Digital MarketingStrategiesA New Breed of Virtual Storefronts

A New Breed of Virtual Storefronts

Joel takes a look at some of the less obvious affiliate marketing plays - virtual storefronts. Of course, every dot-com from Amazon to eToys to Pets.com is a virtual storefront of sorts. But while most dot-coms are busy disintermediating your local merchant, Affinia and Vstore are trying to become a new breed of intermediary - coming between customers and dot-coms. This trend looks as if it will only continue, with other would-be players on the scene like AddAShop.com, Nexchange.com and Commission Junction's EnContext.

My first few columns laid out some affiliate marketing ground rules, hopefully giving us all a common base of knowledge. My primer covered some of the basic metrics every affiliate marketer should have close at hand. Next up were pointers on recruiting affiliates using various affiliate program directories. Last week, we covered the various software options available for powering your program. Over the next few weeks, we’re going to look at some of the less obvious affiliate marketing plays, starting first with a pair of virtual storefront providers.

Of course, every dot-com from Amazon to eToys to Pets.com is a virtual storefront of sorts. But while most dot-coms are busy disintermediating your local merchant, Affinia and Vstore are trying to become a new breed of intermediary – coming between customers and dot-coms.

Affinia

Affinia is working to completely invert the affiliate model. While most networks (e.g., LinkShare and BeFree) are busy trying to meet the needs of merchants, Affinia has charted a decidedly affiliate-centric course. It recognizes that most affiliates aren’t looking to build a bookstore or a toy store or a pet store, but rather niche stores built around specific content topics.

For example, my own small tribute to Penn State Football – WeArePennState.com – includes an Affinia Storefront with nearly 200 items, from Joe Paterno books and Nittany Lion dishes to PSU sweatshirts and Beaver Stadium replicas.

And that’s at the core of the Affinia value proposition: Affiliates are able to offer books, music, tools, toys – whatever suits the topic. All in a convenient one-stop shop. In fact, Affinia claims to represent products from over 1,000 merchants in its database, everything from name brands like Amazon, eToys, Garden.com and Reel.com, to smaller, specialty merchants – in excess of a million products in all.

Just as in any affiliate program, merchants handle all fulfillment issues. Rather than being paid on a commission basis, Affinia pays affiliates a per-click fee ranging from $.03 to $.15 per item – regardless of whether a sale takes place or not. So far, over 60,000 “storefronts” have been built. Some recent highlighted affiliates include CamaroZ28.com’s Full Throttle Store, Backyard Birds and the Deep Sea Diving Locker.

Vstore

Using a somewhat different business model, Vstore also has designs on becoming the storefront of choice for affiliates. Again, the concept starts by focusing on the affiliates’ needs. Vstore’s primary message focuses on keeping traffic at the affiliate site, rather than handing it off to a third-party merchant. In fact, Vstore takes a bit of a scare-tactic approach, warning affiliates that “If one of your customers goes directly to the affiliate program’s site next time, you’re without a commission, and they have a new customer.”

Unlike Affinia, which leaves fulfillment to any number of merchants, Vstore actually consolidates storefront orders and either fulfills them itself or parcels them out to various manufacturers and distributors for shipment. As a result, Vstore is actually a competitor to Amazon, eToys, Reel.com and other merchants. Perhaps not surprisingly then, Vstore compensates affiliates on a commission basis – ranging from five percent on books to seven percent on music to two percent on technology products.

While Affinia allows fairly extensive control of the colors, fonts and overall design of a storefront, Vstore instead offers a handful of templates, color schemes and font styles to choose from. Don’t bring your HTML code here. The result is less precise control over the finished storefront.

Likewise, attempts to select product-by-product are mostly thwarted at Vstore. Instead, affiliates end up building a sporting goods store, but not a St. Louis Rams Store; or a boating store, but not a sailing store; or a music store, but not a Britney Spears store. You get the idea.

Clearly, virtual storefronts are another great tool for affiliate marketers. While product-centric merchants would do well to link up with Affinia, manufacturers and distributors might be better off linking up with Vstore.

The trend to virtual storefronts looks as if it will only continue. Other would-be players include AddAShop.com and Nexchange.com. I’ve heard off-the-record rumblings about similar ventures from some of my contacts at affiliate networks. For instance, Commission Junction has pre-announced its forthcoming “EnContext,” which purports to offer affiliates some of the same content-centric merchandising capabilities. Stay tuned for more.

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