Reap What You Sow
Smart marketers establish a strong foundation to grow their affiliate programs
April 2008 By Kristin Hall
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Marketers hoping to launch a new affiliate marketing program—or invigorate an existing one—should recognize that the best affiliate marketing programs are built on relationships with clear rules of engagement, strategic planning and a steady stream of compelling consumer promotions.
Attracting Affiliates Is Only Half the Battle
It’s not enough for affiliates to join a program if their marketing partners do little to help them succeed. Affiliates cannot deliver on marketing goals unless the objectives are shared and the right tools and information are made available.
All affiliate programs operate within their networks’ standard affiliate agreements, which outline payment frequency, regulations and standards for fair practices. But each marketer also can establish special terms and conditions. The terms and conditions are established at the onset of a program and must be effectively communicated to all affiliates. Within the terms and conditions, marketers can establish brand requirements, creative placement criteria, search engine marketing policies and more.
One critical component of any successful affiliate marketing program is a competitive payout. The payout is based on the commission rate, generally the percentage of sales the advertiser is willing to pay affiliates; the commission duration, which is the time period allowed for affiliate traffic to convert into a sale the marketer will credit to the affiliate; and the conversion rate. The payout should make a program attractive to affiliates relative to competitors in the advertising category, while helping the marketer achieve its financial goals.
Some marketers offer a tiered commission structure, encouraging affiliates to reach certain monthly sales goals to earn increased commission levels. These can be retroactive, where the increased commission level is applied to the entire month’s sales, or sometimes the higher commission rate is paid on sales beyond the threshold. It is important that marketers establish and communicate the details of a tiered commission structure in advance. Affiliates have to be able to anticipate their marketing ROI.
Commissions should at least be competitive within the industry, and category level commissions can help advertisers normalize product margins. Marketers can communicate their margin goals by offering variable commissions on specific products or lower-margin categories.
Give Affiliates Support
Affiliates need to know a program or promotion exists and that someone is available to work with them. Having a person dedicated to affiliates also makes a program competitive. Whether from the advertiser, the agency’s outsourced program manager or a member of the affiliate network’s account team, contact information for someone who can speak about the affiliate program in detail should be made available. And this point person should be reachable at least during business hours.
To keep all affiliate managers updated on problems and uncover unique insights they might otherwise miss, advertisers can ask affiliates for opinions and input through annual surveys and outbound advertiser/affiliate network communications.
Give Affiliates Info
In addition to a competitive structure and access, a smart affiliate marketer learns to arm its affiliates with a marketing tool kit, telling its partners not only what they cannot do but what they can do. A marketer can help affiliates drive high-quality sales and more volume by sharing information.
All too often, marketers focus only on program restraints, leaving too many questions unanswered for the motivated affiliate. Affiliates need the same merchandising and marketing guidelines that benefit retail and other distribution partners, such as:
• What are the top-selling products?
• What seasonal issues should affiliates be aware of, such as holidays, catalog drops and seasonal product lines?
• What’s unique about the products?
• What works with customers?
• What type of conversion rates does the marketer typically see?
Marketers should proactively answer these and other merchandising questions for affiliates. In addition to the communication tactics outlined above, a welcome kit or affiliate tool kit enables marketers to share important program information with affiliates and can be archived for future use.
Give Affiliates Resources
With the foundation in place for success, marketers can roll out the necessary resources. This raises such questions as what types of content to provide, in what formats, what delivery vehicles to use and how often to communicate with affiliates.
Affiliates need timely content and compelling creative assets. They also need promotions and special offers, and marketers should identify their ideal shelf lives for promotions. It can be a challenge for affiliates to swap out promotions daily, so one- or two-day sales should be used selectively. In fact, in a recent survey of DoubleClick Performics affiliates, only 5 percent preferred daily offers, as opposed to monthly (23 percent) or long-running (31 percent) offers.
Online integration of offline offers is important to both consumers and affiliates. If consumers see a catalog or retail promotion, they typically expect to be able to act online or offline. Marketers should make offline promotions available to affiliates and also consider exclusive offers for affiliates. Exclusive offers can be for the entire channel or select high-performing or high-potential affiliates. Exclusive promotions can be used to negotiate high-profile placement.
Beyond offers/promotions and associated creative, affiliates also appreciate regular tips that can be general- or category-specific. Content is another great resource, helping affiliates perform better on natural search efforts or increase clickthrough rates on promotions by establishing credibility for a would-be buyer. How-to articles, relevant trends and customer reviews are just a few examples of the content that can help affiliates succeed.
Marketers can use commission structures to provide occasional incentives to affiliates—which should further the merchandising goals each time they do. An apparel marketer, for example, might want to stand out from competitors during the back-to-school season; a simple one-month increase from 5 percent commission to 6 percent often can deliver the desired boost. Contests and bonuses also work well. Marketers can motivate affiliates with prizes for sales growth, for example, and any efforts that prove successful in other distribution channels may work well with affiliates.
Marketers can help affiliates become more passionate ambassadors for the brand by sending products as gifts or providing discounts on products. Recently, DoubleClick Performics launched a new affiliate program in the highly competitive gift category. The marketer sent gift baskets to high-potential affiliates, and it proved to be an effective way to set the program apart from the crowd. Product samples can help affiliates better understand a product or overcome skeptical affiliates that think claims overstate a product’s actual performance. iRobot, the maker of Roomba and other high-quality robotic vacuums, wanted high-potential affiliates to see for themselves just how well the product performed; so it shared product samples with this affiliate segment and saw sales climb as a result.
So How and How Often?
In the same survey mentioned earlier, most affiliates indicated a strong preference for e-mail communications. Seventy-eight percent of affiliates said they acquire promotions and communications through e-mail; even more, 83 percent, cite e-mail as the preferred delivery vehicle. Fifty percent said they receive this information directly from the affiliate network’s platform; another 23 percent use advertiser links, forms and/or blogs to stay up to date on promotions, merchandising, etc.
Relevancy should define frequency. Marketers and their program representatives should only send affiliate communications with good reason. No rule of thumb exists, but marketers should query affiliates on the fly to keep tabs.
Marketers should be excited to give affiliates what they need to succeed, just not so excited that they overlook critical decisions and steps to set the stage for optimal performance.
Kristin Hall is product marketing director of affiliate marketing at DoubleClick Performics (www.performics.com). Contact her at krhall@doubleclick.com.
Attracting Affiliates Is Only Half the Battle
It’s not enough for affiliates to join a program if their marketing partners do little to help them succeed. Affiliates cannot deliver on marketing goals unless the objectives are shared and the right tools and information are made available.
All affiliate programs operate within their networks’ standard affiliate agreements, which outline payment frequency, regulations and standards for fair practices. But each marketer also can establish special terms and conditions. The terms and conditions are established at the onset of a program and must be effectively communicated to all affiliates. Within the terms and conditions, marketers can establish brand requirements, creative placement criteria, search engine marketing policies and more.
One critical component of any successful affiliate marketing program is a competitive payout. The payout is based on the commission rate, generally the percentage of sales the advertiser is willing to pay affiliates; the commission duration, which is the time period allowed for affiliate traffic to convert into a sale the marketer will credit to the affiliate; and the conversion rate. The payout should make a program attractive to affiliates relative to competitors in the advertising category, while helping the marketer achieve its financial goals.
Some marketers offer a tiered commission structure, encouraging affiliates to reach certain monthly sales goals to earn increased commission levels. These can be retroactive, where the increased commission level is applied to the entire month’s sales, or sometimes the higher commission rate is paid on sales beyond the threshold. It is important that marketers establish and communicate the details of a tiered commission structure in advance. Affiliates have to be able to anticipate their marketing ROI.
Commissions should at least be competitive within the industry, and category level commissions can help advertisers normalize product margins. Marketers can communicate their margin goals by offering variable commissions on specific products or lower-margin categories.
Give Affiliates Support
Affiliates need to know a program or promotion exists and that someone is available to work with them. Having a person dedicated to affiliates also makes a program competitive. Whether from the advertiser, the agency’s outsourced program manager or a member of the affiliate network’s account team, contact information for someone who can speak about the affiliate program in detail should be made available. And this point person should be reachable at least during business hours.
To keep all affiliate managers updated on problems and uncover unique insights they might otherwise miss, advertisers can ask affiliates for opinions and input through annual surveys and outbound advertiser/affiliate network communications.
Give Affiliates Info
In addition to a competitive structure and access, a smart affiliate marketer learns to arm its affiliates with a marketing tool kit, telling its partners not only what they cannot do but what they can do. A marketer can help affiliates drive high-quality sales and more volume by sharing information.
All too often, marketers focus only on program restraints, leaving too many questions unanswered for the motivated affiliate. Affiliates need the same merchandising and marketing guidelines that benefit retail and other distribution partners, such as:
• What are the top-selling products?
• What seasonal issues should affiliates be aware of, such as holidays, catalog drops and seasonal product lines?
• What’s unique about the products?
• What works with customers?
• What type of conversion rates does the marketer typically see?
Marketers should proactively answer these and other merchandising questions for affiliates. In addition to the communication tactics outlined above, a welcome kit or affiliate tool kit enables marketers to share important program information with affiliates and can be archived for future use.
Give Affiliates Resources
With the foundation in place for success, marketers can roll out the necessary resources. This raises such questions as what types of content to provide, in what formats, what delivery vehicles to use and how often to communicate with affiliates.
Affiliates need timely content and compelling creative assets. They also need promotions and special offers, and marketers should identify their ideal shelf lives for promotions. It can be a challenge for affiliates to swap out promotions daily, so one- or two-day sales should be used selectively. In fact, in a recent survey of DoubleClick Performics affiliates, only 5 percent preferred daily offers, as opposed to monthly (23 percent) or long-running (31 percent) offers.
Online integration of offline offers is important to both consumers and affiliates. If consumers see a catalog or retail promotion, they typically expect to be able to act online or offline. Marketers should make offline promotions available to affiliates and also consider exclusive offers for affiliates. Exclusive offers can be for the entire channel or select high-performing or high-potential affiliates. Exclusive promotions can be used to negotiate high-profile placement.
Beyond offers/promotions and associated creative, affiliates also appreciate regular tips that can be general- or category-specific. Content is another great resource, helping affiliates perform better on natural search efforts or increase clickthrough rates on promotions by establishing credibility for a would-be buyer. How-to articles, relevant trends and customer reviews are just a few examples of the content that can help affiliates succeed.
Marketers can use commission structures to provide occasional incentives to affiliates—which should further the merchandising goals each time they do. An apparel marketer, for example, might want to stand out from competitors during the back-to-school season; a simple one-month increase from 5 percent commission to 6 percent often can deliver the desired boost. Contests and bonuses also work well. Marketers can motivate affiliates with prizes for sales growth, for example, and any efforts that prove successful in other distribution channels may work well with affiliates.
Marketers can help affiliates become more passionate ambassadors for the brand by sending products as gifts or providing discounts on products. Recently, DoubleClick Performics launched a new affiliate program in the highly competitive gift category. The marketer sent gift baskets to high-potential affiliates, and it proved to be an effective way to set the program apart from the crowd. Product samples can help affiliates better understand a product or overcome skeptical affiliates that think claims overstate a product’s actual performance. iRobot, the maker of Roomba and other high-quality robotic vacuums, wanted high-potential affiliates to see for themselves just how well the product performed; so it shared product samples with this affiliate segment and saw sales climb as a result.
So How and How Often?
In the same survey mentioned earlier, most affiliates indicated a strong preference for e-mail communications. Seventy-eight percent of affiliates said they acquire promotions and communications through e-mail; even more, 83 percent, cite e-mail as the preferred delivery vehicle. Fifty percent said they receive this information directly from the affiliate network’s platform; another 23 percent use advertiser links, forms and/or blogs to stay up to date on promotions, merchandising, etc.
Relevancy should define frequency. Marketers and their program representatives should only send affiliate communications with good reason. No rule of thumb exists, but marketers should query affiliates on the fly to keep tabs.
Marketers should be excited to give affiliates what they need to succeed, just not so excited that they overlook critical decisions and steps to set the stage for optimal performance.
Kristin Hall is product marketing director of affiliate marketing at DoubleClick Performics (www.performics.com). Contact her at krhall@doubleclick.com.
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