Retailers are increasingly embracing the online world of affiliates, but do they – and should they – trust them? Doug Scott of DiscountVouchers.co.uk looks at the issues facing retailers in the growing voucher code arena.
Additional sales at a low cost – what retailer wouldn’t be attracted by that? That’s what the booming voucher code sites are offering – brand exposure to millions of shoppers and incremental business, without the high costs of a high street store, pay per click or advertising. Sounds like a winning solution, but for retailers it can be more pain than gain.
How do you ensure these affiliate sites deliver incremental business rather than cannibalising your existing market, and how do you protect your brand when less scrupulous affiliates are bidding on keywords and stealing codes from others?
The world of voucher codes has developed fast, but with a growing number of websites promising – and failing – to deliver, it’s understandable that retailers are getting nervous that their brands are being damaged.
Cannibalisation Concerns
Incremental business is what is on offer, according to many voucher code sites, but for retailers how do they know what really are the extra sales they crave. Don’t believe that just being featured on an affiliate site is enough – it’s a short-term solution that could potentially damage your brand and simply cannibalise your existing business, while you continue to pay for the privilege.
The key is to work with an affiliate that has a partner mentality – rather than just taking the codes and blasting them on the site, they will work with you to set up promotions that assist you both tactically and strategically, tracking activity throughout.
Look for partners who want to support you in the long term, those who have a broad spread of exposure – websites and social media – and who have a database that offers you the potential for strategic and tactical promotional activity. For example, you may need to push a specific niche product or work with promotional activity such as competitions or added value offers to build awareness and sales performance – a real partner will be able to advise and help plan the best activity for your brand.
Online Etiquette
While retailers may request affiliates not to bid on specific keywords, it is widely acknowledged that in some instances this is blatantly ignored. These affiliates are so focused on their own visitor quota that retailer preferences can easily be ‘misinterpreted’. Bidding at night, misspells and the like are the usual culprits of this underhand activity, which can leave a nasty taste in retailers mouths.
In truth, this is where a few badly behaved code sites are affecting the reputation of others. But to get past this it’s important for retailers to agree a formal partnership with their affiliates where both see the long-term potential of working together. It should be a win-win relationship – if you feel your reputation or sales are being damaged, then push back and refuse to work with those who are ‘misinterpreting’ your message.
Unscrupulous Practice
Perhaps because of the phenomenal success of the voucher code market, the issue of affiliates stealing voucher codes from one another has impacted on retailer reputations. New voucher code sites were entering the market and building content largely by taking codes from elsewhere and then generating traffic. The result was a problem for affiliates – who were potentially losing sales – and retailers – who struggled to control their brand exposure – not to mention a consumer base that didn’t know where to turn for the offers it needed.
Over the past year the situation has improved. Retailers and affiliates are now working more closely together to deliver bespoke codes, for example DiscountVouchers10, enabling clearer tracking of promotions. Retailers are also refusing to pay commission to an affiliate using someone else’s code, a major step in improving the industry.
Affiliates are also guilty of implying there is a deal when there isn’t one – their aim is often to drop a cookie to help build their knowledge. The result is a mistrusting consumer and the potential to damage your brand.
Before you enter into any agreement with an affiliate do your research – look at how they operate, who they operate with and their approach to you the retailer and the consumer. They should also abide by IAB guidelines – showing a start date, end date, a clear explanation of the offer and highlight when a promotion has expired. Affiliates are improving in this area, but as a retailer make sure you understand exactly who you’re working with and what they do.
Protecting your Brand
For retailers a priority when choosing and working with affiliates should be the protection of your brand. To some extent where, when and how people see your brand is out of your control, but with growing understanding of the voucher code sites you should be able to claw this back through a partnership approach.
Choose an affiliate that has a co-ordinated approach to promoting your offers – assess what they do in terms of their own website, their subscriber communication and any social network activity they operate, particularly through Facebook and Twitter. Their activity should give you the potential to promote your brand with a logo and ensure any key message is communicated.
Make sure to work with them to plan tactical and strategic activity that promotes your own work, whether that’s themed promotions online or in-store. This will give you far greater control over your brand exposure and greater reach into the market.
A Partnership Approach
By seeking out true ‘affiliate partners’ you will gain a far stronger position in the voucher code market. Look for a site that has a strong database – and is committed to growing that database – through newsletters, competitions, pay per click activity, social media, PR and more – they all work together to boost subscribers and profile that will pay off for you.
Don’t think you’ve got to work with every voucher code site out there. Instead handpick those that best fit your brand and the approach you want to take to generating online sales. Then, sit down with them and agree the scope of your partnership from the start. Listen to them as well – they know the industry and should be able to give you a clear insight into what works, what doesn’t and how to maximise your potential.
Finally, make sure you have the ability to monitor performance. You need to know what works and what doesn’t, and get a clear view of how your brand is being promoted. Communication between both parties should be regular and clear – tell your affiliate partner about new offers, and discuss the best way to promote them, and make sure they communicate with you about what is happening and when.
The result? A more successful, trusting relationship that really is win-win.
By Doug Scott
Managing Director
DiscountVouchers.co.uk
www.discountvouchers.co.uk
