INside Performance Marketing
How do Smaller Merchants get Traction in a Crowded Market Place?

How do Smaller Merchants get Traction in a Crowded Market Place?

Smaller merchants can sometimes be seen as small fish in a very big pond. Many are sometimes concerned about the competition they might encounter against bigger, more well-known brands within the affiliate space and so may lack confidence to try new things.

Getting traction in the market: key areas to consider

  • Brand awareness
  • The value of promotion
  • Affiliates recognising the value of smaller merchants

Brand awareness

Today, understanding how brand awareness plays a critical role in the development and optimisation of a programme is not always considered. In order for a merchant to be successful, they must ensure that not one, but two audiences are educated about their brand; the affiliate and the end user. It’s essential that the affiliate understands the objectives of the merchant, what the merchant sells and their unique selling points. The affiliate then needs to communicate this to the end user which will help to increase click-through rate and conversion, in turn increasing the earnings per click (EPC) for the affiliate and the revenue driven for the merchant.

Merchants must be realistic and take this into account when setting commission rates: if your CPA is lower than larger competitors it’s unlikely the affiliate will offer you a stronger placement on site.

Affiliates have a large role to play here and must be careful that merchants aren’t dismissed based on size – end users aren’t always just looking for larger blue-chip brands.

Our top tip - make sure your programme information page hosted by your network and any communications clearly explains what you sell as well as key products/promotional periods.

The value of promotions

Smaller merchants can increase revenue driven via the channel by strategically planning ahead all of their promotions, codes, offers and commission changes to ensure there is continual brand exposure at all times. Yes, a small brand may not make it to the top of a ‘Top Codes’ promotion, but additional coverage in a themed newsletter in their vertical is certainly a possibility if a merchant can offer an affiliate an exclusive offer.

One great example is a small fashion merchant that ran an exclusive code in a voucher code site newsletter – sales increased by a staggering 1600% in one day alone. We send out regular affiliate opportunities to all self-managed merchants which helps with this planning as well as ensuring smaller merchants don’t miss any opportunities.

Due to our Publisher Development Team sourcing new traffic there’s a consistent flow of exciting opportunities (such as Mobile and Social affiliate initiatives) for all merchants to be involved with. Incentives and promotions vary from affiliate to affiliate, however for most merchants, voucher codes and CPA increases are the favoured tools in negotiating exposure.

Our top tip - always take advantages of newsletter inclusions. If an opportunity comes up that’s suitable, take it as it will only enhance your brand presence.

Affiliates recognising the value of smaller merchants.

More affiliates are starting to recognise the value of working with smaller self-managed clients – and so they should – currently they contribute to 50% of the overall number in the TradeDoubler UK market! Over the last 12 months we’ve seen a significant increase in larger affiliates providing opportunities specifically for smaller merchants, such as NetVoucherCodes.co.uk running a ‘hidden gems’ category.

“There are literally 1000s of retailers online. Even though many aren’t well known high street brands, we know that our users will still love what they have to offer. For that reason, our team will focus on promoting their key offers and messages in exactly the same way as the bigger advertisers we work with. The Hidden Gems Category is one way of helping this initiative along” - Joel Tobias, Head of Business Development, NetVoucherCodes.co.uk

Affiliates see the value in promoting smaller merchants on dedicated parts of their site – if opportunist shoppers are the moths, voucher code sites are most definitely the flame – so it is the perfect place for a user to try out a new, or less well known merchant if they give them the deal they are searching for. Small merchants must work with affiliates closely in order to provide an offer which will work with the particular affiliate’s user base, especially for niche categories.

Our top tip - provide affiliates with Earnings Per Click data and a business case for providing you with further exposure on site, which will help them to make an informed decision.

Our Top 10 Tips for self-managed programmes:

  1. Optimise your existing base before recruiting new affiliates - get feedback and find out what is required to get a stronger placement on site.
  2. Utilise your network – larger opportunities are likely to come through the network so take note of communication sent by your network.
  3. Be realistic – larger brands will generally earn affiliates a higher EPC so be prepared to pay slightly more than your large competitors.
  4. Be savvy - affiliate marketing is performance based marketing, the affiliate must demonstrate to you expected performance via case studies before you pay any tenancy fees.
  5. Provide targeted communication - voucher codes are likely to be interested in only offers/voucher codes rather than editorial content/updates.
  6. Analyse the ROI regularly - if your campaign isn’t sustainable, act quickly to make it work for everyone as affiliates want longevity rather than a program closure.
  7. Understand the ‘effective CPA’ - it’s a performance based model and paying commission/tenancy on a CPM/CPC can provide a positive ROI if you compare the ‘effective CPA’ from the costs to the general CPA.
  8. Take opportunities – sometimes you’ll need to test a new traffic source so set a budget and be prepared to take a risk – it’s likely to pay off.
  9. Get help if you need it – we regularly provide additional Account Management support services for self-managed merchants who don’t have the resource/expertise in house.
  10. Communicate regularly – use resources such as the A4U forum to recruit new affiliates by posting about your program, as well as providing updates on your latest offers. This is where the communication to your end users starts!

To conclude

To conclude, with an affiliate program, and even more so with smaller merchants, you get out what you put in. With the above elements considered and applied, all merchants have the potential to become a big fish in the affiliate marketing pond!

We wish you the very best of luck and a successful 2012.

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Connie Li

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