Q&A: Matthew Wood on affiliate marketing challenges & opportunities

In May of 2013 Affiliate Management Days is coming to Europe. The inaugural conference in London is going to be opened by the already-legendary Matthew Wood.

By way of preview, I have sat down with Matthew to ask him a few questions about the current state and future of affiliate marketing.

Matthew has over 15 years of experience in affiliate marketing. He is the founder of a4u and a4uexpo, and an acknowledged thought leader and speaker within the sector.

If you were to emphasise one important area/issue that every affiliate manager should be paying more attention to, what would it be? And why?

Consumer behavior continues to shift towards mobile and tablet. An article published today indicated a 23%+ decline in the shipment of Desktop PCs globally and some countries such as South Africa are bypassing the desktop mentality completely and heading straight to mobile. This we can't ignore.

Affiliate Managers need to do everything in their power to ensure their m-commerce site tracks through their affiliate network. This opens up their affiliate programme to smart, innovative publishers that by embracing mobile are ahead of the curve.

It's no longer a chicken and egg, standoff scenario. Serious volumes of sales are being driven via mobile and forward thinking merchants are already reaping the rewards - Continue to ignore that at your peril!

What do you see as the main areas of opportunity for online (and especially affiliate) marketers in 2013-2014?

Getting to grips with data is key.  As affiliates we hold an enviable amount of data that's ripe for being used to both increase user experience and relevancy – that's a huge win-win-win as both the customer, affiliate and merchant holistically see benefits.

There have been incredible examples of affiliates using their data to drive incremental sales and providing profitable customers and insights to their merchants.

Effective use of data also provides you with an incredible USP as a publisher when seeking closer collaboration.

It's not that hard either to get started. Simple strategies that I'd urge all affiliates to kick-off with include segmenting your customer database by persona and link that to the propensity to buy by vertical, track user behavior and re-target via email or MPU on your own inventory where appropriate.

It isn't unusual to hear that since affiliates operate in the mix with other marketing channels that merchants use (paid search, retargeting, social, etc), with this multi-touchpoint ecommerce, the last-click attribution model is not longer an optimal one. What do you think/recommend?

Attribution modeling, whilst great in theory remains incredibly hard to implement as it invalidates to some extent some key performance based business models i.e. cashback. Their power should not be underestimated.

That said, in an agile commerce world affiliates should continue to innovate and consider how their proposition can be involved in as many parts of the customer journey as possible; not just build business models that rely on the last click.

In addition as a note to affiliate managers publishers consider overall ROI when promoting a merchant i.e. giving them key exposure within their inventory and to continue to promote to such a level to so many eye-balls expect a set level of ROI – if diluted by attribution then an affiliate manager many need to consider how their programme is promoted in the future.

I'd actually see just an increase in tenancy fees to compensate for attribution which kind of invalidates the reasoning for it in the first place.

We often hear that voucher affiliates are seldomly adding value. What do you say in response to such statements? And if an affiliate website that's distributing vouchers and discounts can indeed add value, can you give us three ways how an affiliate manager can enhance this arrangement?

Historically voucher code sites relied on organic SEO to drive significant share of traffic which creates to some a questionable, low value user journey. Whilst this remains to a much lesser extent, voucher sites now work with smart brands to deliver significant volumes of sales through their multiple touch-points / reach both online, through email marketing, re-targeting and driving foot flow to bricks and mortar stores via geo-aware apps.

Between the top three voucher site which I currently deem to be vouchercodes.co.uk, vouchercloud and myvouchercodes.co.uk over 14 Million active online shoppers can be reached at the click of a button. These voucher publishers are multi-million pound, smart operations that have platforms to be able to collaborate with brands, share data and meet business objectives.

For effective code deployment my three tips would be:

• Co-ordinate a multi-channel campaign. Significant reach can be provided that would cost double through traditional display advertising. Consider the eye-balls on your brand when conducting a campaign in return for an exclusive code that incudes, email, on-site MPU exposure and APP exposure to drive in-store sales.
• Use stretch and save offers to increase basket size, split test these.
• Provide product or range specific codes where higher margins exist or codes valid for new customers only.

Finally, if you were to leave online advertisers/merchants and affiliate managers with one piece of advice, what would it be?

Invest your time across a broad range of publisher types. Whilst voucher & cashback account for around 70% of the non financial market in the UK it's imperative to give respect to bloggers, content sites, paid search, re-targeting and technology affiliates to broaden the reach and stability of your affiliate programme.

You should collaborate closely with your key partners whilst picking one or two up-and-coming affiliates each month to contact and engage with in detail – these affiliates on the peripheral of your programmes performance may well become the next big player and reward your engagement with loyalty.

Simply put - don't always give your best voucher codes and deals to the same publishers, spread the reach to tap into new customer types and databases – not all affiliates and not all databases are the same!

 

You can register here for AM Days London. The early bird discount offer ends today.