I’m lucky enough to have been asked to speak again at this years A4U Expo in October. The lovely @missparsnip from A4U has kindly provided me with a discount code for readers of this blog. I am going to have to be very careful about maintaining the IAB Voucher Code regulations here…

The code is SPK25, entitles you to £25 the price of a ticket and probably expires in October. Hope that the @iab_amc are happy with that.

The Big G have announced another change in trademark policy. It’s summed up very well by @jackwallington here.

Essentially, it goes further than the move to allow competitors to bid on brand terms as introduced in May 08.  Now, anyone is allowed to include trademarked terms within their ad copy. Therefore resellers can include the trademarked name of the product they are selling without permission of the trademark owner.  There is still a caveat to say that the destination site must be relevant to the trademarked term, preventing Sainsbury’s from claiming to be “cheaper than Tesco and Asda”, for example.

So how does it affect all stakeholders? Resellers will benefit as they are able to target their ads more effectively and therefore take advantage of higher clickthrough rates and better quality score. Brands will see their CPCs pushed up as a greater number of relevant ads enter their space. Google will make more money.

But what about affiliates? Two key questions to answer in my opinion. Will merchants regulate against affiliates in their Ts and Cs to prevent use of trademarked terms in ad copy by affiliates? Will this lead to a rise in the use of specialist PPC affiliates for brand protection purposes?

Will merchants keep affiliates out? I think it’s completely dependant on the level of competition that merchants will experience on their core search terms that will determine this. If there will be little else there in the search space then it makes little sense to permit affiliates to appear there. It will also be dependant on the agreements that they have with their resellers. Is the brand dictating what resellers are allowed to do? If not, then it would seem counter productive to restrict the activity of affiliates.

The second part is will it lead to an increase of brand protection groups? Personally I doubt it. I don’t see this change leading to a huge shift in the search landscape outside of a small increase in CPC costs in the short term. Some industries will be affected more than others of course, and you see areas like mobile phones and personal electronics getting very competitive. However I do not foresee a seismic shift.

The argument for brand protection groups is still a strong one when a brand has plenty of competition on it’s pure brand and core brand+generic terms. Most brands would prefer a sale to go through an affiliate rather than a reseller, and so managing a small group of affiliates who are tasked with dominating the paid search space is beneficial.

All in all, Google has made these changes primarily to benefit Google.

Incredible results announced this week by Dominos and refreshing to see the City report credit online marketing channels as playing a significant part in their strong performance.

The direct quote from the document reads: “In addition, we have led the way with social media initiatives such as affiliate marketing, our superfans programme and the development of a link up with Foursquare, the location-based social media site.”

However let’s look at the way that the trade press covered this story:

New Media Age – “Social Media Boosts Domino’s Pizza’s online sales by 61.4%” (their capitalisation)

Brand Republic – “Domino’s credits social media for sales growth”

Mashable – “Domino’s UK Social Media Initiatives Heklp Increase Profits by 29%”

Clickz – “Domino’s UK Uses Facebook, Foursquare to Drive Web Orders”

No mention of affiliates in any of those headlines and limited coverage in the actual articles. Whilst I appreciate that social media is the current mode du jour, it would be refreshing if some of the trade press gave some credit where credit is due. In all fairness, there is some increased emphasis with the forthcoming NMA Live event on affiliate marketing, the channel is still hugely unrepresented in terms of press coverage when compared to the proportion of client spend.

So come on @willcooper, @andrewmccormick, @gj, @brandrepublic, @charlottemc, @clickznews, @mashable – start writing more about affiliates!

Great work from the affiliate team over at Arena Quantum, a great fillip for everyone over there.

With the first deal today going live on Twitter’s @earlybird advertising platform, do they immediately become the largest performance marketing partner (or affiliate) in the market?

Twitter @earlybird

@Earlybird is Twitter’s new advertising vehicle, displaying deals and offers to all who follow it. At the time of writing despite only one offer being shown, there are already over 55,000 followers. Twitter claims that the deals are carefully sourced in order to offer followers something exclusive, although I suspect that the commission being received by Twitter plays a part as well as the strength of the offer.

Details are scarce on how this is being monetised currently, but if Twitter trust their ability, they must be looking towards a CPA based model or at least a hybrid CPM/fixed fee and CPA metric that will reward them on performance. Therefore, another move from a large media owner into the performance channel.

Great post by the wise Swede @nilsson_magnus and also a rule change by my old mucker @jasonorris on the Lovefilm account has brought a loophole in affiliate PPC regulations to light. Another example of affiliates operating within the rules of engagement, but not within the spirit.

I wrote a piece over at eConsultancy on the ability to control your brand through the affiliate channel. The conclusion that I reach is the same one that I seem to reach whatever the question. Most things are possible through affiliate marketing if you understand what you want from the channel and put enough resource behind it.

Yesterday I was lucky enough to be invited by @iab_amc Chair, Kevin Edwards, to the inaugural @affwin Affiliate Roundtable. Was a really interesting chat and I recommend you listen to the podcast upon it’s publication.

I just noticed a tweet from @willcooper at NMA about Channel 4 entering the eCommerce market. To summarise for those without access to the NMA content hidden behind a paywall, Channel 4 are to launch 4Beauty to tap into the success of programmes such as How To Look Good Naked etc.

The interesting part from an affiliate point of view is that they will monetise the site through a deal with ShopStyle that will allow users to click through to buy things from 3rd party sites. So essentially, Channel 4 are becoming a sub affiliate of ShopStyle.

Another feather in the cap for the performance marketing and affiliate world and definitely something that we should be shouting about as an industry.

I read with interest this article from Chris Worthy at RO Eye (@cworthy) looking at the role that affiliates will play within the development of the mobile app space. A great article full of thought provoking comment and well written so I thought i’d post my response.

Whilst I agree with Chris about the current constraints of tracking, I’m sure that this will be resolved adequately within the next six months to a year. I think that this will mirror the evolution of the affiliate space all those years ago. A few pioneering merchants will force the changes and the rest of the industry will be forced to follow suit in order to catch up. What brands cannot afford to do is ignore consumer behaviour, and it seems that there is a definite shift occurring towards people being happy to buy through a mobile device. Remember that it wasn’t too long ago that there was widespread reluctance to buy online.

If this is the case then where will affiliates fit in? My view is that I don’t think that “traditional” affiliates will play in this space. Whilst we may see some elements of online affiliate activity mirrored on mobile devices (how soon a Quidco or MVC mobile app?) my view is that a new breed of affiliates will be spawned. I think that as clients open up their API feeds then developers will have access to huge datasets and will begin to manipulate these to develop useful applications.

I have spoken previously about the lack of new entrants into the affiliate market being a result of the fact that tech savvy young entrepreneurs are finding it more profitable to get into app development whereas they would have gone down the affiliate route several years ago. As the app area becomes more congested they will begin to look for ways to monetise their efforts. By opening their API and rewarding developers on a CPA basis, this will be facilitated.

It will be a win-win scenario as merchants will be provided with applications that increase the exposure of their brand and products, paying only when a sale occurs. Developers will become affiliates, able to be rewarded for the success of their work.

It is easy to imagine product comparison apps and geo targeted apps, in fact they are already out there. Would there be an added incentive for developers to get involved if they were able to monetise? Of course there would. To me, this will be one of the most exciting advances in performance marketing going forward.

This morning sitting in my inbox I found that someone had sent me this:

Affiliate Workshop

Now I’m all for recruiting new affiliates to the market and have spoken before about how I feel that the recruitment of new affiliates to the market is a high priority within the market.

However I can’t help but be slightly sceptical about the above. Having seen the leaflet and had a look on the website, there are no testimonials or case studies to illustrate why anyone should hand over their hard earned to attend this workshop. I can’t find any names of who is involved in this. The copy on the leaflet is very American and so my feeling is that this may be some kind of franchise business brought over from the States.

So this raises the question, should we as an industry be looking to regulate this kind of thing? How are we to know that this course isn’t advising people to stuff cookies, bid on brands and commit other unethical practices? Is this something that an outside party can step in and regulate? On one hand you have to applaud the founders if they can make it work for them and persuade people to attend. On the other hand, if this is dodgy in any way then it has the potential to cast a bad light on the industry that many of us are working hard to professionalise.

I read with interest the recent articles on A4U concerning splitting commissions and whether we should move to a system of multiple attribution (part 1, part 2 and part 3). Whilst it is welcoming that there is debate occurring on this topic, I don’t feel that an actionable solution has been put forward yet. So I thought I’d have a go.

This theory takes a couple of factors into consideration. Firstly, that the affiliate landscape has altered considerably over the last 10 years and can no longer be viewed as a single channel. Secondly that last click does not work in driving customers in at the start of the sales funnel. A natural consequence of paying on last click is that models have come to the fore, that focus on being there at the final stages of the sale. Nothing wrong with that, but I am becoming increasingly concerned that the other side of affiliate marketing, priming customers for a sale, is becoming lost.

So my proposal involves splitting affiliates into different groups dependant on the role within the sale that they play. I’m initially going to call these two groups the “primers” and the “converters”. Sitting within the priming group would be those affiliates whose focus is on providing information; the traditional content based sites, price comparison etc. Those that data has shown occur more towards the beginning of a journey. The converting group would include those that aim to appear towards the end and focus on a quick conversion, so cashback, voucher code and brand PPC.

These two groups effectively operate as two distinct affiliate campaigns for the same merchant. The commission may vary between each set or could be the same. However deduplication would only occur within that set and the last referrer within each set would receive a commission.

So a sale that goes via three content sites and then ends up converting on a last click basis through a voucher code site will mean that both the last content site involved and the voucher code site receive a commission. Of course the logic could also be altered to mean that the first referring content site took the credit.

The benefits of an approach like this are that you would actively encourage those types of affiliates who sit within the “priming set” to continue driving traffic as they will be rewarded for it. This is one of my key concerns about the affiliate market at present. You need to incentivise people to create compelling content, and draw customers in at the beginning of the sales funnel. This is one of the most attractive elements of affiliate marketing and must not be allowed to die out.

Additionally brands will still be able to work with those in the “conversion set”. One of the main issues with a multi attribution model is that you lose that ability as you can’t guarantee what commission level an affiliate will get. You can’t have a cashback site telling a customer that they may get £5 unless they have undergone a complex process of clicking on other sites 25 days before, in which case they’ll only get £2.50.

There are drawbacks of course. Brands will argue that it will result in them paying more for sales. It may be the case that they are paying more per sale, but if they are sales that they wouldn’t have got without the involvement of these affiliates then that argument is irrelevant. Of course, there is already precedent for this kind of approach when you look at all other marketing channels. When running a PPC campaign you pay out regardless of whether the sale converts there and then and you factor in that an element of the activity is focussed on branding and priming a sale rather than converting it. The same applies in display, in TV, press, radio etc. It also may be the case that overall commissions will drop as merchants end up paying out twice. However my view is that the market will dictate this.

There are obvious issues around the segmentation and classification of affiliates. Who dictates which affiliates sit in the priming and the conversion set? How many different affiliate groups should you have? In answer to this I think that there are more and more brands and agencies who are beginning to manage affiliate campaigns in a more intelligent way and putting resource behind it. Careful analysis of existing data should faciliatate this, but I emphasise again that it will probably be bespoke to each campaign and will take time to get right, requiring constant review.

In conclusion, the articles I reference above contain an overall feeling that last click just isn’t right anymore, but no real alternative to it exists. Here I propose something that appreciates that the market has evolved. Last click may have been the right way to look at things when affiliate operated as a single channel. Now we are operating multiple channels under the same CPA umbrella, a new metric that rewards both the priming of sales and the subsequent conversion is required.

An incredibly strong and interesting case study landed on my desk this morning from the guys over at FusePump and Argos. They have been working together for around a year now and have just announced the results of their time working together. The results are highly impressive and send out a powerful message to retailers operating in the affiliate channel who do not yet appreciate the power that a well optimised product feed can have on your affiliate and general online marketing performance.

For the uninitiated, FusePump are a company set up in 2009 by Robert Durkin and Chris Conn, two Cambridge graduates, and Lee Brignell-Cash, a marketing industry veteran (sorry Lee!). They developed proprietary technology that dynamically extracts content from merchant websites and subsequently develops product feeds using this data. The feeds produced are generally of a better quality than produced in house by merchants as they represent what is actually on the website at that time. FusePump then manage the distribution of the feed and have developed a suite of tools allowing affiliates to represent merchant information in an easy to use and visually impressive manner.

Highlights of the Argos work include a 171% increase in EPC from affiliates using the new feed and an uplift in conversion rates of 34% across the board. Such statistics are regularly bandied around in affiliate marketing, but to put this into context Argos was a hugely established campaign before FusePump got involved with a wide range of affiliates promoting them. Therefore to attain such an uplift is a considerable achievement.

Hopefully these kind of figures will encourage those merchants who do not fully understand the benefits of product feeds to look into the area more carefully. There are huge wins to be made in this area and the provision of accurate data to affiliates is crucial in the advancement of the channel and merchants perceptions of affiliate marketing.

Credit where credit is due, this is an impressive study.