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An ecommerce site needs a healthy environment in which to flourish, especially in today's competitive hothouse. At GardenCentreUK.com, that environment is decidedly home grown. The company has achieved 100 percent sales growth over the past year largely through its own ecosystem created through affiliate marketing.
"With so many competitors we felt as though a strong affiliate network was the best way to keep our business growing," says Peter Howarth, GardenCentre general manager. "I'd say our affiliate network makes up about 15 or 20 percent of our revenue."
The GardenCentre plan actually runs against current trends. A 2008 Econsultancy report shows that the proportion of merchants saying that affiliate marketing drives high volume has decreased from 26 percent in 2007 to 15 percent in 2008. The average proportion of online sales credited to affiliate activity has decreased from 16 percent to 12 percent over the same time period.
But Howarth and GardenCentre realized early on that it needed to accomplish two goals by using it. One: it could recruit bloggers and other garden-oriented content sites to route traffic their way via display ads, driving commission revenue for the sites, and driving revenue for GardenCenter in the process. Two: running those display ads could increase brand awareness. The problem: how to find the right affiliates?
GardenCentre hired affiliate marketing consultant Webgains to identify the affiliates. That was easy enough, but not a guarantee of sales. Webgains also recommended the use of online coupons with exclusive codes for selected affiliates and the effective tracking of those offers. This addressed the somewhat backhanded issue of "scraping." Some affiliates will take credit for sales they didn't make by claiming coupon codes from rival affiliates. Webgains technology tracks specific codes to reward the correct affiliate. The system also allows merchants to set specific commission levels for discount voucher code purchases, allowing them to control the margin erosion that can result from couponing.
A second and crucial step in the program was to help GardenCentre.co.uk feed comprehensive product data back to the affiliates. The system updates inventory, prices, product images and offers on a daily basis. The GardenCenter program now includes more than 400 affiliates, about 20 of whom use the customized coupon codes. Other marketing efforts, according to Howarth, are mostly focused on paid search. But that budget may be scaled back in favor of more affiliate recruitment and support.
"For the future we want to leverage more sales through the affiliate network," Howarth says. "We need to do more to support it."