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Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
Advertisers: Why Commission Segmentation Matters to You
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Advertisers: Why Commission Segmentation Matters to You

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This presentation is from Affiliate Summit East 2014 (August 10-12, 2014 New York City). …

This presentation is from Affiliate Summit East 2014 (August 10-12, 2014 New York City).
Session Description: Attribution analytics have made it possible to design commission segmentation strategies that cut costs while rewarding publishers who drive quality results.

Published in: Marketing
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  • 1. Advertisers: Why Commission Segmentation Matters to You Affiliate Summit East 2014 Aug. 11, 2014 New York City
  • 2. Presented by Brook Schaaf CEO and Co-Founder Schaaf-PartnerCentric Affiliate Program Management Agency Twitter: @schaafpc If you’re live-tweeting about this presentation be sure to use hashtag #ase14.
  • 3. Agenda • Background • What is Commission Segmentation • Why We Use It; How It Helps • Case Studies • Summary • Questions and Answers
  • 4. Commission Segmentation Is … • Using attribution tools / analytics to design custom commissions for specific affiliates or types of affiliates in order to reward based upon performance.
  • 5. Why We Use It • The more we learn about who’s driving results, the more advertisers want to focus on top performers … … and dangle the proverbial carrot.
  • 6. The Benefits • Allows for a strategy- driven approach to commissions that goes beyond trying to pay more than competitors • Rewards affiliates who are driving desired outcomes • Reduces amount spent on results of lesser quality
  • 7. Case Study – Coupon / Loyalty • After analyzing program performance we began segmenting coupon and loyalty publishers for a retail client. • Value was lower for these “introducers” than it was for other publishers who were “closers.” • Coupon/loyalty publishers commissions were lowered from 8% to 5% What was the outcome?
  • 8. Case Study – Coupon / Loyalty • Revenue for coupon/loyalty publishers saw a modest year- over-year decrease (6.66%) while the commissions paid to those publishers dropped by 49.95%.
  • 9. Revenue Over Time
  • 10. Cost of Sale Over Time
  • 11. Cost of Sale – Vertical Spread
  • 12. Case Study – Midline Commissions • A new client had been paying coupon publishers a 5% commission and non-coupon publishers a 20% commission. However, many non-coupon publishers were still promoting coupons. What was the solution?
  • 13. Case Study – Midline Commissions • We established a midline commission rate and based a tiered commission structure on that. Commission payouts and the cost of sale remained steady during this period of adjustment.
  • 14. Monthly Data Table
  • 15. Revenue Over Time
  • 16. Publisher Commissions Over Time
  • 17. Cost of Sale Over Time
  • 18. Commission Rate Tiers
  • 19. Case Study – Lowering Commissions • An advertiser was offering a default 8% commission rate that we lowered to 5% for most publishers (allowing two top performers to remain at 8%). Commission payouts fell from an average 6 - 6.5% to 5 – 5.5%. Click throughs and revenue remained consistent with advertiser’s historical data.
  • 20. Monthly Data Table
  • 21. Revenue Over Time
  • 22. Publisher Commissions Over Time
  • 23. Cost of Sale Over Time
  • 24. Case Study – Lowering Commissions • A top coupon publisher was earning a 10% commission rate at initial takeover. This was lowered to 5% and then 1%, dramatically reducing the cost of sale. Revenue remained consistent with past performance.
  • 25. Top Coupon Publisher Revenue & Commissions
  • 26. Top Coupon Publisher Cost of Sale
  • 27. Case Studies – Elasticity • We implemented a Q4 growth plan for a fashion retailer whose affiliate program saw YoY growth each week in November/December between 42% and 65%. • We grew year-over-year revenue for a lead gen client's mature program by 84% in one month. • Our affiliate recruitment efforts for a new client brought 118 new affiliates by our second month managing the program, and by that time the program saw a 135% year-over-year increase in revenue.
  • 28. Case Studies – Elasticity • We grew a retail program 20% year- over-year in the first six months. In our second year of management, it grew 60% year-over-year. Now, two years later, the program is pacing to hit a 175% year-over-year increase for July 2014. • We grew the program for an online business solutions client by 20% year-over-year in the first quarter. In Q1 2014 the client's program experienced 41% year-over-year growth.
  • 29. Non-Traditional Opportunities • ArkNet owns MagazineDiscountCenter.com, which drives $5 - 10k daily but with only a 2 - 4% re-order rate. • Wants to optimize email list by targeting those consumers with Quidsi offers • Goal: develop traditional merchant/ publisher relationship
  • 30. Non-Traditional Opportunities • InnerVid is a collection of daily and weekly newspapers • Wants to monetize papers by joining affiliate programs • Will advertise in print editions and track via unique URLs or coupon codes
  • 31. Summary • Use your analytics to identify your top performers. • Create a commission structure in which the rewards are tied to performance. • Don’t be afraid to lower commissions when performance isn’t there. By the same token, don’t be afraid to pay higher commissions for top performing publishers.
  • 32. Thank You brook@schaafpc.com

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