understanding incremental revenue in the affiliate channel
TRANSCRIPT
Personalization + Incremental Revenue
Stephanie Harris, CEO of Schaaf-PartnerCentric
What is Incremental Revenue?
Revenue that can be attributed to ‘new’ sales, meaning sales from shoppers that were not already planning on shopping at that particular merchant.
Ability for an advertiser/business to successfully generate additional revenue/margin by adding a specific and trackable marketing channel or campaign.
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What is Incremental Revenue?
Revenue we wouldn't have otherwise gotten had we not engaged in a certain activity.
Providing additional services/value to your customer in ways that will increase shopper loyalty and long-term relationships with the customer that can be personalized & capitalized on throughout the lifecycle of the customer.
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Why is it Relevant?
Problems with Traditional Affiliate Model
40% to 90% of an affiliate program’s revenue is attributed to coupon affiliates
The advertiser may pay multiple times across channels for the same sale
The affiliate adds minimal to negative value to the advertiser’s traffic after discount is applied, affiliate is paid, and tracking fees are paid
Affiliates that drive incremental revenue are not properly leveraged or compensated
Content affiliates often “lose” in this formula
The value of the affiliate channel as a whole comes into question
Limits in Managing Incremental Revenue in Traditional Affiliate
2nd Purchase Path
3rd Purchase Path
1st Purchase Path
Mobile Web Mobile Web
Mobile Web
Mobile Web
Web Web
Web Web
Web
Chat
Chat
Chat
Social
Social
Cart
Cart
CartAffiliate
Affiliate
Affiliate
Our Viewpoint
The true measure of incremental revenue needs to come from personalization.
Identified as “Last-Minute Traveler” and is emailed about upcoming events.“Foodie traveler” bought
ticket in conjunction with Food & Wine fest, gets free drink coupon.
“Family Travelers” paid more for their tickets to be able to sit next to each other on “first come, first served” flight
So, what’s personalization?
"Personalized marketing, or one-to-one marketing, is a marketing strategy by which companies leverage data analysis and digital technology to deliver individualized messages and product offerings to current or prospective customers."
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9 pm mobile search peaks
What is an area of opportunity in personalization + incremental revenue?
Curated collections of personal recommendations based on trust.
Merchants devising a strategy with select affiliates with niche or specialized offerings/audiences that can be nurtured and grown beyond standard 'affiliate' partnerships.
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How do others personalize?
How do you apply this to an affiliate program?
Imagine a world where
...microsites drive revenue on specific deals
...customized deals for affiliates are relevant to consumers based on their shared history
Technical Solutions
Track additional events that contribute to incremental sales.
Track all channels in conjunction and set attribution logic around these channels.
Find untracked areas of interaction with customers and develop the means to track and quantify that interaction in line with other attribution logic.
expose data to affiliates in a 1:1 relationship
What the Future Looks Like Efficiency is gained as
advertising occurs at critical points.
Data flows freely between publishers and merchants to allow instant personalization to all consumers.
The value of different degrees of personalization is recognized, and investments are allocated duly.
Q&A