Affiliate marketing models
This summary of affiliate marketing models was written as a feature in the Marketing section of .Net Magazine issue 163. It describes 6 different models for working with affiliates and aggregators.
Affiliate marketing is the ultimate form of marketing communications since it’s pay-per-performance – you only pay when you make the sale or get a lead. Compare this to the wastage with advertising or direct mail. Many large e-retail brands get more than 10% of their sales from a well-run office affiliate marketing programme.
But online marketers running transactional programmes need to understand the different forms of affiliate marketing – not all may be desirable. Affiliates were famously described by Nick Robertson, the CEO of online designer clothing store ASOS as "grubby little people in grubby studios" (E-consultancy, 2007).
But imagine you have
created an online store, let’s say selling online clothing, but awareness of
your brand is relatively low. You’re struggling to get visitors through search
engine marketing since it’s competitive. Affiliate marketing could help. These are 6 different models to consider.
1. Aggregators – these are the big comparison sites like Kelkoo, Shopzilla and Moneysupermarket. These aren’t strictly affiliates since most charge per click, but Froogle is a free option and you should definitely consider creating a product feed for some of these comparison sites.
2. Review sites – You’ll know the CNet reviews or maybe startups like Reevoo or Review Centre. These all link to merchants based on cost per click or cost per acquisition deals.
3. Rewards sites – With names like GreasyPalm or QuidCo you get the idea. These split the commission between the reward site and their visitors.
4. Voucher code sites – MyVoucherCodes or Hot UK Deals are typical. If you have some great deals to entice first time shoppers you should generate business, although many search by well-known brand.
5. Uber-bloggers. Martin Lewis’s MoneySavingExpert.com is an incredibly popular site due to his PR efforts and great content. Although he has no ads, he is an affiliate for many sites he recommends.
6. Everyone else –they don’t tend to be high volume super-affiliates like all the above, but they’re collectively important and you can work them via affiliate networks like Commission Junction or Tradedoubler. They often specialise in SEO or PPC. Don’t expect this option to be easy since affiliates often only promote a few well-known merchants who maximise their Earnings Per 1000 Clicks (EPC).
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Thanks, Dave Chaffey.
