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We’re Creating a World Without Boundaries, Where Performance is Power. S2S was founded by CPA marketing pioneers to bring a higher level of performance to the affiliate network industry.

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Presentation Transcript
slide2
Contents
  • What is Affiliate Marketing?
  • Opportunities and challenges
  • Affiliate Marketing – part of the online mix
  • Affiliate marketing process
  • Opportunities and challenges
  • Financial planning
  • Policies on affiliates
  • Affiliate Program Sample Display Program
  • Considerations
what is affiliate marketing
What is affiliate marketing?
  • Online program in which site owners (publishers) display ads and links to generate sales directly into a clients site; on a cost per performance basis
  • Equivalent of having an online sales force working on a commission compensation based model
  • Build a network of financially incentivised “brand advocates”
  • Affiliate Marketing normally involves three parties:
    • Merchant
    • Affiliate
    • Affiliate Network

Your

brand

Network

slide4
Merchant
  • Supply terms & conditions, creative, compensation structure and growth of relationships

Affiliates

  • Sign-up to affiliate network, promote merchant on their sites

Affiliate Network

  • Manage billing and tracking of activity through proprietary platform

Role

  • Over ride – based on between 20% to 30% of affiliate payments
  • Maximize volume of transactions
  • Fixed payment per transaction
  • Commission on value of transaction

Compensation

  • Volume of transactions and affiliate payments
  • Total transactions
  • Cost per transaction
  • eCPM – number of impressions to generate one transaction
  • eCPC – number of clicks to generate one transaction

Key success metric

Growth Tactics

  • Increase compensation and provide flexibility on the terms of the program
  • Increase traffic through natural search & PPC
  • Design sites that fulfil consumer missions
  • Increase number of affiliates through aggressive recruitment

Opportunities and Challenges

affiliate marketing part of online mix
Affiliate Marketing - part of online mix

Reach

Fragmentation

Affiliate

Network

  • Provide reach by aggregating hundreds of small sites (tier 2 and 3 sites) across different content categories
slide6
Creative Assets

Affiliate

Network

Console

Terms & Conditions

Tracking codes

Payment system

Tracking of transactions

Merchant

Site

Merchant

Booking Confirmation

Page

Commission Payment

Over-ride Network Payment

Merchant

Affiliate

Program

Affiliate

Network

Affiliate

www.bestflights.com

Affiliate Marketing Process

slide7
Opportunities and Challenges

Opportunities

  • Performance based results
  • Complete control of affiliate recruitment and management (quantity ad quality)
  • Establish strong commercial relationship with best performing affiliates - “super affiliates”
  • Maximise reach and exposure at minimal cost
    • Free ad exposure – only pay for results

Challenges

  • Affiliate advertising provides reach across tier 2 and 3 sites and excludes tier 1 sites
  • Attracting quality high traffic sites to affiliate programme
    • High worth product
    • Low bounty payment
  • Require on-going management and optimisation
  • Commission payment to network owner – ranging from 20% to 30% of sale
  • Mid to long term investment
slide8
Financial Planning

Affiliate payments (commission or fixed)

Network over ride payments

Internal resource

+

Total investment

-

Gross bookings – cancellations & no shows = stays

Total transactions

/

Cost per transaction

Example of affiliate programme. Thomas Cook payment structure > through

Commission Junction affiliate network. Generates 18% to 20% of all

transactions.

slide9
Policies on Affiliate Marketing

Google policy on affiliates:

  • Affiliates allowed to use AdWords advertising.
  • Google will only display one ad for affiliates and merchant sharing the same Display URL per search query.
  • Google restricts the following:
    • Redirect URLs: Ads that contain Display URLs that automatically redirect to the merchant site.
    • Bridge Pages: Ads for webpages that act as an intermediary, whose sole purpose is to link or redirect traffic to the merchant site.
    • Framing: Ads for webpages that replicate the look and feel of a merchant site.
slide10
Affiliate Program SamplePPC Program

BT PPC listing

BT Affiliate PPC listing

slide12
Considerations
  • Affiliate marketing requires on-going nurturing and relationship building > Affiliates have no loyalty to brands
    • How to differentiate program from competitors? Combine financial incentives with flexibility.
  • Evaluate the metrics to pay affiliates on. Bookings or completed stays?
    • Decision should be lead by internal financial objectives and overall market dynamics
  • Affiliate marketing can become a self-funded program. Bookings can be charged back to hotels (dependant on franchise/ownership contracts)
  • Affiliate Network programs cannot be switched “on and off”
      • In 2004 Thomas Cook was force to close down their first affiliate program for lack of funding – set budget run out
slide13
Considerations
  • Affiliate Marketing delivers the 80/20 rule – 80% of all transactions will be generated by 20% of affiliates
    • How to differentiate program from competitors? Combine financial incentives with flexibility.
    • Have the network focus on quality of affiliates as opposed to quantity
  • Establish strict terms and conditions with affiliate network and affiliates related to:
    • PPC bidding
      • Usage of brand on PPC copy
      • Bidding on brand and generic terms
    • Use of URLs
    • Length of cooling period between recording of transaction and payment for transaction
  • Assign a third party or internal resource to validate transactions attributed to program – track all transactions through an order id
slide14
Contact Us

31/1, Kanakpura Main Road, Yelechenahalli, Beside JyothiKendriyaVidyalaya Bangalore, India-560 102

Phone No:- +9180 3301 3060

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