Category Archives: Affiliate Marketing

  • Hiring an In-House Affiliate Marketing Manager? Tips on Finding the Right Candidate

    June 19, 2013 | Affiliate Marketing, Management & Strategy

    affiliate managerAs more retailers add affiliate programs to their marketing mix, it’s becoming clear that tossing the job of overseeing the program onto any marketer’s plate is not necessarily the best decision. Successful affiliate programs require consistent creativity, oversight and management, and in many cases, demand the attention of a full-time talent with relevant experience. Adding a channel that effectively licenses a brand to others is serious business, and companies need to be very careful when turning over the keys to their affiliate program (which is why many companies hire an experienced agency). However, for those that feel that an in house manager is the way to go, here are three things to consider:

    1.  How serious a commitment is being made to the affiliate program? Is it a top priority or one of many? Many marketing departments rely on staff to manage more than one marketing program, or multiple aspects of different programs.  If a marketing team is structured this way, managers need to be very thoughtful about the priority of the affiliate program in relation to other responsibilities.  Managers spending at least half their time on the affiliate program will inevitability be pulled in other directions.  This often results in making the affiliate program a lower priority as an indirect channel, and the program will lack the basic oversight needed.

    2.  How will the success of the affiliate program and program manager be measured?  Ultimately, marketing programs are all measured on revenue generation but, as many know, it’s more complicated.  When evaluating the success of the program, companies need to look for growth over time, percentage of high-producing affiliates, and brand integrity.  Don’t let meaningless metrics, like total number of affiliates in the program, stand as a success metric.

    It’s also important to have a good sense of how the person hired to manage the affiliate program will be measured. This will help ensure that company goals are appropriately aligned with the candidates. Set expectations from the start.  For example, strong affiliate relationships consistently produce results, so consider how to evaluate this on an ongoing basis.  Are top affiliates getting a high quality of interaction from the program manager?  Affiliates are sales people and brand ambassadors. They need to be cultivated and nurtured on an ongoing basis. Any program manager needs to show that he/she has the hands-on experience finding and cultivating relationships with affiliates that produce.

    Also consider looking for candidates with excellent analytic skills. The easy numbers initially generated by affiliate data rarely tell the whole story. Look for candidates who can go “under the surface” to identify trends and opportunities.

    3.  Do you know what questions to ask potential program managers?  It’s not uncommon for a hiring manager to have limited hands-on experience with affiliate marketing programs, which are extremely complicated.  When a candidate describes the success of prior programs under management in topline revenue terms, it’s very important to explicitly understand where the revenue came from (i.e. from what types of affiliates).  Were sales from affiliates generating new customers or mostly from existing customers using coupon sites to score a bargain? When the answer is the latter, the affiliate program likely had a lot of overlap with other channels and the sales were inflated.

    Other topics to explore with candidates include experience with affiliate recruiting, developing terms and conditions, affiliate fraud, designing incentive programs, brand management and creating compelling content.

    Finding solid skills and experience in all of the areas outlined above may be difficult, as successful affiliate program managers are both left- and right-brained.  The strong relationship and creative skills expected from a good marketer must be balanced with solid analytic, organizational and tactical prowess.  Good candidates should have broad demonstrable skills in addition to prior experience.  The considerations outlined above will go a long way towards helping companies find the right person for the job.

  • Infographic: The Power of Performance Marketing

    May 15, 2013 | Affiliate Marketing, Guest Post, Marketing

    How Does Performance Marketing Work?Performance marketing is one of the most effective ways to acquire new customers in today’s digital world – and yet a surprisingly large number of businesses don’t know what it is.

    For those late to the party, performance marketing involves a customer visiting content on the website of an affiliate, such as a deal, product review, discount, etc. The customer then follows a link on to that business’s website. Affiliate networks manage the affiliates and track sales so that businesses can pay a commission to the publishers that send sales to their site.

    Performance marketing grew 57% between 2008 and 2012, for an average of 12% annually. Not to mention, the return on investment is pretty stellar: for every $1 spent on performance marketing, it brings in $11 of revenue.

    And yet, an alarming number of enterprise brands don’t participate.

    Surely some have good reasons – after all, every business’s customers are different and not every marketing channel is good for every business. But many are simply ignorant of the potential benefits performance marketing could provide their business.

    Thankfully the marketing experts at CAKE, responsible for one of the leading performance marketing platforms out there, have created an infographic that offers a crash course in the power of performance marketing including how performance marketing works, the growing impact of performance marketing, whether some businesses are missing the boat, overcoming barriers and five reasons to move into performance marketing.

    The busy business owner who’s got only thirty seconds to spare should skip to the bottom to see quickly if they should get into performance marketing.

    Perform Mktg Infographic by CAKE

     

     

  • Outdated Models of Attribution Explained By A Doorman

    May 8, 2013 | Affiliate Marketing, Analytics, ECommerce, Guest Post, Marketing

    nyc-doorman-rental-aparments-doorman-tips-2As everyone in the marketing world knows, attribution is one of the hot topics for 2013. Our friends at RhinoFish Media, a PPC consulting firm, have written a guest post explaining the problems with outdated models of attribution. A simple travel metaphor illuminates just how wrong these models can be.

    The number one thing we do here at RhinoFish to ensure affiliate revenue (or any revenue) is incremental is to dive deeply into conversion attribution.

    We view driving conversions like taking a trip. Recently, you drove your car to your hometown airport, you took a bus from the parking lot to the terminal, you walked to your gate, you flew to Philly, you walked down to the street, and you took a cab to this hotel. And guess what, the doorman completely ‘attributed’ your arrival just to the cab that pulled into the hotel driveway. Good thing he’s not in charge of attribution!

    That would be crazy, but that’s what our industry is mostly doing: doorman attribution. A better travel attribution model might be to give full credit to whichever leg took you the most miles – the plane. If only Analytics could measure that touch ‘value’ in our online selling!

    Truth is, it took each leg to get there. But each leg did not contribute the same value, so you can’t just evenly spread the credit over the various legs either. If forced to pick only one leg, you’d likely pick the one with the highest total value.

    When asked, your super complex, mathematical human mind would perform a series of very fast attribution modeling calculations. “How did you get here?” “I flew.” You wouldn’t tell people you took a cab to Philly, or that you took a bus, or that you walked – though you certainly did that along the way.

    In marketing, you also need to devise a set of mechanisms to discern the contributed value of various touches. It’s not easy, but since we’re all already travel attribution experts, it doesn’t take too much creativity and experimentation to also become a marketing attribution expert.

    There are many ways to measure value, but they’ve all been largely ignored in online marketing. The lazy ‘last-in gets 100% credit’ days are coming to an end. Start inspecting your Google Analytics Multi Channel Funnel (MCF) module for value observations, patterns, hypotheses, and experiment ideas. And say goodbye to the doorman method of attribution!

    This post makes it clear that getting attribution right is one of the most important things a business can do, because it drives every other marketing and sales decision. Proper attribution is the only way to ensure that an increase in affiliate marketing efforts, for instance, actually brings a corresponding increase in revenue from affiliate programs. The same goes for all other marketing channels. The old ‘doorman’ method of attribution can mislead businesses into channeling resources toward sales and marketing efforts that in reality contribute a relatively small slice of revenue.

  • Why Network-Based Affiliate Management Is a Conflict of Interest

    May 6, 2013 | Affiliate Marketing

    Conflict of InterestI’ve recently led several panels at industry conferences where I posed the question of whether there is an inherent conflict of interest with network-based affiliate program management. The result is usually a healthy dose of cognitive dissonance from those who are engaged in these services, making me even more concerned that there is a general failure to acknowledge this problem and that it’s far from being addressed by the affiliate industry.

    I continue to be very surprised that clients who buy affiliate program management services from a network do not fully appreciate or understand the issue, and that the industry continues to dance around it. Based on more than five years of experience working with some of the most active and fast growing affiliate programs in the United States, there is no question in my mind that network-based program management presents the opportunity for significant and expensive conflicts of interest.

    To be clear, I define a conflict of interest to be where one’s fiduciary responsibilities and financial interests have the potential to not be aligned when representing multiple parties in a transaction.  In the real estate world, if someone wants to be represented as the buyer by the agent who is also selling the house (thereby paying the agent more money as the purchase price increases), the buyer needs to sign a special waiver acknowledging this conflict. Yet, this same type of relationship exists every single day with network-based affiliate management and it’s very often not disclosed or even made clear to either the Publishers (Affiliates) or the Merchants (Retailers).

    In the case of offering affiliate network services (tracking, payment, etc.) and affiliate program management services, the conflict is obvious based on the current prevailing business model.  Rather than charge a standard fee for tracking services, large affiliate networks generally earn fees as a percentage of the commissions paid to affiliates or from their total sales. This legacy pricing model is supposed to pay networks for performance and for access to their unique affiliate relationships. Advertisers have traditionally been convinced this is a great model since it is all based on “performance.” However, it’s important to remember that affiliate revenue just means that an affiliate has a marker in the transaction click stream. It in no way means that the revenue is exclusive to the affiliate channel.

    Most networks also don’t make it clear to Merchants that they have teams (usually called “publisher development”) dedicated to supporting affiliates, including helping them earn higher commissions and payouts. These publisher development teams wine and dine affiliates and work to increase both their sales and commissions with their advertising partners. As an affiliate, the incentives line up very nicely, since the more “affiliate revenue” generated and the higher the commission, the better both the network and the affiliate do.  So where does that leave the advertiser who is also paying for program management services? Usually holding the bag.

    This is where the enormous conflict in this set-up occurs. At least half of the job of an affiliate program manager today is to focus on the bottom line of the program, remove channel overlap and carefully monitor for fraudulent and low-quality affiliates. Low-quality affiliates may include coupon sites that are making up offers or forcing clicks, affiliates pretending to be the merchant in pay per click ads, e-mail spammers, toolbar sites that steal affiliate credit and numerous other violators.  For in-house or third-party managers, there is a clear independent path for dealing with these issues that often involves working with networks to remove affiliates, lower their commissions, void sales, and/or other activities which also has the effect of reducing the network’s earnings based on the performance component. But for a network- based manager, the path is not so clear, since activities that reduce the network’s earnings are not inherently in the financial interests of the network.  I hear network representatives talk all the time about how they act in the best long-term interests of their clients, but in my five years of working with most of the major U.S. networks, I have never once had a network-based manager proactively suggest that a coupon site may not be high value and/or should have their commissions lowered, or come to the client with an affiliate who they felt should be removed from the program for any qualitative or brand-related reason.

    Here are a couple of real world examples that should give pause to both the network performance pricing model and to having a network-based manager:

    1) We recommended a client stop working with Affiliate A, a coupon site and one of the top grossing affiliates on their affiliate network. The affiliate’s activities were low-value and off-brand. The network program manager initially suggested this was a bad idea despite our reasoning, but then complied. Affiliate A, after learning of their removal, called their representative on the network’s publisher development team to complain and pressured the publisher rep to call the program manager and request that the client reconsider. This is the textbook definition of a conflict of interest.

    2) A third-party fraud monitoring tool notified a network-based manager of an affiliate violating published terms and conditions in one of their programs in early June. The third party then found evidence that the violation had been going on since early May, after being asked by the manager for an estimation of when it began. The network-based manager then inferred to the the provider of the third-party tool that she didn’t want to have to go back to May and void the fraudulent affiliate’s transactions, as that revenue had already been presented and billed to the client. It’s very clear that doing the right thing for the client in this case went against the network’s financial interest and very likely her own personal incentives.

    These examples represent the sort of direct fiduciary conflict which the networks have largely refused to admit or detail in their polices for how they protect merchants from affiliate abuse when that abuse actually makes them more money. Notwithstanding the party line that “we do what’s best for our customers,” the refusal by most networks to acknowledge this dynamic even exists tells me that they are not doing anything seriously to address it.

    It’s really time that the networks own up to these issues and potential conflicts, and get serious about a financial model that better supports their clients’ bottom line and brand interests. I can promise you that if the networks had a financial incentive to remove low-value affiliates, catch cheaters, or focus on the program’s bottom line, these activities would be talked about and acted upon much more. Merchants also need to get smarter and simply refuse to use network-based management, as they will be much better off if they find someone who can truly represent their best interests without any conflicts.  The recent and sudden shutdown of the Google Affiliate Network (GAN) highlights additional dangers of having the management and the network intertwined and those merchants who relied on GAN for both services are now scrambling to find a new network and manager simultaneously.

  • As the GAN Dust Settles: What’s Next?

    April 30, 2013 | Affiliate Marketing, Current Events

    GAN ShutdownThe news that Google is suddenly shutting down the Google Affiliate Network (GAN) came as a shock to many in the performance marketing industry.  GAN, which was formerly known as Performics and inherited via Google’s acquisition of DoubleClick in 2007, had not been in growth mode for a while. However, it was tightly integrated with Google’s advertising technology platform and was certainly a viable business that did not need to be closed down for performance reasons alone.

    In many ways, Google’s decision to shut GAN down entirely shows that it never viewed GAN as a core asset. It’s very unusual to close a profitable business, let an impressive list of clients out of their contracts, and encourage them to go elsewhere as fast as possible. By not even attempting to find an acquirer (for which there would have been a lot of interest), Google disrupted the livelihoods of hundreds of customers and employees more than was necessary.  And, by posting the news to its blog before addressing the situation directly with customers, many of whom spend millions on advertising using other Google products, Google demonstrated why GAN was never a good fit for Google in the first place:

    1. Customer service and high-touch relationships are not Google’s forte. Affiliate marketing is a service-intensive business that requires strong personal relationships, and Google is not a people business, it’s a technology business.  Because clients required one-on-one contact, Google likely saw managing them as an inefficient process.

    2. Google’s core business model is cost-per-click (CPC) advertising, but GAN was a cost-per-action (CPA) business.  CPA is a harder way to make money since advertisers only pay on the sale, not just for the click.

    3. GAN created conflicts with other Google businesses lines, which caused some headaches and awkwardness in the affiliate world. SEO updates like Penguin and Panda, and the expansion of Product Listing Ads, severely impacted many affiliates.  Google also permits PPC trademark bidding, which allows ‘less ethical’ affiliates to assume a brand’s identity in paid search, ultimately turning a cheap click for a merchant into a more expensive commissionable sale that also drives up their own branded PPC costs.

    Combine the above factors with a few notable tracking issues related to GAN affiliate links in other Google products such as Gmail and Chrome, and it was likely an easy decision to remove GAN from the product mix.

    While on the surface these changes may seem like a good thing for the rest of the affiliate marketing industry, when the dust settles there may be some concerns.  What I can sense from talking to industry insiders is a fear that now that Google has removed its self-inflicted conflicting business model, it could choose to make life hard for affiliate marketers in an effort to drive more advertising business to its own products. There has been prior chatter about blocking third-party cookies in Chrome, which would be devastating for affiliate marketers as sales could not be properly tracked. And while a move like this would likely face anti-trust scrutiny, the impacts will reverberate as affiliate marketers wait to see how Google behaves in the post GAN world.

    And so, uncertainty abounds. Former GAN customers must now navigate the feeding frenzy as other industry networks, agencies and tool vendors vie for their newly available business.

    We’ve been offering free program audits and strategic advice to companies who are trying to figure out what to do with their affiliate program.  One interesting thing we have heard is that the newer and up-and-coming networks and tracking platforms are being very aggressive with pricing and contracts in courting the GAN business, while some of the more traditional networks are being heavy-handed, because they believe large GAN customers don’t have many options.  GAN clients are in for a bit of a learning curve when it comes to working with the larger affiliate networks in terms of pricing, services and contracts.  GAN’s contract terms were very flexible and negotiable, while the larger networks tend to have more stringent and fee loaded contracts with minimums and guarantees that they will enforce with a heavy hand, even when clients are unhappy.

    Conversely, smaller networks and emerging tracking platforms such as ShareASale, Cake Marketing, Impact Radius and Has Offers appear to be taking a more aggressive approach with their pricing.  These firms have also de-coupled program management from tracking, offering a low cost or fixed-fee solution for managing large affiliate relationships that have traditionally been the bread and butter of the networks performance-based business model. The economic picture of what a de-coupled program looks like is turning some heads, especially because merchants who are about to move affiliates to a new network are rightfully questioning why they should pay a hefty performance fee for those pre-existing relationships.  Expect to see some major and surprising wins from this group.

    As GAN customers are forced to make this move, many are taking it as an opportunity to revisit their program in whole, from management to payouts and fees.  It will be interesting to see how former GAN customers decide between the high cost, integrated management model offered by the big players, and the more agile, single service offerings.  I’d love to see those who are being innovative with their products and services be rewarded for their efforts and less of the business as usual which has pervaded for too long.

  • AP Offers Migration/Audit Services for Merchants Affected by Google Affiliate Network (GAN) Shutdown

    April 17, 2013 | Affiliate Marketing, Company News

    googleaffnet_616In light of yesterday’s announcement that Google is shutting down GAN, we’re offering GAN clients a free audit of their current program.

    While we are surprised to hear about the Google Affiliate Network shutdown, it presents a significant opportunity for GAN users to reevaluate the success and profitability of their affiliate programs. The Acceleration Partners affiliate team is highly specialized in performing affiliate program audits and migrations, with a focus on successfully moving programs to new networks where they can operate with improved efficiency.

    In addition to our expertise in developing and managing high-quality affiliate programs for top brands such as adidas, Reebok, Tiny Prints, ModCloth, and One Kings Lane, we have unmatched experience in the complex program migrations that will be required for merchants currently on GAN. These migrations are extremely resource-intensive and require the development and implementation of a strategy that includes structural adjustments, an affiliate communication plan, program publicity, and numerous other elements.

    In light of yesterday’s announcement, Acceleration Partners is offering a free audit of any GAN affiliate program, which will include an analysis of the current affiliate base, affiliate activity, spend levels, and suggestions on tactics that might improve growth and profitability. Audits performed by Acceleration Partners on behalf of top consumer brands typically reveal unnecessary spending amounts in excess of 25% of total program costs.

    Current GAN clients that want to learn more about Acceleration Partners’ approach to affiliate program management can visit www.acceleration-partners.com/affiliate-program-management or contact Matt Wool, Vice President of Client Services, at 401-859-1675.

  • AP Founder & Affiliate Expert Robert Glazer to Speak at Two Upcoming NYC Events

    March 8, 2013 | Affiliate Marketing, Company News, Current Events

    March is a great month for anyone interested in expanding their knowledge of internet marketing, especially affiliate networks, because Acceleration Partners’s founder and Managing Director, Robert Glazer, is speaking at two separate conferences next week.

    One of the foremost experts on affiliate and customer acquisition marketing, Bob founded Acceleration Partners in 2007 and has worked with many businesses on the Inc. 5,000 and Internet Retailer 500. These two events represent a rare opportunity to benefit from his knowledge and experience.

    Performance Marketing Summit

    His first appearance is at the Performance Marketing Summit to be held March 12, 2013 at the Baruch College Vertical Campus in New York City.

    As brands get smarter about attribution, many are taking a closer a look at affiliate programs. Titled “Should Last Clicks Still Rule?” Bob’s talk will discuss today’s rules for attribution, how to determine affiliate value, and new ways to optimize an affiliate base.

    Space is limited to 200 people, so be sure to register sooner rather than later.

    Performance Marketing Insights

    Later that very same day Bob will moderate a panel at Performance Marketing Insights, running March 12-13 at the Crowne Plaza in New York City.

    The topic of the panel discussion is “Where Should Networks Invest Their Resources in 2013?” Joining Bob will be Geno Prussakov, founder and CEO of AM Navigator, Rebecca Madigan, Executive Director of The Performance Marketing Association, Jessie Jones, founder and CEO of PopShops, and Ikonya Nginyo, Marketing Manager of DrJays.com.

    They will discuss the key areas affiliate networks should focus on over the next year. Topics likely to come up include new technology, stakeholders, and taxes as well as proposed regulation. Not only will affiliate networks have to grapple with these challenges in 2013, but as the industry evolves and marketing silos continue to break down they will increasingly have to interact with other digital channels as well.

    In addition to offering their own opinions on these issues, these panel members will also take questions from the audience.

  • Vote Today for Affiliate Summit East 2013 Sessions

    March 7, 2013 | Affiliate Marketing, Company News

    Voting for Affiliate Summit East 2013 in Philadelphia has begun! Vote for Robert Glazer, Rhinofish’s Pat Grady, and BrandVerity’s David Naffziger to speak at the this year’s conference. Their session is titled: How Top Brands Ensure Affiliate Revenue is Incremental.

    Vote Now! We look forward to seeing you at Affiliate Summit East, August 18-20!

  • Acceleration Partners Helps ModCloth & Craftsy Break into ShareASale Top 20

    February 25, 2013 | Affiliate Marketing, Company News

    Back in November of 2012, we announced that three of our programs made the top 5 of ShareASale’s Power Rank index – a first that we know of in the affiliate industry. Today, we’re happy to report that ModCloth (#14) and Craftsy (#18) have joined the likes of Tiny Prints, Blurb and One Kings Lane in the top 20 of ShareASale’s Power Rank.

    Craftsy, a leading online social crafting platform, and ModCloth, one of the fastest-growing women’s fashion retailers on the web, both joined our affiliate family in the fall of 2012. Each program has seen exceptional success by focusing on high-value, brand-relevant affiliates who drive incremental sales. We are very proud of the teams working on these programs and the results validate our management philosophy of quality over quantity.

    While many affiliate marketing firms have a single star client that helps attract others to their services, Acceleration Partners is dedicated to making every program a top industry performer – a task that is made harder by our strict quality/fraud controls and the exclusion of low-quality affiliates from many of our programs.  We are pleased that affiliates and ShareASale have recognized the excellent performance of our programs, and we look forward to putting more companies in the top 20 in 2013.

    For more information about any of our affiliate clients, or to learn what we can do for your affiliate program, please visit our Affiliate Program Management page.

  • Matt McWilliams Nominated for Affiliate Manager of the Year

    January 10, 2013 | Affiliate Marketing, Company News

    Acceleration Partners is proud to announce that our own Matt McWilliams has been nominated for the 2013 Pinnacle Award for Affiliate Manager of the Year from Affiliate Summit! This award recognizes innovative, high-performing affiliate managers that have gone above and beyond to improve their programs, and only three managers out of the entire industry received nominations. Matt is a manager on the Tiny Prints affiliate program (Tiny Prints, Wedding Paper Divas, Treat), which won the 2012 Pinnacle Award for Best Affiliate Program. Matt has previously won the Affiliate Manager of the Year award in 2010, as well as numerous other honors for affiliate management and advocacy.

    The Pinnacle Awards will be presented on Tuesday, January 15 at Affiliate Summit West 2013 in Las Vegas, NV. We wish Matt, and all nominees, the best of luck!