Climate Control in Affiliate Marketing

If you frequent affiliate marketing message boards, you know that a big feeling of “us versus them” exists. The affiliates feel that merchants have no regard and no respect for them, treating affiliates as a free branding tool. The sorry truth is that some merchants out there fit that bill, and their bad practices ruin it for the good eggs.

By hook (upper management) or by crook (shady merchants), many affiliate programs are giving affiliates the shaft. The time has come for everybody to clean up his or her own backyard.

Bait and Switch

Don’t set up an affiliate program unless you are willing to share a reasonable percentage of profits with your affiliates. Low commissions can be a huge stumbling block for your program, but it’s better to offer a low commission than a high rate that cannot be sustained.

It has become disturbingly common for affiliate programs to bait new affiliates with a high commission, then switch that commission rate without warning. In response to this technique, Commission Junction has instituted a measure that requires merchants to give a one-week notice before dropping commissions.

Although this safety feature is appreciated by affiliates, some would like to take it a bit further. Recently, an affiliate on the CJU Message Boards stated, “I think they should have another rule preventing the merchants from dropping their commissions by more than 20 percent per week.”

Changes in Latitude, Changes in Attitude

Changes in a company can affect an affiliate program and its affiliates. I learned this firsthand recently, when some business decisions changed the focus of the ClubMom affiliate program.

We shifted from national to geographically targeted member acquisition. This resulted in some unhappy affiliates, who had to remove their links. Fortunately, the transition was more or less seamless because the affected affiliates were contacted and recontacted to ensure that they were aware of the change.

As a result of the change, those affiliates able to target by ZIP Code received a commission increase. Affiliates with commissions earned below the threshold are being issued checks to hold them over until the program moves back to national acquisition.

Brad Waller, EPages vice president of marketing (and part owner), is a strong advocate of keeping affiliates in the loop: “As a business owner who runs his own program, there is no way I would ever allow our program to be halted (suspended, killed, whatever) overnight. The only way to do this is to make a soft shutdown with advance notice.”

The advance-notice technique worked well for David Contract, director of marketing for SharedGreetings: “What worked really well for SharedGreetings was notifying our top affiliates in advance of the change so they weren’t caught off guard. This not only kept them informed but also strengthened our relationship with them. And we found out that they weren’t nearly as upset about it as we thought they would be.”

The Money Pit

Speaking of sudden changes, many affiliates have felt the financial impact of dot-com failures over the past year. In a recent poll of ClubMom affiliates, 65 percent said that they have belonged to an affiliate program that closed down without paying them.

Many of the jaded affiliates are getting together to share their horror stories at Affiliate Programs That Suck, a chronicle of complaints by affiliates about specific affiliate programs.

The home page of Affiliate Programs That Suck warns “deadbeat merchants: You may have been able to avoid paying us today, but make no mistake about it, we will take whatever steps necessary to make sure you will not do this to anyone else. This means we will even go so far as to contact your current clients and advertisers.”

The affiliate solution providers are wise to the fact that unscrupulous merchants tend to scapegoat them when affiliates complain about nonpayment of commissions. In response, LinkShare has a new process that tracks when checks from merchants are received. This enables affiliates to know if the merchant actually sent a check to the solution provider and, if so, when a payment to the affiliate can be expected.

LinkShare has also instituted a “Nonpayment Alert.” An affiliate can submit a complaint to LinkShare regarding a merchant that is overdue on issuing a commission check.

The Fix Is In

Part of the problem with affiliate marketing is that affiliate programs are (under)staffed by folks who know little about the mores of the industry. For those affiliate managers who are not entirely sure how this whole affiliate-marketing thing works, I’d encourage you to participate in Partner Up: Affiliate Marketing in Action, a free online seminar covering the basics of affiliate marketing.

Also, there’s power in the vast community of affiliates, but it all amounts to nothing if they cannot organize. At the same time, the standup merchants hunger for an organizing sensibility to make them more credible and professional. Enter the Affiliate Union.

The Affiliate Union is an ongoing series of planning discussions between affiliates, merchants, and affiliate solution providers. The aim is to both develop a “certification standard” for affiliate merchants and establish the organization for implementing those standards.

Affiliates feel that they are a key part of building a merchant’s business, and they are correct. In this age of customer relationship management (CRM), you’ve got to go out of your way to be sure there is satisfaction among your affiliates.

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