Should Merchants De-dupe accross online marketing channels?

[getvisible]

If merchants utilise various differnet types of marketing approaches and a particular sale has been touched by affiliate marketing / email marketing and SEM who should get the sale and who should be de-duped out?

I've fleshed it out here:

Affiliate Marketing Blog & SEO Advice: Last Click Commissions - Still Relevant in 2007 / 2008?

but what are your thoughts?

[drivetowin]

I know some will say I'm a stick in the mud but I'm still a firm advocate of last referrer wins and am yet to be convinced that any other system really works.

I think as affiliates we need to be mature enough to realise that last referrer wins means sometimes as an affiliate we lose - if someone's final visit to the merchants website is via the merchants own ppc (whether them or their agency) then why should the affiliate receive anything? - before anyone rushes into that, consider the opposite scenario, if someone visits the merchant via the merchant's ppc, then goes either via a rewards affiliate site or a voucher affiliate site to the merchant, are we saying the affiliate should not get the sale - no I guess not - but you can't have it both ways - so last referrer wins, and if the last referrer is not an affiliate, no affiliate commission paid.

The other alternatives to my mind have more serious problems:

If the first referrer wins then the world becomes a cookie stuffer's paradise and that really really is not good news for any of us.

If you try to split the commission across a number of referrers then to my mind at least for affiliates you end up with an unworkable business model - if I sell something that gets 5% commission then I can work on the basis that I get one sale every x number of clicks, 5% of the price works out at say £5, so I know how much I can afford to spend to get that click. If it was split over all channels, who knows but say for the sake of simplicity there were 5 referrers involved in any one sale, so now I don't get £5, I get £1, and the whole metric changes......ok I know the argument that I may well get £1 on other sales where at the moment I get nothing, but how do I build an effective business plan if for each sale I have no idea how much I am going to get. Wouldn't this model also destroy the whole cashback industry overnight. If you were operating a cashback site how could you say to your members, "well we don't know how much cashback we can give you on your purchase until the commission comes through because it depends where else you clicked before you purchased....."

[D-Mac]

The thing that bothers me most about de-duping is when the last referrer is a brand name search on Google Adwords. Affiliates with content sites (used by consumers to make informed purchasing decisions) often lose out at the last moment to a cheap 5p click on a brand name (whether by an affiliate, or the merchants' ppc agency).

Allowing merchant's to de-dupe on brand names benefits Google's bank account most of all as it acts as a valid reason for merchants to bid on their own trademarked name, even when they hold the #1 organic space. It's much cheaper to pay a few pence to Google for the sale than the full commission to an affiliate. Ever wondered why so many merchants do this?

Affiliates with real value added content sites need to be encouraged, as it is often these kind of sites that really drive sales. I blogged about this in a little more detail here: Macf.co.uk » Affiliate Marketing

With regard to cashback sites suffering with a split commission system, well hopefully some networks are looking at the long term sustainability of the whole affiliate model and are thinking about which particular strands of the model they want to focus on. It's my view that the current strands that affiliate marketing covers are not all mutually compatible. Content isn't king in affiliate marketing at the moment..

[Michael_Anthony]

Interestingly, with finance leads, and all other leads as far as I know, it's the opposite way around - the first source to send the applicant gets paid for it.

I see a great deal of logic in this approach - if your affiliate marketing was good enough to capture the visitor's attention and direct their click in the first place, then you deserve to benefit.

I didn't blog about this as I can't see the point of blogs

[drivetowin]

We're not quite talking the same thing Michael - we're talking about the first/last affiliate to plant a cookie - so even in your scenario, if an visitor clicks through from site 'A' and doesn't complete the application form, but clicks through from site 'B' two days later and does complete the form, I'm guessing that site 'B' would get the commission as they have supplied the lead.

[channel5]

I have to say that I sit with D-Mac here and say that all touch points need to take a share of the CPA otherwise we are going to be left without an industry.

The problem I think is that more and more affiliates are not "value add" to to the purchase process.

Cashback sites are the prime example, they have a value to the customer or giving some or all of the commission back to the customer, now that's great for the customer but the customer probably went round a few sites investigating their purchase upfront, most likely visiting a specialist site that gave them some value added content (reviews, comparison engines, etc) that helped them shape their purchasing decision.

If all consumers start to use cashback sites as the site of last click then you will find the value added niche sites will start to choke for lack of revenue. As we start to lose the value add sites then the concept of an affiliate actually adding value to the purchase decision will diminish and all we'll be left with is cashback sites.

I've yet to see a cashback site that actualy helps make an informed decision on anything other than the amount of cashback returned.

It's not that I don't think that there is a place for cashback sites, as I think there is a big place for them, i just believe that the sites that promote content as the draw to bring consumers in need to be rewarded for their place in a purchasing decision.

If a customer only uses a cashback (or any other affiliate) site and never visits another affiliate site as part of the process then fine, give them all the commission, but if there have been other touchpoints along the journey then they need to be rewarded to.

[hpops]

Interesting timing for this post. We're giving notice on the introduction of deduplication on two of our programs today.

Its actually been one of the only things I've changed my mind on in the past twelve months. I used to feel that due to the payment method involved there was a inherent disadvantage to the affiliate channel, however, with my SEM hat on, we would certainly drop spend on any non-performing phrases so that doesn't really apply.

Its also the case that our industry, due to its competitive nature suffers from margin creep. Without a competitive top line rate (sadly, regardless of general performance) its becoming more difficult to attract publishers. With the options limited to;

1) De-dupe at source or
2) lower commission rates (significantly)

Its extremely difficult to rationally argue the latter.

The raw facts are that if de-duping doesn't take place, then merchants are losing too much of their marginality in order to remain profitable. In an ideal world, merchants would have the opportunity to reward appropriately across the mix, with multi-touchpoint tracking. But until then, de-duping can be(and often is) the difference between a program existing, or not.

For our programs we're introducing de-duplication but ony tagging generic or specific ads, essentially leaving the brand terms untagged. This allows value add publishers cookies to remain intact if a user is returning via a brand search (except of course, if another affiliate is on the brand - but thats another story!!) We think this is a fair compromise, which maintains a multi-channel approach for the retailer, yet allows publishers to compete fairly within the wider mix.

[getvisible]

interesting views here.

It still sits uneasy with me that I'm a content affiliate and I educated consumers and often lose out to brand bidders or coupon sites.

Perhaps its time for content affiliates to jumpship?

Where would the internet be without us though?

[D-Mac]

Perhaps its time for content affiliates to jumpship?

Where would the internet be without us though?

A cynic might say that it would be better without us, with our 'reviews', commission weighted star systems, and search interceptions

[loquax]

A cynic might say that it would be better without us, with our 'reviews', commission weighted star systems, and search interceptions

But not all content sites are simply reviews/star systems etc... some content sites like ourselves provide a daily service, and have over time developed a community/brand - in fact all the nice things new affiliates are told to do...

... except even we see users much happier looking for 100% cashback or out of date discount codes... merchants/networks tell me "it's not happening" and "it's nothing to worry about" - but it is happening and it is worrying. I do wonder how new sites/new affiliates can get established in providing serious content services (ref A4UAwards, the nominations managed to just name two worthy of the shortlist... how bad is that!).

I've lost count the number of times I'm given an email with an offer, and i've canned it as "can't be bothered to waste time" because i know sales will go off to cashback or voucher sites (you can argue that's the nature of my userbase... and I'd probably agree).

Perhaps it's time for content sites to jump ship - leave everyone to their 100% cashback affiliate network (you won't need networks either as it'll be easier for merchants to go direct)... although we could fight back.

1. Add voucher codes... if content sites do it (and do it properly) then that should help. Another suggestion is to explain to your users why some voucher codes deliberately mislead them and that you're intent on providing up to date/valid codes so they don't waste their time

2. Offer 110% cashback... yeah that'll screw everyone

Jason

[getvisible]

Perhaps it's time for content sites to jump ship

That's why i'm currently setting up an ecommerce store and becoming a retailer. Much more fun and a greater control over my revenues as I don't have to worry about merchants giving no notice that they're reducing to 0% comm's or loosing out to bnb'ers as I'd sue their sorry backside if I catch em!

[loquax]

That's why i'm currently setting up an ecommerce store and becoming a retailer

Cool, good luck with it... the big worry though is if long established content affiliates all end up as merchants, agencies, affiliate managers or networks.. who's going to fill the gaps?

Jason

[pistol101]

Cool, good luck with it... the big worry though is if long established content affiliates all end up as merchants, agencies, affiliate managers or networks.. who's going to fill the gaps?

Jason

You'll be making a fortune as your be the only place to spend their marketing budgets

[Gavinio]

Last click referrer is the only really fair way. It's the same for all parties at least.

99% of affiliates are paid on a CPA basis, that is per sale/action. They are not paid to engage in any branding activity for a client (although a higher CPA might be factored into this to compensate for the "free" branding a client gets, particularly with larger affiliates) although they might want to control the marketing message (some take this a bit OTT for a CPA sales channel, but there we go). You get paid for the sales you make, not for the branding they've seen on your site. This works both ways, would you have a bit of your affiliate commission taken off if the customer admitted that they'd seen a billboard for your merchant that day and it had influenced the decision to buy? Course you wouldn't. It's the same everywhere, if you go in Curry's, the chap is helpful, but you go back another day and buy from his mate, then his mate gets the sale. You've just got to hope that it evens out over time.

Balancing the above with this...

Affiliates with content sites (used by consumers to make informed purchasing decisions) often lose out at the last moment to a cheap 5p click on a brand name (whether by an affiliate, or the merchants' ppc agency).

Is really difficult, and why brand bidding can harm more than just the client's margins. It harms content affiliates, who are often the ones that really drive the incremental sales, and encourage customers to buy.

In an ideal world, the brand terms would be trademarked and no PPC needed. Another compromise is no de-duplication on the client's own brand terms, but this can be messy, and you can see why most go for the simple "bid on my own brand name".

As far as the argument for "should we all become voucher/cashback affiliates?", it's a free market, and so you've got to do what makes you money. It would be a real shame if that's the way everything went though. Why not partner up with a cashback site or whitelable one if that's a concern?

[loquax]

Why not partner up with a cashback site or whitelable one if that's a concern?

Simple answer - 100% cashback - why would a cashbacker accept 50% cashback when they can get more? Perhaps it's a discussion for another thread, but it'd be interesting to know if the non-100% cashback sites are losing/gaining users to/from the 100% sites?

When you see Quidco offering in Christmas promotions £40k of prizes to Greasypalm's £5k and eDeals £500... that perhaps could suggest some kind of trend?

Jason