Introduction to Affiliate Marketing - Digital Vidya Webinar 12/2/2014

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My presentation for the Digital Vidya Webinar: …

My presentation for the Digital Vidya Webinar:

Affiliate marketing is a mainstay of any modern digital performance campaign, if managed properly affiliate programs can lead to very profitable revenue streams. This seminar will dive into the mechanisms of building an affiliate program, driving affiliates, incentivising and tracking them. We will look at whether you should use networks, run your own affiliate program or outsource to a third party. We will also look at what can be done to excite affiliates and ensure that you grow a healthy community, as well as the payment models and requirements a brand needs to start an affiliate program and drive it to success.

The key questions answered through this Webinar:

1. What is affiliate marketing
2. Why is it good for your business
3. How to set up an affiliate program
4. Rule setting
5. Do’s and Don’ts
6. Finding affiliates
7. How to grow a network that collectively prospers
8. The tools and the technologies involved

More in: Marketing
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  • 1. INTRODUCTION TO AFFILIATE MARKETING Benedict Hayes Vice President iProspect Communicate 2 @benboombastic Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 2. WHAT WILL WE LEARN TODAY 1. What is affiliate marketing 2. Why is it good for your business 3. How to set up an affiliate program 4. Rule setting 5. Do’s and Don’ts 6. Finding affiliates 7. How to grow a network that collectively prospers 8. The tools and the technologies involved iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 3. THE BASICS iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 4. WHAT IS AFFILIATE MARKETING “ Affiliate marketing is a type of performancebased marketing in which a business rewards one or more affiliates for each visitor or customer brought by the affiliate's own marketing efforts iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 5. THE KEY PLAYERS • The Merchant – The brand or retailer • The Network – A middle man between the affiliate and the brand. Often a software solution provider. • The Affiliate / Publisher – The guy driving the traffic that he wishes to be paid for • The Customer – The unsuspecting customer who the affiliate attracts to the brand  • The Technology – The technology provider that is implemented to track affiliate performance, manage creative, offers, outreach and automated payments • The Agency – An agent brought in to manage all of the above and alleviate the client’s headache iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 6. THE MERCHANTS Brands, Retailers iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 7. THE NETWORKS Affiliate and Advertising Networks iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 8. THE AFFILIATES Network Affiliates | Aggregators | Direct Publishers Networks Aggregators Publishers Anyone with iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 9. BASIC AFFILIATE WORKFLOW Customer comes to the… Everyone is happy  Affiliate, who Merchant, sends the customer to the… who facilitates an action. Merchant Customer pays affiliate for the action does something; lead, sale, download etc. iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 10. AFFILIATE JARGONS CPM: Cost per mille (1,000 impressions) CPC: Cost per click CPL: Cost per lead CPA: Cost per acquisition COA%: % of revenue (Cost of Acquisition) CPE: Cost per email CPV: Cost per Video View CPD: Cost per download EPC: Earnings per click iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 11. HOW DO AFFILIATES MAKE THEIR BUSINESS SEO PPC Display EDM Word of Mouth Social Coupons Content Dark Arts iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 12. STANDARD PAYMENT MODELS Pay Per Anything Pay Per Click • Pay affiliates for certain actions the merchant customises • Raw: IP address may be counted twice • Unique: IP Address counted once • Blind: Unknown if raw or unique Pay Per Sale Pay Per Visit • Percentage: Pay based on the size of sale • Flat: Pay equal for all sales • Graduated: Pay set in increments • Pay affiliate for sending customers who only look Second Tier Combination • Pay affiliates for recruiting other affiliates • Pay by a combination of Percentage, Flat and graduated iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 13. INDIAN AFFILIATE PROGRAMS • Indian affiliate models are still very nascent, but growing rapidly. • Primarily take the form of lead generation. • In the more mature UK and US markets, where eCommerce is common place +80% of the affiliate programs are tracked on the resultant sale. • CPM, CPC as well as lead based models are becoming more obsolete Just think as a brand would you rather guarantee business or site visits? iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 14. WHY AFFILIATE MARKETING Sales Opportunity ROI Affiliate Reach Scale Branding iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 15. Communicate 2 CREATING A PROGRAM iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 16. THE STEPS TO A PROGRAM CREATION Decide how and what you want to sell Set-up a tracking and reporting solution Test and validate sales are tracking Configure daily disposition reporting Decide on the affiliate payout Define a brand and affiliate guideline Create a go-to market strategy Build creative off the back of your strategy Empanel the affiliate Give the affiliate creative with their unique Affiliate ID integrated to track Affiliate publishes On a monthly basis, take stock of sales made by the affiliate validate and payout Set payment cycles 30-60 days after month end Pay on time, never default or say goodbye to the affiliate! Test, Hone, Refine Build and generate sustainable ROI iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 17. SET UP A TRACKING SOLUTION iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 18. PATH TO SALE • To track a program you must know your route to sale • If your sales are primarily converted offline then a lead based CPL model may work best • If sales can be fully completed online then a % of revenue or CPA model will be best It is possible to have offline sales turned to a CPA model and % of revenue, but this will require far more sophisticated tracking mechanisms in place. Call tracking and strong CRM systems. iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 19. TWO MAIN TYPES OF TRACKING SOLUTIONS • Referrer based – Links coming direct to the site • Redirect based – Links coming via a tracking server Principally they do the same thing though… iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 20. TRACKING BASICS Merchant 6 8 7 5 Tracking System 3 4 1. Customer comes to the affiliate site Customer 2. Clicks a banner 3. Redirects to a tracking server 1 4. Tracking cookie drops 5. Customer is redirected to Merchant 6. Customer buys 7. Tracking server marries cookie to sale Ad 8. Once validated, merchant Unit pays the affiliate 2 commission for sale Affiliate iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 21. TRACKING You generally don’t want to pay twice for things so… • The crux of tracking revolves around two things: – The unique affiliate ID – The time of the delivery of the customer visit • Every affiliate will carry a unique ID, this ID will be paid out subject to the timing of the initial visit iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 22. TIMINGS AND PAYOUTS There are a number of tracked payout models: First Click • The affiliate that delivered the first visit within a give timeframe Last Click • The affiliate that delivered the visit that directly resulted to the sale Hybrid • Percentage paid to first click, middle and last click within a given timeframe Multi-tiered • Percentage paid out to the first / last click and the affiliate that referred the affiliate that generated the sale iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 23. COOKIE TIMES Most common set-ups • The most common cookie drop is a 30 day period • 60 days can incentivize affiliates to deliver a lot more traffic • Lifetime will mean all repeat business will also be paid out to the affiliate iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 24. REPORTING iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 25. AFFILIATE REPORTING • Try to configure a system that gives the affiliate: – Daily real-time reports – Feed back mechanisms, Excel, API (This can be tricky) – Content tracking for the affiliate The more data and feedback you give the affiliate, the more they can optimize and enhance their campaigns… Limiting data limits what they can do! iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 26. NETWORK SYSTEMS • Using a network is a simple way to do this • They have the systems and software to manage the program • The disadvantage of using a network is that you have to pay for the software license as well as commissions on all payouts • You are also limited to their affiliate base iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 27. PAYOUTS iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 28. SETTING THE RIGHT PAYOUTS AND INCENTIVES • Getting the payouts right can make or break your campaign • Tiered payment structures where the big affiliates get big payouts usually work best i.e. < 50 sales > 50 sales > 100 sales >500 sales - Rs.200 / sale Rs.225 / sale Rs.250 / sale Rs.300 / sale iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 29. KNOW YOUR COMPETITION Creating the go-to market strategy • Sign up for you competitor’s programs • Assess their payouts • Can you do creative payment structures that can entice their affiliates away from them? – Better incentives – Better promos – Better reporting • Use your other marketing channels (PPC, FB, EDM) to assess an acceptable COA% or CPA% • Price too low and you may not make it possible for your affiliate to monetize your program iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 30. EXAMPLE PAYMENT MODELS 1: Dr Batra’s Path to sale: – Website Visit – Website Lead (Appointment) – Visit clinic – Diagnosis / free trial – Sign up for treatment ONLINE OFFLINE In this scenario affiliates could be paid on the leads. Post 90 days they receive a bonus for successful signups. Transversely if they have a poor signup ratio they are booted from the program iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 31. EXAMPLE PAYMENT MODELS 2: Hewlett Packard Path to sale: – Website Visit – Buy online – C.O.D ONLINE OFFLINE In this scenario affiliates could be paid on any transaction. A percentage of sale would be most appropriate 3-5%. C.O.D sales will only be remunerated once the payment is made iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 32. Always remember… Affiliates are as fickle as cats they will always go where the cream is richest!! iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 33. BRAND AFFILIATE GUIDELINES iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 34. BRAND AFFILIATE GUIDELINES What affiliates can or can’t do: • SEM / SEO? – Brand bidding – Competing • • • • • • • Types of content they publish against Language used Association with other brands Exclusivity Miss-selling / Compliance Mailers / Can or Can’t (Spam Watch) The Dark Arts… iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 35. AFFILIATE DARK ARTS Be aware, make provisions, you do not want your brand in the mud! • • • • • • • Brand Bidding Day Parting 8-8 Cookie Bombing / Stuffing Email Spamming Content Spamming Email Viruses / Trojans Malware iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 36. EMPANELMENT • Make sure you have very clear T&Cs that the affiliate is aware of and agrees to, this could be a web based form • You will then need the following: – – – – – – Name Address Contact Number Email Websites he plans to use for promotion Payment details • Cheque • Bank transfer – Tax details PAN / TAN / VAT – Make sure you and your affiliate are aware of the tax implications iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 37. CREATIVE iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 38. CREATIVE • The more offers the better! • Give the affiliates ads that will sell: – Coupon codes – Money off – Bundles – Referrals • Every product you wish to sell needs to have a creative unit. • If you can dynamically generate creative based on SKU codes then nothing like it! iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 39. FORMATS Standard Web Sizes • Manage your creative so that it encompasses the standard ad sizes • Any site that carries ads has the potential to be an affiliate! iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 40. FINDING AFFILIATES iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 41. METHOD ONE Advertise your program • Create links on your homepage to the affiliate program • Use PPC / SEO / Remarketing • Start conversations on the affiliate message boards and forums – Chat up the affiliates directly – Use paid media to buy targeted ad slots iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 42. METHOD TWO Direct Approach • Find content sites in your field that carry AdSense or other affiliate banners • Approach directly with offers that are more lucrative than their AdSense payouts • Sales revenue can sometimes be far greater than CPC payouts • The bloggersphere would be great for this: http://www.google.com/blogsearch iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 43. METHOD THREE Poach competition • Use sophisticated link analysis software to understand your competitors affiliate base • Tools that track upstream and downstream referral traffic will lead you to the good affiliate sources • Use persuasive payment structures to directly snipe the affiliates away • If they are good for your competitors they will be good for you ;) iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 44. METHOD FOUR Poach the networks • Sign up the networks • Use analytics and reverse IP tracking systems to understand traffic source • Isolate the big affiliate sites that drive value • Approach independently outside of the Network iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 45. MAINTAINING A HAPPY AFFILIATE FAMILY iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 46. MAKING AFFILIATES HAPPY Don’t just set up a program and forget about your affiliates… They are cats and you must give them good cream! • Talk to them: – Email updates – Give them offers – Festive specials • Treat them: – Have meet ups give booze and food – Send them Diwali / Christmas gifts • Engage with them: – – – – Join the affiliate forums Understand what the market is doing Who is paying / not paying Maintain your own reputation iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 47. REFERRAL PROGRAMS • Multi-tiered referral affiliate programs can lead to more affiliates joining • Multi tiered means that if I refer a friend I also take a cut of the sales they deliver as my referral fees • Affiliates know affiliates, this incentivises the affiliates themselves to drive the program • If multi-tiered programs don’t work for you then try a CPA model for affiliate referrals I.E. I refer a friend if that friend starts generating business you give me a one time reward. iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 48. PAYOUTS “ Raise any issue immediately. VERY IMPORTANT! Be faithful to your affiliates, pay on time! iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 49. SOFTWARE SOLUTIONS iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 50. WHY SOFTWARE • Pre built software will manage: – Tracking – Payouts – De-duplication – Sign-up / Empanelment – Creative management – Reporting – Email and communication – White labelling iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 51. THE LEADING SOFTWARE SOLUTION PROVIDERS FOR AFFILIATE PROGRAMS • • • • • • • • • • Direct Track PHG AffiliatePro AffiliateShop AffiliateTracking.com Commission Junction RevResponse AffiliateFuture Clickinc AffiliatesForAll • • • • • • • • • Ultimate Affiliate Share Results Tracking ShareASale LinkShare MoreNiche Affiliate Traction iDevAffiliate AvantLink ClickBank Very handy comparison Chart: http://www.aceaffiliates.com/affiliate-education/affiliate-marketing-software-solutions-review.html iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 52. PRICING MODELS Combinations of… Fixed Monthly Fee Oneoff fee Set-up fee % of Payout iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 53. THE AGENCY MANAGED SERVICE iProspect: Driving Digital Performance. Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.
  • 54. Our Proposition…
  • 55. We Offer Two Core Affiliate Services ` ` Affiliate Management Lead Generation CPA Affiliate Network Base
  • 56. Affiliate Management • • • •
  • 57. The Affiliate Model ADVERTISER PUBLISHER CONSUMER
  • 58. Client Benefits of Affiliate Advertising ✓ ✓ New Partnerships & Relationships Incremental ✓ Increase Exposure ✓ Diversify Traffic ✓ ‘Pay on Performance’ ✓ ROI
  • 59. Our 2 Core Affiliate Servicing Options ` ` Leveraging Public Networks Our Private network • • • • • • Private Publisher Base Public Publisher Base
  • 60. Performance Reporting
  • 61. THANKS Any Questions? Presented By: Benedict Hayes VP Strategy @benboombastic +91 961-901-1784 Copyright © 2014, iProspect Communicate 2, Inc. All rights reserved.