new technologies allows designers to create highly interactive and engaging
features.
UNDERSTANDING YOUR MOBILE AUDIENCE
Mobile users tend to be much more receptive to impulse purchases, spending less time on any one
site. However they have a lot more confidence in the buying process – at a recent Google event,
M&S shared that a customer bought a £2,000 sofa through their mobile! In terms of their
demographic mobile internet users tend to be more urban and higher earners; 47% of mobile
internet users live in higher populated areas and 42% earn over £40,000 per year (Essential
Research).
Experian breaks down mobile shoppers into five categories:
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MOBILE APPLICATIONS
The last 24 months have seen a meteoric rise in the use of mobile applications. As of Oct 2010, the
iTunes App Store has over 300,000 apps available and has seen over 7 billion downloads.
If you get the magic formula right then apps can be a license to print money – Jamie Oliver’s digital
cookbook is the top-grossing app to date with industry rumours placing its revenue close to seven
figures, while Angry Birds publisher Chillingo sold to EA Games for a whopping $20 million and has
even branched into plush toy merchandise.
A number of major players now operate heavily through applications, such as Facebook, Amazon,
eBay and Tesco. Affiliate companies have been quick to follow suit. Vouchercloud from Invitation
Digital is the UK’s largest mobile voucher app with close to a million downloads, which allows users
to find deals and offers for businesses in their immediate vicinity using geographical targeting.
Nectar offer exclusive bonus point offers via their iPhone app and Shopstyle have created a fashion
shopping portal that really embraces the tactile experience of a smaller touchscreen.
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Top10.com also recently released their first iPhone app, The Top10.com Speed Test. This is a free
app that allows you to test your 3G data connection speed and see individual 3G speeds mapped
across the UK, even down to street level. Already Top10.com have collected several thousand 3G
speed tests with little promotion of the app, demonstrating how powerful the App Store can be.
Developing and submitting an app can be quite complicated, so here are some tips to get you
started:
Test your app thoroughly. It can be embarrassing if your launch in the App Store is ruined
by negative reviews, so make sure the app works well on all devices and software versions
Set aside time to submit the app. From certificate requests to screenshots the submission
process is quite complicated. With Apple taking about a week to approve your app you can
be back to square one if you make a small mistake
Consider your keywords carefully. Keywords are heavily weighted in the algorithm for App
Store search results so as with SEO, consider the terms you want to appear for when you
submit your app
Provide a means for feedback. Apple doesn’t allow you to respond to reviews or get in
touch with people who have downloaded the app, so provide a support contact or some
incentive for people to send you feedback
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SHOULD I BUILD AN APP OR A MOBILE SITE?
There is a big industry debate about whether the move to mobile should take place via apps or a
mobile site. On the one hand, there was a reported 40% rise in browser usage on mobiles
throughout 2010. A mobile site also removes platform bias, with no need to choose between the
operating system you build for. There are now close to 50 different app stores, each with different
requirements!
On the flip side, an app can have much greater functionality. For example, ‘Amazon Remembers’ is a
feature within Amazon’s app that allows a user to take a photo of a product and view matching
results available to buy from Amazon, which trumps their mobile site.
The general consensus appears to be that if you’re going to take your mobile strategy seriously, then
producing both is the way forward. Apps can compliment mobile sites and interlinking between the
two can provide the optimum user experience.
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MOBILE SEARCH
Mobile now accounts for 4% of all search traffic on Google, which is greater than the volume of
searches across the whole of Bing (Marketing Week). Paid mobile search has been slower to catch
up, as mobile only accounts for 2% of total PPC volumes. This means that companies who can get in
early and do it right can make big wins.
The reduced competition means click prices are lower, and the click-through rate for mobile ads is
20% higher than online (Marketing Week). However, the success of a campaign fundamentally
hinges on the mobile optimisation of the destination site.
Earlier in 2010 Google introduced the ability to add a ‘click to call’ telephone number to mobile ads.
A call from these ads costs the same as a click, meaning that advertisers can pick up ‘warm leads’ at
a bargain rate.
Big gains can be made from adding additional layers of targeting to mobile ads that aren’t available
in an online campaign. For example, sites that don’t convert on smaller handsets may work on larger
formats like iPads and tablets. According to Digital Window, network-wide click to sale rate on
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iPhones is 1.5% compared to 3.5% on iPads, which shows that screen size is directly proportional to
conversion.
The phone numbers chosen for click-to-call ads are also important to think about. Mobile users on
O2 can’t directly click on an 0800 number to make a call, nor can they copy and paste it to the dial
pad of their phone. This means that campaigns using teletracking numbers should exclude O2, or use
another format of number for these customers such as those using 03 prefixes that are just charged
at a standard network rate.
Top10.com run successful mobile search and click-to-call
campaigns for the majority of their clients, and are
expanding their activity month on month as mobile
searches continue to grow in number. Partner sites
optimized for search and with robust call tracking allow
Top10.com to push growing budgets into the mobile space.
They expect to double their marketing spend on mobile
search by the end of 2010.
LOOKING TO THE FUTURE
Consumers are rapidly changing their behaviour to
embrace the possibilities for researching and purchasing
products via mobile, and it will be a test of the affiliate
industry as to well we adapt. Publishers need to embrace this change or risk being left behind. We
would expect that the next twelve months will see the start of developments to the tracking and
reporting tools available specifically related to mobile. A major benefit of affiliate marketing is its
adaptability and the key will be to see mobile as a huge opportunity rather than a threat to ways of
working we’re accustomed to. This should lead to an exciting year ahead!
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SOCIAL MARKETING
PERFORMANCE IN SOCIAL MEDIA
May 2010 represented a tipping point for Social Media in the UK. Until then, the greatest traffic
driver for unique visitors had been the big three search engines – Google, Yahoo! And Bing (With
Google taking a majority share). May brought online a new world order of traffic – whereas Search
Engines provided 11.3% of all UK visitors, Social Media contributed 11.9%. This shift in dynamic has
obviously been noted by the advertising world and heralded new avenue for planners to deliver
branding–focused advertiser budget. But where does this leave performance marketing?
Performance can be measured in many ways. An impression. A Click. Theoretically, any form of user
engagement can be considered ‘performance’. However, what advertisers are really seeking from
Performance marketing is a certain level of measurable return-on-investment. This is where Social
Media needs to be looked at very carefully.
As already mentioned, Social Media has proven itself as a prime channel for advertisers seeking to
align their brands with certain user/customer demographics. However, this kind of performance
does not necessarily mean greater products sold for the advertiser. In fact, according to
eConsultancy’s Social Media Guide (2010), two-thirds of marketers are actually planning to increase
investment in social media even though less than one-fifth can effectively measure ROI.
So where do we start to understand how Social Media can help advertisers effectively attract new
customers?
RETENTION VS ACQUISITION
Firstly, we need to reconcile the fact that Social Media can be used for both retention and acquisition
of customers. As a communication method, Social Media – due to both size and relevance – is
unrivalled when speaking to your customers. For examples on this just look at how brands use
Twitter (London transport organisations used Twitter to update customers on latest disruptions
during the severe weather conditions in London over December 2010). This customer service
ensures retention of existing customers. Having said that, recent studies have shown that only
nineteen of the top one-hundred UK technology companies are using Twitter commercially*.
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To best comprehend where Social Media can contribute to customer acquisition we need to delve a
little deeper into the online behaviour of UK consumers. Acquisition by definition, states that you
are gaining something you did not previously have. This leaves Social Media in an interesting
position.
The availability of product ratings has proven to be a factor that influenced an online purchase for
59% of UK shoppers, as was the availability of user-generated content or consumer product reviews
(57%)*. This method of UGC (user-generated-content) and reviews has propelled price comparison
sites to be amongst the most successful of UK shopping sites (Kelkoo, PriceRunner & Ciao are all
good examples of this). However, Social Media holds a crucial ace up its sleeve…
FACEBOOK & SOCIAL PLUG-INS
Facebook (which now accounts for over 20% of all time spent online in the UK*) takes up around
90% of the 11.9% contribution of Social Media to UK internet figures. With such a large user
penetration it is easy to understand that any means by which Facebook can provide user reviews or
user recommendations would potentially increase take up of product sales.
At F8 2010 (the Facebook developer conference in San Francisco) Facebook unveiled their latest
product launches – one of which was the most significant yet with regards to Performance
Marketing and acquisition in Social Media (It will also be remembered for the definitive moment that
Facebook set co-ordinates for a direct head-on ‘fight for the future’ between themselves and
Google).
The over-arching theme of the conference was that of the effect of Social Media in moving the web
towards an interlinking series of ‘connections’ between people and their respective interests. On a
mass scale, this provides developers (and ultimately affiliates and advertisers) with a powerful tool
to target and add value to users.
Facebook now has the ability to stretch into each and every content driven website by offering
developers & affiliates the opportunity to integrate a number of key Facebook features (or ‘plug-
ins’).
The most significant of these is the ‘Like’ button. You’ll recognize this from the Facebook Fan pages
and as the option on every status update/picture/event that appears on your Facebook interface.
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The Like button currently allows you to quickly and easily inform your friends when you have
positively engaged with something they have posted on their pages. This is now being offered to
publishers to allow users to see when their friends have ‘rated’ a piece of content on their sites –
importantly, these are external sites not currently in the Facebook universe.
For example, right now you can go to an article on CNN.com and see which of your friends have
‘Liked’ it. Obviously, this means your users are much more likely to read and engage with content
that their friends have recommended
For affiliates, this is significant for a couple of reasons. We saw with the Google changes (Nov 09-Jan
10) a turning point in our industry’s relationship with Google. The search-giant demanded an
improvement in the quality of affiliate sites and offer an added value to the ‘Google Users’ purchase
decision through PPC advertising. As many of you in the industry will know, this necessitated that
many affiliates solely reliant on search traffic shifted their business focus.
Then, through Real-Time, Personalized Search & Caffeine we saw Google asking publishers to start
integrating a greater level of Social Media through SEO (see the TradeDoubler Blog for more
information on how these effected affiliates – http://uk.tradedoublerblog.com/397/news/the-
effect-of-google-updates-on-affiliate-marketing/ ).
With these new changes, affiliates will be able to (quickly and relatively easily) bring a greater level
of Social Media to their sites. Hopefully, this will mean Google can start ranking affiliates higher in
SEO due to relevance and fresh/updated content. For advertisers, this obviously means their
Performance Marketing through affiliates will increase in return-on-investment.
One possible drawback may be that users are dwelling longer on the sticky content and overall
conversions rates dip (however, it can also be argued that the users that ARE being pushed through
to the merchant are of a higher quality as they have had more information in their buying cycle).
This will undoubtedly be a balancing act for Performance Marketing in 2011.
Other plug-ins that are available are a Recommended box (offering recommendations based on your
previous liked/friends-liked objects), an Activities feed and also a toolbar which sits at the bottom of
a publishers page which offers developers (and Facebook) a very strategic and flexible platform to
engage with users over a multitude of sites. It includes basic Facebook functions such as Chat and
Updates, but also has room for developers to input their own applications.
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The biggest plus point of this implementation arrives with the aid of research that shows 90% of
online consumers trust recommendations from people that they know. Given how many people in
the country use Facebook it is clear the benefit this could have to new customer acquisition across
Social Media.
CASE STUDY In October 2010, TradeDoubler launched a test with one of the leading UK loyalty-shopping
sites for a large consumer retailer. The goal of this test was to analyse if performance could
be increased across the affiliate campaign by using Facebook Social Plug-ins – namely the
‘Like’ button.
The publisher we used operates in a congested field and competes with several top sites for
greatest share of users shopping habits. Any differentiation that can help increase
conversion would be of significance given the volumes driven on a daily basis.
The results of the test found that, by implementing the Like button on a number of specific
promotions, the click-through-rates rose by up to 4.3% (Vs. base average before Social
Plug-in implementation).
This also led to a 4.4% increase in transactions. For the advertiser, this represented
thousands of pounds worth of incremental sales at a crucial period of the year. The
publisher obviously benefited from increased commissions received over the period.
Added value to the publisher was also attained through new user referrals that appeared in
friend’s status feeds.
WHAT IS THE FUTURE FOR PERFORMANCE IN SOCIAL MEDIA?
Combined, Facebook, Twitter, LinkedIn, Bebo, MySpace, Flickr & Orkut deliver around 425.9 million
unique visitors. The major benefit of perfecting performance over these sites through user
recommendations, UGC and product reviews is obvious – you will get greater market share quicker.
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Once this is realised the next steps are to start identifying which users are proving the most valuable
to your product sales.
For example if ‘User A’ has, by ‘liking’ (or other forms of referring) your offer, generated a large
amount of sales from his friends – would you see this person as a valuable customer? Chances are
the answer is yes and, if you have the ability, the opportunity to offer this customer ‘special’ deals
on your products would (using indications from the above research) statistically improve your
attempt to gain market share quicker.
Be it over Facebook, Twitter, MySpace, this ‘Influence Targeting’ can be seen as the next level of
targeting in Social Media and, technology permitting, is something that we will be recommending to
all of our advertisers over 2011.
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BEHAVIOURAL RETARGETING
The most important aspect of successful ecommerce marketing is capturing customer conversion to
a sale. On average, around 95% of visitors leave an e-commerce site without making a purchase.
While the ecommerce environment has evolved considerably over the last ten years, the "lost
prospect" problem remains a key concern. The use of behavioural retargeting can successfully
address this concern.
The problem is that modern consumers have grown accustomed to shopping online for almost
everything, but the majority of internet consumers are slow to commit. Attention is easily distracted
and it is common for online shoppers to forget about products they were interested in only
moments earlier.
During 2010 UK consumers were on track to spend an estimated £56 billion shopping online due in
part to the proliferation of broadband, as well as improvements in performance and services by
ecommerce companies1. This has made it quicker and easier to purchase online but increased the
available distractions for purchasers. It is becoming a business critical issue to retain the relationship
with the consumer and retargeting those consumers provides an effective way to do this.
Consumer behaviour is
becoming more challenging
to track, analyse and
interpret, and this has
required a more customer-
centric approach to emerge.
The increasing
sophistication, efficiencies,
and scale of retargeting
mean that retailers and
advertisers can now solve the lost prospect problem. A recent study by Criteo2 found that
retargeted customers are 70 percent more likely to complete a sale than their non-retargeted
1 IMRG/Capgemini eRetail Sales Index
2AB split tests of 5 multi-channel retailers conducted in April - June 2010
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counterparts. And by incorporating additional product recommendations, those same retargeted
visitors spend, on average, 50 percent more than non-retargeted consumers.
UK ONLINE – THE BUSINESS OPPORTUNITY The UK internet economy currently accounts for an estimated £100 billion, or 7.2% of the country’s
gross domestic product, making it the largest per capita e-commerce market in the world. It is
forecast to grow a further 10 per cent per year if current market conditions continue.3
Internet advertising in the UK alone was valued at £1.97 billion in the first half of this year - 24% of
the total UK advertising spend - only 2 per cent behind television advertising.4
As the value of this market grows, so does the requirement for more sophisticated, effective ways of
engaging with the online consumer. Ensuring that all advertising activity provides the highest return
for advertisers, whether in ecommerce or brand awareness terms, is crucial to success.
CHANGING CONSUMER BEHAVIOUR
Since January 2008, the average online
conversion rate of retailers participating in
the Capgemini Index has been falling.
There was an average conversion rate of
6% in 2008, down to 4.5% during 2009 and
3.6% to date in 2010. The decline suggests
that consumers’ online behaviour is
changing from that of a linear transactional
nature to browsing and researching
products extensively before purchasing,
either online or on the high street.
The increase of this type of casual shopping, and the growing number of available distractions that
draw potential shoppers away from their purchases, is having an impact on advertising. It means
3 Boston Consulting Group 2010
4 Internet Advertising Bureau & PWC UK Online Adspend Study H1 2010
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that advertiser investments are not maximising sales from existing site visitors, and not delivering
optimal return on advertising spend. What's worse, a customer might end up on a competitor's
website to purchase a product not because the initial product was inferior, but because the options
are abundant and locating additional information is easy.
WHAT IS RETARGETING?
Retargeting allows an advertiser to find site visitors once they have left the site, and display relevant
advertising to encourage them to return to complete a transaction.
As consumers browse a website, information about their interactions is collected. This includes
things like the pages and products they have viewed, as well as purchases that they have made.
When these consumers then leave the original website and visit other sites across the internet, they
are shown relevant ads based on these previous interactions.
Whilst there are similarities to general behavioural marketing, which uses online actions to identify
good prospects, retargeting focuses on consumers who have already indicated an interest in the
advertiser. This results in a much greater propensity to respond to the retargeted ads, which in turn
results in much higher click-through and conversion rates than standard display advertising.
With a retargeting strategy, you can continue to expose consumers to specific and relevant ads as
they surf and shop, encouraging and reminding them to return to the site of the original advertiser.
In today’s ecommerce environment, bringing ready-to-buy visitors back after they have left an
advertiser’s site should be a key part of any customer acquisition and conversion strategy.
STATIC RETARGETING
Finding and re-engaging potential customers has been an ongoing concern for all retailers with an
online presence. In its infancy, the mechanics of retargeting - also called remarketing - were fairly
basic: a user would visit a site, leave, and then would be exposed to a generic branded display ad
from the abandoned site.
Basic static retargeting is effective and has become the default methodology for most retargeting
providers. It is only slightly more successful than existing brand campaigns however, as the
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advertising offered remains generic and not targeted to the individual user. This effectively means
that the ads displayed are no different to a standard display campaign for that advertiser.
SEGMENTED RETARGETING
Segmented retargeting enables advertisers to engage consumers with increasingly relevant ads. It
does this by creating a number of display banner executions for specific segments of online
consumers. For example, if a shopper browsed the kitchenware section of a website, that consumer
would be shown a banner advertising kitchen items. Similarly, a shopper who abandons a full
"shopping cart" can be retargeted with a banner that offers a purchase discount.
Most intelligent networks offer this service, showing visitors ads based on the ‘user segment’ they
fall into. This helps build a greater rapport with the consumer than basic retargeting and moves
further towards full engagement with the consumer. Segmented retargeting has one drawback
however, which is that it doesn’t provide advertisers with the ability to personalise the conversation
by matching a specific product or offer with each individual visitor’s particular interests.
RETARGETING GETS PERSONAL
There is a third iteration of display retargeting available to online advertisers today: dynamic
personalised retargeting. A range of technological advances mean that the most sophisticated
retargeting providers are able to
offer unprecedented levels of
product personalisation in the
display ads they serve.
Instead of static, generically
branded ads or segmented ads,
retailers can now create a
unique ad for the exact shoe or
shirt or gadget that the
consumer initially sought as well
as product-level
recommendations based on their browsing history.
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Each personalised ad is created for an individual visitor in real time and can feature multiple
products in a single banner, offering the consumer a "mini-boutique" within the ad. The placement,
creative and products displayed are optimised to achieve the highest click-through rate (CTR) and
conversion to sale or action which means the user only gets shown ads which they are likely to
interact with.
BENEFITS OF RETARGETING
What makes re-targeting unique is its narrow focus. Advertising content and offers can be based on
something as specific as an individual’s product view history, not simply a section or type of site
visited (like the boots category page on a fashion site, vs. a specific boot brand and style).
In addition, this level of personalisation allows banners to be created dynamically in real time,
optimising the placement, content and products depending on that individual’s history. Essentially,
a consumer may see a different ad variation every time.
In the end this means higher CTRs and conversion (purchase) rates. Criteo’s clients, for example,
achieve CTRs that are 400-600% higher than standard banner ads, and their conversion outperforms
current standards.
Ultimately, sophisticated retargeting provides a combination of personalisation and dynamic
interaction. It means that online consumers can be shown ads for relevant products, at the right
points in the buying cycle, ensuring that advertisers experience tremendous return on investment
(ROI) on their ad spend.
RIGHT MESSAGE AT THE RIGHT TIME
Retargeting can be leveraged at virtually every phase of the consumer lifecycle, from building
awareness to driving purchases and customer loyalty. The greatest benefit of retargeting however is
its ability to convert browsers into buyers at the right time – when they are considering a purchase.
DISPLAY A PERSONALISED MESSAGE TO AN ULTRA QUALIFIED AUDIENCE
Retargeting only potential customers that have previously been to an advertiser’s websites allows
the advertiser to personalise their marketing message and focus their efforts on their most valuable
prospects.
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TAKING THE GUESS WORK OUT OF MESSAGING AND DELIVERY
Retargeting technology enables advertisers to spend less time and money on creative design and
execution, by taking the guess work out of predicting customer intent. Sophisticated algorithms
determine in real-time the most effective creative template, products and messaging as well as
placement that will deliver conversions.
TAILORING THE MESSAGE - ACQUISITION FUNNEL MANAGEMENT
By identifying where consumers are within the advertiser’s acquisition funnel, messaging can be
tailored accordingly. This means advertisers can retarget visitors who have just browsed the
homepage differently to those who have viewed several products or added products to their basket
and then left without purchasing – depending on which is more important to the advertiser.
CROSS-SELL / UP-SELL
The sophistication of retargeting technology means that advertisers can extend their campaigns to
include recommended products in addition to those viewed by the consumer as well as retarget
existing customers with products and offers that may be of interest. A good example would be a
travel website where a customer who has bought a flight to New York may be targeted with hotels
for the dates they are travelling.
SEQUENTIAL RETARGETING
For products with a longer purchase cycle, retargeting can leverage sequential advertising to
reinforce the message as the consumer goes through the research and consideration process. A
potential customer who has not responded to the first or second ad can be presented with a
discounted offer in the third ad to incentivise the purchase. Certain providers can optimise the
messaging sequence based on the response to each creative.
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COMPARABLE TO SEARCH MARKETING
Display advertising has historically been less successful in providing the direct response
measurement of search, but is still viewed as one of the strongest forms of advertising to
demonstrate creativity and build brand awareness.
Retargeting acts as the perfect hybrid of the two. It allows advertisers to benefit from the rich
environment of display advertising, engage with consumers who have shown an interest in the
brand and, when results are measured on a post-click basis benchmarked against conversion and
ROI, delivering ROI comparable to search.
In fact, retargeting is the perfect complement to a search campaign as it enables advertisers to
convert interested consumers who specifically searched for products but did not complete a
purchase.
A recent comScore study which looked at various display placement strategies such as premium,
contextual, run-of-network and retargeting, found that retargeting generated the highest lift in
trademark search behaviour.5
IMMEDIATE AND MEASURABLE RESULTS
Personalised retargeting offers attractive cost-per-click (CPC) and cost-per-acquisition (CPA) pricing
for personalised retargeted banners. As a result each and every penny spent is an investment in a
potential customer. Due to the precisely targeted and personalised nature of this type of
advertising, the post-click conversion rates are significantly higher than other types of advertising.
5 When Money Moves to Digital, Where Should It Go? comScore and ValueClick, Sept 2010
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Retargeting effectiveness – click-through and conversion rates
IMPLEMENTATION
The technical implementation of behavioural retargeting is simple. The relevant code is similar to
web analytics code and can be integrated into a site in the same way. This piece of code enables the
retargeting provider to analyse a consumer’s interaction with the site such as which pages and
products are viewed, and understand and respond to how far the potential customer progressed
through the acquisition funnel.
An advertiser can then provide the retargeting company with product feeds containing all the
information they would like displayed within the retargeting ads, from pricing, images and any offers
that may be available. These are usually provided in xml or csv format.
Creative is then designed in accordance with the advertiser’s brand guidelines.
When a consumer visits the site, an anonymous cookie (a small text file which does not contain
personally identifiable information) is automatically placed on their browser which enables the
retargeting provider to identify that browser across the web.
Everything else, from determining when and where the ad is displayed, to which products to show, is
optimised by the retargeting engine and is dynamically generated on-the-fly in real-time once the
consumer has left the advertiser’s site.
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WHERE DO THE ADS APPEAR?
The retargeting ads appear across the network of the provider, which can differ in size and range.
There are two loosely defined inventory sources that a company looking to aggregate inventory can
access: automated supply and managed supply.
The growth of ad exchanges, supply-side platforms and new evolved networks or demand-side
platforms (DSP), means that aggregating audience and inventory can be automated. The latest and
fastest growing methodology is real-time bidding (RTB) which enables smarter buying decisions and
a competitive advantage for retargeting providers who truly understand the value of a consumer
and therefore the ad impression. Intelligent retargeters such as Criteo are using these sources to
great effect and as early adopters are enjoying a significant competitive advantage.
Despite the growth in automated supply, the best performance and strongest interaction will often
be achieved with a consumer visiting a premium publisher site, one whose inventory may not be
available through networks and exchanges. This is predominantly accessed via direct relationships
with individual publishers or networks.
A combination of the above will ensure the biggest reach and optimal ad performance.
IMPORTANT FACTORS WHEN DECIDING ON A PROVIDER
REACH
Retargeting should ideally be executed across a network that has the size and diversity of websites
to reach consumers virtually anywhere. The broader the reach, the more visitors the campaign will
reach in a faster time and higher frequency. This can be critical if the advertiser’s products and/or
services have a short window of opportunity (eg sale or flight dates).
Choosing a retargeting provider with a large media network will ensure the best reach and optimal
campaign effectiveness.
FLEXIBILITY
Another key consideration is how much flexibility the provider has in both creative and campaign
management.
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The retargeting company should also be able to customise the creative based on an individual
consumer’s on and off-site activity, creating banners on-the-fly based on as much data available to
drive the highest CTR and conversion rate.
PRIVACY
In the current environment it’s critical to ensure that technological advances fully take into
consideration consumers' privacy. Every consumer should understand the following with regards to
online advertising in general and retargeting in particular: why am I receiving this ad, what kind of
information was used to tailor the ad to me, and if I want to, how can I stop receiving these ads and
others like it?
Retargeting providers do not collect personally identifiable information. The data gathered is
completely anonymous and is used for statistical purposes only, and there is no way to identify a
specific internet user. No data is shared with advertisers or publishers and no third-party data is
used for targeting purposes. Providers simply record specific product browsing data in order to
create ads that are most relevant to each unique consumer. The best providers are transparent
about their privacy policies and give clear, simple instructions to consumers on how to opt out of
future retargeting, if they so prefer. Criteo was the first retargeting company to proactively make
this information available to consumers by establishing an “i” icon in every banner they serve.
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CONCLUSION
In the universe of behavioural marketing strategies, retargeting is a great way to cost efficiently
capitalise on each and every site visitor. Search marketing, generic display ads and offline efforts will
do some of the work, while retargeting will finish the job - converting browsers into buyers, buyers
into repeat buyers and repeat buyers into life-long, loyal customers.
“Behavioural Retargeting addresses the lifelong merchant quest of recovering lost traffic
and non converting visitors. It helps improve customer engagement, push up conversion
rates and increase revenue from the received traffic.
This advertising method is nothing new, but the widespread accessibility of BR providers,
the availability of advanced targeting platforms, the use of product feeds and the shift
to paying for the results it generates has created a high interest among merchants, who
are interested in maximising the return of every advertising penny.”
Robert Glasgow, Managing Director, Webgains Ltd
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AFFILIATE MARKETING
HOW DOES AFFILIATE MARKETING WORK?
Advertisers allow their products or services to be promoted on other publishers’ websites (affiliates)
to drive customer traffic back to their own sites.
They do not pay for this advertising, they only pay a commission for any lead/sale or other action
determined that the affiliates then generate.
TOP TIPS FOR RUNNING A SUCCESSFUL AFFILIATE MARKETING CAMPAIGN:
Use a reputable Affiliate Network and/or Agency: utilise their knowledge,
experience & relationships with affiliates
Use multiple channels of communication with your key affiliates. Keep
them informed about developments, upcoming online and offline
marketing campaigns, involve them, talk to them about the program, listen
to their views
Make sure you have all the tools you need for an effective program;
product feeds, range of creative, and above all, a clear message about what
you are trying to achieve
Be aware of the competition, know what’s happening in your industry,
understand the peaks & troughs, what makes different affiliates tick and
most importantly, what your competitors are doing online. Then use the
information to your advantage, don’t just sit there and wait to see what
happens!
Understand that not all affiliates are the same in terms of traffic delivery
and that internal channels may need different incentivisation, commission,
monitoring and treatment
Look at your affiliate program as an integral part of your marketing activity
and not just a low cost way to acquire customers. And then treat it as such
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ABOUT AFFILIATE MARKETING
As the global recession continues to leave its mark, Marketers are faced with an ongoing dilemma of
how to balance budget cuts whilst also maintaining brand visibility and growth.
For some, this can sadly mean simply slashing the numbers. However, as Online continues to
dominate our lives, more savvy Advertisers are seizing the Digital Marketing opportunity and
adopting multi channel strategies which cleverly combine cost effective above and below-the-line
activity, whilst at the same time achieving consistent brand messaging and keeping themselves
firmly in their consumers’ mind’s eye.
In terms of Digital support, this most likely includes a mix of Search, Display, Email Marketing, Price
Comparison and Affiliate Marketing. However, it’s the latter channel that continues to rightly receive
ongoing attention from Advertisers who recognise the benefits of its reach and flexibility, alongside
the very attractive added bonus of its transparent, performance-based business model whereby
they only pay commission for leads/sales or actions generated. After all, if a marketing route can
actually deliver to the bottom line as well as achieve standout, then finance directors will be even
happier!
In fact, Affiliate Marketing is now regarded as one of the most effective and remunerative Marketing
channels in the Online Marketing armoury, and is currently being utilised by many brands to not only
increase their Online standout and compliment other above-the-line and below-the-line Marketing
activity, but also deliver actual measurable revenue contribution and new business leads too.
Each year, this low risk channel’s slice of total Marketing spend therefore continues to expand and
alongside its rapid growth curve in terms of retail revenue contribution alone (over £4.6bn at last
count), the sector looks set to remain a key feature within the broader Marketing mix for a good
while yet.
However, although Affiliate Marketing allows Advertisers to utilise the ‘virtual sales force’ that
affiliates involved in their affiliate programs represent and possibly capture incremental traffic that
may have otherwise gone untapped, there are still a number of brands who may be missing out on
the channel’s full potential.
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For a start, it shouldn’t simply be viewed as the answer to driving sales alone. The channel will
enhance and support a company’s sales activity, but not provide a single solution to its Online sales
requirement. Advertisers need to also consider how they will deliver subsequent lead or sales; how
they will be viewed by new customers; and how this will fit with their overall image.
The need to ensure an affiliate program is fully integrated into other promotional activity is
therefore vitally important. It must be viewed and managed as an integral part of a brand’s
marketing strategy and not simply as a bolt-on tool, or afterthought. On the most basic level, all
creative applications (ie offers, advertisements, branding) should be consistent, timely, relevant and
on brand message.
AFFILIATE MARKETING FOR ADVERTISERS
Advertisers equally mustn’t forget that it is a Paid-for Performance Model, and it is essential that
they understand and deliver their own key part in it.
In its simplest form, Affiliate Marketing revolves around the relationships instigated and nurtured
between merchants and affiliates. Indeed, this requires time input to regularly communicate with
partners; update them on latest promotions; evaluate and discuss joint activity; and to ensure they
remain as up-to-date as possible with business objectives and developments.
In summary, affiliate programs have to be managed and the more input an Advertiser puts into the
activity, the better the long term return. At the same time, brands should listen to their affiliates,
take note of what does and doesn’t work, and regularly discuss ways to make a program even more
effective.
Yet this level of focus is not always possible, and some Advertisers either do not appreciate the level
of commitment they need to contribute to these partnerships, or do not have the time or
experience to maintain and manage successful programs themselves.
For most brands, whether they have an in-house affiliate resource or not, the best course of action is
to utilise the long-standing experience and reach of Affiliate Networks to effectively broker their
affiliate relationships and then provide the pivotal point of contact between themselves and their
affiliate partners.
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Some Advertisers may also prefer to appoint Affiliate Management companies, especially if they are
smaller merchants who don’t have the time or enough resource to maximise the channel’s full
potential, or, are embracing it for the first time.
These suppliers have the strategic skills and knowledge to help a brand launch and maintain an
affiliate campaign, and have the experience to recommend the best Networks for specific sectors or
campaign types. In effect, they become the Advertiser’s unbiased ‘outsourced program manager’,
performing the function of an in-house staff member, yet allowing the Advertiser to still own the
relationships they have with their affiliates and/or Affiliate Networks.
In this way, the merchants still have the total transparency and access they would if they were
knowledgeably managing their own program internally, but with the full support, guidance and
experience of an agency to ensure their campaign is optimised continually.
Whichever route, merchants also need to carefully consider what they are aiming to achieve from
their affiliate campaigns. Over the past few years especially, the channel has become so much
broader than simply a model for merchants who sell products online, and companies are using it to
drive a variety of results for their business now.
Typically, the sectors that have so far been most successful in using Affiliate Marketing include
Travel, Retail and Finance. But, increasingly, there are many other types of businesses that are now
turning to the channel, such as FMCG and B2B brands.
Merchants attracted to the business model should therefore ask themselves ‘What are we trying to
achieve online?’ Is it about acquiring Customers? Acquiring Sales? Collecting information? Is it about
Consumer interaction with our website? Or simply driving traffic to our site?
The good news is that all of these actions can be applied to Affiliate Marketing and the channel
doesn’t have to be a constant part of a brand’s Online Marketing plans either. The model is very
good at supporting seasonal activity or campaign based promotions. In fact, the beauty of this
channel is actually in its ability to successfully mimic and project a business’ Online strategy:
consolidating its existing sales routes; enhancing brand image and pushing that brand into new
territories.
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CASE STUDY
Established global footwear brand, Crocs Europe BV, Inc. turned to Existem Affiliate
Management to co-ordinate its pan-European Affiliate Marketing activity in a bid to extend
its reach in the affiliate space and online presence across the continent.
Additionally, the iconic brand, which was running affiliate programs across eight European
territories, decided to integrate its UK activity into the Affiliate Window network to
especially leverage the size and scope of its publisher relationships within the country.
Jay Custard, Global Director of E-Comm of Crocs, said at the time, “As a global company,
the European market is an important territory for us. We are focused on ensuring the brand
develops a consistent share across all regions. Existem AM and Affiliate Window both have
the experience and relationships that will enable us to grow within the EU.”
Utilising their extensive knowledge of the market and the solid relationships they have with
key players, Affiliate Window, Zanox and Existem AM set out to ensure the brand was
capturing as many sales as possible over the continent, and in turn assist it in its goal to
expand market share. In the 6 months since the strategy was put into action, sales via the
affiliate channel have shown triple digit growth.
Consistent communication of both product ranges and tactical promotions have changed
the perception of the Crocs brand into a multi-product footwear retailer.
This has led to a reduction in seasonal revenue fluctuations and stronger year round
affiliate sales. In-house local language support and pro-active affiliate recruitment assisted
by both Affiliate Window and Zanox have increased the numbers of active affiliates driving
both clicks and sales. This has been positively reinforced by the communication and
promotional activity.
"This is a prime example of best practice being applied to an affiliate programme bringing
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in positive results" says Mark Russell, MD of Existem Affiliate Management and lead
account manager on Crocs "It clearly shows the value of well managed collaboration
between client, network and agency, allowing all paries to leverage their respective
strengths under the guidance of the agency to bring the best possible opportunities to
publishers"
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CASHBACK / LOYALTY
OVERVIEW OF CASHBACK SITES
Cashback sites are continuing to deliver vast volumes of sales for the advertisers that work with
them. There has been considerable growth in the sector over the past couple of years and has
shown no sign of slowing. Cashback sites will typically be among the top earning affiliates on most, if
not all, affiliate networks.
AFFILIATES WITHIN THE SECTOR
There are a number of cashback sites that merchants are able to work with. They vary from sites
that pay all of the commission as cashback rewards (so called ‘100%’ cashback sites) such as Quidco
(http://quidco.co.uk/) and Top Cashback (http://www.topcashback.co.uk/) to points based sites
such as Maximiles (http://www.maximiles.co.uk/) and RPoints (http://www.rpoints.com/). It’s also
important to consider company loyalty schemes run by companies such as Asperity.
Some of these sites charge an annual membership fee (including Quidco) while others are free to
join (Top Cashback).
TYPICAL SITE USERS
One important consideration for merchants in deciding whether to work with cashback sites is the
type of consumer who uses them. Feedback we have received indicates the typical cashback
consumer:
- Is a savvy online consumer
- Appreciates that there are savings to be had online
- Accesses multiple points of reference
- Is loyal to a cashback site or the cashback concept
Contrary to popular opinion, research seems to indicate cashback users are also more likely to be
drawn from a higher income demographic and therefore have an increased propensity to spend
more, with the cashback reward driving up average basket values. Data from one of the leading
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cashback sites indicates that almost 50% of members earn £50k or over per year and just over half of
all members are within the A and B socio economic groups.
WHERE CASHBACK WORKS BEST
Cashback sites can drive incremental sales in a number of sectors but where they can especially add
value is in sectors where there is little product differentiation or if there is a switchers market – e.g.
Insurance/Broadband. With a carefully planned strategy you can effectively take market share from
competitors.
Similarly, the products that a merchant sells have an impact on how effectively they will work with
cashback sites. If the product is something that is widely available from a wide range of merchants
e.g. an electrical product that is offered by a number of retailers, the amount of cashback can be
used as a competitive advantage. By offering a higher rate of cashback, market share can be taken
from competitors.
Cashback site users are able to filter the results by amount. Where a product is available from a
number of merchants at a similar price, the cashback user may be unlikely to show brand loyalty to a
store and will instead opt for the highest cashback rate; in a sense brands share the loyalty to their
offering with the loyalty to the cashback site and model.
An exclusive rate for one of the cashback sites will often result in greater exposure across the site
which should in turn lead to an increase in market share. This will also feed back into the popularity
listings to ensure better placement for your brand. This can be rotated across the various cashback
sites so they are all able to demonstrate how effective each of them is at promoting your brand.
On the other hand, if the product that is being sold is exclusive to you as a merchant then the key
question is whether the customer is brand loyal and would have bought the product from you
regardless of cashback being offered. This is not to say merchants in this situation shouldn’t use
cashback sites but they will need to understand various performance metrics at play such as new
customer numbers, average spend and how incremental the sale is.
Merchants who run lead based campaigns would be advised to avoid promoting through cashback
sites, as sign up campaigns can be abused in order to earn cashback unless additional checks and
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balances are put in place (quality of the leads for example and setting the CPA at a level that takes
account of the potential lower quality of leads through an incentivised channel).
It’s worth noting that consumer forums will often feature where to get ‘free’ cashback and lead
based programmes are usually referenced in this instance.
When promoting through cashback sites, the greater the checks and balances process at the
merchant’s end, the less chance there is for fraudulent or unethical activity to be carried out through
them. For example, if a telecoms merchant is able to track through from application to connection,
then cashback could only be paid once the connection has taken place. If you are a retail merchant,
cashback can be paid once the returns/cancellation period has passed.
INCREASED CONVERSION RATES THROUGH CASHBACK SITES
The nature of cashback sites also means that the conversion rates from these sites tend to be high.
When a consumer clicks through to a merchant on a cashback site, there is a good chance they will
have already carried out their research and will be in a position to buy.
In order to increase conversions further, it is important that merchant descriptions are kept up to
date and also take account of products a merchant sells that may not be eligible for cashback. It’s
also vital to include details of any existing voucher codes that may generally be available online and
whether cashback will be paid on purchases that have also involved a voucher code. If this is the
case, margins must obviously be worked to include cashback, voucher code and affiliate network
fees.
DISPELLING THE MYTHS OF CASHBACK SITES
There are a number of myths that are associated with cashback sites portraying them in a negative
light.
Sale Stealers
One of the myths that has seen a lot of debate in the affiliate community is that cashback sites do
not play a crucial part in the customer journey, they merely “steal” the sale from a content affiliate
who has done all the hard work to initially attract the customer.
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Research carried out by Affiliate Window highlights that this is not actually the case; in most
instances the cashback site is the only referring affiliate in the sales journey and where there are
multiple affiliate clicks in a sale, they are most likely to originate from other cashback affiliates.
Many loyalty and reward sites do not explicitly encourage users to delete cookies and seasoned
cashback users will know how to click through and purchase to avoid overwriting their cookies.
Therefore the chances of a significant amount of cookies being deleted from consumers’ machines
is likely to be reduced, although there is no evidence to currently back this up.
Cashback sites are becoming brands in their own right, so rather than being an afterthought to see if
cashback is available for a particular merchant, they are now becoming the first port of call and
should be seen as a valuable affinity or brand partner in much the same way a large publisher or
portal would be.
NEW CUSTOMER ACQUISITION
There is a common perception that cashback sites do not deliver new customers, rather it is existing
customers of the merchant using cashback sites to get an additional discount from their purchase.
However, cashback sites are able to deliver new customers to a merchant. A consumer that regularly
searches for cashback that may not know your brand has the opportunity to find it when browsing
these sites. Affiliate Window has looked at new customer data and has the following findings for
two merchants, one in the fashion sector, the other in telecoms:
WORKING EFFECTIVELY WITH CASHBACK SITES
For some merchants, merely be listed on cashback sites is enough for them. For the more savvy
merchant, planning a strategy around cashback sites can result in significant sales volumes.
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In order to get the most return from cashback sites, there are opportunities to receive increased
exposure. By providing cashback affiliates with exclusive cashback deals, merchants can get their
offers featured in “top tips” sections as well as newsletters that go out to members.
To build up relationships with each of the cashback sites that are able to deliver volume, a rotating
cashback strategy can be implemented, where each site has the exclusive for a period of time.
During the period of the exclusive offer, the cashback sites will give increased exposure to push the
offer.
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AFFILIATE NETWORKS
BENEFITS OF NETWORKS
The heart and soul of the affiliate marketing industry is the affiliate network, providing the tools
and technology that allows the process to work. Here we take a closer look at the affiliate
network, looking beyond the technology and highlighting the role they play in the industry.
WHAT ARE AFFILIATE NETWORKS?
At its core, the backbone of affiliate marketing is it’s accountability and the transparency that it
offers and the performance nature of remuneration. The ability to track clicks, match cookies and
report on the individual items in a shopping basket is, at a fundamental level what sets affiliate
marketing aside from any other ‘referral scheme’. The technology that powers and facilitates this is
at the heart of the affiliate network.
In the relationship between the merchant, the affiliate and the consumer, it is the network that at a
technological level binds them all together. The network provides the platform for the merchant to
promote their affiliate program to the affiliates who are signed up to the network and a mechanism
for payment. It allows the affiliate to easily pick up their ‘links’, small pieces of code unique to
merchant and affiliate. It allows both parties to report on their activity and the tools to manage
their campaigns.
Affiliate networks are usually remunerated via the network override, which is an additional
percentage (30% is industry standard) of the commission paid to the affiliate. A simple model to
demonstrate this would be that in a £100 sale where the affiliate commission is 10%, the affiliate
received £10 and the network would charge an addition £3. Total cost of sale £13.
There are alternatives to using a network including out of the box solutions and vanilla solutions for
white labeling, so what are the advantages of using an affiliate network? On a general level
merchants benefit from the various economies of scale in the services that networks provide and
that a merchant would struggle to match for the same price in house. Affiliates benefit from
accurate impartial tracking and the general activities networks perform on their behalf. The next
section will cover this in detail.
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TRACKING
Fundamental to the success of an affiliate program is tracking. Network tracking has been
developed over many years and can be configured to work with most programs, merchants sites and
payment gateways. The network tracking provides visibility of activity, and will report at product
level giving merchants and affiliates full visibility of what is performing and what is not. Affiliates
also benefit from being able to manage all their campaigns through a single interface. Network
tracking system work with 1st or 3rd party cookies, server to server tracking and can be configured to
record single actions or a combined lead to sale.
TECHNOLOGY
Although the basics of tracking are similar, each network has developed their own approach and
methodologies over time. The main physical extension of a network is the network interface that
allows the merchant and affiliates to manage their activities, communicate, access creative and build
reports. Both tracking infrastructure and interface are a key benefit of using a network. They have
been the subject of major investment and developed over many years in conjunction with the
affiliates, merchants and agencies that use them.
The very nature of the network as a solutions provider means they have the skills in house to build
extra functionality. This can be bespoke for large merchants and affiliates, providing tools to handle
product feeds and increase conversion. Each networks interface will offer affiliates a different set of
tools, sometimes driven a by a particular strength in a vertical sector, and are a point of
differentiation for them. Most also provide an API for the more advanced affiliates and merchants
who can integrate the data into their proprietary systems.
AFFILIATES AND MERCHANTS
The networks represent the hubs of the affiliate marketing landscape and each will work hard to
make sure the best affiliates are working with them. Relationships on an individual and company
level are important, with those networks with well-established publisher teams being particularly
successful in this area. The network may define themselves by the types of merchant and therefore
affiliate (and vice versa) that they have on the network. A network can play a key role in increasing
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the exposure of an affiliate program with their publishers through events, promotional spaces on the
interface, newsletters, and one to one communication.
AFFILIATE REACH AND LONG TAIL
Networks have large numbers of affiliates signed up to the network and the network provides a
single point of access. This is particularly useful for quickly building the number of affiliates on a
campaign and attracting the long tail where sales are purely incremental, albeit of lower volume,
and where a client may not invest logistical resources in recruitment. However these publishers do
promote a merchants brand and contribute to the groundswell of the campaign and therefore its
overall success. Networks can help a merchant source appropriate partners from their knowledge of
other programs in the same sector.
CONTROL & FRAUD
Fraud is not uncommon in affiliate marketing although it is the case of a few rotten apples rather
than the norm. Networks have invested significantly in reducing fraud by introducing various
measures to stop fraudulent affiliates before they join the network and making sure they cannot re-
join when they have been removed. Technical improvements such as IP checking, click to sale lag
time analysis and affiliate traffic lighting all contribute to the on-going process.
Affiliates must apply to join a network and in most instances must then apply to each individual
program as well. This puts the control in the merchants hands and gives a level of control over who
will promote the program.
COMMISSIONS
Affiliate marketing famously rewards performance. Cost per action (CPA) is the most common term
to describe this but it may apply to sales, leads, or any trackable predefined action. Networks are
active within a wide variety of sectors and will be able to advise a new merchant on what
commission they should consider offering on their program as well as tactical advice for promotions.
COMMUNICATIONS
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Communication is key to the performance of a program. Networks can assist in communicating new
offers to a merchant’s affiliates. Most interfaces will allow segmentation of affiliates so that
communications can be tailored. Others compile lists of weekly offers so that affiliates can react
quickly to promotional activity or to changes on the program. Every network sends out regular
newsletters to the affiliate base with news of program changes or recent launches. Some will offer
merchants promotional slots on these newsletters and it may be charged. Many have Facebook
pages, blogs and Twitter feeds which allows the affiliate to choose the communications method of
their choice. Activity around key times like Xmas can significantly increase the presence of a
program in an otherwise noisy period and get cut through.
ACCOUNT MANAGEMENT
Account management will be offered by the network and for programs that bring significant return
to the network this will often be offered free of charge. For smaller clients where the resource
cannot be funded by the return ion override, account management may be charged as required. For
the larger merchants, the network will be a valuable source of expertise and intelligence due to the
large numbers of merchants they host campaigns for.
PRODUCT FEEDS
Product feeds have become important parts of a merchants program, on average accounting for 25%
of the program revenue. They allow affiliates to pick up data feeds of a merchant’s product
inventory and integrate with their sites. The network interface can host the feed, integrate their
tracking code and provide a platform from which the affiliate can retrieve it.
AFFILIATE PAYMENT
One of the most critical functions an affiliate network performs is paying the affiliates. As affiliates
are not salaried or employed by the network or the merchant, the network interface issues an
invoice on the affiliate’s behalf which is then paid by the network. The merchant receives a single
invoice including the networks fees rather than dealing with a ton of paperwork. It is also easier
from the affiliate’s perspective dealing with one payment for multiple merchants.
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TRACKING SOLUTIONS
Tracking sales and leads is the heart of Affiliate Marketing, without the ability to track results reliably
performance marketing doesn’t exist. Affiliate Tracking is surprisingly simple. Each time a visitor
clicks an Affiliate URL the Affiliate Network will set or store tracking information on the visitor’s
computer so that the Affiliate Network knows which Affiliate referred that visitor to that Merchant.
The Affiliate Network will provide each Merchant with their individual HTML tracking code. This is
added to the page at the end of any action the Merchant is paying Affiliates for, normally this goes
onto the “success” or “thank you” page shown to the visitor after making a purchase. This tracking
code will pass order or lead data to the Affiliate Network. When the Affiliate Networks tracking code
is shown, for example after each purchase, the Affiliate Network will read back it’s tracking
information, which was previously set, and pay commission to the Affiliate, if any, who referred the
visitor making the purchase or lead.
Currently, Affiliate Networks in the UK operate on a “last click wins” basis, this means if before a
transaction takes place multiple Affiliates refer the same visitor, only the last Affiliate who sent the
visitor before the transaction takes place will be paid the commission. Other methods, such as
splitting commission amongst all the Affiliates who referred the visitor, are currently in the early
stages of consultation within the industry.
TRACKING METHODS
Most commonly, browser cookies are used to store tracking information. Unfortunately, some
reports have stated that privacy concerns result in almost 40% of users routinely deleting their
cookies. Newer web browsers make deleting cookies a one click process and even offer private
browsing, where cookies are not stored or set. It sure sounds like we should just give up! Luckily,
Affiliate Networks for a number of years have been investing in ‘cookieless tracking’ to ensure
performance continues to be reliably tracked.
Cookieless tracking is the ability to track sales and leads without solely relying on traditional browser
cookies to store the tracking information. There are numerous forms of cookieless tracking, and
most UK Affiliate Networks will use at least one or two forms. These are used in addition to regular
browser cookies, and will normally only be called upon in cases where there is no cookie available to
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use, in other words they are fall back options used when no regular cookie is available. Regular
browser cookies are still the primary form of tracking.
In a recent survey Affiliates rated reliable tracking as the 3rd most important aspect of an Affiliate
Program. This is understandable, since Affiliates are investing time and money into generating
sales/leads for a Merchant - they don’t want to worry about their performance not being tracked
reliably. If Affiliates believe a Merchant has reliable tracking, then they will have the confidence to
support the Merchant. When a Merchant is considering which Affiliate Network will run their
affiliate program, the tracking technologies that each network can offer them, should be a key factor
in their selection process.
There are 5 common methods for cookieless tracking used today by most Affiliate Networks.
Merchants & Affiliates should ask their Affiliate Network which methods they support.
FLASH COOKIES
Since version 6 of Adobe Flash Player, Local Shared Objects has been available to flash movies.
These work much like regular web cookies, and offer flash movies with the ability to store data on
the user’s computer and read it back at a later date. It is the closest replacement to traditional
cookies available. When the visitor clicks through an Affiliate URL, the Affiliate Network will load a
flash movie which sets the necessary tracking information. When a sale or lead takes place, another
Flash movie will be loaded by the Affiliate Network to read the tracking information.
IP TRACKING
One of the most basic forms of cookieless tracking is to use the users IP Address. The IP Address is
recorded when the user clicks an Affiliate URL. Later when a sale or lead takes place, the IP Address
of the user is again taken and compared to the IP Addresses which previously clicked an Affiliate
URL. If a match is found, that can be used for tracking. However, increasingly ISP’s are using proxy
or cache servers, so many users may share the same IP Address. Also dynamic IP allocations – where
the user will have a different IP Address each time they connect to the Internet, means this isn’t a
very reliable form of tracking and certainly cannot be used long term. It can be used for limited
periods of time however – so for example, only used if that same IP Address clicked an Affiliate URL
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in the last few hours, you can then be pretty certain it is the same person who clicked the link. You
do still have to remove and ignore common proxy and cache servers.
ETAG/CACHE TRACKING
It is possible to track visitors using the browsers web cache by manipulating the Etag or the Last
Modified date of a page or file. Each time a browser requests a page it first checks its cache, and
then sends a request to the server asking for the file if it has been modified since the version in the
local cache, or if the file has a different Etag. Using this it is possible to cache a file in the user’s
cache which contains the tracking information or to assign a different Etag to each visitor. It’s
certainly not as flexible as other methods as it is much harder to update the information stored in
the cache once set, also users tend to clear their cache regularly or have set a maximum size for
there cache, so its always being refreshed. However, this method will certainly help in situations
where regular cookies are blocked from being set by the browser or third party software.
VOUCHER CODES
Recent years have seen a massive surge in voucher codes which is only going to grow as users
become more and more savvy looking for a bargain. Voucher codes can also be used for tracking
depending on the tools offered by your Affiliate Network. By creating unique customised voucher
codes for a single Affiliate, your Affiliate Network can assign commission coming from sales which
use that voucher only to the Affiliate who was assigned the unique voucher code. This opens up
opportunities for Affiliates to promote the vouchers in printed or offline media, where an Affiliate
URL cannot be clicked.
DATABASE TRACKING
Even with the best tracking platform, the time span of a cookie and even cookieless tracking options
may be shorter than the time a visitor may take to make a purchase. A visitor may take days, weeks
or sometimes even months before making a purchase, especially when it comes to high value ticket
items. Merchants who prompt or encourage visitors to sign-up to a newsletter or create an account
prior to purchase – perhaps with the incentive of exclusive offers or discounts, are able to make use
of database tracking.
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Once a Merchant is able to convert the user into giving their details, such as an email address, this
can be assigned to the Affiliate who sent the visitor. Whilst no commission is paid at this stage, it
means either the Affiliate Network or the Merchant knows which Affiliate is due commission when
the visitor makes their purchase. This means that cookies are no longer used and it is a more
permanent form of tracking, only failing if the visitor uses either different account details or email
address. Your Affiliate Network may be able to make this process easy, meaning minimal
development or integration cost to the Merchant.
COOKIELESS TRACKING PERFORMANCE
This graph shows the percentage of sales and leads tracked via each different tracking method,
between 1st January 2010 and 30th November 2010 through the Paid On Results Affiliate Network. It
shows regular cookies still being the prime method used for tracking. In total, cookieless tracking
accounts for 12.22% of all sales and leads for this period.
Certain Merchants show a higher percentage of cookieless tracking. Adult toy/gift Merchants have a
higher percentage of cookieless tracking than other types of Merchants, with Food/Drink and Health
& Beauty Merchants showing the lowest percentage of cookieless tracking being used.
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WHEN IS COOKIELESS TRACKING USED?
Every Merchant will pay Affiliates commission for sales which happened within so many days of the
last click taking place. This is referred to as the “cookie period”. For example if a Merchant offers a
30 Days Cookie, it means sales which take place within 30 days of the last click will be tracked and
paid to that Affiliate. The same principle applies to when cookieless tracking is used by the Affiliate
Network.
Are cookieless tracking technologies only needed when a Merchant offers a long cookie period? Is
relying only on regular cookie tracking reliable for short period of time? The answer is no. Below is
a graph which shows the percentage of sales which tracked using regular cookies vs. cookieless
tracking. Each column represents the period of days between the last click and the sale taking place,
the further right in the graph the greater the number of days between click and sale, with the first
column being all sales which happened in less than 24 hours from the last click.
The graph shows that 3.88% of sales which were tracked within 1 day of the last click taking place
were tracked using cookieless tracking. As the period between sale and click grows, the number of
those sales tracked using cookieless tracking grows. This shows that as time passes an increasing
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number of regular cookies are deleted or lost, so the need to use cookieless tracking increases.
However, even in the early days after the click, performance cannot be reliably tracked without the
Affiliate Network offering some form of cookieless tracking.
THE FUTURE OF COOKIES
Each time a new version of a web browser is released brings with it more ways for users to block,
clear or reject cookies. One recent example is Private Browsing. In Private Browsing mode, the user
can browse websites without history being recorded or cookies set, this is now a standard feature of
most new browsers. In these modes existing cookies are not transferred over, and cookies set
within this mode are not stored.
Internet Explorer 9 when released will offer a new featured called Tracking Protective List. This is a
list of websites which can or cannot set regular cookies on the user’s computer. However, a useful
feature is that websites themselves can suggest the domain names which need to be added to the
user’s white list. Therefore, websites which rely on third party domains being able to set their
cookies, such as their Affiliate Networks, should be able to prompt the user to add these to their
white/allow list. At the time of writing this it is unclear how the integration of this will work. This is
certainly better than a complete block of cookies.
Newer browsers also offer new creative ways of cookieless tracking which will continue to provide
an important fallback to regular cookies. Already some features in HTML5 offer the potential for
cookieless tracking.
The good news is cookies are used for more than tracking users. Try disabling cookies and browsing
your favourite websites, the constant prompts to log-in to each website is enough to make anyone
re-enable cookies! Users take for granted the ability to visit sites such as Facebook, Twitter and
Hotmail and be instantly signed in. This is all made possible with cookies, so they are not going away
anytime soon and will continue to be a primary form of tracking for Affiliate Networks. Along with
the continued investment by Affiliate Networks in other forms of tracking, the future of reliable
tracking for Affiliates is assured.
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COMMISSION TYPES
Performance Based Digital Marketing is an increasingly diverse landscape with payment models that
reflect this. Fortunately the industry has developed a variety of TLA’s (Three Letter Acronyms) to
further confuse the matter! In this section we look at the major payment methods that exist, how to
choose which method is most applicable for your campaign and the advantages and disadvantages
of each.
SETTING YOUR OBJECTIVE
As with all marketing activities, your first priority is to identify your objective. This should be a
distinct and measurable aim. Potential objectives may be:
Generate Additional Sales
A general increase in targeted traffic
Improve Reach to a specific audience
Increase brand recall within a geographic area
Increase Average Order Value
Your set objective should have buy-in from across your organisation. Internal discussions are
imperative to ensure that your chosen objective adds value to the overall business.
Once your objective is defined, clear targets should be set. The next task is to ensure that your
chosen commission/payment type is appropriate for your objective.
CHOOSING YOUR METHOD
CPM (COST PER MILLE)
Impression based payments are as old as Internet Marketing itself. Publishers charge advertisers a
fixed cost per thousand impressions served. Costs vary significantly according to both the reach and
targeting of the impressions. Usually the more specific the targeting, the higher the CPM rate. The
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traffic delivered should then be tracked internally by the advertiser to determine the overall return
on investment.
Advantages
Delivers targeted advertising to an appropriate audience
Specific audiences easily targeted
Breadth of impact simple to achieve
Creative messaging controlled by advertisers
Disadvantages
Performance measures usually limited to impressions only
Tying spend to sales increase difficult unless measuring post impression
sales
Post impression sales measurement flawed
CPC (COST PER CLICK)
Perhaps the most well known of all performance marketing methods due to the phenomenal success
of the adwords system. Publishers charge advertisers either a fixed or variable cost per click.
Payments are tied directly into traffic delivered to the advertiser. Costs vary significantly depending
on the sector of activity and the competition within the sector. This traffic should then be tracked
internally by the advertiser to determine the overall return on investment.
Advantages
Payments directly tied to performance – will definitively increase traffic
Usually very targeted traffic either by user search, or industry sector
Usually some element of creative control
Disadvantages
Competitive markets tend to become very expensive
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An increase in traffic may not lead to an increase in sales
Budgets are directly linked to user activity making them harder to manage
CPA (COST PER ACQUISITION)
By linking payments directly with the acquisition of a customer, publishers are able to offer an easy
to understand and genuinely performance advertising solution. Tracking on the advertisers site (very
often delivered by an affiliate network) provides both the publisher and the advertiser full visibility
on both performance and commissions owned. The advertisers perceived value of a customer and
the publishers perceived value of their traffic govern costs.
Advantages
Direct link between the generation of a customer, and payments
Transparent relations between publisher and advertiser
Shared agenda of improving conversion rates
Disadvantages
Tight control of messaging can be difficult to maintain
Entire model relies on “last-click” tracking, does not reward publishers for
traffic in the early stages of the buying process
Highly competitive markets may operate below the point of marginality
PPL (PAY-PER-LEAD)
Particularly well-used within the finance sector, advertisers will establish a set rate for a delivered
lead. The criteria for an acceptable lead will vary significantly between advertisers, from a single
email field to a 15 field form. Leads will then usually be validated based on an agreed set of criteria
(usually related to ensuring the lead is “real” – ie the prospect can be contacted and initially
expressed interest).
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Advantages
Usually very scalable, can produce very high volumes
Allows for internal follow up and conversion
Low initial commitment from user
Particularly appropriate for certain verticals
Disadvantages
Considerable administration involved in validation
Can be open to fraud (large quantities of invalid leads) if not managed
appropriately
No guarantee of lead conversion
HYBRID
Although currently not widely considered, as objectives become increasingly sophisticated, it’s only
natural that multiple payment methods should be considered to fulfil them. Advertisers create
bespoke campaign payment structures with publishers with a focus on providing value across the
purchase process. If objectives are focused on reach, then CPM rates can be increased, if the focus is
more related to traffic then a CPC element can also be introduced.
Advantages
Precise and multiple objectives can be targeted
May be more appealing to publishers with competitive inventory
Disadvantages
Can be extremely difficult to define an appropriate model Complex commercials may be off-putting to some publishers
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BEST PRACTICE POLICIES
INTRODUCTION
The affiliate marketplace has long been an amalgam of many different promotional methods and
disparate interests. In order to provide some clarity and coherency the industry over the past couple
of years has worked hard to formalise best practice initiatives through the formation of an industry
body.
The Internet Advertising Bureau (IAB) is the trade association for online advertising and each online
discipline has their own separate council designed to represent their needs, for affiliate marketing
this is the Affiliate Marketing Council (AMC).
The AMC is comprised of nine affiliate networks (Affiliate Window, Affilinet, buy.at, Commission
Junction, LinkShare, OMG, TradeDoubler, TradeTracker and Webgains) and is free for affiliates,
advertisers and other interested parties to attend. Meeting every other month, the AMC deals with
a wide range of issues broadly categorised under the headings of self-regulatory initiatives, best
practice, research, educational and promotional activity.
The self-regulatory work of the AMC has attracted the most coverage from the industry and is
becoming an increasingly important part of online activity. As more and more budget is shifted into
digital advertising so online channels will need to ensure they have appropriate checks and balances
in place to offer assurances to advertisers and external regulators.
Therefore since 2008 the AMC has been focused on providing ‘codes of conduct’ for various areas of
promotion designed to standardise and further professionalise procedures to ensure excellence is
delivered by the channel daily.
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VOUCHER CODE; CODE OF CONDUCT
In late 2008 the AMC decided one of the first areas that needed self-regulation was voucher coding.
The growth of this market has been well documented. It’s now one of the most dominant and
compelling areas of affiliate marketing but with growth came a realisation that certain practices
needed to be modified in order to demonstrate the incremental value the industry has long prided
itself on.
Therefore the voucher code; code of conduct was issued, being further modified twice since its
launch in December 2008. The code deals with how codes can be displayed on site. It also requires
deals, promotions, sales and other content be split out in order to provide clarity for the consumer.
Expired content must also be labeled as such with further guidelines for how this could be
showcased on affiliate sites. The most recent incarnation of the code of conduct also made
reference to all affiliate sites that make use of voucher codes rather than the traditional ‘voucher
code’ sites that have previously drawn most attention.
An additional modification from late 2010 made reference to user generated content. This activity
may not typically be used by traditional voucher code sites but codes will often be posted by users
on consumer champion sites. It’s obviously imperative where these sites have a commercial
relationship with the advertisers whose codes are listed that the codes are eligible for the affiliate
channel. The changes to the code therefore extend to cover these relationships.
In drawing up the code of conduct it was imperative that clear guidelines be provided without overly
prescriptive language for fear of damaging the entrepreneurial nature of the industry. Underlying
the code is an understanding that affiliates should ensure the content they provide is clear and
unambiguous, offering a positive consumer experience.
In order to offer further assurances to the industry a disciplinary procedure was also drawn up
outlining the process for dealing with contraventions of the code. Additionally an email address was
created for potential breaches of the code to be reported to.
The full code can be viewed http://www.iabaffiliatemarketing.com/updated-voucher-code-code-of-
conduct/.
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ETHICAL MERCHANT CHARTER
The AMC is keen to offer best practice guidance for all areas of the industry and there was a general
feeling amongst members that advertisers entering the channel for the first time needed
standardised guidelines for a range of practicalities they may not be best placed to address
themselves.
Affiliates can often feel there is not enough transparency between themselves and merchants and
improving this would make them more likely to promote that merchant above competitors. The
AMC feels closer relationships should be sought by both sides and being as open as possible will help
engender this. Inevitably much of the responsibility for fostering this will fall to the affiliate
networks.
Whilst not all areas will be relevant to all advertisers in 2009 the AMC issued the Ethical Merchant
Charter.
The Charter requests advertisers are transparent with their affiliates on their de-duplication policies.
As digital marketing has matured so advertisers may only pay for the last referring click that led to a
sale, transaction or lead. However some advertisers (for a variety of reasons) will choose to exclude
some channels from their de-duplication policies. The Charter therefore suggests advertisers inform
their affiliates which channels they are de-duplicating against.
In addition the Charter recommends advertisers spell out the affiliates they work with and why they
may restrict certain affiliate groups from their campaigns.
One area guaranteed to frustrate affiliates is the decline of a lead or sale. Whilst for some
advertisers this may be a natural consequence of not wanting to pay out on returns or credit failed
transactions there can frequently be little guidance offered on why a sale or lead is not paid out.
Therefore it is again recommended that advertisers endeavour to provide this information. A list of
reasons advertisers might choose to give is provided in the Charter.
Other areas the Charter encourages advertisers to offer additional clarity on include the products or
add-ons that are commissionable and finally ensuring enough notice is provided if significant
changes are being made to a programme’s terms and conditions.
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The Charter is available for all advertisers and offers neutral, cross network advice designed to
facilitate transparency between all parties in the affiliate marketing relationship.
BEHAVIOURAL RETARGETING
Behavioural Retargeting (BR) is a method of online promotion that entered the affiliate channel for
the first time in 2010. It is premised on serving banner advertising that is targeted based on previous
user behaviour. Retargeting helps companies advertise to website visitors who leave without a
conversion, encouraging them to return and transact.
The core premise is that because the consumer has had a level of engagement with the
advertiser/merchant, additional exposure (be it a general banner or banner featuring specific offers,
deals or products) following the consumer visit to the advertiser/merchant site will lead to that
consumer transacting when they previously may not have done.
The ads that are served will usually be bought from ad networks by BR companies on a CPM (cost
per thousand impressions); the resulting sales from the ads being rewarded by
advertisers/merchants on a CPA basis when operated via affiliate networks.
In order for behavioural retargeting to be effective many BR companies require Post Impression (PI)
or Post View (PV) cookies to be used alongside traditional click cookies. PI/PV cookies are impression
based as opposed to click based; in other words, a cookie is stored on an impression being served
rather than a click.
Historically very few networks or affiliate programmes have operated PI/PV cookies, the ‘harder’
action of a click being seen as more in line with the CPA and sale function of affiliate marketing
rather than the branding element of banner creative (and therefore impression cookies).
In working with PI/PV cookies the industry needed to set some hierarchy rules involving click and
impression cookies and standardising overwriting procedure across all networks.
Also, given banner impressions are perceived as a more passive, brand focused area of online
marketing, clarity is needed on whether the cookie length should be different depending on the type
of cookie.
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With BR becoming more prevalent and BR companies looking to run activity on a CPA basis via
affiliate networks a code of conduct has been devised that all BR companies must adhere to when
running activity via member networks of the AMC. The code will be available before mid 2011.
OTHER WORK OF THE AMC
In addition to the codes of conduct and Ethical Merchant Charter the AMC has also published
guidance for advertisers looking to work with affiliates who may have plug-ins or downloadable
software running through the channel.
This type of promotional method is relatively rare in the channel but the AMC felt clarity that an opt-
in to the technology offered was a good way of ensuring advertisers would be aware of the
ramifications for their existing affiliate traffic. The technology tends to be offered as an add-on for
current affiliates.
The full code of conduct can be seen here.
It was also felt the quality of product feeds offered by advertisers left much room for improvement
so a comprehensive guide to retail feeds was issued in late 2010. This comprises two documents, the
first offering more of a general introduction to product feeds and why they are important and the
second more of a technical specification. Further explanation and links to the guides can be found
here.
2010 also marked the launch of the AMC blog, Twitter account and regular minutes and agendas.
Minutes can be viewed on the blog as well as occasional case studies, industry updates and other
useful information. The blog is also available for guest posts. Contact Helen Southgate for more
information.
The AMC meets every two months with two separate committees (regulatory and promotional)
meeting every month and feeding back to the full Council. The meetings are held at the IAB’s offices
in Macklin Street, central London.
CONCLUSION
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As the digital space continues to grow its share of marketing and advertising budget so it will fall
further under the scrutiny of external regulatory bodies. By demonstrating we are continuously self-
policing, offering industry wide best practice as well as guidance we stand the best chance of
securing the channel’s future longer term.
The AMC can only succeed if it is embraced by the whole affiliate community, advertisers, agencies
and networks. Whilst the work will inevitably be network focused (as they are best place to elicit
change) the interests of all parties need to be served in order for the Council to remain relevant.
Future work has to focus on the strengths of the channel and Council members will be tasked with
finding new and innovative ways to shout about the channel and extol the virtues of performance
marketing.
In a relatively short space of time the Council has achieved a lot but it’s evident there is still much
more to do in order to secure a bigger share of digital spend. Fortunately with the strongest talent
committed to the task the future of affiliate marketing is very bright indeed.
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VOUCHER CODES
ABOUT
This document is set to give an outline of what an advertiser needs to take into consideration when
working with voucher codes.
There has always been a lot of speculation within the industry about voucher codes and the best
practice. Some non voucher code affiliates were concerned about the potential overwriting of
cookies by voucher code sites in the final stages of the buying cycle.
In September 2009, Red Letter Days resolved to respond to this concern. The challenge was to
develop a fairer system that would enable every affiliate to provide compelling and exclusive deals
to customers, without disadvantaging any particular affiliate type. After four months of intensive
development work from October 2009 to January 2010, Red Letter Days proudly unveiled an
innovative approach to this issue that represented a huge step forward in the way in which
advertisers deliver special offers to affiliates and which responded directly to a complex and highly
emotive industry issue.
ADVANTAGES OF USING VOUCHER CODES
Voucher code sites are rewarded more effectively on incremental sales, while content
sites receive highly targeted and relevant offers to drive stronger conversion.
The system addresses a common problem for advertisers, whereby constant requests
for exclusive offers are received. The Red Letter Days website contains over 2,500
products which can be provided at exclusive discounts, enabling affiliates to suggest
and create their own highly targeted deals.
The same product can even simultaneously be offered at a wide variety of different
prices on various affiliate sites, and the price seen by the customer is entirely
dependent on the affiliate link followed.
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The discount available to the customer is visible throughout the entire customer
journey, providing a continual visual reinforcement of the offer available.
Any affiliate can decide to opt in or out of the system, depending on individual
preferences for delivering special offers.
The Red Letter Days approach to voucher codes has always been to empower affiliates
by offering complete transparency about the margin available and enabling affiliates to
determine how that margin is divided up. A voucher code site can now continue to opt
for a deeper discount with less commission without any fear of an exclusive offer being
republished without permission.
VOUCHER CODE GUIDELINES
When looking to implement voucher codes on your affiliate programme, there are many things that
need to be considered and planned for. Affiliates can be seen as a virtual sales team and in order for
them to promote the programme effectively they need to be given all possible information that will
help with their campaigns.
Here are some points that need to be considered when looking to use voucher codes in an affiliate
programme:
Do you have the ability to create bespoke trackable codes/deals?
Will the code be available to everyone to promote?
What is the biggest discount/commission combination you can afford to give to your
customers & affiliates without infringing on margins?
How long with the code be valid for?
Are there going to be any restrictions on the code?
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How do you deal with sales from a voucher code affiliate where a discount code has not
been used?
Would you decline commissions for any sales that have been made from a non-voucher code
affiliate where a code has been used in the purchase?
Always try to create deals/ discount codes that give you some room to manoeuvre around your peak
selling seasons.
It is important to ensure that you publish comprehensive guidelines and terms & conditions on your
programme as these are a useful resource for affiliates when researching your programme. They
also provide the necessary transparency between merchant and affiliate, acting as a reference point
when explaining breaches to any terms & conditions of your programme.
CASE STUDY: ‘CONTROLLING THE BOX’ AND ENABLING URL-BASED DEALS (INTELLILINKS)
The first step in achieving the overall vision was to develop the ability for the Red Letter Days site
to either display or hide the voucher code entry box in the checkout, according to the affiliate ID
and whether the affiliate has an active discount code. This would ensure that customers driven
from sites without a code would not see this box (and therefore not be prompted to search for a
voucher code), whereby non-affiliate or voucher code affiliate traffic would still see it.
The next stage involved enabling affiliates to pass in an extra parameter in the inbound URL called
a ‘deal ID’. This ID, represented in the URL string as dealid=!!!id!!!, is recognised by the Red Letter
Days site and a corresponding promotion is applied automatically throughout the customer
journey. The types of deals that can be arranged are highly flexible, including:
£ or % off an individual product;
£ or % off a category of products e.g. Driving;
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£ or % off a subcategory of products e.g. Driving > Ferrari Driving;
£ or % off products site-wide;
the ability to exclude any already discounted products or any other products specified from
any category, subcategory or site-wide based deal; and
the ability to set a minimum spend before the customer can receive a discount.
the ability to create limited number deals, “Deal available to the first 20 customers, etc…)
In addition, an affiliate is not restricted to running only one deal at any time. Deal IDs are exclusive
to individual affiliates and must be used in combination with the affiliate’s ID, so there is no risk
that another affiliate can hijack an exclusive deal.
One of the most powerful features of the system is that deals are session-based, meaning that the
customer must follow the link from the affiliate site in order to display the relevant offer/s. This
gives real exclusivity to the affiliate and a very strong call to action. It also addresses any potential
issues caused by hiding the voucher code entry box, as the customer has been provided with a
compelling reason to convert.
The discount would be displayed to the customer throughout their purchasing journey.
Discounted pricing shown throughout a
category
Picture name – product-category
Discounted pricing reflected in the basket
Discount shown for individual product
Picture name – product-specific
Minimum spend in order to receive a special
offer
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AFFILIATE REACH
This technology allows an Advertiser to deal with each affiliate on an individual basis and not on a
blanket or cluster approach. Many affiliates tend to have more than one promotional method,
therefore, making it important that they are treated as individuals and not clustered together with
other affiliates based on their sign up details. Exclusive deals can be created for more than one
affiliate, allowing for maximum exposure to many different customer segments.
The release of this new technology has enabled Red Letter Days to increase the number of active
affiliates on their programme. By limiting your programme to certain affiliates, you risk losing out
on opportunities to increase your customer and affiliate reach. Therefore, careful planning and
consideration should be undertaken when deciding what promotional methods are supported and
made available through your affiliate programme.
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PRODUCT FEEDS
Product feeds are used for a range of applications, both within Affiliate Marketing and within online
marketing wherever it is important to include specific product information within the advertising.
The advantage of product feeds is that an eCommerce merchant can easily communicate
information about a large number of products, or about changes in pricing or availability of those
products, or both, to partners and affiliates. Hence, feeds tend to be particularly important for retail,
mobile and travel retailers as their product offering varies continuously based on merchandising,
pricing and availability.
The simple way to conceptualise a product feed is to imagine that all the key information from your
website has been condensed into a simple data file. Forgiving the graphics and layout, a third party
would be then be able to use that data file to recreate your product offering on another third-party
website, as with many applications in affiliate marketing.
Specifically within affiliate marketing, feeds are used for the following types of activity:
Price Comparison
By bringing lots of feeds together from multiple retailers, a price comparison
affiliate is able to compare the pricing and availability of products, allowing the
consumer to choose the cheapest, or usually a combination of the cheapest and
most trusted, retailer to purchase from.
Shopping Comparison Engines & Aggregators
The key difference between “shopping comparison” and “price comparison” is that
the affiliate is using product attributes other than just price and availability to
provide users with a shopping experience. For example, the affiliate may offer a
fashion shopping experience where a user can filter products by colour size, style
and price band to find products that match the users’ requirements. These sites will
use the rich attribute information available in some retailer feeds to improve the
user experience. Within travel the term “aggregator” is often used to describe the
affiliate publishers who process multiple feeds and APIs from a range of flight
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and/or holiday companies. This data is then presented to users on a range of
selection criteria, usually including destination, date, board basis and availability
information so that a user can review pricing and make effective comparisons
between travel offers.
PPC Affiliates
PPC Affiliates will use product feeds as useful sources of keywords from which they
can construct PPC campaigns and build landing pages. Key attributes for this type of
activity will include descriptions, titles and categories which will contain rich
sources of keywords from which to construct both keyword lists as well as
interesting advertising copy.
Third-party applications and plugins
There are many applications and plugins available within the affiliate marketing
sector which make use of product feeds. For example, dynamic link technologies
(e.g. Skimlinks) and pre-configured widgets (e.g. Easy Content Units) make
extensive use of product feeds to allow affiliates to use product data on their
websites without necessarily having to have the technical capabilities to work
directly with product feeds.
Affiliate Network Tools
Once an eCommerce company’s products have been loaded into their affiliate
network platform, a range of tools have been developed to help affiliates quickly
build links for specific products and categories they wish to promote. Hence,
content sites can ensure that they promote products that are relevant to the
context of their articles, improving conversions and earnings. Product feeds are by
far the easiest way of keeping this product information up to date within the
affiliate network as they can be updated as often as required (normally once per
day for retail and mobile and more often for travel).
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Each affiliate network will have its own range of tools and it is recommended that affiliates spend
some time reviewing these on each affiliate network to ensure that you are able to maximise the
promotional opportunities available to you.
WHY DO YOU NEED A PRODUCT FEED?
A product feed is a data file containing information about the products listed on an e-commerce
company website. Hence, feeds are data files which can be used to represent the inventory that you
had for sale on your website at the time the data feed was generated.
WHAT ARE PRODUCT FEEDS USED FOR?
Product feeds can be used within a variety of online marketing practices. Common applications of
feeds include affiliate marketing, comparison shopping engines, Google product listings (Google
shopping), paid search automation, dynamic display advertising, social media integrations and
mobile phone applications. As the use of the web becomes more sophisticated, new applications for
feeds are appearing all the time, meaning that they are becoming increasingly important in online
marketing.
WHO NEEDS TO PRODUCE A PRODUCT FEED?
It’s important to consider product feeds as part of your online sales and marketing strategy,
particularly if your site retails many different products, or if you sell products who’s pricing and
availability frequently change. Hence, the three main e-commerce categories for product feeds are:
Retail
Where the product feed describes each product’s attributes, pricing and
availability.
Mobile Phones
Where the product feed describes the combinations of product (phone) attributes
such as the handset features as well as the contract attributes such as the price per
month and the number of minutes of calls per month etc.
Travel
Where the product feed could describe one or two legs of a journey (e.g. flights), or
describes the combination of a product (perhaps a hotel and its facilities) along
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with the journey information (the combination providing us with all the
information on a holiday).
Other categories can also benefit from the use of product feeds provided that a suitable data format
can be used to communicate the products and services between the e-commerce company and the
user of the product feed. However, they are out of the scope of this guide.
WHAT ARE FEEDS USED FOR WITHIN AFFILIATE MARKETING?
Within affiliate marketing affiliates use product feeds in a multitude of ways, all culminating in
driving sales to the merchant. Here are some examples of how product feeds can be used within
affiliate marketing:
Product comparison Feeds are essential for affiliates who compare pricing, attributes and
availability of products for users.
Paid search affiliates PPC affiliates will use a range of attributes within feeds to determine
campaign keywords, copy creation, which products to bid on.
Content affiliates From blogging to news aggregation, product feeds help to ensure
well-matched embedded links within content-rich sites.
Loyalty affiliates Voucher code and cash back sites are starting to incorporate
product information into their sites.
Innovative Sites Affiliates are entrepreneurs and innovators. If you have a poor
product feed (or don’t have one at all) you could be left out of
exciting and dynamic revenue generating projects.
Dynamic Advertising/Widgets
There are a growing number of third-party providers who build
functional widgets and applications based on data feeds. These can
then be incorporated easily onto affiliate sites while providing
enhanced functionality and conversion for merchants and affiliates.
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HOW MUCH OF MY AFFILIATE REVENUE SHOULD BE GENERATED BY FEEDS?
Clearly, the exact amount of revenue that your product feed generates depends on several factors.
However, a good quality product feed that is well distributed could be generating over 25% of all
affiliate sales. Therefore, a good quality product feed is an essential part of your affiliate marketing
toolset and is worth investing in. Your affiliate network will be able to advise you more specifically
on your particular category, and based on their experience in your category.
ARE THERE DIFFERENCES IN FEED STRUCTURE FOR DIFFERENT RETAIL CATEGORIES?
Clearly, the information required to describe a book, a DVD or a TV will be very different to those
required to describe a pair of shoes or a dining room table. Hence, when considering which
attributes (or data fields) your product feed will contain, it is important to evaluate the different
types of products that you sell, and consider how the data contained within your feed(s) might vary
between your product types.
However, in Part II of the Product Feed Best Practice Guide – Retail called “Feed Structure and
Attributes”, we detail how some of these individual categories should be catered for, as well as
providing guidance on core attributes such as title, category, image, URL, price and SKU which every
product should contain.
WHERE CAN I GO FOR MORE PROFESSIONAL GUIDANCE ON PRODUCT FEEDS?
As you’ll be using product feeds for affiliate marketing, one of the best sources for additional help
and advice on your feeds will be your affiliate network(s). Your network will be able to provide you
with specifications and information on uploading your feed to their feed platform. It is important to
note that these vary according to each network. Your network(s) will also be able to provide you
with information and contact details for feed creation and management specialist companies who
are able to assist with all aspects of your feed marketing.
WHICH FILE FORMAT(S) SHOULD I USE TO CREATE MY FEED(S)?
The most common file formats for product feeds are XML and CSV. There are advantages and
disadvantages with each of these, the key advantages being that XML files are better at representing
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products which have variants (e.g. colours and sizes in fashion) whereas CSV files can be opened and
viewed in standard spreadsheet software such as Excel.
SHOULD I SEND AFFILIATES PRODUCTS THAT ARE OUT OF STOCK OR AVAILABLE FOR PURCHASE
IN-STORE ONLY IN MY FEED?
As affiliates only get remunerated from online sales that they have initiated, providing products to
affiliates that are not available to purchase online (be they out of stock or in-store purchases only)
will lead to reduced earnings per clicks (EPC) and conversions which will negatively impact your
affiliate programme. Hence, it is not recommended that you include these products, or at least
include the appropriate attribute values so that these products can be filtered out by affiliates as
required. Another possibility is to enter a date into this attribute to indicate when a product will be
available to purchase if you have this available (this is especially the case for items that can be pre-
ordered).
HOW SHOULD I APPLY TRACKING TO THE URLS IN MY FEED?
Should you wish to incorporate your own tracking into your feed activity you simply need to apply
this to the URLs as per normal before supplying the feed to your affiliate network. Your affiliate
network will then apply their tracking to your URLs prior to sending it out to affiliates.
WHAT SHOULD I DO IF I HAVE PRODUCTS THAT ARE RESTRICTED TO ADULTS, OR ADULT
PRODUCTS?
If you sell adult rated products such as adult DVDs, alcohol or provocative lingerie it is recommended
that you include an attribute in your feed to mark which of your products is adult rated. Hence,
affiliates can filter these appropriately to suit their own audience requirements.
SINCE FEEDS ARE BEING USED EXTENSIVELY IN FASHION THESE DAYS, DO I NEED TO INCLUDE
GENDER INFORMATION IN THE FEEDS?
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If you sell product which is targeted at particular genders such as fashion it’s important to help
affiliates filter these products by gender. Hence, this attribute should feature in your feed.
WHAT ABOUT SPECIFIC ATTRIBUTES FOR PARTICULAR VERTICAL CATEGORIES? HOW DO I
INCLUDE THESE?
Many product categories have specific attributes which only apply to these types of products. For
example, if you retail books and DVDs then you can make use of attributes such as “ISBN” numbers
and “genres”. If you are a multi-category retailer then it’s worth reviewing your categories to
determine which attributes you need to add for these particular products.
CASE STUDIES
FusePump and Argos published a recent case study, showing how improving the quality of a
product feed improved their metrics in the affiliate channel. Argos achieved an increase of
171% in their earnings per click (EPC) and 34% increase in their conversion. For a copy of
this case study, please contact FusePump directly.
Marks & Spencer also replaced their feeds with feeds that meet the requirements of the
IAB guidelines. They have seen a significant return on investment on this project and have
continued to expand on their feed marketing activity since.
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DEEPLINKING
‘Deeplinking’ is very simply the act of creating a hyper link or dedicated URL that points to a specific
page or image within a website, rather than that website’s homepage or default landing page.
Within the deep link URL will be all the information required for the user to navigate to the
appropriate page.
The benefit to a website in providing a deep link URL is that it takes the user directly to a relevant
page within the website, as opposed to that user needing to find his or her own way there. With
that lies an inherent risk that the user won’t find the relevant information, most often information
which would lead said user to interact positively with the website content e.g. purchase an item,
read a relevant article, see a photo, etc.
In digital marketing, deep linking is seen as best practice for advertisers who wish to point users [and
potential customers] to the most relevant page on their site.
The choice of deep linked page will depend on the journey the user has been on up to that point, for
example if Clive started a particular web journey searching for “cheap iphone 4 deals” on Google and
clicks on the link illustrated below:
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This URL is a deep link to the iPhone 4 specific page of the 3 website
http://www.three.co.uk/Phones/iPhone. All the content on the page is iphone 4 relevant including
product image, price summaries, and clear signposts for Clive to take that next step to ordering the
iphone from 3. Perfect.
Imagine if Clive had navigated from the same search term to the 3 home page
http://www.three.co.uk. It’s a nicely built page, which acts as a satisfactory introduction to the 3
consumer offering, with the latest phone deal, and a number of other offers for the user to browse
to.
What it doesn’t do is give Clive any information whatsoever about the iPhone 4 which he is looking
for. It’s highly likely he will click the back button and find an alternative supplier from the Google
search results page, and 3 lose out on a potential new customer.
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Deep linking to a relevant page from Google is one thing, and advertisers on the whole have
embraced the deep linking advantage.
Deep linking also promotes the exploration of your site by visitors, providing additional points of
conversion.
In affiliate marketing, driving a potential customer as close to completing a transaction on an
advertiser’s website is vital, as the affiliate tends to occupy a large proportion of his or her time,
least not a fair amount of income trying to put the consumer in front of the content relevant enough
to the consumer’s needs to maximise the propensity to transact. Deep links play a vital role here.
As explained above, taking a user deeper into a website improves chances of conversion. Conversely
not deep linking doesn’t only mean the user is less likely to convert, as an advertiser you are actually
harming the chances of conversion. You are going completely the other way. The user will be
frustrated and the chances of that user returning to that advertiser’s website, at least for the
purposes of that particular transaction, are remote.
In this day and age retailers cannot afford to lose prospects in this manner. At a time when brands
are building dialogue with individual target customers, deep linking has to be seen as standard.
Though the incidents are diminishing, it is alarming how many advertisers still do not deep link, or
offer affiliates deep linking opportunities, or affiliates not utilising deep linking functionality or a
combination of all three.
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Here is an example of what not to do. A popular travel website invites Alan to ‘Check availability in
Egypt, Africa with any of these operators’. Alan arbitrarily clicks on the Jet2 button.
Alan is taken to this page with no reference to Egypt or Africa. This means that Alan has to re-
search, navigating through choices he already made on the previous website. He will feel this is
wasting his time, and the advertiser has already compromised the conversion opportunity. The
propensity to transact has diminished.
Whose responsibility is it to deep link? The advertiser or the affiliate?
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Well both actually. The advertiser ought to supply the affiliate with the deep link URL so that Alan
navigates directly to an Egypt search page on the Jet2 website, and if the affiliate does not have it,
he should ask the advertiser to supply one.
It may be that Jet2 cannot supply a deep link URL of this nature in which case no fault lies with the
affiliate. That is inexcusable though.
A reduction in conversion rate affects both parties financially so both should be looking to maximise
conversion rate potential.
Here’s an example of an affiliate doing it right. Recombu the mobile phone comparison engine –
http://recombu.com - carries a ‘Recommended Deal’ for the Blackberry Torch:
Penelope visits Recombu looking for some information about the Blackberry Torch. She navigates to
the relevant page and sees the offer and clicks on the Recommended Deal from Vodafone and deep
links to the exact deal offered on Recombu.
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By deep linking to the exact offer she saw on the Recombu site, Penelope remains within the journey
and the likelihood of her navigating on to purchase information is maximised. She doesn’t have to
re-type her requirements on the advertiser’s site.
This is an example of using deep links to maintain the propensity to transact. It’s now up to Tesco
(on behalf of Vodafone) to maintain Penelope’s user expectation levels, as a new customer prospect
right through the basket confirmation, but the deep link task is complete.
For retailers and advertisers with a large range of products, it is vital that deep links are supplied to
affiliates. In order for affiliates to effectively market the merchant’s product suite, pointing
prospects directly to searched products is key.
Distribution of deep links is simple and most merchants use their product feeds to do this; manually
via an excel spreadsheet or CSV, or automatically and regularly (e.g. daily within an XML file or data
post.
In summary all merchants should supply affiliates with deep link URLs for all key areas of their
websites, and key products they are selling. Deep link URLs are one of the mandatory marketing
tools for affiliates to maximise conversion, and therefore revenue for a merchant’s affiliate program.
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“People are impatient nowadays! Gone are the times of dial up connections whereby you’d
happily watch a page load up bit by bit as it made a funny whirring sound.
If your customers don’t get the information they want in 3 nanoseconds or less then they
are likely to make their way elsewhere. Consequently it is imperative to deeplink, specifically
to the product or category they are looking for. Failure to do so really signifies a missed
opportunity for both you and the Affiliate. Linking to the Home page simply doesn’t cut the
mustard.”
Zak Edwards, Managing Director – Prezzybox.com
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ANALYTICS
THE IMPORTANCE OF GREAT ANALYSIS
Analytics is arguably the most important part of any project! After all, you can’t tell where you
should be going if you don’t know where you are.
The emphasis of performance marketing revolves around being paid on performance only. This
makes it an excellent choice of promotion for advertisers and just as good an option for publishers
to engage their visitors with relevant promotions. However, without strong and accurate analysis it
is almost impossible for advertisers and affiliates alike to improve their performance, which is of
course the ultimate shared goal.
Everybody knows that there are no guarantees with any projects, which proves the strong need for
analysis. However, many companies still see data analysis as a secondary process, to be completed
occasionally, and find it hard to spend much time keeping tabs on what is going on with their
website.
Even those businesses that do set up analytics software often miss out on the importance of keeping
track of this data. Over time the benefits of analysing trends can be easily lost.
PROCESS AND OBJECTIVES OF WEB ANALYTICS
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WHAT GOOD ANALYSIS CAN DO FOR YOUR BUSINESS
IDENTIFICATION AND ORGANISATION OF BUSINESS GOALS
Targets and goals are vital when it comes to web analytics. They are essential for ensuring that your
business stays on track and should be regularly reviewed in organisational planning meetings. The
most simple and important goals are to decide what your website is, what your products are, and
what you do in your business to generate profit.
Your overall business goal should be clear, defined and focused in order to get the best results. Can
you answer the question “So, what does your website do?” in 20 words?
Deciding on a goal for your website helps the rest of your business work towards an objective with a
strong sense of direction to drive them forwards and keep them on track. It is then advantageous to
set targets within clear time frames to achieve your goal. Because the web is constantly changing,
most web businesses find that it is a good idea to set short term achievable targets (around 6
months) and then have bigger goals that allow room for stretching your team's efforts to achieve
things that you may, at first, see as a long way off.
GOALS AND TARGETS HELP WEB BUSINESSES:
Focus and define strategies for development which are clear to everyone in the organisation
Create a culture of teamwork and encourage employees to be accountable for their actions
Are often the tiebreakers for discussions when people get tied up in new ideas and start to
go off track
Allow management to decide where money and resources should go
Aid with the measurement of performance on an individual and overall basis
When goals and targets are used well in conjunction with web analytics you will see big changes in
the efficiency of your business and everyone within it.
Analytics, when used correctly, should aid the definition and creation of goals enabling good
decisions to be made, monitor the gradual performance of your business, and eventually produce
results that are in line with your overall objectives.
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IDENTIFYING KPIS
Many websites will use the same metrics to analyse how well they are doing as a business. Different
Key Performance Indicators (KPIs) will appeal to different websites and businesses, but the overall
point to remember for any website is:
KPI analysis is most valuable when multiple metrics are segmented, tracked, analysed and are viewed
in context.
It is common to think there is a “most important KPI” which everyone should put in front of other
metrics and obsess over (the one most often used is conversion rate). However, it is far more
important to build an overall picture of how your website or business is performing using a variety of
metrics which are specific to your business and objectives.
If you focus on one metric you are missing a whole world of analytics that could do a lot more to
help you reach your goals than you may originally think. Remember that it is often only a minority of
visitors who actually have the intent to convert the way you want.
There will be a handful who are in limbo and can sway either way, but the majority will be doing
other things such as comparing your site to the one they just came from/are going on to, or
browsing and reading content, weighing up what your offerings are. Lots will just be trying to work
out what the point of your website is and whether it relates to what they are looking for. If you
spend all your efforts on improving something like conversion rate, you can easily end up missing
out on your biggest market of visitors.
ANALYSIS OF KPIS NEEDS TO BE:
Detailed but clear
Actionable
Targeted/segmented/focused (general KPI analysis doesn’t provide actionable data)
Specific to your business and objectives
Analysed in context
Goal orientated
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The point of any analysis is to produce accurate results that are actionable. You need to be able to
draw something from your results and act on them, otherwise using analytics is futile. You can do
this by making sure that the first thing you do is get an accurate knowledge of your business goals
and the objectives that you want to achieve through analysis. Identifying these goals will mean that
you can focus on the right KPIs and get the information you want from the data you gather.
CREATING HISTORIC FACTUAL EVIDENCE
The process of web analysis can become a long one and if you only focus on weekly, monthly and
yearly changes and improvements it can sometimes throw you off course.
It is therefore vital that you also look at the much larger picture and analyse what your progress has
been in the longer timeline. Where are you now compared to 3 or 5 years ago, and where are you
aiming to be in 5 or 10 years' time? These are important questions to answer, but should not be
looked at as all important.
The nature of the web and its speed of growth and change are immense. The importance of being
able to recognise and adapt to changes in different verticals and within the web as a whole is
essential to staying at the top of your game. This is why monitoring your performance over a long
period of time is crucial to being able to spot dips or rises, not only in performance, but in its
relevance to the outside world. This will help you identify what effect the rest of the world's
influential factors have on your business and in turn will enable you to predict possible future issues
and react to them quickly and effectively.
CONFIRMATION OF INSTINCT
Another area where good analytics can help is in confirming your and others' instincts. This is
especially true when moving from a mainly offline advertising strategy and trying to bring your brand
and offerings online. During this process it is very easy, especially for creative minded people, to
expect the development of your web presence to have a certain effect on your marketing and
promotional efforts.
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Predictions can often be right, but in the same way as you would not rely wholly on your instincts
when marketing your business offline, you need to make sure that research, and analysis of this
research, is thoroughly taken on board for your online promotions.
This also goes for convincing others of the validity of your instincts, and using strong analytical
figures to present a case to management for marketing your business will go a long way as numbers
and factual evidence are hard to argue with!
MARKET RESEARCH AND COMPETITIVE INTELLIGENCE ANALYSIS
One of the key benefits of analysis is knowing where you stand within your marketplace. Market
research is the most commonly used process of analysing your competitors' products and services
and researching either where there are gaps in your chosen market that need filling, or whether
there are ways in which you can do a better job than your competitors. By doing so you can establish
your business and brand and also position yourself as a valuable source for your chosen target
market to get what they are looking for. Market research is not only useful at the start of a project,
but throughout all stages of development.
Competitive intelligence fits in well with market research, focusing on your competitors and
involving looking at your business within the context of what the rest of the web (and the rest of the
world) has to offer. You may have spent a long time analysing your website’s visitors, knowing their
behaviour, gathering their personal data, driving them in the direction you want them to go, and
even predicting their movements around your site, but all of this information is useless unless you
know what your competitors are doing.
Maybe you have spent time analysing your visitors' behaviour and have been able to increase your
sales conversion rates by 200% over the last 6 months by making a few small changes....great!
However, when you look at this rise in a wider context you may realise that your biggest competitor
has had a 500% rise in online sales over the last 6 months, the reason for which becomes clear when
you notice that the market or vertical you are both operating in has been all over the news. Having
had the masses of off and online advertising thrown around for all to benefit from, you have now
gone from being ahead of your game (in your mind) to being well behind your competitors.
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In its most basic form, a mistake can be made by thinking that you show up highly in search engines
for your branded keywords, but for the non-branded keywords (which probably have higher search
queries) you are nowhere to be seen!
This is where competitive intelligence and market research come in. Using sites like Hitwise and
Alexa, which analyse web trends, will enable you to get an idea of what you are up against and also
what is going on in the rest of the world (online and offline) which could affect your business.
You can even track things like your visitor journeys once they leave your site. Are you driving traffic
to your competitors, or are they driving traffic to you?!
It is important to remember that when you are using competitive intelligence tools, you should take
less notice of any rankings given to your websites and concentrate more on your positions in various
segments in comparison to your competitors. This is what the tools are made for and are best at
assessing.
ANALYTICS PACKAGES
There are many packages available for use in website analysis and the best method for most
webmasters and businesses would be to use a combination of different packages.
This does not need to be expensive, and there are a number of free or open source platforms that
will give you an excellent insight into your traffic with minimal or no costs, especially if you have the
technical expertise in your organisation to get you up and running with these packages.
WEBSITE TRAFFIC ANALYSIS
With all these analytics packages you can get a really comprehensive insight into your visitors and
their behaviour which will help reach the all important goal of trying to work out user intent.
However, you must be very careful to analyse all the data and metrics very carefully and always take
into account the bigger picture. Any metric can be analysed in minute detail but if you miss what the
big picture really tells you, or whether it actually tells you anything significant, then you could be
wasting your time.
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For example, you could spend a lot of time trying to look at your “Top Exit Pages” which show what
page your visitors were viewing when they decided to leave your site. On the face of it most people
would assume that they need to improve those pages in order to keep people on the site. However,
these statistics could actually prove that your visitors are performing a positive step. After all, they
are all going to have to leave your site eventually. It is just as likely that those visitors reached your
top exit page, found exactly what they were looking for and left happy.
Therefore the statistics on their own don’t give you anything actionable. However, add the “Time
Spent on Page” metric to the “Top Exit Page” metric and you know whether the visitors are staying
on the page long enough for you to be satisfied that they have digested the content and left happy
or alternatively visited the page and left straight away. This gives you a better insight, but there are
still many other metrics that would be useful to include in your analysis.
This makes the vital difference between simply reading the data and analysing it.
Features include the ability to drill down into your web visitors' profiles and learn more about their
behaviour, geographical location, technology usage, path analysis. You can also see where and how
your visitors came to your site, what pages they are on when they decide to leave your site, how
long they spend on your webpages and what they clicked on.
PACKAGES AVAILABLE
Google Analytics - https://www.google.com/analytics/
Piwik - http://piwik.org/
Woopra - http://www.woopra.com
Reinvigorate - http://www.reinvigorate.net/
AFFILIATE STATISTIC ANALYSIS
When it comes to performance marketing, whether you are on the advertiser or publisher side, data
analysis is essential to working well with the other party and producing the best results possible.
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Performance marketing is a win win situation, with minimal risks and initial investment from both
advertisers and publishers, but making it work well requires a lot of in- depth analysis and once you
have looked at all the above web analysis solutions and have started tracking the visitors who are
converting, you will need a program which will let you drill down into the data to establish what
people are buying, when they are buying it, where they are buying it from and how much you are
paying out versus how much you are making.
PACKAGES AVAILABLE
AffJet - http://www.affjet.com
AffJet is an online package which offers the opportunity to combine your affiliate networks and
analyse many different metrics. There are many extra features to make your analysis simple and
quick. You can combine links from any network or merchant into a project and create custom
dashboard reports that can be viewed whenever you log in. AffJet supports multiple users, has
access control for each user and a really easy to use interface!
Alternatives
Staagg - http://www.staagg.com
Affmeter - http://www.affmeter.com
NEXT STEPS
With all these analysis packages available free of charge or for minimal cost, you really don’t need to
spend a lot of money on getting good software. However, you should aim to spend your money and
time in analysing your data effectively to produce actionable results.
This will get you well on your way to developing good online strategies that improve your brand
awareness and image, increase your market share, drive your conversions and push up your sales
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IN-HOUSE AFFILIATE CAMPAIGNS
Whilst the de facto way of running an affiliate marketing campaign is to do so through one of the
‘traditional’ affiliate networks, there is a growing move towards merchants looking to take greater
control over their affiliate activity and bringing their affiliate campaigns in house. Many of the larger
players in the market already run direct in house campaigns, for example eBay, Amazon and many
gaming companies, but increasingly more and more merchants are beginning to explore this option
as well.
IN-HOUSE METHODS
There tends to be two methods that companies adopt when moving in house:
Complete removal of the network to work directly with all affiliates - i.e. eBay and
Amazon
Working direct with a section of affiliates and working with the ‘long tail’ through
an affiliate network or multiple networks.
There are obviously pros and cons to this approach and this article attempts to outline these. There
are five basic elements that an affiliate network provides and this seems a good place to start in
identifying the benefits of working directly.
The network provides the tracking technology that enables affiliates to be credited
for the sales that they drive.
On top of this the networks have historically developed additional tools that assist
affiliates in promoting their merchants.
The network provides payment solution to the merchant, meaning that the
merchant only has one consolidated payment to the network rather than paying all
affiliates directly.
The network offers varying levels of account management to its merchants,
advising them on how best to drive sales and effectively utilise their online
marketing budget.
The network provides reach to a wide base of affiliates, typically being able to
match up publishers to a merchant based on the past performance of that affiliate
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on similar campaigns.
As the affiliate industry has evolved in the UK, more and more merchants and agencies are
beginning to gain greater understanding of the affiliate channel, scrutinising the channel more and
adding increased resource to manage their affiliate programmes. In many cases also there is an
added realisation that there is a need to ensure that affiliates are driving not just a large volume of
sales, but that those sales are valuable to the merchant.
Allied to this, the majority of large affiliates are now investing considerable resource into account
management, as they seek to get closer to merchants in order to enhance the relationship and gain
a greater understanding of the merchant’s requirements. Through doing this, the affiliate is able to
work closer with the merchant and drive more sales for them.
So we have a situation where merchants, agencies and affiliates all have account management
resource that means they are liaising directly with each other. Many of these merchants and
agencies are questioning the need to have a network sat in the middle when the relationship
between them is held directly. Why are they paying the network for all five of the factors outlined
above when they are only using two of them at most?
BENEFITS OF UTILISING 3RD PARTY TECHNOLOGY
The benefits of utilising 3rd party technology to track affiliates are:
The enhanced relationship that comes from a merchant/agency working directly with their
affiliates, leading to a greater understanding and an increased ability to work together to
achieve the desired results.
Typically it would generate a cost saving as working direct with a partner through a
performance tracking solution means you are saving the portion of the override that goes
towards paying for account management and the other network services that are not used.
As a merchant, you are able to focus on ensuring that affiliates are driving valuable sales for
you. Because a network is generally paid a percentage of every sale that their affiliates drive,
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the accusation can be levelled that they are focussed on increasing the volume of sales with
little understanding of the quality of these sales. For example, were these sales already
coming to the merchant regardless of the actions of the affiliate. By taking greater control
over your affiliate campaign, you can ensure that they are focussing on value as well as
volume.
The drawbacks of not working with a network
You may miss out on the long tail of affiliates who could drive sales for you. However, a large
number of affiliate campaigns are reliant on a small number of affiliates who drive the
majority of their sales.
You would miss out on the additional tools that networks make available to their affiliates.
Recently, however, network innovation seems to have been scaled back and increasingly
these tools are being developed by independent 3rd parties.
You would not benefit from the account management offered by the network, but if you
have the requisite resource in house, then you may not be gaining through having this in
place anyway.
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CASE STUDIES
MAZDA KNOWS AFFILIATE MARKETING IS MORE THAN JUST VOUCHER AND LOYALTY
INTRODUCTION
Mazda originally entered the affiliate marketing space in July 2008 offering affiliates the opportunity
to earn commission for brochure requests and test drive bookings. The program launched with a
number of restrictions including the inability to deeplink, consequently for the first 18 months
activity grew slowly. Towards the end of this period Mazda, Mindshare (Mazda's agency) and
affilinet ran a detailed review of activity and decided a relaunch was required. The successful
relaunch demonstrates how Mazda embraced the full spectrum of affiliate business models available
and ultimately made the most of this dynamic marketing channel.
OBJECTIVES
Increase overall program performance by 297.9% to hit the target budget.
Increase the proportion of test drives generated from 2% to 14% of total affiliate actions.
Increase actions delivered whilst maintaining an overall CPA commission rate of under £20.
Establish a broader publisher base with greater reach, using ‘push marketing’ methods. Before
the re-launch the publisher base was restricted to automotive content sites.
STRATEGY AND EXECUTION
Following feedback from affiliates and an in-depth review of the program’s performance it was
decided that a number of actions would need to be taken in order to improve the performance of
the program and expand Mazda’s portfolio of affiliates beyond automotive content sites.
SETTING-UP DEFINED PROCESSES THAT SUPPORT DECISION MAKING
Improving integration between network, agency and client was a key method for the successful re-
launch of the program. Procedures were put in place to ensure both agency and network were
better placed to make decisions autonomously and in turn respond to affiliates more swiftly. These
included the creation of an affiliate profile form for affiliates to complete when applying to the
program, which resulted in a more efficient approval process.
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IMPLEMENTATION OF END-TO-END TRACKING FUNCTIONALITY TO MONITOR LEAD QUALITY
OFFLINE
Before the re-launch Mazda had limited visibility to lead quality, and therefore placed restrictions on
the types of publishers used. To overcome this Mazda introduced innovative, end-to-end tracking,
which allowed them to tag the lead with publisher information and pass this to their CRM system.
With more insight into the quality of leads Mazda opened the program up to a broader publisher
base.
ADOPTING AN OPEN APPROACH TO AFFILIATE BUSINESS MODELS
Before the re-launch Mazda implemented a very tight affiliate approval strategy, in essence working
only with affiliates that operated websites about cars. With the re-launch Mazda dramatically
increased the scope of their affiliate activities by lifting some of its restrictions regarding publishers it
worked with and broadening the spectrum of affiliate business models to include email,
communities and Facebook arbitrage. This resulted in achieving increased volume and broader reach
whilst still paying on a performance basis.
ALLOWING TEST PHASES AT HIGHER COMMISSION LEVELS
With the re-launch of the program, Mindshare and Mazda together with affilinet established
bespoke commercials for test drives based on tiered commission structure. This enabled affilinet to
target and run test campaigns with new affiliates such as Rocketer, which drive a high volume of
good quality test drive leads from Facebook. It also gave more room to negotiate with publishers
that drive higher volumes of traffic such as high-quality content sites.
FACEBOOK ARBITRAGE: BEYOND DEMOGRAPHIC TARGETING
Rocketer were recruited in the early stages of the re-launch, to help drive higher volumes of test
drive leads from this major new traffic source. They took a ‘test, learn and refine’ approach, and
after some test phases and a new bespoke tiered commission structure, ran a successful Facebook
campaign. Success was largely due to the use of thousands of ad variants and analysing click to
action rates to optimise the activity. As well as the standard demographic targeting, Rocketer were
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also able to target through user activity on Facebook, such as status updates, groups joined and likes
and dislikes.
GIVING PUBLISHERS THE TOOLS THEY NEED TO DO THE JOB
Feedback from publishers showed that conversion rates on
the Mazda program were not as good as they could be, and
that they could be improved with some changes to the
advertising creative. In response Mazda made efforts to
improve the effectiveness of their activities by providing a
new set of creatives with better imagery and a stronger call
to action. In addition they provided trusted partners with
brand guidelines to enable them to tailor creative, subject to
approval, to suit their purpose. Mazda gave final sign off on
all creative allowing them to keep control of how their brand was portrayed. This was supported by
Mazda providing affiliates with a full set of demographic profiles by Mazda car model to aid
targeting. This innovative and open approach to creative execution gave affiliates more control on
conversion, in turn optimising both creativity and performance.
RESULTS AND ROI
Mazda’s re-launch strategy and the methods adopted were key in creating a commercially viable
campaign and optimising the affiliate channel. Between January and September 2010 the following
was achieved:
Performance increased by over 297.9% and affilinet had to request 30% more budget.
The number of test drives increased to 29% of all affiliate actions.
The number of active publishers increased by 166%. The number of publisher types also
rose.
Conversion rate increased, peaking at 8.2% of those who clicked on a Mazda advert.
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CASE STUDY #2
PERFORMANCE MARKETING CAMPAIGN DRIVES 22% SALES INCREASE FOR SIMPLY ELECTRONICS
INTRODUCTION
Simply Electronics operates in the crowded and competitive consumer electronics market. It sells
some of the world’s best known brands, from manufacturers of memory cards to high-end
photography equipment. Competing predominantly on price, the retailer was looking to implement
a new channel to market to support its wider e-commerce strategy of increasing sales and driving
awareness online.
Simply Electronics identified affiliate marketing as an ideal tool to improve customer engagement
and increase sales. The company’s priority was to find a network that could offer deep levels of
insight as well as outstanding customer service and reporting – requirements that would help the
retailer stay one step ahead of the game.
In January 2009 Simply Electronics selected LinkShare to develop an affiliate programme that would
help it meets its sales objectives and increase the number and quality of online customer
transactions.
APPROACH
LinkShare designed an affiliate programme that would target voucher code and cashback sites, a
segment whose audience overlaps to a significant degree with the Simply Electronics’ customer
base. These sites are proven both to drive incremental sales and attract new customers, making
them ideally suited to Simply Electronics’ needs.
The programme utilises cash back, loyalty and price comparison sites, all of which are proven to
drive incremental sales and attract new customers. It offers affiliates the added incentive of earning
extra revenues from the campaigns they run and runs on a CPA model for maximum transparency
and accountability.
The campaign also integrates online video, a trend that has seen significant growth in the last 12
months. Videos which Simply Electronics has placed on YouTube have been repurposed for affiliate
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use as an added incentive for partners. This allows Simply Electronics can target specific products
and contributes towards click-through, sales and ultimately revenue.
RESULTS
The affiliate programme has grown 20 per cent month-on-month and 17 per cent year-on-year in
terms of click-throughs. Offers which have run on sites such as Idealo, Twenga, MVC as well as
selected employee malls have converted especially well and this flexible approach to the campaign
has meant Simply Electronics is able to reinforce its key messages around price and value for money.
Simply Electronics has seen a 22 per cent increase in month-on-month sales, accounting for
approximately 115% of year-on-year sales. A key part of this success has been the focus on
optimising relationships with key partners to help increase volumes and is clear evidence of the
success of the overall campaign.
QUOTES
Simply Electronics’ online marketing manager comments: “Our affiliate programme has gone from
strength to strength and the fact we have a presence on a mix of affiliates is helping to reinforce our
brand position across a range of sectors. With innovation at the core of our approach, we’ve also
been extremely satisfied with the consultancy LinkShare has provided which has also helped us forge
relationships with a broader range of publishers to help increase sales. This coupled with easy to
manage and monitor platforms means we have a clear idea of how the programme is performing
every step of the way.”
Liane Dietrich, MD, LinkShare, adds: “Affiliate marketing is now a core part of many retailers e-
commerce strategies and our work with Simply Electronics is an excellent example of how such
programmes can really drive home the benefits in terms of ROI and increased sales. Vouchers and
cash back sites are excellent tools for a company like Simply Electronics which is striving to boost
awareness amongst its customer base. We’ll be working closely with Simply Electronics to help evolve
the campaign as prevailing customer behaviours evolve.”
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CASE STUDY #3
INCREASING GROWTH AND CUSTOMERS FOR ONLINE FOOTWEAR RETAILER
BACKGROUND
Cloggs has over ten years experience selling branded footwear online. Cloggs.co.uk, offers top
brands including Dr Martens, Converse, UGG Australia, Fitflop and many more, providing home
shoppers with access to top brand footwear at low cost.
The site receives 15,000 unique users per day on average whilst the European site www.cloggs.eu,
launched in 2008 after an excellent track record with affiliate marketing, receives approximately
4,000 unique users per day.
With a relatively modest marketing budget compared to some of the larger online retailers, Cloggs
needed to focus on the most effective marketing measures. In-house activities centred on SEO,
content development and site design, to enhance its USPs of great customer service and user-
friendly functionality.
APPROACH
Affiliate marketing was acknowledged as the
best way to allow Cloggs to compete and build
and maintain their online presence. Cloggs had
worked with a number of other networks
before signing up with Webgains. Webgains
was selected because of its European reach
and strong reputation for customer service.
Cloggs is 100% committed to making its
affiliate strategy work and employs an affiliate marketing agency, Existem am, to help realise this
objective. Each month Cloggs plans, produces and sends in advance new promotional codes as well
as seasonal campaigns to its affiliates. All supporting marketing initiatives including banners and mid
season sales offers must be ready long before the “go live” date to ensure distribution is fully
prepared and ready to maximise exposure. Thanks to the transparency and inherent functionality
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within the Webgains platform, Cloggs can communicate directly with all affiliates involved, or a
specific sub-set, and at the same time are able to create bespoke creative for them if required.
Kerry Gunn, Marketing Manager at Cloggs explains the importance of communication with affiliates
and how it contributed to the success of the program: "Cloggs has spent time maximising the use of
all the relevant communication channels available to increase its contact with affiliates. These
channels include - the Existem-am blog, Cloggs Affiliate Blog, Webgains Blog, the Webgains email
system, the Affiliates4u Forum and direct msn contact through Existem am. We have found all these
channels have really helped to make sure that affiliates are always up to date with our top selling
products and also any new products or new brands we launch. We also provide affiliates with the
option of exclusive codes to help convert their traffic while promoting their own website.”
Following the success experienced in the UK market with Webgains and Existem-am, Cloggs has now
expanded the program into Europe.
Nick Thomas, Company Director, comments on the success of their European activity:
“We have been merchant partners with Webgains for a number of years now and it has provided our
online business with a first class and dedicated service that you just don’t get with some of the larger
networks.”
“We always get fast support and I find Webgains’ systems the friendliest to use and manage affiliate
relationships with. This has encouraged us to use Webgains’ services to enter Europe confidently
and the results have been astonishing. The success of our European site in its first year would not
have been as profound without the excellent support of the whole Webgains team.”
RESULTS
Gunn says, “Affiliate marketing is a good way of getting into the ‘nooks and crannies’ of the internet
whilst targeting unique customers. Affiliates drive a significant volume of our overall number of new
visitors. We get completely fresh customers from this channel, with no issue of duplication or
conflicts with other marketing efforts from other online channels. Another benefit is that this is
completely pre-qualified traffic, which means it is more likely to convert into customers. Conversion
of this traffic is actually higher than pay-per-click, shopping feeds and comparison websites.
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“The challenge for the future,” Gunn comments, “is finding new affiliates and of course ones who
can become key affiliates on our program. It is important to be consistent and find creative ways to
incentivise affiliates and keep them loyal.”
The Cloggs affiliate marketing program has grown by 112% in 2008. We fully expect continued
growth in the years to come.
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