Effective Voucher Code Implementation A4uexpo London 2008 15 th October

Panel Participants Richard Clark • Marketing Manager, DSG International PLC Chris Frost • Director, ColdSnail Duncan Jennings • Founder, Vouchercodes.co.uk James Little • Head of Affiliate Development, Affiliate Future Panel Moderator Hero Grigoraki • Client Services Manager, Webgains Ltd

Panel Participants

Richard Clark • Marketing Manager, DSG International PLC

Chris Frost • Director, ColdSnail

Duncan Jennings • Founder, Vouchercodes.co.uk

James Little • Head of Affiliate Development, Affiliate Future

Panel Moderator

Hero Grigoraki • Client Services Manager, Webgains Ltd

What are vouchers important for? Where are they used? New customer acquisition Customer retention – reactivation – reward Shifting stock (tactical marketing) Campaign response measurement Credit crunch upon us – more customers actively looking to save money Vouchers can be advertised offline to be used online Vouchers can be advertised online to be used offline (in store)  very limited take up in the UK, highly popular in the US Usually vouchers are used by retailers, however we have seen service providers offering them as well. Sole sector not able to benefit from vouchers is Finance, due to FSA restrictions.

What are vouchers important for? Where are they used?

New customer acquisition

Customer retention – reactivation – reward

Shifting stock (tactical marketing)

Campaign response measurement

Credit crunch upon us – more customers actively looking to save money

Vouchers can be advertised offline to be used online

Vouchers can be advertised online to be used offline (in store)  very limited take up in the UK, highly popular in the US

Usually vouchers are used by retailers, however we have seen service providers offering them as well. Sole sector not able to benefit from vouchers is Finance, due to FSA restrictions.

Some merchants choose not to distribute vouchers at all. Reasons: Not wishing to approach “bargain hunting” customers Wishing to be perceived as full price or exclusive merchant Brand perception – business approach Also, certain merchants exclude voucher affiliates from joining their programs. For most merchants, vouchers are an important tool and voucher affiliates are an important part of their affiliate mix.

Some merchants choose not to distribute vouchers at all. Reasons:

Not wishing to approach “bargain hunting” customers

Wishing to be perceived as full price or exclusive merchant

Brand perception – business approach

Also, certain merchants exclude voucher affiliates from joining their programs.

For most merchants, vouchers are an important tool and voucher affiliates are an important part of their affiliate mix.

With the economy slowing and prices rising, everyone is on the lookout for a bargain. Vouchers have become a popular way of promoting discounts, particularly around Christmas time. In fact, they have become so popular that price sensitive shoppers are looking for them in increasing numbers. Robin Goad – Research Director, Hitwise “ Online vouchers prove popular in bargain-hungry Britain”

Shoppers are going crazy for voucher codes

Who are the voucher sites? Which affiliates use voucher codes and how? Voucher specialist sites

Who are the voucher sites? Which affiliates use voucher codes and how?

Voucher specialist sites

Content sites

Content sites

Price comparison

Price comparison

Email marketing

Email marketing

Cashback/Loyalty sites

Cashback/Loyalty sites

User generated content

User generated content

Even PPC affiliates can use vouchers effectively There is no such thing as “voucher affiliates” – vouchers can be used effectively by all types of affiliates . Moreover, no affiliate restricts activity to one type of marketing. Categorisation becomes difficult.

Even PPC affiliates can use vouchers effectively

There is no such thing as “voucher affiliates” – vouchers can be used effectively by all types of affiliates . Moreover, no affiliate restricts activity to one type of marketing. Categorisation becomes difficult.

What issues arise from the use of voucher codes? Merchant issues Affecting their overall marketing/business Margin retention Brand perception Incorrect redemption due to loose Ts & Cs / tech implementation Channel overlap Wide distribution – vouchers going viral Customers looking for voucher at a late stage of the purchase cycle (during checkout) Lifetime value of voucher customers Customer complaints/harmful brand impact when a voucher is not activated due to usage restrictions

What issues arise from the use of voucher codes?

Merchant issues

Affecting their overall marketing/business

Margin retention

Brand perception

Incorrect redemption due to loose Ts & Cs / tech implementation

Channel overlap

Wide distribution – vouchers going viral

Customers looking for voucher at a late stage of the purchase cycle (during checkout)

Lifetime value of voucher customers

Customer complaints/harmful brand impact when a voucher is not activated due to usage restrictions

Affecting their affiliate program Value of voucher affiliates Big admin task to create & maintain bespoke and generic codes and monitor & analyse performance Inaccurate promotion of vouchers/Ts & Cs Affiliates promoting codes intended for different channels Use of exclusive codes given to other affiliates

Affecting their affiliate program

Value of voucher affiliates

Big admin task to create & maintain bespoke and generic codes and monitor & analyse performance

Inaccurate promotion of vouchers/Ts & Cs

Affiliates promoting codes intended for different channels

Use of exclusive codes given to other affiliates

Affiliate issues Time strains – affiliates can’t amend promotions/promote new vouchers as fast as needed Cookie overwrite from voucher sites as the last referrer – lost commission for content sites – more analysis needed on a per merchant basis Short term promotions are difficult to get good results from “click to reveal vouchers” when no vouchers exist – cookie stuffing Increased competition as more affiliates jump onboard the voucher train and ready made tech solutions become available

Affiliate issues

Time strains – affiliates can’t amend promotions/promote new vouchers as fast as needed

Cookie overwrite from voucher sites as the last referrer – lost commission for content sites – more analysis needed on a per merchant basis

Short term promotions are difficult to get good results from

“click to reveal vouchers” when no vouchers exist – cookie stuffing

Increased competition as more affiliates jump onboard the voucher train and ready made tech solutions become available

Tackle the issues Merchants Overall strategy Give clear and specific Ts & Cs Improve technical backend to minimise issues with them and which customer can use which code Analyse the sales and customers to define how they interact with your site and their lifetime value Use vouchers for short term campaigns, whose effectiveness is easier to measure, prior to releasing a full scale long term campaign

Tackle the issues

Merchants

Overall strategy

Give clear and specific Ts & Cs

Improve technical backend to minimise issues with them and which customer can use which code

Analyse the sales and customers to define how they interact with your site and their lifetime value

Use vouchers for short term campaigns, whose effectiveness is easier to measure, prior to releasing a full scale long term campaign

Affiliate strategy Specify the commission for voucher sales – not voucher sites/affiliates Give clear Ts & Cs for voucher use within the affiliate channel Specify which codes can and cannot be used by affiliates Codes distributed through internal CRM should not be banned for affiliates – simply reduce the commission for those sales Possibly work with selected voucher affiliates Monitor what vouchers are in use and being promoted by affiliates, in conjunction with your network Provide affiliates with longer running promotions Analyse the sales and customers to define how they interact with your site and their lifetime value Provide exclusive offers , rather than replicate a single offer branded differently, wherever possible

Affiliate strategy

Specify the commission for voucher sales – not voucher sites/affiliates

Give clear Ts & Cs for voucher use within the affiliate channel

Specify which codes can and cannot be used by affiliates

Codes distributed through internal CRM should not be banned for affiliates – simply reduce the commission for those sales

Possibly work with selected voucher affiliates

Monitor what vouchers are in use and being promoted by affiliates, in conjunction with your network

Provide affiliates with longer running promotions

Analyse the sales and customers to define how they interact with your site and their lifetime value

Provide exclusive offers , rather than replicate a single offer branded differently, wherever possible

Tackle the issues Affiliates Respect exclusivity – do not promote what is not given to you or is not a generic promotion Community sites: accept responsibility to monitor and vet what your users are uploading Respect Ts & Cs and expiry dates: take them down or mark as expired Promote vouchers accurately to minimise customer enquiries Ask for exclusive codes when you plan on making good use of them and once you have shown the merchant the value you can add. Provide presentations on the available marketing opportunities you offer, showcasing to the merchant the benefit of working with you “Click to reveal”: Use only when there are actually offers available

Tackle the issues

Affiliates

Respect exclusivity – do not promote what is not given to you or is not a generic promotion

Community sites: accept responsibility to monitor and vet what your users are uploading

Respect Ts & Cs and expiry dates: take them down or mark as expired

Promote vouchers accurately to minimise customer enquiries

Ask for exclusive codes when you plan on making good use of them and once you have shown the merchant the value you can add. Provide presentations on the available marketing opportunities you offer, showcasing to the merchant the benefit of working with you

“Click to reveal”: Use only when there are actually offers available

Best practices/advice Have clear objectives on what you are looking to achieve through your affiliate program and how affiliates fit within your advertising & marketing channels, as well as your overall business strategy. Define cost of sale for affiliate channel, rather than allocate marketing budget Talk with your network – they will be able to advise you on what technical solutions they offer and what they would advise you to do specifically for your program with regard to voucher affiliates Talk with your affiliates – understanding their PoV and needs is vital Monitor your competitors : are they working with voucher affiliates? How? What restrictions are they imposing? Take action – if affiliates don’t comply with your guidelines, they must face the consequences

Best practices/advice

Have clear objectives on what you are looking to achieve through your affiliate program and how affiliates fit within your advertising & marketing channels, as well as your overall business strategy. Define cost of sale for affiliate channel, rather than allocate marketing budget

Talk with your network – they will be able to advise you on what technical solutions they offer and what they would advise you to do specifically for your program with regard to voucher affiliates

Talk with your affiliates – understanding their PoV and needs is vital

Monitor your competitors : are they working with voucher affiliates? How? What restrictions are they imposing?

Take action – if affiliates don’t comply with your guidelines, they must face the consequences

Innovation – The future of voucher codes Voucher sites are now easy to create – however correct maintenance is the differentiator and success indicator

Innovation – The future of voucher codes

Voucher sites are now easy to create – however correct maintenance is the differentiator and success indicator

More control to merchants and networks over what is displayed. More transparency and monitoring on how and where vouchers are promoted Networks have made voucher distribution easier , through blogs, forum posts and dedicated CSV & XML feeds Tech solutions for tracking voucher sales , allocating different commissions, reporting voucher sales and analysing voucher performance within the affiliate channel have been made available by the majority of networks Offline promotions can now be tracked online Customers can receive codes on their mobile phones, therefore pushing affiliate marketing into mobile advertising Merchants are changing their sites to better handle, display and allocate vouchers

More control to merchants and networks over what is displayed.

More transparency and monitoring on how and where vouchers are promoted

Networks have made voucher distribution easier , through blogs, forum posts and dedicated CSV & XML feeds

Tech solutions for tracking voucher sales , allocating different commissions, reporting voucher sales and analysing voucher performance within the affiliate channel have been made available by the majority of networks

Offline promotions can now be tracked online

Customers can receive codes on their mobile phones, therefore pushing affiliate marketing into mobile advertising

Merchants are changing their sites to better handle, display and allocate vouchers

Voucher sites are a powerful segment of the affiliate arena which, when used correctly, can help achieve outstanding marketing results. Voucher sites should be considered for inclusion in the affiliate partner mix, either at the planning stage or during execution for optimal program performance.

Over to you! Questions?