Media agency run affiliate networks... info request.

[jq74]

I would welcome comments and feedback about what people think about traditional media agencies who are increasingly setting up their own affiliate networks.

So an agency who also do the clients online media (banners and PPC search etc.) may have traditionally gone though CJ, TD, DGM etc... to run the affilaites. I understand that increasingly media agencies are cutting out the traditional networks in favor of running the programs themselves using some affiliate software. Eg WASP (Walker Media), Generator (iLevel) etc...

Does anyone have any experience of this (good / bad)?

Welcome your feedback.... Thanks!

[EyeOfTheTiger]

From an affiliate perspective would prefer if they stayed with the agencies, unless they are going to increase the commission by the money they save from dropping the network which I doubt.

I am more likely to NOT work with a client if they are in an agency. Something to do with more contacts, more administration, more invoicing blah blah blah.

The networks are specialilsts with specialist tracking platforms and staff. They're good at what they do. I think it's just media agencies being greedy......

Mike

[Azam.net]

It is certainly an interesting and increasingly common trend.

Networks undoubtedly have experience in affiliate marketing and some of them do a good job, others not. Experience does not necessarily mean handling things better. For instance, most of the issues I was frustrated by when I opened my account with one network six years ago are still occuring, even though they said they would try to get a grip on them.

It depends how the media agencies handle their affiliate operations. If they treat affiliates with care and consideration, I can't see a reason not to work with them.

We have been working with PhD since June last year and I can only say that our experience has been that they are a super professional outfit. The guy running the show, Sid, is always available to assist with affiliate enquiries and has shown a level of dedication and enthusiasm which you don't generally get elsewhere (e.g. gone out of his way to help in evenings and weekends).

So, I really think it depends on the agency and how passionate and knowledgeable their staff are about affiliate marketing.

[Helen]

Interesting post...

The reason why they might be changing from managment to a network is;
* It's getting harder for some agencies to charge their rate cards for affiliate management. Remember some agencies charge in excess of £800 a day!
* Most agencies cannot engage in management with clients in competing areas e.g Tesco and Ocado. Moving to a network model would allow agencies to increase their client base.

I agree 100% with nadeem. I for one see no reason why agencies should not setup as a network. There are independant networks popping up all the time, why should an agency be treated differently? Agencies just need to make sure the funding and staff are put in place to match the support and experience given by some of the current network leaders.

Another pro for agencies are that they will have a lot more visibility over the clients marketing plan and overall spend. If they are now the network, perhaps they will fight harder for commissions and hybrid deals.

Mike, I would challenge your point on agencies having more administration, more invoicing etc etc. Having worked in an agency, I used to waste a lot of time waiting for replies from networks. If we had our own in house team (network) I could just pop round and ask them, and be there in person to put the pressure on. The admin in an agency is no more than a network will go through.

Anyway time will tell, after all if the client isn't happy with the sales they will move on.

Cheers
Helen

[taramoar]

Further to Helen's comment about saving time this way, as an agency we deal with a lot of different networks. To have our own in house would mean everything could be much more efficient and streamlined. Not having 10 different contacts would help! And would leave much more time to interact with affiliates.

But as with everything it has it's place - the agencies who truly see the value of affiliate marketing and understand all the implications.

[Tel]

Afternoon,

An agency with exceptional talent and skill set should be in a position to offer their clients the best solution using the affiliate sector, no matter what the tracking solution/network/software is.

This may come either through managing a closed programme through their tracking software, managing white label programmes or adding significant value to a network programme.

I hope that the roll of the agency can be fully understood. OK there are fees involved, but there are fees involved for an affiliate manager too. The true value from a good agency comes from being able to strategically steer an affiliate programme through the space with all of the challenges that will undoubtedly lie ahead. These challenges come from both internal and external factors which include market forces, changing landscapes, consolidation and maturity, US influences, SEM challenges etc. An understanding of the merchant's marketing objectives is key for a perfectly aligned affiliate programme.

Add to this strong affiliate relationships, trust and integrity, technical support, data management systems with campaign analytics and I'd hope to think that an agency interest in the sector will allow it to mature further into a long term sustainable marketing solution.

Col

[taramoar]

Originally Posted by Tel I hope that the roll of the agency can be fully understood. OK there are fees involved, but there are fees involved for an affiliate manager too.

Colin, you've morphed this post into something that's a sore spot for me! So many times agencies have to defend their position in affiliate marketing. It seems that it's missed that someone has to manage the programme - so its either going to be in-house or an agency. And affiliate agencies are often so much better equipped - with all the resources, existing relationships, expertise, technical knowledge (and everything else you mention in your post!).

Rant over!

[Qui Gon Jinn]

I won't debate yet on whether agencies being mini networks is a good or bad thing ie whether it's healthy competition or fragmenting the industry.

However, if indeed (assuming) there is a trend & it continues .. and since agencies look after a significant portion of major brands accounts. Would this over duration lead to a number of major brands leaving networks to go in house with the agency (or dual at least giving affiliates the option)?

It's just that i can recall on many occasions "some" networks wouldn't & still don't say boo to agencies with affiliate concerns or messages wouldn't get communicated in fear of losing them as a client, when now ironically some may now or in the near future be branching out as their own network ... which granted they have every right to do.

An agency ... and this is not meant to be a derogatory remark, so please don't get me wrong ... would only be any good if they understand the mindset of affiliates which is the same rule which applies to any employee within a network who have to understand everyones mindset. And this shouldn't be a simple token understanding. The more agencies mix & mingle with the affiliates the better, so that the perspectives of both parties can be undertood.

One advantage with direct communication is that not everything gets sugar-coated, chinese whispers not created and affiliate ideas credited to the actual affiliate.

The more genuine affiliate friendly agencies will naturally come to the fore & will duly be treated with respect. However like with any merchant, network or agency they are often only as good as the actual individual people who are at the front dealing with affiliates day in day out .. any of which can go from hero to zero in a blink, that figurehead is quite important & if that person departs for whatever reason can be difficult to replace.

[drivetowin]

Originally Posted by Tel Afternoon, An agency with exceptional talent and skill set should be in a position to offer their clients the best solution using the affiliate sector, no matter what the tracking solution/network/software is. This may come either through managing a closed programme through their tracking software, managing white label programmes or adding significant value to a network programme. I hope that the roll of the agency can be fully understood. OK there are fees involved, but there are fees involved for an affiliate manager too. The true value from a good agency comes from being able to strategically steer an affiliate programme through the space with all of the challenges that will undoubtedly lie ahead. These challenges come from both internal and external factors which include market forces, changing landscapes, consolidation and maturity, US influences, SEM challenges etc. An understanding of the merchant's marketing objectives is key for a perfectly aligned affiliate programme. Add to this strong affiliate relationships, trust and integrity, technical support, data management systems with campaign analytics and I'd hope to think that an agency interest in the sector will allow it to mature further into a long term sustainable marketing solution. Col

I see Mark has got you writing your pitch for the conference already Colin