And it's good bye from next

[Mogga]

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Not a major problem as their datafeed hasn't work for ... well forever..

*sighs*

Apparently: Next have a set affiliate budget and like any business want to maximise their ROI in the best way possible.

My only advice would have been to spend the budget on getting the datafeed working.

I enquired 10/9/09 about the feed and was told I'd be informed when it was updated. There's no update email as far as I can see.

[afinlr]

I agree.

Do merchants really pay extra to the network for each extra affiliate? That's the only way I can see that their ROI could be improved by kicking off affiliates ...

[toast8172]

Having received the email saying my services promoting next were no longer required, have now received another email saying
"Unfortunately there has been a system error and some emails have been sent out to the wrong recipients.
This however will be immediately corrected and the emails will be re sent.
Apologies for any confusion."

So now have no idea if I am meant to be getting the boot or not (although expect I will as I never drove much traffic in good part due to the datafeed not working).

[mattb811]

Just to quell any conspiracy theories before they begin, this isn't a drive to improve our statistics or reduce workload.

The facts of the matter are that Next assign a fixed budget to their affiliate marketing activity and as their retained agency we have a responsibility to ensure that this budget is utilised in the most effective manner. Over the last few months, the volume of sales being driven has begun to increase meaning that we have had some difficult decisions to take.

As far as we saw it the three options open to us were:

- To cap some of our larger affiliates on a monthly basis.
- To impose a monthly budget limit and turn the campaign off at whichever point we hit that cap
- To remove some affiliates from the campaign

In terms of managing the campaign in the most efficient manner whilst giving ourselves the ability to manage budget, we decided that the third option was the most sensible.

Having taken this decision, we then conducted some incredibly in depth analysis measuring individual affiliate profitability, percentage of new customers driven by individual affiliates and impact of affiliates within the overall consumer journey. Having carried out this analysis we then produced a quality score for each affiliate based on: volume, profitability, new customer ratio and affiliate type. Those with a high quality score were kept on and unfortunately we have had to regrettably cease working with those with a lower quality score.

Regardless of your opinion on working with a fixed budget, I hope that this goes some way to outlining our reasoning. We would like to be able to justify the role of the affiliate channel to Next moving forward and secure more budget, and in that case we would welcome the opportunity to work with some of the "lost" affiliates then. However I appreciate that this may not be possible.

I am more than happy to discuss this decision with anyone and all of my contact details are below.

Thanks,

Matt

matt.bailey@i-level.com
020 7399 7259
IM: mattbailey811@hotmail.com

[mattb811]

Additionally apologies to any buy.at affiliates who have received two conflicting emails. This is an error on the network side which they are working to correct now.

Matt

[D-Mac]

I wonder what % of commissions are accounted for by large voucher sites..?

[Mogga]

I love the idea any company would want to cap sales from part of it's sales team.

It's madness.

And if they have that tight a budget then surely cutting out the agency and letting the network manage it would save them a few quid.

Apologies to Matt if that sounds like a conspiracy theory. It's not. It's my thoughts on the issue as an affiliate.

[MattSweet]

I wonder what % of commissions are accounted for by large voucher sites..?

Unfortunately they probably contribute so much to the monthly total that removing them would just kill the programme. However, if a programme was constantly coming in over budget then voucher code sites would be top of my list to streamline. I'm sure you could work out some way to reduce voucher site costs if your aim was to actually reduce monthly sales costs.

We don't know that some voucher sites haven't been kicked off though...

[mattb811]

OK, a few questions to answer.

Dave - Clearly depends on how you define "top voucher code sites" but the top 3 voucher sites with whom we currently work account for around 7% of the budget at present.

Di - Maybe that could be the case. Maybe, however, Next get a reduced override from the network because they work with an agency and the agency manage all of the account management therefore the network have less to do. Maybe if the agency dropped out of the relationship then the network would have to charge more for their time and therefore there would be no cost saving? It's not always as simple as it seems when you're not in full possession if the facts.

Matt - As mentioned we conducted a lot of analysis about how different affiliate types operate on the campaign. Our conclusion was that all affiliate sectors are driving incremental sales and we would be naive to remove one particular group. Maybe if I didn't have access to data then I would jump to assumptions about specific affiliate types and the benefit that they add but luckily I can see exactly what happens on all of our campaigns. I appreciate that there is a desire to cast voucher code sites as smugglers pilfering the last click but we've found that that simply isn't the case. We have removed a significant number of voucher sites but have taken the decision to remain working with two. Those two are affiliates with whom we have strong relationships and believe that we can trial different ways of working to demonstrate to Next the value of the channel.

Any more questions, I'm happy to be as transparent as I'm allowed to be.

Matt

[MattSweet]

I appreciate that there is a desire to cast voucher code sites as smugglers pilfering the last click but we've found that that simply isn't the case.

That wasn't my point. If a programme was over-performing and there was a need to rein costs in, then surely the sites that actually discount the sale price (and margin) would be the logical choice to close down. I said nothing about them pilfering last clicks.

It wasn't a criticism, merely an observation. And like you say, you have removed lots of voucher sites.

[Entrepreneur]

Matt,

I'm genuiinely interested to know what cost I am as an affiliate if I drive no sales and no traffic. I assume none, but I'm presumably wrong.

As for capping sales, I agree with Di - utter madness.

George

[mattb811]

If a programme was over-performing and there was a need to rein costs in, then surely the sites that actually discount the sale price (and margin) would be the logical choice to close down.

Apologies Matt, I misunderstood. The fact is that Next do not offer discount codes and therefore there is no discounting of sale price. Add this to the fact that we pay voucher code sites a lower commission and the logical thing to do would be to keep as many voucher sites on as possible. However there were further considerations that were taken into account than pure commercials.

As for capping sales, I agree with Di - utter madness.

George/Di, I'm in two minds about this. In order for a client to be completely secure in handing over a completely uncapped budget they have to be fully secure in the fact that all activity on the campaign is both ethical and as incremental as possible. If not, there are serious possibilities of the client wasting money on affiliates acting badly (eg forced clicks, brand bidding) or of paying for sales more than once. Therefore the client has to have faith that the affiliate campaign is being managed effectively. Unfortunately Next have suffered from instances of unethical affiliate behaviour in the past and are therefore reluctant to assign a bottomless pot to the channel. It is my responsibilty at i-level to convince them of the value of the channel and of the benefits of assigning more (hopefully unlimited) budget going forward, and the changes that we have made today will hopefully facilitate that. Sometimes you need to take two steps back in order to move forwards...

[Entrepreneur]

George/Di, I'm in two minds about this. In order for a client to be completely secure in handing over a completely uncapped budget they have to be fully secure in the fact that all activity on the campaign is both ethical and as incremental as possible. If not, there are serious possibilities of the client wasting money on affiliates acting badly (eg forced clicks, brand bidding) or of paying for sales more than once. Therefore the client has to have faith that the affiliate campaign is being managed effectively. Unfortunately Next have suffered from instances of unethical affiliate behaviour in the past and are therefore reluctant to assign a bottomless pot to the channel. It is my responsibilty at i-level to convince them of the value of the channel and of the benefits of assigning more (hopefully unlimited) budget going forward, and the changes that we have made today will hopefully facilitate that. Sometimes you need to take two steps back in order to move forwards...

I'm still genuiinely interested to know what cost I am as an affiliate if I drive no sales and no traffic.

As for capped versus uncapped budget, affiliates only get paid if they drive sales. Unethical affiliate behaviour, paying for sales twice, etc., are issues with the program itself and should be adressed, but they are separate issues. They do not alter that fact that affiliates only get paid if they drive sales.

I really do try to understand things from the merchant's point of view, but am still at a loss to understand why any business would put a cap on sales unless those sales were unprofitable. There is no reason why an affiliate program should be run at a loss unless by design.

[Keith]

If anyone has a hole to fill, loads of articles to amend plenty of Next stuff on ebay next bnib, Women's Shoes, Girls' Clothing, Men's Shoes items at low prices on eBay.co.uk

[mattb811]

I'm still genuiinely interested to know what cost I am as an affiliate if I drive no sales and no traffic.

You are no cost but as an agency we are tasked with managing a budget. To do that we have to take as much control over the constituent parts of that budget as possible and we want to know where our budget may be spent. A dormant affiliate may do nothing on the campaign for 6 months but then start activity unbeknown to us and account for 10% of our budget. This may be an exaggerated hypothetical situation but it is one that we are keen to avoid.

I'm still genuiinely interested to know what cost I am as an affiliate if I drive no sales and no traffic.

As for capped versus uncapped budget, affiliates only get paid if they drive sales. Unethical affiliate behaviour, paying for sales twice, etc., are issues with the program itself and should be adressed, but they are separate issuies. They do not alter that fact that affiliates only get paid if they drive sales.

I really do try to understand things from the merchant's point of view, but am still at a loss to understand why any business would put a cap on sales unless those sales were unprofitable. There is no reason why an affiliate program should be run at a loss unless by design.

Yes affiliates do only get paid on sales and therefore it should be a no risk channel. However if that sale was already on it's way to the merchant then that merchant has incurred a cost for that sale that they didn't have to pay, and therefore affiliate marketing is costing them money unnecessarily.

I do get frustrated that a lot of people within the industry view affiliate marketing in isolation without understanding the impact that it has on other marketing channels.

I completely agree that if a campaign is run well and all risk to the client has been minimised, in terms of "dodgy" affiliate activity and cannibalisation of sales, then budget should be uncapped. It is our responsibility to demonstrate to Next that this is the case on their program and then make a compelling case as to why more budget should be made available.