How the Affiliate Channel Can Help Grow In-Store Business

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Consumers want not only the convenience and accessibility of online shopping, they also want a seamless transition between all their shopping experiences – both online and offline. And, of course, they want to get a good deal when they make a purchase.

Unfortunately, many retailers miss prime opportunities to connect with shoppers because they only invest in online advertisers to drive online sales, and offline advertising to drive offline sales. The concept of using online budgets to drive offline sales is not always understood or implemented correctly.

But the winds are shifting. Increasingly, retailers are finding that by strategically leveraging the influence of affiliate marketers online, they can boost their business offline.

In addition to attracting new customers, creating more value for existing customers, and strengthening the brand, retailers have found that using the affiliate channel to drive in-store promotions also results in increased average order value, better conversions, and higher revenue.

The vast majority of today’s shoppers go online to comparison shop, conduct product reviews, and find the best deals – long before ever stepping foot in a brick-and-mortar store. And more often than not, they are going to affiliate sites to get this information.

Affiliates are a key ally for merchants looking to grow their online and offline business. But before reaching out en masse to affiliates, it’s important to consider these four tips to help ensure a successful online-to-offline promotion:

1. Start Small

Select a small group of high-performing affiliates and give them the opportunity to promote your in-store offer. Most publishers know the potential of online-to-offline marketing campaigns, so they’ll likely be enthusiastic about distributing the offer. However, in order to keep costs in check and ensure an effective rollout, it’s a good idea for retailers to test the offline promotion with a small group of online affiliates.

Once the effort has proven successful, it can then be opened up to more affiliates. This also helps protect the retailer’s customer service and in-store sales associate team from being overwhelmed by shoppers wanting to use a coupon or promo deal that they found online.

To determine the best affiliates for your initial offline promotion, it’s essential to evaluate their site content, their promotional methods, and their distribution channels. Usually, the larger the distribution, the better.

After conducting independent research, it’s important to have discussions with each publisher to see what placement they could offer (e.g. mobile app). Then negotiate a placement in exchange for the retailer’s offer.

2. Set up a compelling (yet reasonable) commission structure.

Typically, affiliates aren’t paid on online-to-offline promotions. By giving affiliates a commission on an in-store-only sale (albeit, one that is lower than their online commission) they will be much more motivated to promote it within their distribution channels.

Providing a small commission for an offline/in-store-only sale

  • Allows the merchant to test the campaign while keeping costs in check
  • Strengthens the relationship between affiliate and retailer, offering both potential opportunities for growth
  • Incentivizes the affiliate to promote the in-store offer
  • Creates data that makes it possible for retailers to evaluate online-to-offline sales.

3. Create an offer that will incentivize online shoppers to shop offline.

This one may be obvious, but it’s a critical point. Promotions need to be attractive enough so that the customer feels that it’s worth their while to go offline to make their purchase.

Consider Reebok’s online-to-offline promotion. For all purchases over $75 made at a Reebok Outlet Store, shoppers received $15 off.

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This promotion accounted for a large proportion of total affiliate program sales for the three months it ran: 11% in October, 17% in November, and 13% in December.

Retailers should also consider using their offline-to-online promo as an acquisition channel. By requiring shoppers to provide their email address in order to receive the special in-store offer, advertisers would be able to reach out to them for future offers.

4. Establish a system to gather the data

Most online-to-offline promotions use one of two methods (and sometimes both in order to A/B test):

  1. A promo code, or
  2. A bar code that’s scanned (e.g. Reebok’s coupon)

In order to determine whether or not an initiative is effective and worth continuing, the information gathered from these methods should be delivered to a system that records and segments the data.

Time is also a factor. If possible, have a nightly file sent to the affiliate network that lists out all the sales that were produced offline from the online source. For example, this information might show that affiliate 123 referred shopper 567, what the sale amount was, and what commission amount to send to the affiliate.

Timely results benefit both the affiliate and the retailer. The affiliate is able to quickly see the impact of their efforts, which could encourage more distribution, and the retailer gains faster results on the efficacy of the campaign as well as valuable consumer data.

When initiated and implemented correctly, using affiliate channels to drive online-to-offline promotions can prove to be quite lucrative for retailers and affiliates, and present unique deals to cost-conscious customers.

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