New report examines how affiliates can achieve valid incremental sales

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Posted 27 February 2012 09:57am by David Moth with 0 comments

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A new report by Affiliate Window and buy.at examines how affiliate promotions can complement an advertiser's online marketing strategy to deliver incremental sales.

Affiliate Window client strategist Owen Hewitson points out that advertisers commonly question the extent to which the sales achieved through the affiliate channel are incremental.

The customer may well have bought the product anyway, for instance, or affiliates might simply be capitalising on the promotions financed by advertisers to give their own campaigns a boost.

But Hewitson suggests there should be some recognition on the part of advertisers these questions should take into consideration the reality of online shopping habits.

There is more choice online than on the high street, and shoppers tend to browse several sites in search of the best deals.

Incrementality can also be defined in several ways – as well as looking at the number of new customers, advertisers should consider whether the average order has surpassed that of other channels and the type of products that are being sold through affiliates.

The report looks at several different aspects of the affiliate channel, including behavioural retargeting, cashback offers and voucher codes.

Voucher codes are a complex area, made apparent by the sheer number different types available – they are also important for brands as a study by LinkShare found that 56% of people would buy from an unfamiliar brand if offered the right deal at the right time.

So which type of voucher should advertisers use?

Depending on the objectives of their particular campaigns, there are a number of tactics that advertisers may wish to pursue to ensure that they do not unnecessarily sacrifice their bottom line or compromise brand values in pursuit of higher sales volume."

Hewitson suggests that advertisers should avoid offering a blanket discount on all products, as it cheapens the perception of the brand.

Instead it might be better to offer a code that gives free delivery or one free product, or an exclusive code to a select few affiliate sites that refer high quality, repeat customers.

One way to deal with this is voucher tracking functionality, which identifies where a code has been used and by which affiliate – so affiliates can't get away with offering discount codes they haven't actually been given access to.

Another interesting tactic is the use of basket abandonment codes.

The report points out that as many as 87% of online shoppers abandon their baskets prior to purchase, but if the email has already been captured affiliates could entice the shopper to return with a discount code.

The report cites a case study from Red Letter Days – the site uses technology that ensures that the voucher code box at a checkout page is only shown to customers referred from an authorised affiliate site.

The inbound URL was also tagged with a 'deal ID' linked to the affiliate's own network ID that is valid for a single session.

Red Letter Days could then offer its affiliates exclusive deals unique to a single affiliate and multiple affiliates could also offer different exclusive codes on the same product.

This technology also negates the fact that some consumers may be tempted to abandon their basket and search for a voucher code if they see a box to enter a voucher code at the checkout.

The full report, 'Achieving Incremental Sales in Affiliate Marketing', can be downloaded here.

David Moth is a Reporter at Econsultancy. You can follow him on Twitter.