CJU Course: Advertiser Best Practices: The Hitchhiker’s Guide to Affiliate Marketing
Looking to optimize your program but can’t figure out how? Does the affiliate marketing industry often seem like a giant galaxy without direction? Don’t Panic! Chris and Craig presented a guide on how to jumpstart any new or veteran program and drive results – money! They shared travel-tested principles you can use to offer the right marketing mix, invest your time and money effectively, and engage publishers and customers. Pack light for this trip through the keys to growth in the affiliate marketplace. The panel consisted of:
- Chris Schwass, Advertiser Account Manager
- Craig Cacciola, Advertiser Account Director
I’m not a raging Hitchhiker’s Guide to the Galaxy fan but I have see the movie and understand the references, which made this a really fun presentation. I really enjoyed using the rules of the book/movie as analogies to affiliate marketing. It was fun and informative – my favorite kind of session! You could tell that Chris and Craig were both having a good time putting together their session, something that’s greatly needed the last day of a conference when people are thinking about going home!
Bullet Point Review!
- Bring a towel – Bring something of value to the table.
- Offer the right incentive. Flat rate vs. Performance incentive. Bigger performers don’t need performance incentives, especially loyalty – they want flat rate. Short term vs. Long term. They want long term.
- Vary your promotions. Give your publishers tools so they can be effective in attracting consumers. Some affiliates build momentum so a long offer is good, but some affiliates hit the moment and short term offers could work better, so don’t ignore either demographic.
- Fix your site. Make sure landing pages are right, close leaks with phone numbers. Optimize, optimize, optimize! Consider it from the publishers perspective.
- Use your babelfish – Speak the publishers language.
- Write to one person. Be more conversational, engage them. Write as if you’re writing it to one person.
- Keep it simple. The rule of 3: 3 words in the subject line, 3 paragraphs max, 3 sentences per paragraph.
- Be transparent. Think of them as your sales force. You’ll build loyalty and rapport with your top publishers.
- Listen to your robot – Don’t ignore the data.
- Test everything. Why? What? How? Not everything fits your conventional wisdom. A/B test publisher emails.
- Find the ROI.
- Set a baseline.
- Analyze incremental lift and cost.
- Organize future opportunities.
- Think long term. There might not necessarily be return in year 1. Diversify. The more investments you put in, the greater possibility of seeing payoffs
- DON’T PANIC!
CJU Course: Doing More With The Traffic You Already Have
Many publishers spend the majority of their time and resources trying to increase the volume of traffic they receive. In this session, the focus was on how to get more performance out of the traffic you already have. The ValueClick Brands division shared the tips and tricks developed during its ten year history; highlighting what, why, and how each optimization can have impact. The speaker was:
- Steve Neufer, General Manager, ValueClick Brands
This was pretty informative. I really liked the direct way Steve presented the information, and it made me realize just how important usability testing is to everyone! Steve was an engaging speaker, funny, and used great analogies to make his points.
Bullet Point Review!
Increasing traffic to an under-performing website is like adding more water to a leaky bucket.- What we say is we want more traffic, but what we mean is we want to earn more.
- Traffic is a tool, not a goal.
- Understanding your traffic.
- A little bit of information allows you to create a hypothesis and do more.
- What percentage of your current traffic is “productive”?
- Where is your productive traffic coming from?
- Resources: Google Analytics, Webmaster Tools, session level conversion reporting.
- This is easy, doesn’t necessarily cost a lot of money or take a lot of expertise.
- Understanding your users
- If you’re not observing actual user behavior you are missing the boat. Usability testing is a must!
- Myths: expensive, complicated, requires expertise.
- Resources: UsabilityTest.com, Family/Friends
- Testing Scenario: go to Google, perform search for “Kohls coupons” and try to find a coupon that you can use the save money on your online order.
- Testing Results: tested 20 users, most visited 8 sites, 2 successfully found a coupon, most common initial response was confusion, most common descriptor used was spam (pretty much means they’re weary).
- Designing for Productive Users
- Them not us: you are not your users, your users are asymmetrically savvy, your users are asymmetrically patient, trust is an issue.
- Sophistication level may be very low but apprehension level is high, so we have to talk to them with sophistication to gain trust.
- Unfamiliar terms: SKU, S&H, merchant, related searches, promo, next, sponsored, post.
- Familiar alternatives: item, shipping, store, popular searches, promotion, next page, advertisement, news.
- Be concise: what is the user supposed to look at here?
- Be safe: why do you need my info before you answer my question? Give first, ask later.
CJU Course: PayPerCall: Dial Up Your Marketing Results
Want to take advantage of a marketing channel that has conversion rates as high as 50%? Want to successfully promote high priced items and services through the affiliate channel? Advertisers and Publishers in this session learned all about PayPerCall and how they can use unique, trackable, phone numbers to attribute calls to various efforts. The solo presenter was:
- Nicole Ron, Manager, PayPerCall
There’s not much to share here since it was largely a demonstration of the platform, but wow. This was what I needed to want to explore it more. Now, unfortunately for my limited forays into being an affiliate there’s not much on the PayPerCall platform that’s in-line with my ideas, but here’s to hoping they grow! A personal note for Nicole if she reads this – I LOVED the Wizard of Oz theme & analogies in the presentation!
Bullet Point Review!
How does it work? Advertisers create a PayPerCall campaign and publishers apply and select unique toll-free numbers. Publishers run promos online or off. When a consumer places the call, CJ tracks it and it connects to the advertisers call center.- PayPerCall is powered by RingRevenue.
- Three ways to get paid: Phone Leads, Phone Sales, and Both!
- Phone Lead: commission granted for qualified calls based on duration or other factors.
- Sales: commission granted for sales that result from referred calls.
- Hybrid: commission granted for quality calls AND from sales from a referred call.
- More high end products and services do well on PayPerCall. There’s more personal contact which means up-sell and a higher AOV.
- Tip for Search Publishers: include the phone number in the ad. Lends credibility. Good for mobile.
- Tip for Display Publishers: advertisers provide the creative and CJ pops in the unique phone numbers you selected.
- Tip for Blogger Publishers: phone numbers fits nicely into a blog in a write up or review.
- The average conversion rate on PayPerCall is 20-30%
CJU Course: Kerri Pollard’s Opening Remarks
Despite our impressive growth rates, performance-based model and in-depth relationships, why does affiliate marketing continue to play in the minor leagues? Commission Junction President Kerri Pollard challenged us (advertisers, publishers, agencies, and CJ employees alike) to become major players in the overall media mix — aka, the “big leagues.” Not only do we recognize that there is life beyond the last click, but we can — and we do — add value to many of the critical stages of the consumer life cycle that lead to the purchase.
As usual, Kerri’s opening remarks were engaging, energetic and encouraging.
Bullet Point Review!
- The industry thinks we’re too small, we don’t deserve as much attention in affiliate marketing.
- Benchmark Capital says “Affiliate marketing is slowing” but they’re the only ones that think that.
- We know we’re growing; those outside our industry and those above us do not.
- We can ignore these doubtful questions or we can answer them by demonstrating our value. Answering them will allow us to do more in the future.
- How do we create more outliers to increase commissions?
- Are we having the right conversations?
- We need to focus on incrementality.
- Loyalty publishers have a 171% higher AOV, their users shop more frequently, and they have less returns (within CJ, anyway).
- We need to look at what’s happening in other channels and address the concern, money can be funneled elsewhere.
- We need to focus on profitability.
- Revenue: cost of goods sold – operating expenses = profit.
- Reach: who is your audience? What are their preferences? Do they match advertiser goals?
- We can do more.
- 5% of CJ publishers have a mobile experience or mobile website.
- Only 10% of advertisers have mobile shopping experiences.
- Starting November 3rd, CJ will be offering impression to conversion. The click will always trump the impression.
CJU Keynote: So what drives customer engagement, anyway?
2011’s keynote speaker was the very informative Dr. Jeffrey F. Rayport, Ph.D. Jeffrey coined the term “viral marketing” and brings an incredible knowledge of the online commerce space. He advises businesses in rethinking how they interact with their customers. His keynote focused on how the networked world requires new approaches to drive customer engagement, which in turn is changing the face of online and multi-channel commerce.
Last year’s keynote was informative, but dry. This year’s keynote was awesome. Dr. Rayport was informative as all get out while being funny and engaging all at the same time. I’d love to see him speak again, and I definitely ended the keynote feeling jazzed to keep learning more and energized for my meetings!
Bullet Point Review!
- Consumers have changed over the decades
- Consumer 1.0: Demand was greater than supply
- Consumer 2.0: Demand was equal to supply
- Consumer 3.0: Supply is greater than demand
- We’re all in the business of demand generation.
- Engaging and captivating consumers is key.
- Toyota’s Scion is a great cast study of how to do it right.
- Scion never spent money on TV advertising: 60% allocation of their marketing budget to events and 40% to online advertising.
- Made a lot of after market peripherals and accessories for the car.
- It’s changing the way car buying works. Most owners customize their Scions online.
- Integrate social networks, read dynamic comments, follow Twitter streams.
- 2/3 of the 100 million streams of videos happen on exterior sites, not YouTube.com
- StumbleUpon now accounts for over 50% of all the referral traffic from the topographic social media sites. There are 12 million SU users vs. 750 million Facebook users and yet SU just surpassed Facebook.
- Best Buy extends multiple-channel retail experience into many useful OUTGOING points of presence, such as Facebook, online magazines, mobile apps, Twitter-based customer service, and crowd sourced ideas.
- A single social graph can become a vast constellation of thousands of INCOMING points of presence.
- With the proliferation of local deals and offers, mobile couponing is growing rapidly in appeal.
- It’s expected that 16.5% of adult mobile phone users will be using mobile coupons by 2013.
- iPhone and iPad apps enable mobile access to flash sales with “call to action” offers for people on the go.
- To boost mobile sales, companies have provided a “virtual shop window” for the retail experience without the inventory. Ocado in the UK has a store front, you can scan the barcodes on the window with your mobile phone and order items.
- Mobile smart phone apps provide branded city guides to deepen brand engagement and drive sales.
- Hulu’s move beyond online video streaming is fueling growth for it’s business and content owners, too. It went from a website to having multiple platforms to provide premium content.
- The highest productivity retailer in the world as measured by retail sales per square foot is the Apple Store.
- Publishers and advertisers will win consumers not through Customer Relationship Management, but Customer Managed Relationships.
- Forget segments and niches in the traditional sense.
Dr. Rayport’s 5 Main Takeways:
- Target your diehard fans: put them in the driver’s seat
- Social the brand: make rewards matter
- Work the web: let the outside in and the inside out
- Experience is everything: form factors rule
- Integrate the touch points: be savvy and seamless
CJU Course: It’s a TAXing Debate: Don’t Cut Me Off
So many states have implemented affiliate nexus tax laws. What does this mean to you as a publisher? What does this mean to you if you are an advertiser who does not have a store in the state? Come listen to our panel to hear how others are managing the challenge. The panel consisted of:
- Jennifer Lovette, Vice President, Client Development, CJ (Moderator)
- Rebecca Madigan, Executive Director, Performance Marketing Association
This was a very informative discussion, even for someone like me who tries to keep abreast of what’s going on in an effort to help however I can. I should note that since CJ (since this info is about a month stale) that the Governor of CA has signed the deal with Amazon and many merchants have welcomed CA affiliates back into their programs.
Personally, I only accepted a few that I really liked before and declined the pushed offers from the others as I already did my link removal on my sites, but I’m the lowest level of affiliate in terms of how much I personally make, so it’s the bigger affiliates who can really make a difference in leveraging their income figures in this fight!
Bullet Point Review!
- Do we want to fight this on a state by state level or on a national level.
- Publishers aren’t mad at the advertisers, they’re mad at the legislature.
- On average affiliates lose 25-45% of their revenue, the state loses income tax revenue, and never collect the sales tax.
- There are a lot of names, which are confusing, but we’ve chosen affiliate nexus law as a general catchall phrase.
- Quill Corp v. North Dakota: advertising does not constitute physical presence or nexus. It became a constitutional issue.
- Passed: California, New York, North Carolina, Rhode Island, Illinois, Connecticut, Arkansas.
- Big box retailers banded together this year to support this tax to try to get Amazon to pay tax. Rumor is they spent 11 million.
- The PMA surveyed California affiliates after the budget bill was signed here:
- 32% are moving out of state or plan to.
- 20% decided to shut down their affiliate marketing efforts altogether
- 35% of lost over half their income when the law passed.
- Amazon & CA have come to an agreement that will eliminate this tax for 1 year – we need to look at it more long term.
- They want to get a federal sales tax solution in place by July 2012. If they’re not successful, the law gets reinstated September 15, 2012.
- Streamline Sales Tax Project. 24 states have agreed to this. Main street fairness act needs to pass to allow SSTP. The chance of this happening isn’t very high.
- Amazon just cut a deal with the state that benefits their own business, so now all these other advertisers who haven’t been involved in the fight or the opposition will be forced to collect tax. Now is the time to fight for yourself & promote the federal solution.
- Board of directors of the PMA are new and still determining whether to fight nationally or state level.
- What can you do?
- Think before you act.
- Make Your Case
- Simplify actions
- Measure twice, cut once. Advertisers need to make sure you’re doing what’s best for your business before making a knee jerk decision to cut affiliates. Talk to a lawyer if you have to.
- There are ways to work together, identify your threshold of risk.
- Taxes will always exist, think long term when making decisions that are going to affect your business.
- No matter what side you’re on, WE can make a difference
- Things change quickly so don’t give up!
If you were an attendee of CJU and registered for their (awesome!) CJUniverse network, you can download a PDF of Jennifer’s slides here.
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