Has the credit crunch hit you?

[Alfie]

Interested to hear if the economic slow down has had any major impact on other affiliates yet? I guess it may depend what industry's you are active in, but i personally am suprised that the high street is reporting the slowest month in 3 years, but I've yet to see any real slow down in terms of traffic - conversion has dropped a little, but its still early to say whether thats as a result of the credit crunch or just a business as usual fluctuation.

All the best,

Alf

[a4uChris]

I think it will take a while (if ever) for online to slow down at the supposed rate of high street decline.

Seeing all these Money Saving opportunities on peak time TV, all are telling to buy online rather than the high street for cheaper prices, discounts etc - plus not having to travel and use up your expensive fuel tank is an added extra - which all adds up.

I would guess that the financial sector in the industry has taken a hit, although I haven't really noticed too much change.

[John Jupp]

I have not seen any slow down in the niches I cover.

[Ditzy]

I'm drifting slightly off topic here as I'm going to talk about us as merchants rather than affiliates.

Started the business in September 2006 and earlier this year it was starting to fly.

We experienced a drop in sales during February although our reps told us that the baby/nursery trade does have a dry spell annually around then.

Things were just easing back in nicely when the media belted everyone round the chops with doom and gloom and it was like someone had flicked a switch ... sales dropped to virtually none.

Sales are trickling back in now but they are well down on what they were ... just in time to coincide nicely with the bills rolling in from the suppliers for the new season stock that we bought at the trade fair in March!

[Affility]

As an affiliate I have had poor sales from 24th April to 10th May but maintained visitor numbers. Things appear to be picking up again now.

Anyone else have figures to match?

[Mike_M]

Originally Posted by a4uChris I would guess that the financial sector in the industry has taken a hit, although I haven't really noticed too much change.

Yes, life as a finance affiliate is much tougher now than this time last year.

Merchants can't lend to as many people anymore and many are trying to squeeze more profit out of their online activity. Unfortunately for affiliates, agencies and networks are on their side because they are scared of losing the relationship in the uncertain climate. At the end of the day it's the merchant who pays their wages, not the affiliates.

The affiliate is suffering because they are being told either:

1. We're going to start paying you less
2. We'll pay you the same but we're repackaging the deal - ie we're going to tighten our criteria and start rejecting more of your leads: here's a good example - ACF Car Finance: Important news and changes (point 2)

3. both of the above (worst case scenario)

[aaclapham]

April was pretty good for me in the retail sector. However beginning of May was very poor, but I put that down to sun and a bank holiday. It has started to pick up a little bit but not going to hit any targets I thought I would hit this month.

[ChrisBishop]

I would advise affiliates to look at the sectors or merchants they are advertising and potentially look at new models or new sites.

What is very clear is that the middle/mass market brands are seeing the "crunch" the hardest however, high end/aspirational brands are appearing to be suffering less because of their core demographics and the need for the "general consumer" to still treat themselves.

Being in London and looking at the high street, and slightly more Regent Street and Bond Street etc - there is certainly still very high demand - and eating out for the past week the restaurants are still full.

So if you are seeing a dip in your traffic or conversions maybe look to trade up either your current traffic or appeal to a new audience.

Specifically with loyalty/cashback with web savvy consumers this kick back definitely allows for accessibility.

At House of Fraser we are seeing this across the board and if you feel across our different departments ( Womenswear, Accessories, Menswear, Childrenswear, Home, Electricals, Travel & Gifts, Beauty) and brands (Ranging from Hugo Boss, Versace to Kenneth Cole and Linea) that you would like to discuss opportunities feel free to get in touch.

Thanks, Chris

[aotagain]

1st. May saw our earnings drop through the floor - picking up a bit now though.
Hot weather theory - its been so bad for so long that everyone just switched off and went out as soon as the sun came out properly ?

There has been comment that those who have benefitted from being awash with rising asset prices and cash in the last 15 years and who have never had it so good, are ultimately going to feel any trouble far worse than the average punter. Purely because they've never really had to budget and their lifestyles and overheads have expanded to match their incomes. So they have no experience of how to cut back.

Whereas a good proportion of the population who don't get £10,000+ bonuses have always had to budget.

[accelerator]

If you are marketing high end Caribbean hotels to retired hedge fund managers you should be ok, I've heard there was a surge of demand after some of these City folk got laid off.

Rgds

[Grounded Vertigo]

Personally I'm not having the best month ever. I'm still getting the visitors just not as many conversions. I've now begun to do what Chris is also suggesting and focusing on higher end retailers as they seem to be getting more conversions (in my case at least).