20 Affiliate Program Management Mistakes To Avoid

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We will cover 20 mistakes that affiliate managers routinely commit. Real life examples will be provided. You will take away practical knowledge, and a checklist to compare against your own style.

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20 Affiliate Program Management Mistakes To Avoid

  1. 1. Affiliate Summit West 2010 20 Affiliate Program Management Mistakes to Avoid Evgenii “Geno” Prussakov Founder, AM Navigator
  2. 2. Introduction <ul><li>You must learn from the mistakes of others. You can't possibly live long enough to make them all yourself. </li></ul><ul><li>-- Sam Levenson </li></ul>
  3. 3. Introduction <ul><li>An error doesn't become a mistake until you refuse to correct it. </li></ul><ul><li>-- Orlando A. Battista </li></ul>
  4. 4. Outline <ul><li>Merchant errors (10) </li></ul><ul><li>Affiliate program manager mistakes (10) </li></ul><ul><li>Checklist  </li></ul>
  5. 5. Errors Committed by Merchants
  6. 6. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul>
  7. 7. Leaks - Definition <ul><li>Leaks – external links within your website that lead to sites which do not credit your affiliates for the work they perform. </li></ul>
  8. 8. Leaks - Types <ul><li>Leaks – external links within your website that lead to sites which do not credit your affiliates for the work they perform. </li></ul><ul><li>Types of Leaks: </li></ul><ul><ul><li>1. Telephone number / Live chat </li></ul></ul><ul><ul><li>2. AdSense units </li></ul></ul><ul><ul><li>3. Amazon widgets </li></ul></ul><ul><ul><li>4. Links to “network” stores/sites </li></ul></ul><ul><ul><li>5. Affiliate links & links to other merchants </li></ul></ul>
  9. 9. Leaks – Example (type 1) Telephone Number
  10. 10. Leaks – Example (type 1) Live Chat
  11. 11. Leaks – Example (type 2) AdSense (Google ads)
  12. 12. Leaks – Example (type 3) Amazon widgets
  13. 13. Leaks – Example (type 4) Links to “network” stores/sites
  14. 14. Leaks – Example (type 5) Affiliate links & links to other merchants
  15. 15. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul><ul><li>“ Autopilot” approach </li></ul>
  16. 16. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul><ul><li>“ Autopilot” approach </li></ul><ul><li>Autopilot – “device for automatically steering ships, aircraft, and spacecraft.” </li></ul>
  17. 17. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul><ul><li>“ Autopilot” approach </li></ul><ul><li>Such systems of directing vehicles without assistance from human beings are excellent when used in the contexts they were created for. </li></ul><ul><li>Affiliate marketing is not one of them! </li></ul>
  18. 18. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul><ul><li>“ Autopilot” approach </li></ul><ul><li>Unclear/absent program TOS </li></ul>
  19. 19. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul><ul><li>“ Autopilot” approach </li></ul><ul><li>Unclear/absent program TOS </li></ul>
  20. 20. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul><ul><li>“ Autopilot” approach </li></ul><ul><li>Unclear/absent program TOS </li></ul>Merchant naïvete -- loss of defensive behaviors and adaptations needed to deal with “predators”
  21. 21. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul><ul><li>“ Autopilot” approach </li></ul><ul><li>Unclear/absent program TOS </li></ul><ul><li>Inexistent PPC policy </li></ul>
  22. 22. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul><ul><li>“ Autopilot” approach </li></ul><ul><li>Unclear/absent program TOS </li></ul><ul><li>Inexistent PPC policy </li></ul>
  23. 23. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul><ul><li>“ Autopilot” approach </li></ul><ul><li>Unclear/absent program TOS </li></ul><ul><li>Inexistent PPC policy </li></ul><ul><li>Embarrassing commission rates </li></ul>
  24. 24. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul><ul><li>“ Autopilot” approach </li></ul><ul><li>Unclear/absent program TOS </li></ul><ul><li>Inexistent PPC policy </li></ul><ul><li>Embarrassing commission rates </li></ul><ul><li>Short cookie life </li></ul>
  25. 25. Short Cookie Life <ul><li>5 hours or under </li></ul><ul><li>Sephora.com (4 hrs) </li></ul><ul><li>Toys R Us, Babies R Us </li></ul><ul><li>eToys.com </li></ul><ul><li>Miles Kimball Company </li></ul><ul><li>ShopNBC.com </li></ul><ul><li>12-24 hours </li></ul><ul><li>Nordstrom.com (12 hrs) </li></ul><ul><li>Enterprise.com (23 hrs) </li></ul><ul><li>Chase.com (23 hrs) </li></ul><ul><li>Amazon (24 hrs) </li></ul><ul><li>3 Days </li></ul><ul><li>Apple iTunes </li></ul><ul><li>Champs Sports </li></ul><ul><li>Dell </li></ul><ul><li>ESPN Shop </li></ul><ul><li>Foot Locker </li></ul><ul><li>Walmart </li></ul>
  26. 26. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul><ul><li>“ Autopilot” approach </li></ul><ul><li>Unclear/absent program TOS </li></ul><ul><li>Inexistent PPC policy </li></ul><ul><li>Embarrassing commission rates </li></ul><ul><li>Short cookie life </li></ul>
  27. 27. Cookie Retention Data <ul><li>1 day – 85% </li></ul><ul><li>2 days – 75% </li></ul><ul><li>3 days – 70% </li></ul><ul><li>4 days – 63% </li></ul><ul><li>45 days ~ 50% </li></ul><ul><li>340 days ~ 20% </li></ul>Source: &quot;Web Analytics Analyzed&quot; blog by Paul Strupp at blogs.sun.com
  28. 28. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul><ul><li>“ Autopilot” approach </li></ul><ul><li>Unclear/absent program TOS </li></ul><ul><li>Inexistent PPC policy </li></ul><ul><li>Embarrassing commission rates </li></ul><ul><li>Short cookie life </li></ul><ul><li>Commission drops </li></ul>
  29. 29. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul><ul><li>“ Autopilot” approach </li></ul><ul><li>Unclear/absent program TOS </li></ul><ul><li>Inexistent PPC policy </li></ul><ul><li>Embarrassing commission rates </li></ul><ul><li>Short cookie life </li></ul><ul><li>Commission drops </li></ul>As a valued [Merchant Name] affiliate partner, I wanted to let you know that we are currently working to make our program, and our partnerships, as successful as possible. In order to continue to support the success of our current partnership we are unable to continue to offer you a flat 4% commission on all goods. Starting at the end of February, our new offer will be lowered to 1.5% on all goods.
  30. 30. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul><ul><li>“ Autopilot” approach </li></ul><ul><li>Unclear/absent program TOS </li></ul><ul><li>Inexistent PPC policy </li></ul><ul><li>Embarrassing commission rates </li></ul><ul><li>Short cookie life </li></ul><ul><li>Commission drops </li></ul>As a valued [Merchant Name] affiliate partner, I wanted to let you know that we are currently working to make our program, and our partnerships, as successful as possible . In order to continue to support the success of our current partnership we are unable to continue to offer you a flat 4% commission on all goods. Starting at the end of February, our new offer will be lowered to 1.5% on all goods.
  31. 31. Commission Decrease
  32. 32. Commission Decrease
  33. 33. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul><ul><li>“ Autopilot” approach </li></ul><ul><li>Unclear/absent program TOS </li></ul><ul><li>Inexistent PPC policy </li></ul><ul><li>Embarrassing commission rates </li></ul><ul><li>Short cookie life </li></ul><ul><li>Commission drops </li></ul><ul><li>Unrealistic goals for commission increases </li></ul>
  34. 34. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul><ul><li>“ Autopilot” approach </li></ul><ul><li>Unclear/absent program TOS </li></ul><ul><li>Inexistent PPC policy </li></ul><ul><li>Embarrassing commission rates </li></ul><ul><li>Short cookie life </li></ul><ul><li>Commission drops </li></ul><ul><li>Unrealistic goals for commission increases </li></ul>
  35. 35. Swimmer (illustration)
  36. 36. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul><ul><li>“ Autopilot” approach </li></ul><ul><li>Unclear/absent program TOS </li></ul><ul><li>Inexistent PPC policy </li></ul><ul><li>Embarrassing commission rates </li></ul><ul><li>Short cookie life </li></ul><ul><li>Commission drops </li></ul><ul><li>Unrealistic goals for commission increases </li></ul><ul><li>Tampering with tracking code </li></ul>
  37. 37. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul><ul><li>“ Autopilot” approach </li></ul><ul><li>Unclear/absent program TOS </li></ul><ul><li>Inexistent PPC policy </li></ul><ul><li>Embarrassing commission rates </li></ul><ul><li>Short cookie life </li></ul><ul><li>Commission drops </li></ul><ul><li>Unrealistic goals for commission increases </li></ul><ul><li>Tampering with tracking code </li></ul><ul><li>Late/inexistent notifications </li></ul>
  38. 38. Errors Committed by Merchants <ul><li>“ Leaky” website </li></ul><ul><li>“ Autopilot” approach </li></ul><ul><li>Unclear/absent program TOS </li></ul><ul><li>Inexistent PPC policy </li></ul><ul><li>Embarrassing commission rates </li></ul><ul><li>Short cookie life </li></ul><ul><li>Commission drops </li></ul><ul><li>Unrealistic goals for commission increases </li></ul><ul><li>Tampering with tracking code </li></ul><ul><li>Late/inexistent notifications </li></ul>Notify affiliates at least one month in advance
  39. 39. Mistakes of Affiliate Managers
  40. 40. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul>
  41. 41. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>… when, in reality: </li></ul><ul><li>not affiliate managers </li></ul><ul><li>but affiliate program managers </li></ul>
  42. 42. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul>
  43. 43. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul>Affiliate marketing is “the art of doing a merchant's marketing better than they can, and profiting from it.” -- Chris Sanderson, AMWSO
  44. 44. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul>
  45. 45. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul>ASSUME = + U + ME
  46. 46. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul>Merchant: I wanted to let you know that we strictly prohibit direct linking to our website from search engines. Please update any campaigns or otherwise we will not be able to continue working with you.
  47. 47. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul>Merchant: I wanted to let you know that we strictly prohibit direct linking to our website from search engines. Please update any campaigns or otherwise we will not be able to continue working with you. Affiliate: We are not doing any direct linking to [your site]. What makes you think we are?
  48. 48. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul>Merchant: I wanted to let you know that we strictly prohibit direct linking to our website from search engines. Please update any campaigns or otherwise we will not be able to continue working with you. Affiliate: We are not doing any direct linking to [your site]. What makes you think we are? Merchant: Great! We didn’t. We just saw your sales pick up and wanted to ensure you knew our keyword policy.
  49. 49. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul><ul><li>Treating affiliates a employees </li></ul>
  50. 50. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul><ul><li>Treating affiliates a employees </li></ul>Motivating affiliates by threat =
  51. 51. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul><ul><li>Treating affiliates a employees </li></ul>Motivating affiliates by threat = &quot; dead-end strategy&quot; Even in traditional management “threats are generally counterproductive” and “always demotivating” “ We can motivate people to their highest levels of potential by presenting them with opportunities to succeed instead of telling them what to do” -- Alexander Haim Streetwise Motivating & Rewarding Employees
  52. 52. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul><ul><li>Treating affiliates a employees </li></ul>As you may know from previous experience, [Merchant Name] works each month to a set budget. While in the past, if they surpass that budget, we have been forced to remove partners. This is never ideal and we want to prevent this from happening as much as possible. As of right now, we are on track to surpass our February budget. To prevent this, we are asking you to take a 1% commission cut through the rest of the month. We ask that you opt into the lower-commission offer immediately, or we will have to remove you from the program . This is only a short-term adjustment, so we thank you, in advance, for your cooperation and understanding.
  53. 53. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul><ul><li>Treating affiliates a employees </li></ul><ul><li>Treating all affiliates the same way </li></ul>
  54. 54. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul><ul><li>Treating affiliates a employees </li></ul><ul><li>Treating all affiliates the same way </li></ul>Contingency Approach There is “no one universal solution… but the correct solution will depend on the unique needs of the situation” -- Montana, P.J., Charnov, B.H. Management
  55. 55. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul><ul><li>Treating affiliates a employees </li></ul><ul><li>Treating all affiliates the same way </li></ul>Contingency Approach Main situational variables: 1) affiliate maturity 2) task at hand
  56. 56. Contingency Approach (grid)
  57. 57. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul><ul><li>Treating affiliates a employees </li></ul><ul><li>Treating all affiliates the same way </li></ul><ul><li>Believing money is the best incentive </li></ul>
  58. 58. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul><ul><li>Treating affiliates a employees </li></ul><ul><li>Treating all affiliates the same way </li></ul><ul><li>Believing money is the best incentive </li></ul>… things that make people satisfied and motivated … are different in kind from the things that make them dissatisfied. …even if managed brilliantly [environmental factors] don’t motivate anybody to work much harder or smarter. People are motivated, instead, by interesting work, challenge and increasing responsibility. These intrinsic factors answer people’s deep-seated need for growth and achievement. [bold font mine] -- Frederick Herzberg
  59. 59. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul><ul><li>Treating affiliates a employees </li></ul><ul><li>Treating all affiliates the same way </li></ul><ul><li>Believing money is the best incentive </li></ul>“Compensation and incentive packages” are not motivating enough for people. A manager “can charge a person’s battery, and then recharge it, and recharge it again,” but “it is only when one has a generator of one’s own that we can talk about motivation.” [bold font mine] -- Frederick Herzberg One More Time. How Do You Motivate Employees Harvard Business Review, Jan. 2003
  60. 60. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul><ul><li>Treating affiliates a employees </li></ul><ul><li>Treating all affiliates the same way </li></ul><ul><li>Believing money is the best incentive </li></ul><ul><li>Losing personality </li></ul>
  61. 61. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul><ul><li>Treating affiliates a employees </li></ul><ul><li>Treating all affiliates the same way </li></ul><ul><li>Believing money is the best incentive </li></ul><ul><li>Losing personality </li></ul>
  62. 62. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul><ul><li>Treating affiliates a employees </li></ul><ul><li>Treating all affiliates the same way </li></ul><ul><li>Believing money is the best incentive </li></ul><ul><li>Losing personality </li></ul><ul><li>Lack of communication </li></ul>
  63. 63. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul><ul><li>Treating affiliates a employees </li></ul><ul><li>Treating all affiliates the same way </li></ul><ul><li>Believing money is the best incentive </li></ul><ul><li>Losing personality </li></ul><ul><li>Lack of communication </li></ul>Communicate regularly and on different levels
  64. 64. Channels of Communication <ul><li>Email (42%: 38% mass e-mail, 4% personal msgs) </li></ul><ul><li>Blog (17%) </li></ul><ul><li>Network internal email (17%) </li></ul>Source: AffStat 2009
  65. 65. Frequency of Communication <ul><li>Monthly (42%) </li></ul><ul><li>Weekly (39%) </li></ul><ul><li>Quarterly (11%) </li></ul>Source: AffStat 2009
  66. 66. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul><ul><li>Treating affiliates a employees </li></ul><ul><li>Treating all affiliates the same way </li></ul><ul><li>Believing money is the best incentive </li></ul><ul><li>Losing personality </li></ul><ul><li>Lack of communication </li></ul><ul><li>Ignoring affiliate suggestions </li></ul>
  67. 67. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul><ul><li>Treating affiliates a employees </li></ul><ul><li>Treating all affiliates the same way </li></ul><ul><li>Believing money is the best incentive </li></ul><ul><li>Losing personality </li></ul><ul><li>Lack of communication </li></ul><ul><li>Ignoring affiliate suggestions </li></ul>Listening is not enough. Hear them and respond.
  68. 68. 3 R s to Remember <ul><li>R eachable </li></ul><ul><li>R esponsive </li></ul><ul><li>R eal </li></ul>
  69. 69. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul><ul><li>Treating affiliates a employees </li></ul><ul><li>Treating all affiliates the same way </li></ul><ul><li>Believing money is the best incentive </li></ul><ul><li>Losing personality </li></ul><ul><li>Lack of communication </li></ul><ul><li>Ignoring affiliate suggestions </li></ul><ul><li>Failing to admit mistakes </li></ul>
  70. 70. Mistakes of Affiliate Managers <ul><li>Believing they need to manage affiliates </li></ul><ul><li>Assuming they are smarter than affiliates </li></ul><ul><li>Assuming all affiliates are prone to fraud </li></ul><ul><li>Treating affiliates a employees </li></ul><ul><li>Treating all affiliates the same way </li></ul><ul><li>Believing money is the best incentive </li></ul><ul><li>Losing personality </li></ul><ul><li>Lack of communication </li></ul><ul><li>Ignoring affiliate suggestions </li></ul><ul><li>Failing to admit mistakes </li></ul>
  71. 71. Checklist  Top 20 Mistakes to Avoid: Pick it up at www.amnavigator.com/ASW10.htm
  72. 72. Soviet Pasta (illustration) Soviet Pasta Diameter - 7.62 mm
  73. 73. Soviet Pasta (illustration) Soviet Pasta Diameter - 7.62 mm AKM (AK-47) assault rifle Caliber - 7.62 mm
  74. 74. Thank You! [email_address] amnavigator.com /blog twitter.com/eprussakov

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