Is Affiliate Marketing Really Worthwhile? Matt Bailey Head of Affiliate i-level

YES ...if it’s managed correctly

What are we going to talk about? Context – Why are we asking this question? Looking past the last click More than a single channel Are all sales the same? Maximising your campaign effectiveness

Context – Why are we asking this question?

Looking past the last click

More than a single channel

Are all sales the same?

Maximising your campaign effectiveness

Who Am I? Head of Affiliate at i-level Chair of IAB’s Affiliate Marketing Council Passionate advocate of performance marketing

Head of Affiliate at i-level

Chair of IAB’s Affiliate Marketing Council

Passionate advocate of performance marketing

Unprecedented Times Uncertain Climate

How online is doing Economy shrank 2.9% in Q1 2009 Unemployment up by 29% in the last year 17p in every £ spent online 50% spent online by 2014 Sources: ONS (April 09), National Staistics, IMRG CapGemini e-Retail Sales Index

Economy shrank 2.9% in Q1 2009

Unemployment up by 29% in the last year

17p in every £ spent online

50% spent online by 2014

Performance Marketing in a Recession Low risk marketing channel Paying after the money is in the till Scaleable LET’S NOT WASTE A GOOD RECESSION

Low risk marketing channel

Paying after the money is in the till

Scaleable

SCRUTINY

What clients want... Lower cost per sale More sales Incremental sales Better sales

Lower cost per sale

More sales

Incremental sales

Better sales

Looking past the last click

The last event Last Exposure Event type Display Impression Display Click Paid Search Natural Search Affiliates Sale Sale

Sales journeys are complex E1 Conversion Event E2 E3 E4 E5 Event type Display Impression Display Click Paid Search Natural Search Affiliates Sale

Evidence for both incremental sales and interception 1. Affiliate–only Journeys (+) 2. Other->Affiliate Journeys (-) 3. Affiliate ->Other Journeys (+) Sale

What you pay for Affiliate Only Other to affiliate Last click sales

True Value Affiliate Only Other to affiliate True value Affiliate to other

Determining the worth 100 sales 80 sales 20 30 90 sales Last Click Sales Affiliate Only Affiliate to other Other to affiliate True Value

More than a single channel

PPC Brand New Technologies High Traffic/ Portal True Content Price Comparison Voucher Code Loyalty/ Cashback Email

Affiliate types interact in different ways Transaction Share of journey events 01 Jan 09 – 04 Mar 09 Event type Content Price Comparison Incentive Voucher Paid Search Other

Breaking out affiliates by category Display Click Natural Search Affiliate Voucher Affiliate Content Affiliate Cashback Paid Search Sale

What types of activity feeds sales, by type Display Click Natural Search Affiliate Voucher Affiliate Content Affiliate Cashback Paid Search

Clear difference in journey lengths % Sales Number of exposures

What does this show? Different affiliates operate in different ways They require specific: Approaches Marketing collateral Remuneration models

Different affiliates operate in different ways

They require specific:

Approaches

Marketing collateral

Remuneration models

Are all sales the same?

Can you use affiliates to: Make people spend more? Drive new customers? Stay with you longer? Buy sooner?

Can you use affiliates to:

Make people spend more?

Drive new customers?

Stay with you longer?

Buy sooner?

Average basket value

New vs Existing Customers Where is the brand loyalty, with you or the affiliate? Would the sale have come to you anyway? Reward affiliates for driving new customers?

Where is the brand loyalty, with you or the affiliate?

Would the sale have come to you anyway?

Reward affiliates for driving new customers?

Lifetime Value Some affiliate models promote switching Do you measure the lifetime value of sales through different channels? Should an affiliate be rewarded for driving better customers?

Some affiliate models promote switching

Do you measure the lifetime value of sales through different channels?

Should an affiliate be rewarded for driving better customers?

Affiliates convert sales quicker Sale event type Display Click Paid Search Affiliates Natural Search

Using this information to maximise your campaign effectiveness

Looking past the last click Analyse what you are paying affiliates Remember last click isn’t everything

Analyse what you are paying affiliates

Remember last click isn’t everything

Determining the worth 100 sales 80 sales 20 30 90 sales Last Click Sales Affiliate Only Affiliate to other Other to affiliate True Value

Determining the worth 100 sales 80 sales 20 50 sales 50 sales Last Click Sales Affiliate Only Affiliate to other Other to affiliate True Value

More than a single channel Understand different affiliate types How do they interact with each other? Bespoke approach for each one

Understand different affiliate types

How do they interact with each other?

Bespoke approach for each one

More than a single channel PPC Affiliates Cashback and Incentive sites Voucher Code Sites Emerging Technologies Email affiliates Long Tail Content Can they be used to complement your existing search strategy? Do they add incremental value or simply cannibalise other channels? Are you providing them with the right tools to promote you? How do we stay ahead of the curve whilst protecting ourselves at the same time? What offers should we be pushing and how do we retain control? Incremental value or cannibalisation? How do we harness them and achieve our aims?

How can we use affiliates?

Pull Capture all traffic looking for your products Price Comparison Product based content sites Brand/Generic PPC Get your brand on front of online shoppers Voucher sites Cashback Email Push

Capture all traffic looking for your products

Price Comparison

Product based content sites

Brand/Generic PPC

Get your brand on front of online shoppers

Voucher sites

Cashback

Email

EPC = CPA & CTR & OSC Pay affiliates more Compelling creative Strong consumer offers/ voucher codes Securing good placements on the affiliate site Deeplinking to specific products Reducing the customer journey Easy site to use

Compelling creative

Strong consumer offers/ voucher codes

Securing good placements on the affiliate site

Deeplinking to specific products

Reducing the customer journey

Easy site to use

Are all sales the same? Plan Execute Test Optimise

Making people spend more

Driving new customers? Can affiliates be incentivised to drive new customers? Pay a bonus for new customers Is it something they can influence? Does it vary for different affiliate types?

Can affiliates be incentivised to drive new customers?

Pay a bonus for new customers

Is it something they can influence?

Does it vary for different affiliate types?

Driving better customers Do certain affiliates/ affiliate types drive better customers already? Do merchants measure this? Would certain affiliates be better incentivised working on a lifetime rev share model?

Do certain affiliates/ affiliate types drive better customers already?

Do merchants measure this?

Would certain affiliates be better incentivised working on a lifetime rev share model?

Aiding conversion Some (content) affiliates are losing sales Instead of paying them more, how can we help them convert? Sale Sale

Some (content) affiliates are losing sales

Instead of paying them more, how can we help them convert?

Is Affiliate Marketing Worth It? All marketers are under intense scrutiny Incredible opportunities for us all

All marketers are under intense scrutiny

Incredible opportunities for us all

What you need to demonstrate Affiliates is a key solus channel You treat affiliate types differently You understand what different affiliates are delivering for you. Always be in beta

Affiliates is a key solus channel

You treat affiliate types differently

You understand what different affiliates are delivering for you.

Always be in beta

[email_address] twitter.com/mattb811