Affiliate Marketing Blog - a Traffic Junction Blog

Internet Retailer reports that Wal-Mart.com’s site-to-store service is successful in attracting new customers, with more than 50% of those using the service being first time buyers on the site. This service, which is akin to online ordering for a ‘food takeaway service’, allows shoppers to order online and pick up the items ordered from their nearest Wal-Mart store. It’s a simple concept and is even entirely new, but has made quite an impact for the company [by cutting down on transportation/distribution costs and riding on consumers’ tendency to buy more when they are at the store] as well as to consumers [who save on shipping costs].

Excerpts on how the service has benefited everyone concerned from the article:

Shoppers who have used the Site to Store service often buy additional items when arriving at a store for pickup of the online order. Since the service was launched, Wal-Mart has seen as 20% increase in the number of Site to Store customers who spend an additional $60 or more on in-store purchases, the retailer says.

The service has saved Walmart.com customers $5 million in shipping fees for more than 500,000 products shipped since the service started, Wal-Mart says. By consolidating shipments of online orders to stores instead of to consumers’ addresses, the service has also provided Wal-Mart with more efficient transportation and packaging operations, saving the retailer 1,000 gallons of gasoline each week and 20,000 packing boxes each month, it adds.

I wasn’t really thinking about affiliate marketing when I decided to write this post, but there may be some benefit to affiliates too, with its success in attracting NEW customers. I actually wrote this because I felt there’s a simple lesson for any business- online or offline: there are numerous opportunities and ways business/ sales/ operations can be optimized/ maximized, if we were to only look deeply enough. There is ALMOST ALWAYS a different, new and better way of doing things that can yield better returns at a much lower incremental cost. Can you spot it?

I saw this discussion thread on the UK Affiliate Marketing Forum about brand name bidding- an affiliate bids only on brand names of a company and generates sales. Is it the correct and acceptable thing to do?

Like many affiliates participating in that thread, I believe this isn’t a clear-cut black & white issue, and one cannot be judgemental about the morals and ethics of the affiliate concerned. If a merchant we promote has no objections whatsoever on bidding on their brand name, why would we not do it? Afterall, users are more likely to click through and buy if they recognize a particular brand. It’s a different matter if the merchant or network does not permit brand name bidding or has imposed conditions and guidelines that are being violated — in which case the affiliate deserves appropriate action.

Another problem with brand name bidding is ignorance [of course, ignorance cannot be used to prove innocence, and I am not justifying it by any means] — there are a large number of affiliates that not only do not know the rules related to brand name bidding but also numerous other guidelines.

A significant part of the responsibility therefore lies with the merchants and the networks– for affiliate education, monitoring and taking corrective & preventive actions. When it indeed comes down to unethical practices and somebody knowingly tries to flout the rules, make the affiliate pay for it- it’s as simple as that.

A new ad marketplace, AdJug, which enables advertisers and publishers to buy and sell ads directly has been launched with aspirations to be the leading ad marketplace in the UK. The platform will allow for sales of both text and display advertising on CPC and CPM basis. More details about how the network works.
Based on a quick review, i get the impression that it is a combination of a service like AdBrite and Google’s Site Targeting for Adwords, wherein advertisers can choose what sites their ads can appear and define the amounts they are willing to pay.

As I see it, the key challenges for any new network/market place of this kind are: differentiation and the value addition to the online advertising process; a critical mass of advertisers and publishers to ensure that there is sufficient ‘trading’ for everyone to benefit. On a disappointing note, the site did not offer a lot on both of these counts. For example, when I searched the marketplace to check the kind of publishers participating, I did not find any publisher for most categories. It doesn’t look like the marketplace has been able to build a good mass of publishers for the launch phase.

However, the site is founded by people with strong background in online advertising and marketing- so hopefully they willl get it right.

A feature article in Internet Retailer says, “Gaining sex appeal, affiliate marketing is receiving more attention”. Without giving a lot of detail/ statistics as to why they think affiliate marketing is getting sexier, the piece talks about retailers looking at this channel more closely and altering their strategies.

Sexier or not, there are a few discernible (if inevitable) changes that have happened in the recent past:

(a) Affiliates getting more tech-savvy. Not only have they been early adopters of some of the emerging technologies and social phenomena (user behaviour), in many cases affiliates are leading the way and sowing the seeds of change.
(b) Affiliates becoming enough of a force to reckon with to make the large networks listen to them (even though there are some companies that believe affiliates are a lowly bunch out to steal commissions from them). With their expertise, proprietary tools and capabilities, and most importantly, results in terms of greater sales, affiliates have shown the power to shape decisions at networks and merchants.

Undoubtedly there has been continuous growth in affiliate commissions in the past few years, which one would expect considering the growth in overall online marketing budgets. There are two questions that most of us in this field look at closely, the answers to which are probably a better indicator of the health of the affiliate marketing industry (a) are merchants increasing their affiliate marketing budgets as a proportion of their overall online marketing spend (b) is the proportion of revenue contributed by affiliate marketing growing compared to other marketing methods?

Continued success for affiliates will depend on being where their consumers are (whether that be the forums or review sites) and secondly, speaking in the language of their consumers (if consumers like videos, then the affiliates better give them videos..). Of course, these rules apply to any form of marketing; thus far, affiliates have pretty much followed these rules to a ‘T’ and there’s no reason why they wouldn’t continue to do so and get even sexier…