tag:econsultancy.com,2008:/topics/affiliate-marketing Latest Affiliate Marketing content from Econsultancy 2017-09-04T15:00:00+01:00 tag:econsultancy.com,2008:BlogPost/69392 2017-09-04T15:00:00+01:00 2017-09-04T15:00:00+01:00 Amazon turns Twitch into an influencer sales platform Patricio Robles <p>Even to this day, there are still <a href="https://www.theverge.com/2014/8/25/6066509/why-it-makes-sense-for-amazon-to-buy-twitch">different</a> <a href="http://www.businessinsider.com/amazons-970-million-purchase-of-twitch-makes-so-much-sense-now-its-all-about-the-cloud-2016-3">theories</a>, but whatever Amazon was thinking at the time, it is now aiming to use Twitch to drive sales for its retail empire.</p> <p>On Thursday, in the lead up to the PAX West video game conference, Twitch announced a new program under which users who stream through Twitch will be able to feature products they like and receive a commission from Amazon for sales they refer. As Bloomberg's Spencer Soper <a href="https://www.bloomberg.com/news/articles/2017-08-31/amazon-turns-thousands-of-twitch-streamers-into-product-pitchmen">detailed</a>:</p> <blockquote> <p>The Gear on Amazon feature will let Twitch streamers showcase their favorite products as a widget on their page. Viewers who click the widget are routed to Amazon, where they can buy the streamer’s favorite items. The streamer gets a commission of as much as 10 percent on each sale, Amazon said.</p> </blockquote> <p>Currently, Twitch has over 100m monthly visitors and claims to reach more than half of all millennial males in the U.S. More than 2m of its 10m daily active users actually broadcast their own streams and nearly half of Twitch users consume more than 20 hours of content on the service weekly.</p> <p>Put simply, even though Twitch is niche, it boasts a ton of highly-engaged users and now Amazon is going to try to turn some of the most prolific into salespeople.</p> <p>According to Tobias Sherman, who used to head the esports division of entertainment agency giant WME-IMG, Twitch's influencers "are a massive market."</p> <p>"They are the same as sports figures in being able to convert eyeballs and fans into dollars and cents. Everyone plays games and it tethers everyone together," he explained.</p> <p>Twitch's Gear on Amazon program will be open to tens of thousands of Twitch users who are members of its partner and affiliate programs. These, like the YouTube Partner Program, are designed to reward popular content producers with the ability to earn money for publishing their content on Twitch.</p> <p>Gear on Amazon could make participation in these programs far more lucrative. After all, popular Twitch streamers who are able to take advantage of their influence to help sell physical products for which they receive commissions of up to 10% could find that affiliate commissions add up a lot more quickly than ad revenue shares do.</p> <h3>Amazon's influence on influencer marketing</h3> <p>It seems there are few markets that Amazon doesn't have a hand in, and the ecommerce giant is clearly interested in putting its imprint on the influencer marketing space.</p> <p>Gear on Amazon is the second program Amazon has launched this year that seeks to turn influencers into affiliates. In April, the company <a href="https://econsultancy.com/blog/68961-amazon-tries-its-hand-at-influencer-affiliate-marketing/">launched a beta of an invite-only Amazon Influencer Program</a> "exclusively designed for social media influencers with large followings and a high frequency of posts with shoppable content." </p> <p>Influencers who participate in the Amazon Influencer Program get the opportunity to curate their favorite products on an Amazon-hosted page that has a vanity URL. As TechCrunch's Sarah Perez described it at the time, "Basically, it's a more exclusive step up from Amazon Affiliate linking, and offers a better browsing experience."</p> <p>While it remains to be seen whether or not Amazon will actually find success trying to merge influencer and performance marketing, there are a growing number of reasons to believe that performance marketing will indeed become a more prominent part of influencer marketing. These reasons include:</p> <ul> <li> <a href="https://econsultancy.com/reports/measuring-roi-on-influencer-marketing">Measuring the ROI of influencer marketing</a> continues to be a challenge for many marketers.</li> <li>Fees charged by top influencers have been skyrocketing, causing some marketers <a href="https://digiday.com/marketing/confessions-social-media-exec-no-idea-pay-influencers/">to question</a> whether the costs can be justified.</li> <li>Emerging threats <a href="https://econsultancy.com/blog/69343-are-marketers-underestimating-the-fraud-threat-to-influencer-marketing">such as fraud</a> could undermine the market.</li> <li>Big platform owners like Facebook <a href="https://econsultancy.com/blog/69355-is-facebook-preparing-to-tax-influencer-marketing-campaigns">could seek to tax</a> influencer marketing campaigns on their platforms, increasing costs. </li> </ul> <p>Tying influencer compensation to sales could help address many of the challenges the influencer marketing ecosystem is facing and if any company is capable of pushing the ecosystem in this direction at scale, it's Amazon.</p> tag:econsultancy.com,2008:Report/3008 2017-08-25T11:33:00+01:00 2017-08-25T11:33:00+01:00 Internet Statistics Compendium Econsultancy <p>Econsultancy’s <strong>Internet Statistics Compendium</strong> is a collection of the most recent statistics and market data publicly available on online marketing, ecommerce, the internet and related digital media. </p> <p><strong>The compendium is available as 11 main reports (in addition to two sector-specific reports, B2B and Healthcare &amp; Pharma) across the following topics:</strong></p> <ul> <li><strong><a href="http://econsultancy.com/reports/advertising-media-statistics">Advertising</a></strong></li> <li><strong><a href="http://econsultancy.com/reports/content-statistics">Content</a></strong></li> <li><strong><a href="http://econsultancy.com/reports/customer-experience-statistics">Customer Experience</a></strong></li> <li><strong><a href="http://econsultancy.com/reports/web-analytics-statistics">Data and Analytics</a></strong></li> <li><strong><a href="http://econsultancy.com/reports/demographics-technology-adoption">Demographics and Technology Adoption</a></strong></li> <li><strong><a href="http://econsultancy.com/uk/reports/ecommerce-statistics">Ecommerce</a></strong></li> <li><strong><a href="http://econsultancy.com/reports/email-ecrm-statistics">Email and eCRM</a></strong></li> <li><strong><a href="http://econsultancy.com/reports/mobile-statistics">Mobile</a></strong></li> <li><strong><a href="http://econsultancy.com/reports/search-marketing-statistics">Search</a></strong></li> <li><strong><a href="http://econsultancy.com/reports/social-media-statistics">Social</a></strong></li> <li><strong><a href="http://econsultancy.com/reports/strategy-and-operations-statistics">Strategy and Operations</a></strong></li> </ul> <p>Updated monthly, each document is a comprehensive compilation of internet statistics and digital market research with data, facts, charts and figures. The reports have been collated from information available to the public, which we have aggregated together in one place to help you quickly find the internet statistics you need - a huge time-saver for presentations and reports.</p> <p>There are all sorts of internet statistics which you can slot into your next presentation, report or client pitch.</p> <p><strong>Sector-specific data and reports are also available:</strong></p> <ul> <li><strong><a title="B2B Internet Statistics Compendium" href="http://econsultancy.com/reports/b2b-internet-statistics-compendium">B2B</a><br></strong></li> <li><strong><strong><a title="Financial Services and Insurance Internet Statistics Compendium" href="https://econsultancy.com/reports/financial-services-and-insurance-internet-statistics-compendium/">Financial Services and Insurance</a></strong></strong></li> <li> <strong><a title="Healthcare and Pharmaceuticals Internet Statistics Compendium" href="https://econsultancy.com/reports/healthcare-and-pharmaceuticals-internet-statistics-compendium/">Healthcare and Pharmaceuticals</a></strong><strong> </strong> </li> <li><strong><a title="Retail Statistics Compendium" href="https://econsultancy.com/reports/retail-statistics-compendium/" target="_self">Retail</a></strong></li> <li><strong><a title="Travel Statistics Compendium" href="https://econsultancy.com/reports/travel-statistics-compendium/" target="_self">Travel</a></strong></li> </ul> <p><strong>Regions covered in each document (where data is available) are:</strong></p> <ul> <li><strong>Global</strong></li> <li><strong>UK</strong></li> <li><strong>North America</strong></li> <li><strong>Asia</strong></li> <li><strong>Australia and New Zealand</strong></li> <li><strong>Europe</strong></li> <li><strong>Latin America</strong></li> <li><strong>MENA</strong></li> </ul> <p>A sample of the Internet Statistics Compendium is available for free, with various statistics included and a full table of contents, to show you what you're missing.</p> tag:econsultancy.com,2008:BlogPost/69285 2017-08-02T10:20:38+01:00 2017-08-02T10:20:38+01:00 Five great examples of integrated brand partnerships online James Cristal <h3><strong>Our business just doesn’t make enough money</strong></h3> <p>Once a new idea has been scoped, beta takes shape and initial adopters gather onboard, some firms are lucky enough to receive their first, then second round of funding and so on.</p> <p>In today’s tech-heavy, entrepreneurial world we are seeing some amazing products, services and apps develop. Though, to the surprise of the traditional businessman, they make no money whatsoever! Those funding these firms are taking huge risks on companies for long-term growth and eventually monetisation, but like Facebook they delay their monetisation techniques until their base is significant enough on which to capitalise. </p> <p>Focusing particular attention on apps; some are lucky enough to generate an income from the offset, others later in life. It all depends on the nature of their proposition, the userbase, the costs and demands from shareholders. Let's first explore what monetisation options are out there. This is by no means an extensive list but gives an idea, particularly for growing applications that are at that stage where monetisation is becoming important, of what options are available:</p> <p><strong>1. Fees.</strong> Apps such as Deliveroo, Uber or Booking.com will charge fees whether to the consumer or restaurant/hotel. Investment platforms such as Moneyfarm or Scalable will take small monthly fees from the consumer for managing their funds. Airbnb takes a fee from the host every time a booking is made.  </p> <p><strong>2. Subscriptions.</strong> Some products operate via a subscription service. The most obvious is Netflix – its huge userbase gives it a consistent income from monthly payments. Interestingly, services such as Spotify offer a free service too, with ads, to entice skeptics in before upselling to more premium subscriptions. Cornerstone is another example, charging you regularly for razors to be delivered direct to your door.  </p> <p><strong>3. Advertising.</strong> As we touched upon, Facebook is the main monster example, Google and LinkedIn too. Using their service is free from a consumer perspective but they earn through paid search and a host of other advertising services. Livescore, a live sports results app, uses ad banners at the bottom of the screen. Other sites are subtler still, Buzzfeed for example charges businesses to create content.</p> <p><strong>4.</strong> <strong>Purchases. </strong>Focusing again more on applications, some charge for purchase while others for in-game extras. Pokemon Go is a notable example of a free app that offers in-app purchases.</p> <p><strong>5. Affiliation.</strong> Many firms choose to include affiliate links, earning from CPC or CPA deals with third parties. Content heavy sites tend to introduce this strategy as a more native technique than pure advertising. Apps tend to avoid affiliation so as to not encourage movement away from their own environment, but the likes of Moneysupermarket and Topcashback live off it.  </p> <p>There are so many examples out there of businesses that have developed over time with no clear-cut strategy of how they will monetise, only to figure it out later. The reasons aren’t because their products aren’t popular, on the contrary they are simply growing their userbase in unforeseen timeframes.</p> <p>But when it comes to the crunch, when the investors are no longer patient for profits, it’s time to look for revenue streams, and there are those who are adopting a cleverer technique, one we have yet to mention... those I call integrated partnerships...</p> <h3> <strong>So, what are integrated partnerships?</strong> </h3> <p>To understand integrated partnerships one must first appreciate the difference between affiliation and partnerships.</p> <p>Affiliation is the act of linking to a third party and receiving commissions in return for clicks or conversions. It is a form of partnership marketing. There are advertisers and publishers, an advertiser being those that are seeking to advertise, while publishers ‘publish’ or host the ad. An advert can be obvious such as in a table on Confused.com, or a native link within an article on Moneysavingexpert.</p> <p>Partnerships are the act of working with any secondary brand to promote each other’s services. Some are pure partnerships where each promotes one another, others are paid for agreements, like affiliation or sponsorships. Those that I believe to be a game changer in today’s digital heavy, app dominated landscape, are integrated partnerships.</p> <p>An integrated partnership takes all the elements of the traditional partnership model but takes it a step further where a primary brand will incorporate the secondary’s product into their own. In my <a href="https://econsultancy.com/blog/69182-a-complete-guide-to-partnership-marketing-part-one">partnership marketing guide</a>, I reference this as a Joint Product but it can take many forms. Offline it can be a literal merger of products or including elements of one into another. Online though and within apps it’s via the use of white-labeling, I-framing and integrating APIs.</p> <p>This will become clearer in the examples below but it’s about including a third-party within your own with the primary objective of benefiting the user. And this is a vital point here, despite our focus in this article on monetisation, integrated partnerships are not adverts, not in-app purchases or subscriptions, they are meant to be native and principally to add value. </p> <h3><strong>Check out some examples</strong></h3> <p>Here are several examples to illustrate the point that integrations are, for some really well-known brands, the answer to monetisation without jeopardising the customer experience. They may also help you think about your own revenue streams – brands don’t necessarily need to rely on just one. </p> <p><strong>TripAdvisor</strong></p> <p>In July 2017 TripAdvisor announced that it was partnering with Deliveroo. The partnership was a big enough story to <a href="http://www.bbc.co.uk/news/technology-40573272" target="_blank">feature on the BBC</a> and meant a unique offering to users where they could order via Deliveroo from their favourite restaurants featured in TripAdvisor.</p> <p>It really is seamless and a very complimentary partnership which connects more than 20,000 restaurants to the service.</p> <p> <img style="vertical-align: middle;" src="https://assets.econsultancy.com/images/0008/7792/Tripadvisor___Deliveroo.jpg" alt="" width="640" height="679"> </p> <p>For a content-only site TripAdvisor has steered away from the overuse of adverts, instead deciding to expand its consumer offering and revenue streams to integrated partnerships. The integration of Deliveroo via its API is just one example – TripAdvisor has also partnered with Opentable to offer direct table booking services in-app, another really useful proposition.</p> <p><img src="https://assets.econsultancy.com/images/0008/7793/Tripadvisor___Opentable.png" alt="" width="800"> </p> <p><strong>IMDb</strong> </p> <p>One of the longest running sites still in existence and going strong for that matter is IMDb. Starting in 1990 and otherwise known as Internet Movie Database, it was purchased by Amazon in 1998 for the core reason of upselling Amazon products, mainly DVDs and video.</p> <p>It continues to partner with its parent by upselling Amazon Prime and suggesting to purchase products via Amazon store. It has also synced cinema showing times with the ability to purchase tickets in-app.</p> <p><img src="https://assets.econsultancy.com/images/0008/7794/IMDb_image.PNG" alt="" width="280"> </p> <p><strong>Starling Bank </strong></p> <p>Challenger bank Starling created a very interesting integration with savings app Moneybox.</p> <p>Its current offering provides a traditional bank account but for the digital generation. Like other challenger banks Starling is looking to disrupt the industry with easy-to-use services with the focus on mobile first. Without a savings vehicle of its own Starling has integrated with Moneybox so that its users can round-up their savings seamlessly and invest.</p> <p>This is a great example of how you can offer a third-party service through your own app, in turn benefiting from commissions from each user. It was made possible through the <a href="https://www.finextra.com/pressarticle/68857/starling-integrates-with-moneybox-for-real-time-savings%20">use of open APIs</a> which allow both products and data to combine so the journey is seamless. </p> <p><strong>Citymapper</strong></p> <p>Anyone who has ever been looking for the quickest route home will be familiar with Citymapper. The commuter's favourite app uses opensource data from local transport services to provide options on journey routes and in doing so compares various forms of transport.</p> <p>Citymapper has no obvious revenue streams, it’s a free app, no subscription required and no ads – amazing for the consumer. But Citymapper has to generate revenue, so without compromising its great service it integrated Uber as a transport option, in turn earning from each booking. </p> <p><img src="https://assets.econsultancy.com/images/0008/7795/Citymapper_image.PNG" alt="" width="280"> </p> <p><strong>Easyjet</strong></p> <p>Easyjet is the king of integrated partnerships and has two famous ones that you might not have even noticed as they are extremely well done.</p> <p>Although producing revenue from its primary source of flight bookings, Easyjet realised that users would want to view hotel and hire car options too. Rather than redirecting to a third-party site it could simply host the partners site within its own. This I-frame is both contextual and beneficial to the consumer.</p> <p>Easyjet partners with Booking.com and Europcar all within the boundaries of its own site: </p> <p><img src="https://assets.econsultancy.com/images/0008/7796/Easyjet___Booking.png" alt="" width="615"></p> <p><img style="vertical-align: middle;" src="https://assets.econsultancy.com/images/0008/7797/Easyjet___Europcar.png" alt="" width="615"></p> <p><strong><em>For more on this topic read:</em></strong></p> <ul> <li><a href="https://econsultancy.com/blog/69182-a-complete-guide-to-partnership-marketing-part-one">A guide to partnership marketing</a></li> </ul> tag:econsultancy.com,2008:BlogPost/69211 2017-07-04T12:00:00+01:00 2017-07-04T12:00:00+01:00 Seven steps to plan & manage your affiliate marketing campaigns Andy Favell <p>The stat above is from the <a href="https://iabuk.net/research/library/iab-pwc-online-performance-marketing-study-opm" target="_blank">IAB OPM study</a> (April 2017), which is one of several highlighted in my <a href="https://econsultancy.com/blog/69199-a-dive-into-the-murky-but-very-important-world-of-affiliate-marketing" target="_blank">introduction to affiliate marketing</a>, a tactic that not only delivers good ROI, but can be considerably better at driving ecommerce sales, subscriptions and other conversions than display ads.</p> <p>But not every affiliate marketing program will deliver the same return on investment and not all those sales will be incremental.</p> <p>A survey by <a href="http://www.viglink.com/blog/2017/05/15/state-affiliate-marketing-survey/" target="_blank">Viglink</a> (May 2017) of US affiliate marketers found that 27% of merchants said their affiliate marketing revenue did not meet expectations and 64% of publishers said the same. The survey didn’t explore why affiliate marketing failed to deliver on expectations, but it’s worth a wager that the merchants are partly to blame, both for their own disappointment and that of their affiliates.</p> <p>Like anything in digital, a successful affiliate marketing program is based on careful planning, research, strategy and management. Whether the mission is to improve ecommerce sales, customer registrations, trials or downloads, for immediate or long-term impact, the affiliate advertiser must:</p> <ol> <li>Establish the goals of the program.</li> <li>Decide on the right profile of affiliate to deliver the program.</li> <li>Decide how you will reward different types of affiliate.</li> <li>Make sure the most deserving affiliates get paid accordingly.</li> <li>Create content suitable for each affiliate.</li> <li>Put someone in charge of approaching affiliates and reviewing applications and managing relationships.</li> <li>Optimize your website to convert the new traffic when it arrives.</li> </ol> <h3>1. Establish affiliate marketing program goals</h3> <p>An affiliate marketing program is made up from a balanced mix of affiliate partners. Setting clear goals for what the program will achieve will help you identify the particular affiliates and types of affiliate you wish to recruit.</p> <p><strong>Short-term or long-term?</strong></p> <p>Is there an immediate short-term goal, such as creating hype and momentum for a new product or shifting some slow-moving stock as the end of the quarter or season approaches? Then maybe a big-bang incentive campaign is the right choice.</p> <p>Or is this a long-term play to gradually recruit affiliates that will help you launch into a new geography or gradually expand your customer base and revenues over years? Then you need to partner with the sites to which shoppers continually return to for advice, reviews and ideas.</p> <p>Jules Bazley, vice president, commercial development (EU), CJ Affiliate explains:</p> <blockquote> <p>There are specific types of affiliate publishers that retailers find work best for them, usually this comes down to specific business interests and strategy. If a retail brand is looking for a high volume and a quick turn-around, then the obvious choice are vouchers and cashback sites. That’s a meaningful way of generating sales.</p> <p>However those looking to create more long-term value from affiliate may be better off looking at mid-tier partnerships such as content publishers. Typically, CJ’s retail advertisers work with a broad mix of publishers to give them a custom ratio of affiliate publisher types, generating both fast turn-around and long-term gain.</p> </blockquote> <p><strong>Who is the target customer?</strong></p> <p>Are you recruiting new ones or retaining and selling more to existing ones? Are you aiming to win a financial, energy, telecoms etc. customer from a competitor?</p> <p>Think about how they shop, what sites they read and emails they subscribe to. Pick affiliates that specialise in your business niche and those that attract your target customer. See the women’s sportswear guide on Mumsnet pictured above.</p> <p><strong>What problem are you trying to solve?</strong></p> <p>Are too few visitors coming to your site or are you failing to convert the visitors into customers? Would retargeting via affiliates help reduce the worrying number of abandoned carts?</p> <p><strong>Is this an investment for future sales and loyalty?</strong></p> <p>Do you want people to sign-up for a trial service or receive a free sample? Is the goal to increase sign-ups for your email newsletter or drive downloads of a mobile app?</p> <h3>2. Decide on the right profile of affiliates to deliver the campaign</h3> <p>Affiliate marketing has historically been dominated by so-called incentive affiliates (e.g. cashback sites). They have become popular with value-conscious consumers and with businesses that wish to drive quick results.</p> <p>The IAB UK Consumer Insights Survey (February 2017) found that in the last six months 43% of shoppers had visited a comparison shopping site; 36% entered a competition; 26% had signed up for a newsletter; 25% visited a voucher code site; 23% visited a loyalty site; 20% had consulted a subject expert website; 17% had visited cashback websites; 16% had visited an independent blog site.</p> <p><img src="https://assets.econsultancy.com/images/0008/7092/t6_affil_perf_mark_iab.png" alt="" width="615" height="351"></p> <p>However, it is unlikely that incentive sites are the only sites that consumers will visit on the path to purchase. They may not be the most useful to either the consumer or the advertiser and a program mix that is over-weighted with incentive sites may mask the value of and divert rewards from other affiliates.</p> <p>So what might a balanced affiliate marketing program look like for an ecommerce merchant? Evan Weber, CEO, Experience Advertising, a Florida based affiliate agency, explains:</p> <ol> <li>Relevant websites in the merchant’s niche. These provide a true upside and a source of new customer acquisition.</li> <li>Bloggers offer similar benefits as relevant websites. They can do product reviews and help with product announcements.</li> <li>Conversion affiliates that help websites increase conversions and remarket to departing customers, such as SaleCycle.com or ReachDynamics.com.</li> <li>Content monetization affiliates that insert merchant links on keywords in relevant content on participating blogs and news sites, e.g. VigLink.com or SkimLinks.com.</li> <li>Incentive affiliates, including cashback and loyalty portals, with membership bases that pay or reward their users a cashback percentage of each sale they purchase through the portal’s links. US examples: eBates.com, HooplaDoopla.com. UK examples: Quidco.com.</li> <li>Email Marketing – including the advertiser’s creative within the targeted emails of affiliate partners and dedicated email publishers. Affiliate gets paid on any sales or leads that result.</li> </ol> <p>User research will help identify the publishers that are popular with your customers or potential customers. Web analytics tools are useful, but will only show the sites which the user visited directly before your own.</p> <p>In addition to the news and blog sites that populate every niche, some sectors have spawned their own specialist affiliates.</p> <p>The fashion business has a number of so-called shopping discovery engines (SDEs) which allow visitors to search for fashion products by style or colour across number of outlets. Shopstyle (recently acquired by eBates) for example, claims to have delivered $1 billion in ecommerce revenues to a network of 1,500 retail partners. Other SDEs include Polyvore and Lyst in the US and Snap Fashion in the UK.</p> <p>In sectors such as finance, insurance, utilities and telecoms, specialist aggregator / comparison sites, such as the UK’s Comparethemarket.com, MoneySuperMarket and uSwitch drive a large share of volume of typical affiliate programs, reports Aftab Aslam, head of client development (UK&amp;I), Tradedoubler.</p> <p>The portfolio of affiliates is a very important consideration when choosing an affiliate network. Publishers with an established affiliate business are likely to work with particular affiliate networks and may be reluctant to join another to work with you. Request a list of affiliate members that are relevant to your business from each network.</p> <p>A quick way to find out if your target publisher a) uses an affiliate network b) which particular network is to search on a tool such as SimlarTech or BuiltWith. It’s not fool proof, but faster than a search for buy-now links, or affiliate advertiser information on the publisher website.</p> <h3>3. Decide how you will reward different types of affiliate.</h3> <p>It is important to determine which sites play the most valuable role in influencing the purchase decision and decide whether they should be offered a higher incentive to reward them or stop them working with a competitor.</p> <p>Affiliate fees vary incredibly. Evan Weber says it’s common for retailers to pay 5-15% in percentage of sales, but in some industries it’s much more. In web hosting the affiliate may take 100% of the first year’s fee. Similarly, cost per lead (CPL) can range from $5 to $100. For example, in the US a health insurer might pay $20-50 per lead.</p> <p>Retailers commonly reward affiliates differently. Some retailers have varied rates for distinct product types. Amazon, for example, which operates the largest affiliate network in the world, pays 0% for wine, 3% for toys or 8% for Amazon Kindle devices, as can be seen on its Amazon rate card pictured below. Until March 2017 Amazon paid affiliates more if they sold more product.</p> <p>Other retailers have varied rates for different types of affiliate. The ASOS UK affiliate program (AWIN affiliate network) pays up to 5% commission, but pays cashback and loyalty partners “0% commission for existing customers and 10% for new customers” and pays voucher-code partners 3%.</p> <p><img src="https://assets.econsultancy.com/images/0008/7093/t6_affil_amazon_rate_table_615.png" alt="" width="615" height="493"></p> <h3>4. Make sure the most deserving affiliates get paid</h3> <p>Traditionally, affiliates are paid on a last click basis, which means the last site visited receives the commission. So if the customer’s last port of call was to check an offer on a cashback site, then any previously visited affiliate, no matter how influential to the customer, will receive nothing.</p> <p>This may help to explain why Viglink finds that 64% of publishers are dissatisfied with the results of affiliate marketing.</p> <p>Discuss with your affiliate network if it is possible to a) track all customer interactions with affiliates and b) if it is possible to reward different partners on a shared revenue model.</p> <p>Karl Wood, senior manager, network development, Rakuten Marketing Affiliate Network:</p> <blockquote> <p>The latest trend is to split out commission based on the affiliates’ contribution to a sale using attribution. Our insights and attribution platform helps retailers re-evaluate the significance of upper funnel contributors such as bloggers and influencers and redefining at what stage of the consumer journey an acquisition is entitled to a commission and ensure this is identified and rewarded.</p> </blockquote> <h3>5. Create and provide content suitable for each affiliate</h3> <p>Hopefully the message is getting through that balanced affiliate programs should use a variety of publisher types.</p> <p>The problem is different publishers will have distinctive content requirements. Merchants may need to produce logos, buttons, images, banner ads in appropriates sizes and formats, and make available product descriptions, and text in different lengths and styles, up-to-date pricing and offers and multimedia content, such as videos.</p> <p>Depending on the publisher requirements these will be provided through product feeds, APIs or via download from the merchant or affiliate network.</p> <p>This means merchants must have the creative capability in-house or outsource to an agency.</p> <p>Tradedoubler's Aftab Aslam:</p> <blockquote> <p>Content requirements depend on the environment. An incentive site is restrictive, but the text needs to be offer led, or compelling to cater for that audience. Where content restrictions aren’t at play, then the text needs to be informative, highlight benefits or amplify any offer-led messaging.</p> <p>Having an up-to-date, robust product feed is a must for any multi-product advertiser. Compliance and accuracy of content is a big consideration, both affiliates and brands need to ensure information is both relevant and updated for the end consumer.</p> <p>It’s important to move away from a one-size fits all messaging approach, and tailor content for the affiliate site in question. This requires methodical planning, but ultimately the rewards are greater.</p> </blockquote> <h3>6. Put someone in charge of managing relationships</h3> <p>Affiliate programs do not run themselves. Simply joining a network with an attractive portfolio of publishers does not guarantee that many (or any) will instantly start promoting your products and services.</p> <p>Finding, recruiting and managing publishers requires careful research, often some wooing and deal making. Some companies have a dedicated affiliate manager(s), others will work with an affiliate agency, or use the in-house agency at the network.</p> <p>Jules Bazley says "Advertisers work in different ways, but most networks provide both ‘self-service’ and ‘managed’ programmes. The industry is very much relationship driven, so having someone with good contacts and experience working with affiliates is key to success."</p> <p><img src="https://assets.econsultancy.com/images/0008/7094/t6_affil_shopstyle_partner_with.png" alt="" width="615" height="530"></p> <p><em>An application form to partner with the fashion shopping discovery engine ShopStyle.</em></p> <h3>7. Make sure the website is optimized for conversion</h3> <p>Lack of traffic and on-site conversions should be helped by recruiting affiliates, but not if the fault lies with the website itself. It doesn’t matter how many prospects the affiliate sends if there are problems with usability, e.g. customers can’t find what they are looking for or links don’t work; or the user experience is poor, e.g. they need to fill our lengthy forms.</p> <p>Evan Weber:</p> <blockquote> <p>Retailers need to take their site through a process called <a href="https://econsultancy.com/blog/64210-what-is-conversion-rate-optimisation-cro-and-why-do-you-need-it">conversion rate optimization</a> before launching their affiliate program. This is a series of website tweaks, improvements, and tools that help to improve the overall click to sale rate on the website.</p> <p>Affiliates need to earn conversions from the traffic they are driving to the merchant’s website. If they don’t make what they expect, they may become frustrated that you invited them to promote your products and their efforts didn’t create income.</p> </blockquote> tag:econsultancy.com,2008:BlogPost/69199 2017-06-27T12:00:00+01:00 2017-06-27T12:00:00+01:00 A dive into the murky, but very important world of affiliate marketing Andy Favell <h3>What is affiliate marketing?</h3> <p>Affiliate marketing occurs where one website, “affiliate”, places a link, e.g. text, button, image link or discount code, on a website to direct traffic to another site, e.g. retailer or publisher. The affiliate then receives payment if that visitor consequently purchases the good, signs up for a trial, service etc. (lead generation), or downloads an app. The relationship between merchants and publishers is facilitated by an associate network.</p> <p>This might sound a bit like digital display ads, and they will often be found side-by-side on a web page (as seen in the screenshot of TechRadar below) but affiliate marketing is a different world that has grown up in parallel to traditional internet ads, and it plays by different rules.</p> <p>Affiliate ads do not often look like a display ad, rarely are they marked as “ads” or “sponsored” or declare that commission is received (though recent <a href="https://www.ftc.gov/tips-advice/business-center/guidance/ftcs-endorsement-guides-what-people-are-asking#affiliate">FTC</a> and <a href="https://www.asa.org.uk/advice-online/affiliate-marketing.html#Obv">CAP guidance</a> suggests this should happen).</p> <p>Affiliate activity does not get caught by ad-blocking software, and, if the stats are to be believed, affiliate ads deliver better results than banner ads (more on those stats later).</p> <p><img src="https://assets.econsultancy.com/images/0008/6977/t_affil_techradar.png" alt="" width="615" height="655"></p> <h3>Grubbygate</h3> <p>So what did Robertson actually say? <a href="https://econsultancy.com/blog/918-affiliates-close-rank-after-asos-ceo-calls-them-grubby/" target="_blank">Reportedly</a>, he told New Media Age:</p> <blockquote> <p>Next year we'll reintroduce affiliate marketing, but as it should be. No silly commissions being paid to grubby little people in grubby studios growing income at our expense, getting in the way of genuine sales.</p> </blockquote> <p>What did he mean by this? Robertson later <a href="https://econsultancy.com/blog/1121-q-a-asos-nick-robertson-speaks-out-on-grubbygate" target="_blank">explained</a> that his beef was with affiliates that offered discounts on ASOS purchases – particularly those that would harvest coupons/discount codes from one affiliate (e.g. glamour mag Grazia) and republish them on their own sites. ASOS' concern, understandably, was that discounts on smaller purchases meant they lost money on the sale.</p> <p>Robertson’s outburst – dubbed ‘Grubbygate’ – was symptomatic of a disquiet at the time among retailers and advertisers generally with the affiliate business.</p> <p>Firstly, there was a general suspicion (merited or not) that unscrupulous members of the affiliate business participated in unlawful practices, including click fraud, which is faking online customer activity to collect commissions; cookie stuffing where one website drops a variety of retailer cookies on a visitor’s browser, in an attempt to steel a commission from another affiliate; and voucher fraud (as mentioned in the ASOS example).</p> <p>Secondly, there was a concern the growing dominance of incentive companies offering coupons, money-off, and money back and price comparison engines would squeeze retailers’ margins and take a cut of what’s left.</p> <h3>Called to order</h3> <p>By voicing his concerns, while other retailers kept their worries, concerns (and budgets) to themselves, Robertson, in many ways did the industry a favour. It encouraged the business to get its house in order and make itself more attractive to clients that were hitherto directing their entire digital media budgets into display and search ads.</p> <p>So would Robertson, and the retailers/publishers of his era – be happier with the state of the affiliate nation 10 years on?</p> <p>Jules Bazley, vice president, commercial development (EU), for US-based affiliate network, CJ Affiliate:</p> <blockquote> <p>In the past, some marketers did look down on the affiliate channel as somehow being less reputable, but those connotations have, to a large extent disappeared now. In part, that’s thanks to the status of reputable brands getting involved in the channel, and of course the incentives for them are there. Today, affiliate marketing is a relevant part of almost every major retail brand’s marketing mix.</p> </blockquote> <p>A recent survey by <a href="http://www.viglink.com/blog/2017/05/15/state-affiliate-marketing-survey/" target="_blank">Viglink</a> (May 2017) suggests a much wider acceptance of affiliate marketing than there was even five years ago. Forty percent of larger merchants and 49% of larger publishers using affiliate marketing today were not doing so five years ago.</p> <h3>Big business</h3> <p>Affiliate marketing has quietly become a substantial business and is driving good returns for advertisers and publishers. In the UK advertisers spent £1.39 billion ($1.77 billion) in 2016, according to the <a href="https://iabuk.net/research/library/iab-pwc-online-performance-marketing-study-opm" target="_blank">IAB / PwC Online Performance Marketing (OPM) Study</a> (April 2017), creating £17.6 billion in ecommerce revenue.</p> <p>10 years ago, at the time of Robertson’s comments, Econsultancy estimated the affiliate marketing industry drove just £2 billion in ecommerce revenue.</p> <p>The US market isn’t as closely monitored. But a report by <a href="https://www.emarketer.com/Article/Affiliate-Marketing-Highly-Measurable-Scales-Easily/1014737" target="_blank">Forrester / Rakuten</a> (Feb 2016), reported by eMarketer, predicted US advertisers would spend $4.78 billion (£3.75 billion) on affiliate marketing in 2016, about 7% of total ad spend.</p> <p>So how does affiliate marketing performance compare to other digital marketing channels?</p> <p>Analysis by <a href="http://blog.custora.com/2016/10/custoras-q3-2016-pulse-report/" target="_blank">Custora</a> Q3 2016 of its US clients' traffic found that affiliate marketing drove 11.4% of ecommerce orders, down from 16.7% a year previously. This was a magnitude higher than ecommerce orders attributable to display advertising (0.9%) or social (2.1%).</p> <p>But affiliate does not perform as well as organic search (21.8%), paid search (19.9%) or email (19.8%).</p> <p>On the face of it these stats are very impressive. But they come with a caveat. We don’t know what proportion of retailer’s ecommerce sales credited to affiliates would have occurred anyway.</p> <h3>Is click fraud still an issue?</h3> <p>Karl Wood, senior Manager, network development, at affiliate network Rakuten Marketing says "Not Really". He continues, "That ‘Wild, Wild West’ of affiliate seems to be less of an issue. Our compliance team here at Rakuten Marketing take click fraud, cookie stuffing etc. very seriously.”</p> <p>Affiliate relationships tend to work on a cost per action / acquisition (CPA) model, so ought to be safer from click fraud than cost per click (CPC) ads, also known as pay per click, which are common in display and search advertising.</p> <p>CPA means no one gets paid unless the required conversion e.g. sale, sign up, download takes place, and it’s clear that the conversion is attributable to a particular affiliate. This is tracked via a cookie that is placed on the user’s web browser that will last for a limited number of days.</p> <p>But no model is immune from fraud.</p> <p>Evan Weber, CEO, Experience Advertising, a Florida-based affiliate agency, explains:</p> <blockquote> <p>When you run any sizeable affiliate program, there’s always the possibility that some of those affiliates are going to try to create false sales with fake or stolen credit cards, or fraudulent leads by having friends sign up. This is why all of the sales and leads needs to be vetted before the affiliate is paid for those commissions. Where there is doubt I recommend a phone call to the consumer if possible to verify their order.</p> </blockquote> <p>All major affiliate networks have worked hard to clamp down on such dodgy practices. Publishers ought to be carefully vetted and systems should be in place to catch unusual activity.</p> <h3>Is affiliate business still dominated by coupons and cash-back?</h3> <p>An affiliate could be any sort of website, app or web based tools – and the market has seen a lot of innovation – but the model has favoured incentive-based affiliates, including coupons, loyalty, money-off and money-back companies, and price comparison engines.</p> <p>Retailers have a love-hate relationship with incentive affiliates.</p> <p>On the plus side, some of these site are huge, so provide a great opportunity to drive new business, to promote new products, to shift slow-moving stock or pinch business from competitors. Incentive sites can contribute anything between 60%-90% of revenue on some affiliate programmes, according to Aftab Aslam, head of client development (UK&amp;I), Tradedoubler.</p> <p>On the other-hand incentive sites can erode retailer margins and intensify price competition, while taking a cut of sales – sometimes hijacking sales to customers who would have purchased anyway.</p> <p>While these incentives and price comparison affiliates still dominate, it appears that other affiliate businesses, perhaps more appealing to retailers, are growing also.</p> <p>Jules Bazley, CJ Affiliate:</p> <blockquote> <p>The channel is still weighted towards cashback and coupons, but we’re now seeing the mix become more and more varied, as brand-side understanding of affiliate marketing evolves. The scale of other publisher types has grown and is continuing to grow – content and editorial publishers, for example, and the many upcoming and emerging types of publishers – onsite conversions, tech-driven and even affiliate publishers that are using retargeting in more effective ways.</p> </blockquote> <h3>What’s holding back the growth of alternative affiliate models?</h3> <p>There are two factors that hold back the growth of alternative affiliate models.</p> <p><strong>1. Last click attribution</strong> – traditionally the industry has paid the affiliate that cthe ustomer visited last. This can favour the incentive sites over others e.g. reviews sites that many have had a greater influence over the purchase decision.</p> <p><strong>2. Retailers imposing flat-rate low commission</strong> - with a short cookie period which applies to all affiliates, regardless of their influence over the purchase decision.</p> <p>For example, Walmart, according to its <a href="https://affiliates.walmart.com/#!/benefits" target="_blank">Terms and Conditions</a>, “pays 1-4% with three return days” and <a href="https://affiliate-program.amazon.com/help/operating/policies#Associates%20Program%20Fee%20Statement">Amazon</a> pays 1-10% for sales – depending on category – within 24 hours of click through.</p> <p>Evan Weber, Experience Advertising explains, however, that "Walmart or Amazon don't have to pay out as much as other retailers. But [low commission] is also because of coupon sites that exist only to serve up coupon codes to people in the purchase process, which affects all the affiliates."</p> <p>Weber understands that “Merchants don't want to pay coupon affiliates much commission," but argues that "it shouldn't affect all types of affiliates. [Retailers] are just not prepared to or don't have the manpower to micromanage it.”</p> <h3>Secrecy and invisibility </h3> <p>The Achilles’ heel of affiliate business is its invisibility to anyone outside the business (including many participating advertisers and publishers). Few people outside the affiliate world realise how big it is, how important it is to participant retailers’ or publishers’ businesses, or understand how it really works.</p> <p>This is important on several levels. First, if the industry is going to grow, affiliate marketers and affiliates need to see/know who is involved, what they are achieving and any issues companies face. Second, if the business is going to finally leave behind the old “Wild West” image there needs to be much more transparency, retailers need to understand how the business works and what it will deliver for them. Third, if affiliates do not do more to improve transparency, the business risks coming under the same scrutiny as the ad business.</p> <p>Let's look at these issues in more detail:</p> <h3>Affiliate marketers &amp; retailers do not like to talk about their affiliate businesses</h3> <p>What is the poster child of the affiliate business? It should be Amazon. Amazon was a pioneer in affiliate marketing, founding Amazon Associates in 1996. So why don’t we know more about the role it played in the ecommerce giant’s growth over the last 20 years?</p> <p>According to <a href="https://trends.builtwith.com/ads/affiliate-programs" target="_blank">BuiltWith</a>, which tracks the technologies that underpins websites, Amazon Associates is the biggest affiliate network in the world. There are a staggering 145,835 websites around the world are live with Amazon Associates and 435 of the top 10,000 global sites. This is a third larger than CJ Affiliate, the largest of the multivendor affiliate networks.</p> <p>It would be fascinating to know just how much this vast network contributes to Amazon’s revenues today, or how much it contributes to the company’s revenue growth from $147.8 million in 1997 to $135.9 billion in 2016, but such gems are not generally included in company annual reports.</p> <p>Amazon’s advertising spend, which includes affiliate commissions, was $5 billion in 2016, which gives an idea of how much ecommerce business affiliates drive to Amazon. N.B. That’s three times the UK’s total affiliate spend.</p> <h3>It is rare to see affiliate links marked as “sponsored” or “ads”</h3> <p>It is uncommon for affiliates to declare to customers that they receive a commission from the retailers or publishers they link to.</p> <p>There were 124 million transactions in the UK alone via affiliates according to an IAB study reference earlier. How many people who clicked on those links realised they were helping websites get paid?</p> <p>Arguably there is a transparency issue here, if customers rely on the opinion of the affiliate, such as a reviews site, or are not being given a full range of choices because key providers do not pay an affiliate fee. It is an area which is increasingly coming under scrutiny of authorities on both sides of the Atlantic.</p> <h3>There is a complex web of affiliate networks</h3> <p>For example: a cruise is booked through an affiliate travel agent of an online booking company; which was referred through an affiliate voucher code company; which the customer signed up with after clicking on an affiliate ad.</p> <p>Then there are a host of intermediaries, including people who cleverly arbitrage the buying and selling of affiliate media. I’m sure I am not the only one who would like to know more about how this fascinating – but still a little murky – business really works.</p> <p><em><strong>More on affiliate marketing:</strong></em></p> <ul> <li><a href="https://econsultancy.com/blog/66914-how-to-use-affiliate-marketing-without-risking-brand-damage/">How to use affiliate marketing without risking brand damage</a></li> <li><a href="https://econsultancy.com/blog/67731-think-affiliate-marketing-doesn-t-work-for-luxury-brands-think-again/">Think affiliate marketing doesn't work for luxury brands? Think again </a></li> </ul> tag:econsultancy.com,2008:BlogPost/69190 2017-06-20T15:08:00+01:00 2017-06-20T15:08:00+01:00 A complete guide to partnership marketing: Part two James Cristal <ul> <li>Licensing</li> <li>Loyalty</li> <li>Product placement</li> <li>Shared stores</li> <li>Sponsorship</li> </ul> <p>So, on with our list of the 10 types of partnership marketing...</p> <h3>6. Licensing</h3> <p>“Licensing is a business arrangement in which one company gives another company permission to manufacture its product using its brand image for an agreed payment or partnership.”</p> <p>There are two ways that a brand will choose to collaborate with another when it comes to licensing partnership marketing: </p> <ol> <li> <strong>Sold</strong> - most brands that decide to license their brand choose to sell it to their partners for a given price. This provides them access to various assets (described below) to improve their product or service offering. </li> <li> <strong>Collaborative</strong> - some brands decide to get involved in the licensing partnership and actively collaborate with the partner. This has close associations with joint product partnerships where a company may utilise another's product and brand image to provide an exclusive unique offering.</li> </ol> <p>There are many ways a company who licenses another's brand can utilise it. After purchasing the right to use their brand they can work on the following:</p> <ul> <li> <strong>Logo</strong> - the logo of another brand can be used within a company's own product line to enhance it. </li> <li> <strong>Brand image</strong> - the brand image itself can comprise not only the logo but the colours, font and tone of voice. </li> <li> <strong>Reputation</strong> - with the purchase of any brand comes with it its reputation; utilising this to a company's advantage in their new product offering. </li> <li> <strong>Culture</strong> - with a brand's reputation also comes its company culture. A company can utilise the ethics and company values this also brings. </li> <li> <strong>Design</strong> - the design assets that come with a brand can also be utilised within the firm’s products or services.</li> </ul> <p>The creation of a brand, one with a stand-out reputation, is extremely time consuming and costly. So for many organisations the quickest and simplest way is to purchase it. This is what licensing offers a company; tying in a global brand to the product hugely enhances it.</p> <p>A product can go from mediocre to a sales success very swiftly if the right brand is licensed and leveraged accordingly. Simply using the brands name for the product and attaching the logo to it, even if the product hasn’t changed at all from previous editions, can lead to a huge surge in sales. This is a type of Partnership that some may say is a sales technique rather than marketing, but it involves the use of branding which can affect the entire marketing proposition and how it is positioned. </p> <h3>7. Loyalty</h3> <p>"A retention marketing technique that offers consumers a reward in return for increased usage. A loyalty partnership enhances the typical model by offering consumers partner offers to encourage longevity and purchase frequency. "</p> <p>Loyalty partnership marketing comes in three specific types. All of which relate to how consumers are loyal to a brand: </p> <ol> <li> <strong>Frequency</strong> - loyalty can be rewarded based on frequency of customer use; the more a product is bought or a service used the more rewards a consumer receives. A reward can be a partner brand discount; smart brands take this a step further by personalising, providing an offer in conjunction with a partner brand tailored to the consumer based on their spending patterns or personal profile.</li> <li> <strong>Volume</strong> - the alternative is to reward based on amount purchased; where the higher the number bought the larger the reward. Savvy brands provide varying degrees of reward to those that purchase larger amounts, often fully personalising the offer.</li> <li> <strong>Advocate</strong> - the third type is often described as advocacy; where a consumer is so loyal to a brand they will support it and promote it, with this a brand will offer extended rewards. It is a type of loyalty that focuses purely on rewarding those who shout about a brand and even have the power to influence others.</li> </ol> <p>A brand can encourage consumer loyalty in a number of ways. The following examples can be adjusted depending on consumer base segments:</p> <ul> <li>Loyalty club/scheme </li> <li>Loyalty cards/vouchers </li> <li>One-off rewards </li> <li>Free money, gifts, raffles </li> <li>Seasonal promotions </li> <li>Product extensions</li> </ul> <p>All of these offer the possibility for partner brand involvement, mainly by including their discounts or exclusive products within the loyalty program. As a technique it allows two brands to successfully align their proposition with each other utilising their similar databases to improve customer retention rates.</p> <p>This is a type of partnership marketing that has been tried and tested by a number of high profile brand names, which highlights it as one of the most effective types. A loyal collaboration can enhance the image of a brand, acquire a vast number of new customers who already contain the proven characteristics of being loyal, and increases the spend frequency and volume growth.</p> <h3>8. Product placement </h3> <p>"The subtle placement of a brand within a media channel. It is deemed a cross-over of sponsorship and advertising that works well in partnership with high grossing TV and Film productions." </p> <p>Product placement partnership marketing comes in three key types. These reflect the main ways in which products are placed within the media, a decision made through the coalition of brand and media channel: </p> <ol> <li> <strong>Subtle placement</strong> - where the inclusion of the brand logo, a background shot of the product, or an elusive hint towards a products usage, is found within TV and film scenes. </li> <li> <strong>Direct advertising</strong> - aside from subtle placement there is a more direct approach. More obvious placement advertising within a media programme, such as a cookery show endorsing a product, is deemed direct.</li> <li> <strong>Public person sponsorship</strong> - there can be a fine line between product placement and sponsorship. Away from TV and film there is also the placement through the use of celebrity endorsements who are encouraged to wear the clothing or use a product. When a brand sends a celebrity free items they are seeking product placement, often through paparazzi photos, <a href="https://econsultancy.com/blog/67400-three-youtube-influencers-give-their-views-on-brand-partnerships/">social media</a> and usage in their daily lives.</li> </ol> <p>Once a brand has established a relationship with an agency acting on their behalf or in collaboration directly with a TV studio or film production company, placement can take the following forms: </p> <ul> <li>Logo within frame or scene</li> <li>Direct mention or usage</li> <li>Inclusion in plot</li> <li>Background placement</li> <li>Visible foreground placement</li> <li>Celebrity endorsement</li> </ul> <p>Even though it is currently one of the least used types of partnership marketing let's not take away its extremely innovative attributes. Although often subtle there are a number of smart ways in which to achieve exposure.</p> <p>When it comes to such niche forms of marketing as this there are always brands that perfect it better than others, larger brands in particular find they can leverage its qualities more so than smaller ones. Often the reason comes down to the network, celebrity or media in question, they only wish to work with such brands that will resonate with the audience; the Apple's, Facebook's and Pepsi's of this world.</p> <p>Although, saying this, smaller brands running product placement via celebrity endorsements often notice soars in sales and overnight recognition; a fashion brand that places their products in the hands of a well-known public figure is likely to see their popularity surge. </p> <h3>9. Shared stores</h3> <p>“Where a partner provides an area of agreed space within their own store for the other partner’s brand. The primary brand has rented out, provided or extended their retail outlet to integrate the secondary brand, for additional value to their consumers.”</p> <p>Shared-store partnerships are a growing phenomenon with some of the biggest names teaming up, but this isn’t just reserved for retail outlets, it too can be found online:</p> <ol> <li> <strong>Offline</strong> - the most common type of shared-store partnership. Offline we refer to the physical world where petrol stations, retail outlets, supermarkets and coffee shops have all been found to merge stores. </li> <li> <strong>Online</strong> - a relatively new concept but one that is increasing in popularity. Online it is where both brands look to be associated alongside another by combining areas of their websites together through iFraming or creating dedicated sections.</li> </ol> <p>Shared-Store partnerships offline and online can be further broken down into various forms:</p> <p><strong>Offline</strong>: </p> <ul> <li> <strong>Store within a store</strong> - the classic form of a shared-store partnership is to provide a section of the primary brand’s retail space for another brand – as shown in the example below with Cineworld and Starbucks. This adds value to the consumer base by offering an additional proposition to their shopping experience.</li> </ul> <p><img src="https://assets.econsultancy.com/images/0008/6899/pic3.jpg" alt="cineworld starbucks" width="588" height="272"> </p> <ul> <li> <strong>Permanent desk</strong> - this is where a primary brand provides a permanent desk for a partner brand. Department stores such as Selfridges or John Lewis often provide areas such this in their cosmetics section. </li> <li> <strong>Promotional stand</strong> - occasionally a store will offer some of their space as a promotional stand. This provides a partner brand with an exclusive area dedicated to their product often manned by the brand’s own personnel. </li> </ul> <p><strong>Online:</strong></p> <ul> <li> <strong>Dedicated tab or page</strong> - providing a specific tab or page for a partner brand within the primary brand's website. This provides a dedicated area for added-value. </li> <li> <strong>Members area</strong> - a members area provides exclusive material or content, this is therefore a popular area for partner brands to be featured.</li> <li> <strong>iFraming</strong> - displaying a partners webpage within your own website. iFraming acts as a window that shows a relevant section of their site. </li> </ul> <p>What’s hugely beneficial about this strategy, particularly offline, is that it places the partner brand physically in front of consumers entering a store. It's the ideal way to interact, touch and test a partner brand product. By being alongside one another this creates a powerful perception and by sharing retail space it minimises overall costs, attracts new consumers, and retains existing ones for longer. </p> <p>Saying this, it is not without its risks; for a primary brand it will have to sacrifice a portion of its store for another that they may find doesn’t resonate as strongly as they hoped. This may have negative connotations and in instances actually deter customers.</p> <h3>10. Sponsorship  </h3> <p>“The marketing tactic of placing a brand alongside a particular event, displaying itself as a partner or supporter, with the objective to increase brand recognition and reputation.”</p> <p>Sponsorship has been around since the dawn of marketing and one of the most successful ways to create a brand identity. There are various objectives to sponsorship and these lie under three key banners: </p> <ol> <li> <strong>Awareness</strong> - aligning a product alongside an event for mass exposure is the most common type of Sponsorship. The aim is to have the largest possible reach of your brand to both existing and new consumers. </li> <li> <strong>Association</strong> - linking the product with a cause, person, or event to provide a brand association in the eyes of the consumer. Every time you think of that event you will tie that in with the sponsored brand too. </li> <li> <strong>Consumer understanding</strong> - sponsorship can link a brand proposition with an event so that it provides product education to the consumer. Some propositions are more complex than others so sponsorship is seen as an effective way to teach a consumer what the product can offer.</li> </ol> <p>Sponsorship comes in many shapes and sizes. Below are several varieties that are commonly found across many of the world's popular partnerships:</p> <ul> <li> <strong>Sporting sponsorships</strong> - some of the most expensive yet effective forms of brand exposure. They can be found within every popular sport from team sponsorships, stadium names, board advertisements, and player endorsements.  </li> <li> <strong>Media sponsorship</strong> - any sponsorship found within TV, film and radio are all forms of media sponsorships; the sponsoring of a new television series is a great example. It is an effective tactic for mass brand awareness. </li> <li> <strong>Event sponsorship</strong> - the World Cup, Olympics, and charity events such as the London Marathon, are all examples of this. The Olympics was in such high demand for London 2012 that there were sponsors for nearly every possible association: drinks, supermarkets, and even an official furniture sponsor. </li> <li> <strong>Local sponsorship</strong> - a niche but highly effective form where local businesses look for exposure towards a specific market. Local farmers market, charity events and political conventions, all provide a brand the opportunity for exposure. </li> <li> <strong>Seal of approval</strong> - with foods, health products and luxury items such as holidays a seal of approval is a powerful tool. When a hotel or restaurant has the TripAdvisor certificate displayed it provides that seal of approval we know and trust. </li> </ul> <p>For decades global brands such as Coca Cola, McDonald's, Pepsi, O2, Nokia, Red Bull and British Airways all pour billions of marketing spend into sponsorships, and the reasons are plentiful. They increases brand reach, increase brand awareness, improves brand trust, change a brand's value proposition or image, improve product understanding and open up new global or local markets.</p> <p>The benefits are a clear justification for companies acting on sponsorship marketing, but for some marketers they like to stay clear due to several distinct drawbacks: </p> <p><strong>Difficult to track performance</strong> - other than the media value earned, noticing the increase in overall sales from a sponsorship campaign can be difficult. There is very little to tag a campaign and go by as often it is simply just a branded logo that’s displayed. The fact is the performance will never be as accurate tracked as some forms of digital marketing.</p> <p><strong>Difficult to quantify</strong> - can the costs be quantified accurately in comparison to the media value earned? Numbers can become vague in sponsorship; many feel the true value of new acquisition cannot confidently be associated with the sponsorship.</p> <p><strong>How to trigger sales and conversion?</strong> - At the end of the day brands must focus on conversion, but sponsorship offers no clear call to action. Brand recognition that isn’t purely quantifiable is the main advantage rather than direct sales.</p> <p>Despite this, sponsorship has been tried and tested by the most well know global brands out there, therefore it is, aside from the caveats, trusted and relied upon, making it a vital partnership marketing technique.</p> <h3>Consistent terminology</h3> <p>Alongside the 10 types of partnership marketing it’s important to also understand the terminology that goes alongside them. The subject currently suffers from a distinct lack of consistency when it comes to the terminology used. Upon billboards, online ads, and loyalty schemes, many of the terms detailed below have been used to illustrate a partnership between two brands. They are recognisable terms although ones that are not always entirely accurate.</p> <p>Here are a few definitions: </p> <ul> <li> <strong>In partnership with</strong> - the most popular phrase used to describe a partnership with another brand, literally says what it means; informing consumers that there is a collaboration occurring and that the partnership will benefit both primary and secondary brands as well as ultimately the consumer.</li> <li> <strong>Supported by</strong> - commonly found within charitable partnerships. Being supported by a partner brand refers to one brand assisting the other in the campaign. It portrays an element of comfort towards a consumer, showing the cause is backed by a reputable brand.</li> <li> <strong>Certified by</strong> - provides authenticity to the partnership. By stating that a brand certifies another delivers trust to the consumer that the offering is backed by the supporting brand.</li> <li> <strong>Incorporating</strong> - generally means 'together with' and relates to a primary brand including a secondary brands proposition within their own. If a major brand is incorporating with another it is referencing the fact that they are providing their services as an add-on or an extra. </li> <li> <strong>Powered by</strong> - often refers to the presence of a partner brand supplying their services to benefit another product. An example of this is the Nexus phone which is 'Powered by' Google. Such a partnership ultimately benefits the consumer with a far superior product utilising both technologies.</li> <li> <strong>In association with</strong> - most commonly used when both brands have an equal role to play in the partnership. The term association means that both brands have agreed on a mutual partnership offering.</li> </ul> <h3>The Future is ripe</h3> <p>With everything we have been discussing it makes sense to say that as digital and performance marketing expands so should partnership marketing. There is a direct correlation between increased communication and the growth of partnerships. </p> <p>As channels such social media continue to increase in popularity, everyone becomes more connected. Consumers talk to each other and new markets continue to open, in turn leading to increased competition as well as opportunity. With this being said, the need for collaboration will expand as brands fight to survive and capitalise. All in all the future is ripe for the taking, for brands using any of these 10 types of partnership marketing.</p> tag:econsultancy.com,2008:BlogPost/69182 2017-06-20T14:07:00+01:00 2017-06-20T14:07:00+01:00 A complete guide to partnership marketing: Part one James Cristal <p>It is fair to say that partnership marketing has been simply swept under the marketing rug. Read any marketing text book and you will find chapters on digital, social, strategy and branding, and amongst these you will notice the odd reference to brand synergies between two companies. However, search online and you will find articles, agencies, and job adverts on partnership marketing all under an array of titles; joint marketing, co-marketing, and merchant marketing.</p> <p>There also thousands of global brands that participate, from Virgin to Google, Pepsi to O2, and Apple to American Express. It is becoming clear then that it’s an emerging subject, and I am sure you will agree it should now be acknowledged as one of the most important marketing techniques to materialise in recent times. </p> <p>Over the next decade or two we will see an even faster advancement in technology and greater connectivity but this inadvertently means an even higher rate of competition. Those businesses with common aims should stick together; they must collaborate and share resources. Brand sharing and benefiting from each other’s proposition will start to take more and more prominence. For those businesses that want to not only survive but thrive in the 21st century market, then partnership marketing is the answer.</p> <h3>So firstly, what actually is partnership marketing? </h3> <p>‘Partnership’ is now the more universally accepted term. It’s been defined multiple times and in many different guises, but in its simplest form it can be described as:</p> <p>"Where two or more brands collaborate via strategic marketing campaigns to help each other achieve their objectives. It is where a primary brand has the ideal product or service to compliment a secondary brand; utilising target audiences to improve their value proposition." </p> <h3>What are the 10 types? </h3> <p>These are the most common forms of Partnership Marketing practiced by small, medium and large businesses. While one model might be successful for one company it may not necessarily fit into the scope of another. Brands may decide to use just one or many of these types, or occasionally combining several to form a hybrid. The 10 types are not fixed; they are fluid and can be interchangeable depending on the partnership in question:</p> <ol> <li>Affiliation</li> <li>Content</li> <li>Distribution</li> <li>Charitable</li> <li>Joint products</li> <li>Licensing</li> <li>Loyalty</li> <li>Product placement</li> <li>Shared stores</li> <li>Sponsorship</li> </ol> <p>In this, part one, we'll cover the first five on the list. </p> <h3>1. Affiliation</h3> <p>“Affiliate marketing is a <a href="https://econsultancy.com/blog/66942-five-rewarding-performance-marketing-case-studies-from-brands/">performance marketing</a> technique where websites otherwise known as publishers will promote your product or service in return for a monetary reward.”</p> <p><a href="https://econsultancy.com/blog/67171-what-is-affiliate-marketing-why-do-you-need-it/">Affiliate Marketing</a> can be achieved by using any of the methods described below. Both utilise a primary partner, often referred to as an advertiser, and a secondary partner, often referred to as the affiliate or the publisher. These partners work in collaboration; in doing so the primary brand benefits from promotion of their products resulting in sales, the secondary benefiting from commissions earned per lead or sale.</p> <p>They are three ways brands can work with affiliates:</p> <ol> <li> <strong>In-House</strong> - when a primary brand is looking for a solution that provides them with the ability to upload all creative banners, allow an affiliate to select the type of campaign with relevant tracking links and display all results in one centralised location, they use an affiliate program.</li> <li> <strong>Networks</strong> - a third party where both advertiser and publisher register and utilise its services all through the network’s external portal. A major benefit to brands over an in-house solution is that it provides far greater reach for publishers to find relevant brands to promote, while the advertiser is immediately exposed to thousands of publisher sites rather than having to promote their own in-house programme. </li> <li> <strong>Agencies</strong> - a third option is to work directly with an agency which manages the portfolio of affiliates as well as the operations behind it such as banners and tracking links. An agency can also be a network, or they can manage your own in-house solution, ultimately they should support your requirements in this channel.</li> </ol> <p>Affiliates can promote an advertiser using numerous techniques. Depending on the type of website, unique selling point (USP), and target audience they will promote those with the highest conversion and those offering the greatest commission rates. Promotional formats include: </p> <ul> <li> <strong>banner ad</strong> - banner ads are one of the more common forms of exposure for a partner brand on a publisher site. Header (728x90) or Skyscraper (160x600) banners are most popular. </li> <li> <strong>text link</strong> - a simple hyperlink often found within an article. It is more subtle than a banner ad.</li> <li> <strong>dedicated article</strong> - a strong partnership between brands can lead to more unique forms of exposure. A dedicated article can engage a target audience and provide a more detailed product description than that of a text link or banner ad.</li> <li> <strong>promotional page</strong> - exposure of advertisers through specific areas of the publisher’s site devoted to promotional offers. Here promotional banner ads can be kept separate from the core content.</li> <li> <strong>newsletters</strong> - for those affiliates that require accounts to be created or email addresses to be captured newsletters are a strategic way for them to directly market affiliate offers. 6Groupon and 7Quidco for example are excellent at targeting their segmented database with the latest partner deals.</li> <li> <strong>comparison table</strong> - for aggregator sites such as Money.co.uk (below) and Confused.com the comparison table is a huge USP, adds value, and attracts customers over other affiliates. It allows them to rank advertisers by pricing, features and benefits to consumers.</li> </ul> <p><img src="https://assets.econsultancy.com/images/0008/6890/Picture1.png" alt="money.com" width="615"></p> <p><em>Money.co.uk comparison site</em></p> <p>Affiliate marketing is widely considered to be one of the purest forms of partnership marketing. It comes under the umbrella of performance marketing because it can be so accurately measured and the return on investment (ROI) precisely calculated. Affiliation is quantifiable and unlike some other marketing methods can always be proven.</p> <p>Affiliation refers to the practice of partner websites promoting your brand in return for commissions. An affiliate will be paid depending on the agreement that has been made with the advertiser. It's not always a complete sale, there are many models that pay based on the number of impressions, clicks, or leads. This doesn’t mean that an affiliate will always receive commissions on just one sale, the deal can be on multiples; CPM (cost per thousand impression), CPC (cost per click), CPA (cost per acquisition), revenue share (percentage of the revenue a sale generates), or a fixed fee per ad-spot. There are also amalgamations of these often referred to as hybrid deals. </p> <p>An affiliate can range from a successful newspaper brand to a small niche one-man-band website reviewing headphones. Both of these follow the same principle as they contain content, attract traffic, and publish ads. There are a number of affiliate variants out there; voucher sites such as Groupon, cashback sites such as TopCashback, or comparison Sites such as MoneySupermarket.com or Gocompare.</p> <p>Bringing this back to partnership marketing; when primary brands are looking for specific partners to promote their services, affiliation is seen as a very attractive option. It creates an alliance of brands in a very direct way towards a mutual target audience. LG for example, the popular TV manufacturer, will work closely with renowned TV review sites in order to drive sales. The review site will demonstrate the quality of the brand offering and effectively promote LG’s products to their database. </p> <h3>2. Content </h3> <p>“Content Marketing is the creation of relevant content that will be highly engaging to customers. Content partnerships are the development of such content in collaboration with a partner brand that is then shared or promoted to respective target audiences.”</p> <p>There are two main ways a brand can partake in content partnerships: </p> <ol> <li> <strong>Co-creation</strong> - both brands collaborate to create the content. This could be industry trends, market research, product releases or thought-leadership papers. By writing the content together and referencing one another's products it will align both brands for mutual recognition. </li> <li> <strong>Link sharing</strong> - the primary brand creates the content but works in partnership with a secondary to promote it. Link sharing means linking to the partner’s content from their own site. This provides exposure, aligns both brands together, and advances SEO. </li> </ol> <p>Content partnerships can take various different formats, such as:</p> <ul> <li> <strong>white papers</strong> - presenting the latest industry research, advice, knowledge and trends using thought-leadership. </li> <li> <strong>articles</strong> - featuring the latest joint products, opinions or promotions. These can take the form of reviews, how-to guides or case-studies.  </li> <li> <strong>infographics</strong> - a visual representation of information or data. Extremely effective for the use of joint brand imagery amongst the content. </li> <li> <strong>videos &amp; podcasts</strong> - the joint creation of a video or spoken media. Utilising the likes of YouTube to engage with the target audience.  </li> </ul> <p>SEO is now such an important aspect of digital marketing that specialist agencies have arisen, dedicated jobs created, and millions spent. Success in search rankings can literally make or break a business, making it the 21st century's most talked about marketing topic.</p> <p>The evolution of websites has now reached the point where each page should ultimately evoke an action to convert viewers into paying customers. This means the greater numbers to a site the better chance of conversions and therefore revenues. This is the reason millions are spent climbing the ladder of Google’s rankings. </p> <p>Organic traffic via search engine optimisation is governed by a complex well-guarded algorithm made up of a huge number of variables, such as keyword usage, trusted inbound links and subject relevance. This means that your 'content is king' - how it is constructed, who likes it and how it is shared has direct influence on traffic, therefore conversions and ultimately sales.</p> <p>SEO is not the only means to achieving traffic; social media has a huge part to play too. Channels such as Facebook and Twitter can guide vast quantities of traffic to your site depending on what you have to say and your shared content. </p> <p>To ensure traffic remains high from both SEO and social the information that consumers receive must be fresh, relevant, and engaging. It also has to answer their questions, fulfil their needs and attract their attention. So this is where content partnership marketing comes in. </p> <p>The fact is, one brand can create appealing content, but by providing fresh material in conjunction with a partner suddenly makes it an entirely new proposition, one that is far more interesting, likeable and engaging. This will attract the attention of both customer bases and affiliated parties. All this means a much larger network that will interact and share it. From an SEO and social engagement perspective the benefits are vast. </p> <p>Let’s consider, too, the cost effectiveness of such a partnership; utilising each other's personnel, resources and industry knowledge to produce the content is of huge value to both. While the utilisation of one another’s digital channels and expertise will mean a lower end cost per acquired customer per content piece produced.</p> <h3>3. Distribution </h3> <p>"Where one partner agrees to cross-market or bundle another partner’s product or services into their own distribution channels to target the agreed customer base."</p> <p>There are two main types of distribution partnership marketing, each a slightly different way to distribute a partner’s product or service: </p> <ol> <li> <strong>Bundling</strong> - including your partners offering as an in-box bundle or package insertion, such as giveaways in packaging, promotion within the product itself or online bundle for a purchase such as buy-one-get-one-free. </li> <li> <strong>Cross-marketing</strong> - achieving the joint marketing efforts of both products through a distribution channel. Rather than the inclusion of the product within the packaging, instead offering a marketing opportunity to a partner brand within the distribution.</li> </ol> <p>Online, offline and mobile all have their own distinct vaue in distribution of a partner brand in order to provide the most effective customer targeting. The more common forms include: </p> <ul> <li>In-store leaflets</li> <li>In-store coupons</li> <li>Magazine coupons</li> <li>In-store live demonstrations</li> <li>In-store TV demonstrations</li> <li>Email vouchers</li> <li>Mobile coupons</li> <li>QR codes</li> </ul> <p>This is widely considered one of the most widespread types of partnership marketing, and one that has been practiced for decades. The reason for its popularity is due to the physical nature of the collaboration. It can physically place a partner brand in the hands of the target audience and visually places the partner brands alongside each other.</p> <p>Both brands show a strong association and trust, and this resonates all the way to the customer, having a positive effect on loyalty and customer retention. Often the secondary brand will provide a primary brand an 'exclusive' offer or discount. This adds a huge advantage to sales potential.</p> <p>The act of distributing a partner’s brand within your own store and alongside your own products is one of the purest and most recognisable types of partnership marketing. </p> <h3>4. Charitable</h3> <p>"A primary brand sponsors or markets itself with a charitable organisation or cause. In turn they seek exposure and promotion via agreed marketing channels."</p> <p>Benefits can be very fruitful when working with a charitable cause. We have pin-pointed two main reasons why a primary brand would do partner with a charity:</p> <ol> <li> <strong>Cultural influence</strong> - a brand can primarily work with a charitable brand to offer a moral contribution. This is part of company culture and CSR and often attributable to the attitudes of senior stakeholders.</li> <li> <strong>Brand leverage</strong> - some firms prefer to associate themselves due to the benefits it brings to their consumer and public reputation.</li> </ol> <p>Charitable partnerships can take a number of forms, with various ways in which a brand and charity can run such campaigns. These include exhibitions, public events, award shows, sponsorship, raffle contributions and news stories.</p> <p>As today’s customer is more industry aware and savvy with their purchasing decisions, with abundant comparison and review sites at their fingertips, a brand that upholds a strong public reputation is increasingly standing out from the crowd. Associating your brand to a charitable cause is therefore fast becoming the main method to securing such a status. </p> <p>Innocent Smoothies for example, one of the most reputable drinks companies in the UK, stressing the importance of fair-trade production, also associate themselves with a number of charities via their Innocent Foundation. Firms such as this that can leverage a Charitable Partnership for marketing purposes will see their public reputation and brand image vastly enhanced.</p> <h3>5. Joint products </h3> <p>“When two companies agree to create a new product or alter an existing product in order to provide additional value to the customer. Often the product is an amalgamation of both products aiming at mutual target audiences.”  </p> <p>For brands partaking in joint product partnerships there are many factors to consider. Bearing in mind the huge impact on internal product departments, they are presented with three main collaboration choices:</p> <ol> <li> <strong>Powered by</strong> - a partner brand supplying their services to benefit a new or existing product. Often software providers will provide their technologies for a product. Mobile phones powered by a technology provider such as Google or Microsoft is a good example.</li> <li> <strong>White label</strong> - many successful technologies also offer white label solutions. This means selling off their services or leasing their technology for a partner brand. The partner brand then utilises it under its own brand name.</li> <li> <strong>Product merger</strong> - a merger is where both brands have decided to amalgamate their products together. This too comes in various formats, from full to partial mergers depending on the product line.  </li> </ol> <p>These alliances can be very interesting for an organisation's product portfolio, the result is a fresh line of innovative product solutions. With the breakthrough of digital technologies over the past decade we are now seeing a far greater increase in such partnerships. There are four specific forms that have emerged:</p> <p><strong>New Product Launch</strong> - two firms may decide to launch a brand new product, one that amalgamates both brands under an exciting new concept. Both companies leverage each other's brand image, reputation, resources, and market reach – as shown in the example below with Apple and Nike who combined to create the 'The Nike &amp; iPod Sports Kit'. </p> <p><img src="https://assets.econsultancy.com/images/0008/6892/pic2.jpg" alt="nike ipod" width="577" height="454"></p> <p><strong>Brand leveraging</strong> - rather than a full product merger often just the branding is joined. With such product partnerships it is about utilising the partners design and packaging. </p> <p><strong>New markets</strong> - by partnering products together a popular firm in the US seeking new customers from Europe might collaborate with a successful European brand to enter this new market, and with this the joint product might have to adapt to the new market.</p> <p><strong>Sharing costs</strong> - occasionally a product partnership will purely be a cost-saving exercise. This is achieved with the sharing of resources and expertise; this in turn reduces cost of production and marketing.</p> <p>The main consideration with these kind of partnerships is that they are a product and marketing initiative involving the buy-in from both departments. Any alterations to a product would have to be planned for; Sales departments briefed on alterations, with Marketing prepared for go-to-market campaigns.</p> <p>An effective go-to-market strategy will require a distinct value proposition. The unique selling point of the joint product must be communicated to highlight these new product features and their benefits to a consumer. Branding is also important, getting this right will ensure that the primary brand's look and feel is displayed not only through the packaging but also via all advertising channels effectively.</p> <p>It is fair to say that this is probably the most innovative type of partnership marketing but one that does not come without its complications. If the product misses the mark and the value proposition fails to resonate with the target audience it would certainly be deemed a very expensive failure.</p> <p><em><a href="https://econsultancy.com/blog/69190-a-complete-guide-to-partnership-marketing-part-two/">Read part two</a> of this article, covering:</em></p> <ul> <li>Licensing</li> <li>Loyalty</li> <li>Product placement</li> <li>Shared stores</li> <li>Sponsorship</li> </ul> tag:econsultancy.com,2008:BlogPost/69126 2017-06-06T15:45:00+01:00 2017-06-06T15:45:00+01:00 Why did Amazon's online video shopping channel fail? Patricio Robles <p><a href="http://pagesix.com/2017/05/29/jeff-bezos-live-television-stint-canceled/">On May 26</a>, the online retail giant "abruptly" told staffers that the show – which was hosted by former MTV-er Lyndsey Rodrigues, ABC news correspondent Rachel Smith and reality TV star Frankie Grande – was being canceled.</p> <h3>So what happened?</h3> <p>Amazon posted a message on the Style Code Live Facebook Page telling fans that "all good things must come to an end" and promising that "there is more to come." But it has not revealed any further information about its decision or details like viewership.</p> <p>While most of the Style Code Live social media accounts have been deleted, it appears that the show had accumulated some 69,000 followers on Instagram, 42,000 likes on Facebook and 18,000 followers on Twitter. Interestingly, the show's YouTube channel remains and reveals that the company had generated little activity and engagement on one of the most popular platforms for style and beauty content.</p> <h3>A failed experiment?</h3> <p>Amazon's prowess in using data to inform business decisions is no secret and thus if one was to speculate about the cause of Style Code Live's cancellation one would have to conclude that the most likely reason for it was that the show was not generating sufficient business to make the investment worthwhile.</p> <p>Producing a live broadcast five days a week was likely a costly undertaking, and during its run Style Code featured celebrity guests like Sarah Jessica Parker, Meghan Trainor, Meghan Markle, Nicole Richie, Kourtney Kardashian, Kelly Osbourne and Ariel Winter. Ostensibly, Amazon compensated them for their appearances on the show.</p> <h3>All about influencers?</h3> <p>Celebrity and new media influencers looked to be a prominent part of the Style Code Live value proposition, but it's not clear that Amazon's program was actually able to take advantage of their influence.</p> <p>While the aforementioned Style Code Live social media accounts had tens of thousands of followers, that's a drop in the bucket compared to many of the celebrities that appeared on the show. For instance, Kourtney Kardashian has over 57m followers on Instagram, and Sarah Jessica Parker has over 3.5m.</p> <p><img src="https://assets.econsultancy.com/images/0007/2792/stylecode3.jpg" alt="" width="311" height="264"></p> <p>If one assumes that the activity on Style Code Live's social media accounts were indicative of the show's actual viewership, it would appear fairly likely that audience numbers were extremely modest and thus nowhere near high enough to move the needle for Amazon, which generated more than $135bn in revenue last year.</p> <p>As far as bringing the home shopping channel into the 21st century, consider that QVC generates more than $8bn in sales every year. Clearly, if Style Code Live showed any promise of being the digital QVC for millennials, Amazon wouldn't have shuttered it. </p> <p>So if Amazon's plan was to pair original content with a hefty dose of influencer appearances to sell fashion products, it fell short. But that doesn't mean Amazon is giving up on influencers. To the contrary, the company is now trying to tap them through alternative means: <a href="https://econsultancy.com/blog/68961-amazon-tries-its-hand-at-influencer-affiliate-marketing">a special affiliate program</a> that allows influencers to curate their own collections of products on Amazon, which they can promote to their fans.</p> <p>Will that be a more effective and less costly approach? Time will tell.</p> <p><em>For more on influencers, check out these Econsultancy reports:</em></p> <ul> <li><a href="https://econsultancy.com/reports/measuring-roi-on-influencer-marketing/"><em>Measuring ROI on Influencer Marketing</em></a></li> <li><a href="https://econsultancy.com/reports/the-voice-of-the-influencer/"><em>The Voice of the Influencer</em></a></li> </ul> tag:econsultancy.com,2008:BlogPost/69026 2017-05-03T10:00:38+01:00 2017-05-03T10:00:38+01:00 Why online publishers are launching wedding verticals Nikki Gilliland <p>Now it appears publishers want a slice of the cake too. Many more are launching wedding-related content to engage users, with some even expanding into the world of commerce to increase revenue. </p> <p>Here’s just a few examples, as well the reasons why it’s proving to be a profitable move.</p> <h3>Cosmopolitan</h3> <p>According to data, 10% of all engaged Americans have visited Cosmo.com. Up until recently, Cosmo has consistently written about the topic, choosing to ramp up activity ahead of and during the summer months when readers are most likely to attend events.</p> <p>After seeing an increase in traffic to this bridal content, the publisher decided to launch it as an official vertical all year round, giving ‘Weddings’ a dedicated category on the main site alongside ‘Style’, ‘Beauty’, ‘Love’ and ‘Video’.</p> <p><img src="https://assets.econsultancy.com/images/0008/5616/Cosmo_weddings.JPG" alt="" width="760" height="330"></p> <p>For Cosmo, the aim is to meet the obvious demand for wedding content, as well as draw in readers who would otherwise turn to standalone wedding publications like Brides. </p> <p>To ensure it doesn't alienate anyone who <em>isn't </em>getting married, the new vertical will offer a range of wedding-related content, including articles about bachelorette parties, as part of a wider <a href="https://econsultancy.com/blog/68384-how-cosmopolitan-reinvented-itself-became-the-number-one-women-s-magazine-in-the-uk/" target="_blank">strategy to reach a millennial audience</a>.</p> <p><img src="https://assets.econsultancy.com/images/0008/5615/Cosmo_insta.JPG" alt="" width="760" height="483"></p> <h3>InStyle</h3> <p>Last year, InStyle expanded its online presence from just fashion to include the verticals of home, entertaining and, you guessed it – weddings. It was partly done to help engage a wider demographic (which is naturally interested in a more varied subject matter), but also to increase the potential for advertising revenue.</p> <p>InStyle readers reportedly purchase an average of seven items based solely on ads. That’s more than any other competitor, even the likes of Vogue which famously includes a hefty amount of advertising. Adding weddings into the mix is only likely to increase this spend, especially when you consider the fact that InStyle has the highest number of readers with an annual household income of more than $100,000.</p> <p>With the average American wedding <a href="http://fortune.com/2017/02/03/wedding-cost-spending-usa-average/" target="_blank">said to cost $35,329</a>, this type of content is bound to appeal to InStyle’s more affluent demographic. What’s more, it aligns with the publication’s decision to become more of a luxury lifestyle title rather than a straightforward fashion mag.</p> <p><img src="https://assets.econsultancy.com/images/0008/5617/InStyle_weddings.JPG" alt="" width="760" height="707"></p> <h3>The Knot</h3> <p>While the aforementioned publishers use wedding content to increase readership and ad revenue, rival bridal site The Knot has ventured deeper into the world of commerce.</p> <p>In 2015, it acquired event marketplace Gigmasters in order to allow users to search and book venues, photographers, planners, hairdressers and more. </p> <p><img src="https://assets.econsultancy.com/images/0008/5618/The_Knot.JPG" alt="" width="760" height="519"></p> <p>By fusing content with commerce in this way, its aim is to reach users at every stage of the wedding process. From providing initial inspiration to help with finding a photographer and inviting guests – even a honeymoon when the wedding is over – the idea is that there’s no need for users to seek help or advice anywhere else.</p> <p>With its own retail component, The Knot also allows users to directly shop the items featured in its print and online magazine.  </p> <blockquote class="twitter-tweet"> <p lang="en" dir="ltr">You'll love these little white dresses from <a href="https://twitter.com/Macys">@Macys</a>! <a href="https://twitter.com/hashtag/ad?src=hash">#ad</a> <a href="https://t.co/7iVweMaZdD">https://t.co/7iVweMaZdD</a> <a href="https://t.co/Bcy2LB4Q6b">pic.twitter.com/Bcy2LB4Q6b</a></p> — The Knot (@theknot) <a href="https://twitter.com/theknot/status/855053727257985024">April 20, 2017</a> </blockquote> <h3>Brides</h3> <p>Another publisher that has dipped its toes (or should that be fingers) into commerce is Brides – Conde Nast’s popular wedding title. Instead of an online marketplace on its own site however, it has partnered with a number of other retailers to launch products that have the Brides brand stamp of approval. </p> <p>These include a line of engagement rings called ‘In Love by Brides’ sold at Walmart, ‘Modern Bride Jewelry’ for JCPenney, plus a custom stationery line called ‘Brides Fine Wedding Papers’ sold in a number of US stores.</p> <p><img src="https://assets.econsultancy.com/images/0008/5619/In_Love_By_Brides.JPG" alt="" width="760" height="505"></p> <p>Using data to delve into the interests of readers, Brides discovered that a large proportion were interested in more affordable or budget-friendly weddings.</p> <p>By partnering with retailers like Walmart it has been able to deliver this, offering readers the chance to invest in more than just content.</p> <p><strong><em>Related articles:</em></strong></p> <ul> <li><em><a href="https://econsultancy.com/blog/68121-why-i-love-the-pool-and-its-refreshing-approach-to-publishing/" target="_blank">Why I love The Pool and its refreshing approach to publishing</a></em></li> <li><em><a href="https://econsultancy.com/blog/67494-five-ways-the-new-york-times-is-innovating-its-publishing-model/" target="_blank">Five ways The New York Times is innovating its publishing model</a></em></li> <li><em><a href="https://econsultancy.com/blog/67312-are-publishers-in-a-losing-battle-with-content-distribution-platforms/" target="_blank">Are publishers in a losing battle with content distribution platforms?</a></em></li> </ul> tag:econsultancy.com,2008:BlogPost/68961 2017-04-06T14:07:52+01:00 2017-04-06T14:07:52+01:00 Amazon tries its hand at influencer affiliate marketing Patricio Robles <p><a href="https://techcrunch.com/2017/03/31/amazon-quietly-launches-its-own-social-media-influencer-program-into-beta/">According to</a> TechCrunch's Sarah Perez, the program functions like the company's affiliate program in that participants are paid a commission for product sales that they drive. It is not known if the commission structure differs from Amazon's affiliate program.</p> <p>Unlike Amazon's affiliate program, which requires that affiliates link to Amazon products from their own websites, Amazon is offering influencers vanity URLs, such as <em>https://www.amazon.com/shop/whatsupmoms</em>, on which lists of products they curate are displayed. As Perez notes, "Basically, it's a more exclusive step up from Amazon Affiliate linking, and offers a better browsing experience."</p> <p>One of the early participants in the Amazon Influencer Program is WhatsUpMoms, which claims to be the top parenting network on YouTube. Its president and COO, Liane Mullin, says that the program was a natural fit. "We are constantly asked by our community for product recommendations and about the products used in our videos. Now that we have our own Amazon store it makes it much easier to have a curated collection all in one spot," she told TechCrunch.</p> <p><img src="https://assets.econsultancy.com/images/0008/5232/amazoninfluencer.jpg" alt="" width="878" height="322"></p> <h3>The appeal of performance marketing for influencers</h3> <p>Amazon's desire to team up with influencers isn't at all surprising. After all, influential social media entities like WhatsUpMoms, which counts more than 1.5m subscribers to its YouTube channel, have the ability to promote products to broad and often loyal audiences. And there's <a href="http://www.latimes.com/fashion/la-ig-bloggers-20160809-snap-story.html">strong evidence that influencers <em>can </em>convert their followings into<em> </em>sales</a>.</p> <p>For that reason, it's reportedly not uncommon for brands to pay the most prominent of influencers – those with millions of subscribers on popular social platforms like Instagram, YouTube and Snapchat – well into the five figures, and in some cases even six figures, for each promotional post.</p> <p>Given the large sums being paid in the upper echelons of the market, brands tapping influencers to promote their wares will increasingly seek to justify the spend <a href="http://econsultancy.com/reports/measuring-roi-on-influencer-marketing/">by tracking ROI</a> and ensuring that their deals make financial sense. Performance marketing payment structures, which align compensation directly to customer acquisition or sales, could help them do just that in a very straightforward manner.</p> <h3>But will influencers embrace performance marketing?</h3> <p>For those earning thousands of dollars or more for sponsored posts, the prospect of giving up a guaranteed payment for a percentage of sales generated or a set fee for each customer acquisition might not be all that appealing. While some arrangements could theoretically offer significant upside, the truly influential influencers aren't likely to see the benefits of taking on increased risk unless the market dynamic changes completely and they are forced to.</p> <p>Instead, so long as their sway is growing and bringing with it negotiating leverage, expect to see more top influencers focus on long-term <a href="https://www.marketingweek.com/2016/09/16/loreal-on-why-other-brands-are-using-influencers-the-wrong-way/">partnerships</a> in which they might even work with brands to co-create product lines that they have a real ownership stake in. And expect to see the most ambitious influencers try to follow in the footsteps of social media stars like Michelle Phan, <a href="https://www.forbes.com/sites/natalierobehmed/2015/10/05/how-michelle-phan-built-a-500-million-company/">who has built</a> her own business empire on the back of her YouTube popularity.</p> <p>Of course, none of this means that the Amazon Influencer Program is destined to fail. But absent a bigger hook than an Amazon page on which influencers can curate lists of products that are sold on Amazon, it seems unlikely that the influencers with "large followings" Amazon is courting would have good reason to give their Amazon Influencer Program links top billing.</p>