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How a Private Affiliate Program
Can Meet Your Goals
• Chris Henger
Vice President, Affiliate Marketing, Performics • Laurie Barkman
Senior Manager, Marketing, American Eagle Outfitters
The Performance Marketing Division of DoubleClick
• Founded in 1998 as an affiliate marketing network
– To provide cost-effective affiliate marketing solutions for traditional direct marketers – Launched paid search marketing practice in 2000 • Expanded to provide comprehensive
performance-based marketing services and technologies
– Affiliate marketing agency specializing in delivering sales to retailers
– Search services and technologies encompass paid, natural and data feed marketing
A leading provider of performance-based marketing services and technologies and the only leader in affiliate and search marketing
Affiliate Marketing
--It’s Just Marketing…
An Affiliate Advertiser’s Product = Product selection, Program Terms & Conversion Rate
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The Metrics that Matter in Affiliate Marketing
Performance Marketing Metrics • Average transaction value • Conversion rate • Click through rates • Active affiliate ratio • Productive affiliate ratio • Percent of online sales • Referral quality
Multi-channel Marketing Indicators • ROI
• Life-time value • Acquisition versus retention • Retention versus reacquisition • Channel attribution
• Online metrics compared to other channels
Adoption of Channels by Multi-Channel Marketers
52% 69% 71% 83% 87% 90% 93% 0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% Online affiliate marketing programNon-paid search optimization Direct mail Keywords from Search Engines Paper catalogs E-mail E-catalogs/Web site
Source: DMA Multichannel Marketing Report, 2005
Increased complexity and choice for the consumer make it harder to determine the true drivers of sales
Requires Recognizing the Value Affiliate Traffic Plays in a Multi-channel Environment
Mass Media – Online, Print , Broadcast DRTV
Search, and Affiliate Catalog, Direct Mail, Insert Media Store Promotions Email, RSS, Blogs, Podcasts Mobile Mail Order/FAX Retail Stores Outlet Stores Call-Center Website
Offer Channels Response Channels
Awareness Consideration Purchase
• Brand Management
– Empower publishers with what they can and cannot do with your brand – Educate publishers with best practices
– Control your program by understanding publisher activity • Risk Management
– Effective affiliate marketing requires control – Compliance monitoring
– A relationship with publishers to address behavior and enforce non-compliance, if necessary
• Implications in Multi-Channel World
– Promotional coordination – Who’s customer is it? – Contact strategy
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• Brand Management– Empower publishers with what they can and cannot do with your brand – Educate publishers with best practices
– Control your program by understanding publisher activity • Risk Management
– Effective affiliate marketing requires control – Compliance monitoring
– A relationship with publishers to address behavior and enforce non-compliance, if necessary
• Implications in Multi-Channel World
– Promotional coordination – Who’s customer is it? – Contact strategy
Issues in Affiliate Marketing Today
• Emerging Distribution
– Social Marketing: Blogs, social networking and personalized “pick lists” • Blending online shopping with the viral aspects of Web 2.0 • Examples: ThisNext, MyPickList
– “Loyalty in a box:” Pre-packaged loyalty programs for affinity groups • Examples: NASCAR, LA Dodgers, Epilepsy.com
– Printable coupons • Niche Content
– Blogs
– Content sites focused on specific target markets
• Examples: parenting, tech-savvy, product lovers • Advanced Placement
– Affiliate marketing is more than pure CPA
– Some publishers warrant premium placement, hybrid media buys and slotting fees
Growth Opportunities
• Mass – Auto-approval
– No criteria for publishers to join the program • Open
– Available for all publishers to apply
– Advertisers can choose to approve publishers or not • Private
– Invitation-only
– Requires proactive recruitment • Closed
– Invitation-only
– Focused on a very small, select group of publishers
Types of Affiliate Programs
What is your affiliate program
situation?
A. Considering launch
B. Re-thinking current
C. Satisfied, just curious
Today’s topics
¾
AE brand
¾
Marketing challenges
¾
Affiliate program, AE style
¾
Maximizing programs
¾
Q&A
Marketing challenges:
9Drive incremental sales without increasing markdowns
9Acquire new online customers without leveraging stores
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Results: a profitable program uniquely AE
9
Tightly managed (small program)
9
40% new customers
9
Low coupon use
9
Strong conversion rate
9
Repeat purchases
Other options
In-house
Open
Homepage link
General T&Cs
Delegated approval
AE
Outsourced
Closed
Not marketed on website
Specific T&Cs
Approval required
Success driven by structure
Other considerations:
the bigger picture
• Do you have an Online Marketing &
Advertising (OMA) roadmap?
Affiliate program checklist
¾Even if outsourcing, be involved ¾Establish success metrics & monitor ¾Include affiliates in marketing plans & budgets
¾Focus on 80/20
¾Talk to other retailers
¾Consider role in overall OMA program
