Segmenting your affiliates

The recent a4uexpo London had lots of good talks this year but my favourite from the event was Matt Swan and Helen Southgate discussing Sky’s data. Within the presentation they looked at the different performance of affiliates on different metrics. It got me thinking about how people segment their affiliate base.

The need to segment your affiliate base is obvious. You only have to look at a recent A4u forum thread, from a couple of weeks ago, to see that being sent irrelevant communications or offers is frustrating.

Most times when I hear people talk about segmenting their programme, they talk about doing it by the type of affiliate. It kind of makes sense. Cashback affiliates should in theory be most worried about the cashback offered, the voucher code sites want the best code and content sites want something they can write about. But does this over simplify the affiliate’s business? On a lot of programmes, there will be more in common between affiliate types so it could be a good way to segment. But the main thing they will have in common is the promotional tool. How often do people actually look at the sales being driven by these affiliates to see if they have anything else in common?

Another panel from the expo had an affiliate champion for each area. While I really enjoyed it, what it highlighted more than anything is that a lot of affiliate types have converged. Just looking at cashback; sites are doing content, they have comparison engines, they offer branding opportunities, and they promote vouchercodes. Although segmented as the same ‘affiliate type’, some cashback sites may have more in common with content sites like Money Saving Expert than other cashback affiliates.

So how do you segment them?

I think Helen’s talk could suggest one way. Ask yourself some questions about your programme. Do you have insight into the type of customer that is being driven by the affiliate? For example, do they tend to attract customers with higher basket value? Is the churn lower? What sort of customer demographic do you get from them? Can you look to segment your affiliates based on the type of customers they provide? Would the affiliate perform better with a different promotional message tailored towards their audience? Perhaps you still use the promotional type as the base for the segmentation but then use your data to create sub-segments.

Using Sky as an example, could they create bespoke promotions around the full Sky+HD packages with Broadband etc to those affiliates whose users have the higher spend? Affiliates with lower basket values may convert better with a stripped down version. Perhaps these customers are less valuable so Sky could look at how they demonstrate the value of the higher packages through this affiliate segment. If they are content sites, can Sky work alongside them to provide good quality content on the savings for the full package? Segmenting the affiliate base by the end user rather than thinking all affiliates are the same.

But average order value should not be looked at in isolation. It is also important to look at what they are selling. The affiliate who was upset in the thread above was being sent information about diets when he only promotes travel. So for Sky it could make sense to look at the product split from affiliates before sending offers out to them. Sky may have affiliates that focus on different areas. For example, a sport blogger might push Sky Sports. They are, therefore, likely to be more engaged with Sports related communication and promotions than finding out about the special offer on Talk Unlimited.

If your time is limited, then segmenting by affiliate type is better than nothing. You will hit a lot of affiliates with a promotional offer/tool that they can use. But by actually looking at some of your data, understanding your affiliates and their users will give you a better insight and opportunity to help improve their performance. You will also be less likely to be accused of spamming. One definition of marketing is to identify and fulfil and exceed customer needs. It’s interesting that in affiliate marketing, segmentation too often fails to look at the customer and instead looks at the method of promotion.

source: affiliates4u.com

Affiliate model justified in roundtable

a4uexpo London hosted a roundtable of various performance marketing figureheads. The discussion was filmed and organised by affilinet and featured representatives from companies such as Nectar, Holiday Autos and uSwitch.



Mary Keane-Dawson was chief instigator of conversation. She incited discussion about the entrepreneurial aspect of the industry. Publishers are uncovering new technologies and business models, which will help advertisers test and trial new CPA activity, a big positive for the sector.

There was talk about the perception of publishers. They should be pushing to become viewed as brands, especially the more mature, premium publishers. There will likely be a shift in perception where customers become brand-loyal in the UK, much like consumerism in the USA.

Publishers should become brands

Evidence of publishers becoming brands is no more evident than in the spate of TV advertisements that have been aired recently. The traditional role of affiliates as being purely a mechanism for generating sales is becoming somewhat of a grey area. Their increased media activities show they create demand too.

Big data’s still in its infancy according to the roundtable. You just have to look at the volume the industry has available and how little it’s capitalising on that volume. There was talk about pooling it together so publishers, networks and advertisers can create a bigger picture of future trends.

Talent is another issue that needs to be resolved. The roundtable felt so-called attractive digital channels like mobile and social were more appealing. Once affiliate business had recruited talent, they needed to be kept engaged. It’s a tricky prospect as new recruits look to broaden their marketing experience by hopping to other channel.

source: affiliates4u.com

Facebook offering e-retailers sales tracking tool

SAN FRANCISCO — Facebook Inc wants more credit for making online cash registers ring.

Facebook will begin rolling out on Friday a new tool which will allow online retailers to track purchases by members of the social network who have viewed their ads.

The tool is the latest of the new advertising features Facebook is offering to convince marketers that steering advertising dollars to the company will deliver a payoff.

Facebook, with roughly 1 billion users, has faced a tough reception on Wall Street amid concerns about its slowing revenue growth.

“Measuring ad effectiveness and outcomes is absolutely crucial to all types of businesses and marketers,” said David Baser, a product manager for Facebook’s ads business who said the “conversion measurement” tool has been a top customer request for a long time.

The sales information that advertisers receive is anonymous, said Baser. “You would see the number of people who bought shoes,” he said, using the example of an online shoe retailer. But marketers would not be able to get information that could identify the people, he added.

The conversion tool is specifically designed for so-called direct response marketers, such as online retailers and travel websites that advertise with the goal of drumming up immediate sales rather than for longer-term brand-building.

Such advertisers have long flocked to Google Inc’s Web search engine, which can deliver ads to consumers at the exact moment they’re looking for information on a particular product.

But some analysts say there is room for Facebook to make inroads if it can demonstrate results.

“The path to purchase” is not as direct on Facebook as it is on Google’s search engine, said Debra Aho Williamson, an analyst with research firm eMarketer. But she said that providing information about customer sales conversion should help Facebook make a stronger case to online retailers.

“It lets marketers track the impact of a Facebook ad hours or days or even a week beyond when someone might have viewed the ad,” said Williamson. “That allows marketers to understand the impact of the Facebook ad on the ultimate purchase.”

Marketers will also have the option to aim their ads at segments of Facebook’s audience with similar attributes to consumers that have responded well to a particular ad in the past, Baser said.

Online retailer Fab.com, which has tested Facebook’s new service, was able to reduce its cost per new customer acquisition by 39 percent when it served ads to consumers deemed most likely to convert, Facebook said. Facebook defines a conversion as anything from a completed sale, to a consumer taking another desired action on a website, such as registering for a newsletter.

New opportunities

Shares of Facebook, which were priced at $38 a share in its May initial public offering, closed Thursday’s regular session at $22.17.

In recent months, Facebook has introduced a variety of new advertising capabilities and moved to broaden its appeal to various groups of advertisers.

Chief Operating Officer Sheryl Sandberg said in October that Facebook saw multi-billion revenue opportunities in each of four groups of advertisers: brand marketers, local businesses, app developers and direct response marketers.

Facebook does not disclose how much of its ad revenue, which totaled $1.09 billion in the third quarter, comes from each type of advertiser. Pivotal Research Group analyst Brian Wieser estimates that brand marketers and local businesses account for the bulk of Facebook’s current advertising revenue.

Earlier this year, Facebook introduced a similar conversion measurement service for big brand advertisers, such as auto manufacturers, partnering with data mining firm Datalogix to help connect the dots between consumer spending at brick-and-mortar and Facebook ads.

And Facebook has rolled out new marketing tools for local businesses such as restaurants and coffee shops, including a revamped online coupon service and simplified advertising capabilities known as promoted posts.

The new conversion measurement tool is launching in testing mode, but will be fully available by the end of the month, Facebook said.

source: interaksyon.com