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A further trend via the channel has been the evolution of traditional display activity into behaviourally retargeted ads delivered to a CPA. This adds a further level of complexity to the channel as historically brand-focused activity takes on an acquisition focus. It is still very much early days for this
activity, with much work to be done on how incremental the sales are given that post- impression tracking is a prerequisite for behavioural advertising companies working to a CPA. This invariably dilutes the harder click action that all affiliate marketing has previously been based on. Clarity is needed with where on the page the ads appear and on which sites those ads are featured. Networks will need to support advertisers to make the right choices, not least what commissions to pay for the activity and how it sits with CPM (cost per 1000 impressions) brand campaigns. For many advertisers running mature affiliate campaigns, a constant challenge is long-tail engagement. It is typical to assume the top ten affiliates on most programmes will account for the majority of sales even though many thousands may be signed up. In theory it could be easy—and cheaper—to run these relationships directly and not bother with a huge number of affiliates who don’t seem to add material benefit.
But this is a self-fulfilling prophecy. Disengagement from deeper relationships with a wide range of affiliates will invariably
focus sales with a more concentrated group of larger sites. There are a number of strategies advertisers can employ to motivate the longer tail, who individually may make little financial difference to turnover but collectively would be a major driver of sales. Taking time to speak to them, providing unique content, understanding their individual needs and requirements, appreciating their traffic and tailoring promotions and codes accordingly, are just some of the measures that can be used to foster a great relationship with your long-tail affiliates. Tried and tested voucher code and cash- back sites will continue to dominate the scene whilst consumers are hungry for the offers and deals, but advertisers that have a wider view will look for a diverse affiliate base. A healthy programme is one whereby major affiliates do not dominate commission payments. It’s not easy and there are few shortcuts. If you’re not a major brand, you face additional challenges to cut through the not insignificant affiliate marketing noise. Failure to invest, however, will see campaigns remain unoptimised.
Next year will see the affiliate channel continue to mature, having broken through the £5 billion revenue barrier for the first time. It will continue to offer the most diverse range of opportunities to advertisers in the marketplace; the challenge is to work out how the increasingly crowded range of propositions best fits with individual advertiser needs. This
can only succeed if advertisers work closely with their network or agency and affiliates to perpetuate a loop of on-going feedback based on customer data and traffic quality. This will facilitate deeper, strategic partnerships that will truly demonstrate the power of affiliate marketing.
Tactics Views
Kevin Edwards is strategy director at affiliate networks Affiliate Window and
buy.at.
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