the truth will out: disproving common misconceptions in affiliate marketing

The Truth Will Out: Disproving Common Misconceptions

in Affiliate Marketing

Kevin EdwardsStrategy Director,Affiliate Window

Some Caveats & Explanations Relies on correct affiliates categorising themselves accurately Not all voucher code directory sales were the result of voucher codes being used Two months of data used for all examples, May-June 2009 Only affiliate channel data has been used; we are unable to make conclusions about merchants’ additional online channels All merchants used are exclusive to the network so we are comparing complete affiliate data All merchants work with all affiliate types although some have varying commissions and T&Cs Only merchants with meaningful data chosen None allow brand bidding; all have relatively strict PPC T&Cs

Voucher Code sites are goal

hangers who steal sales at

the last minute

Number of Referrers – Gifts Single Referrer Two Referrers Other Referrers Total Merchant 1 87.1 10.1 2.7 100 Merchant 2 88.6 9.6 1.8 100 Merchant 3 86.8 10.5 2.7 100 TOTAL 87.8 10.0 2.3 100

Number of Referrers – Gifts

Number of Referrers – Mobiles Single Referrer Two Referrers Other Referrers Total Merchant 1 92.3 6.7 1.0 100 Merchant 2 91.2 7.6 1.3 100 Merchant 3 86.9 10.7 2.4 100 TOTAL 89.6 8.7 1.7 100

Number of Referrers - Mobiles

Number of Referrers – Electricals Single Referrer Two Referrers Other Referrers Total Merchant 1 82.3 14.2 3.6 100 Merchant 2 87.0 10.5 2.5 100 Merchant 3 87.0 10.5 2.5 100 TOTAL 85.0 12.1 2.9 100

Number of Referrers – Electricals

Winners & Losers - Electricals

Winners & Losers – Mobiles

Winners & Losers – Gifts

Latency – Click to sale speed

Minutes

Perc

enta

ge o

f Sal

es

Latency – Click to sale speed

Minutes

Perc

enta

ge o

f Sal

es

Latency – Gifts code (general)

Minutes

Perc

enta

ge o

f Sal

es

• 19% of VC sales between 3-5 mins• 12.5% of other affiliate sales• 16% of ‘True Content’ sales

Latency – Click to sale, electricals

Minutes

Perc

enta

ge o

f Sal

es

• 16% of VC sales in first 5 mins• 19% of other affiliate sales in first 5 mins• 19% of ‘True Content’ sales in first 5 mins

Latency – Electrical code (product)

Minutes

Perc

enta

ge o

f Sal

es

• 6% of VC sales in first 2 mins• 9% of other affiliate sales in first 2 mins• 8% of ‘True Content’ sales in first 2 mins

Latency – Electrical code (general)

Minutes

Perc

enta

ge o

f Sal

es

• 15% of VC sales in first 2 mins• 6% of other affiliate sales in first 2 mins• 4% of ‘True Content’ sales in first 2 mins

• 16% increase in sales during code period• 2% increase in multiple referrer sales• Most first click VC sales lose out to VC sites

Conclusion • Small minority of sales are multi referrer

• When there is a multiple referrer sales, loyalty/reward sites are

much more likely to take sale

• Using meaningful data, price comparison and PPC lose out on first

click vs. last click;

•Negligible difference in the percentage of multi-referrer sales

during strong code period

• Voucher code sites most overwritten by other voucher code sites

Last click wins is outmoded

and doesn’t fairly reward

affiliates...

Is last click wins unfair?

• If so few sales are multiple referrer should we move to

another system?

• If we decide on a fairer system, what model could we use?

• With fairness do we lose transparency?

• How does it work on a practical level?

• What values do you use to decide your multi-attribution

model?

Attribution Choices

First Click Acquisition

Last Click Conversion

Even Split Egalitarian

Weighted Recency

Budget Spend

Last Click Wins

£6£0 £0

First Click Wins

£0£6 £0

Every Click Wins

£2£2 £2

Every Click Wins - Weighted

£3£1 £2

Multi Attribution Models - MobilesFirst ClickEqual ClickWeighted LastWeighted First

Multi Attribution Models - ElectricalsFirst ClickEqual ClickWeighted LastWeighted First

Multi Attribution Models - GiftsFirst ClickEqual ClickWeighted LastWeighted First

Average Order Values - Electricals

Number of Referrers

+7% +14% +25.1% +35%

Average Order Values - Gifts

Number of Referrers

+12.8% +31.8%

Where’s the value?

Affiliate multi-attribution isn’t necessarily the answer but it

could be a contributory element of a wider value system

Value System

Average Order Value

New Customer Acquistion

Contribution in the sales journey

Sales Volume

ConversionRate

?

Kevin Edwards,Strategy Director

020 7553 035407974 810 547

kevin.edwards@affiliatewindow.com