At the end of our recent webinar on second-generation affiliate programs and the future of performance marketing, AP founder and managing director Robert Glazer fielded some very thought-provoking questions from our audience.
In case you missed the opportunity to attend the webinar and have these topics on your mind, we thought we’d include them for you along with the answers Bob provided:
What should come first: service or technology?
It depends. In some cases, people come to us and they’ve already decided on a technology partner because they had specific technology requirements and they wanted to make that decision. For these companies, determining their network and technology first before looking for services might be more ideal.
We are observing that technology and tracking RFPs are becoming separate from services RFPs as people realize that these could be done by the same agencies but that these are fundamentally different groups and require different competencies.
How are you advising your clients on incrementality? Please give examples on how you’re measuring that in affiliate.
When we advise clients on incrementality, our first objective is to understand their business. For example, is their business new customers or returning customers?
Brands’ affiliate business and regular business must be aligned. If their regular business is generating 75% new customers and their affiliate business is generating 25% new, that might raise some red flags.
Walking through the qualities and behaviors that a client wants and understanding their specific business is key because every client has their own unique definition of incrementality. We’ve run the same analysis on the same set of data and have received totally different answers.
It’s not an easy process and many clients are still trying to understand what incrementality means to them. We approach incrementality by determining the business model, examining target behaviors, and analyzing cross-channel data.
How do you recommend working with coupon sites?
We recommend being consistent. It’s difficult to regulate 100 coupon sites. Building relationships with coupon sites that place a high value on communication with brands is the ideal strategy.
I encourage people to move away from the vernacular of “if they work with sites” to “how they work with sites.” By leveraging technology, setting the commission rules and having the discussions with coupon partners about which activities they value and don’t value, online retailers can move the discussion towards driving more valuable sales and create a win-win for everybody involved. (Read our tips on coupon strategy here.)
Often with changing leadership and seasons, clients will ask us to remove them from all coupon sites. However, when Nov. 18th rolls around and sales aren’t looking good, they call us and ask to be included in holiday promotions on coupon sites. As you can imagine, this doesn’t go over well with coupon affiliates. We recommend that clients refrain from engaging in a seesaw relationship and instead provide specific requests such as refusing to honor invalid coupon codes.
Why is it so important to work with content affiliates? What are some effective approaches for recruiting them?
The focus should be on brand alignment. If I’m a leading athletic shoe company, a training site is going to be more relevant than a wedding site. It’s important for ecommerce retailers to understand that content is much lower volume than partners such as coupon, loyalty, and comparison-shopping sites. Many clients aspire for content to be a bigger part of their program, but the reality is that it tends to be a smaller component as a revenue driver.
In terms of recruitment, it’s about going to where the traffic is. Companies will go through their own site logs and Google Analytics and see who’s already driving referrals. Some companies might not see the benefit of driving paid traffic if they’re already getting organic traffic, but it’s essential to develop relationships with referral sources on an affiliate basis because that is what creates more reliable, long-term partnerships.
How can affiliate programs be leveraged to take advantage of other partnership opportunities?
We joke with one client that “Business development’s trash is our treasure.” They are a large public company, so a partnership that generates $30,000 a year is not going to excite their BD department. For us, on the other hand, that is a very productive affiliate. Since we value transparency and good communication with our clients, they happily send those opportunities to us. So affiliate programs can be a standardized form of business development.
Same thing with PR. PR departments often prefer to work with a short list of influencers rather than deal with an unwieldy list of bloggers asking for free products. By establishing them as affiliates, we can corroborate their clout through data and determine which bloggers deserve top priority.
Additionally, some companies set up in-house referral programs. While these programs can be lucrative, their partners can feel limited with store credit being the sole incentive. Instead, they often prefer the flexibility that comes with an affiliate program. Since these companies have already set up a tracking system, they should consider the opportunity to leverage it across multiple channels with a consistent set of data and creative for all partners.
Miss our webinar on content and SEO? You’re in luck! You can watch it here!