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The Price is Not Right - Is Affiliate Marketing all About Discounting?
Image Credit  Richard Masoner Creative Commons license

The Price is Not Right - Is Affiliate Marketing all About Discounting?

“There is no truth, there is only perception,” Gustave Flaubert is quoted as saying. Without doubt the affiliate marketing landscape has changed significantly over the (many) years that I’ve been involved in it.

When I started out the main players were large PPC affiliates and there was a healthy long tail of vocal and passionate ‘traditional’ content affiliates.

The marketing managers at brands I spoke to were sometimes sceptical of the value that some of these ‘brand bidding’ affiliates added and there was still a lot of concern from brands about unethical and illegal activity that took place under the auspices of affiliate marketing. 

Change in Perception

The word 'affiliate' was often perceived as being tainted because of the negative actions of a small minority. A lot of people (hopefully me included) worked hard for a long time to change the perceptions of senior decision makers, to give a more positive and professional image of our industry.

Fast-forward to today. I believe that the negative image of days past has been banished. There are hardly any large brands that don’t have an affiliate programme and there is a flourishing affiliate market in many countries in the world. Many brands are also investing a lot of resource in understanding the channel better and looking to take greater control of their activity by bringing management in house.

However when I think about the perception that people at CMO level have of where we are now, I can’t help but think that there is an inherent association in their minds between affiliate marketing and discounting.

Money-saving Reliance

It seems that the majority of activity that takes place now is reliant on providing special offers to customers; be that by way of a voucher code or by offering cash or points to consumers. The IAB Online Performance Marketing Study compiled last year showed that 67% of total revenue from the affiliate channel is driven by cashback, loyalty and voucher sites. Considering that there are a relatively small number of players in each of these sectors, this is a staggering amount. These partners will inevitably be the largest on most campaigns meaning they get the most face time and the highest coverage amongst senior marketers.

Looking back over the last few weeks on this very site I can pick out a range of headlines emphasising this feeling:

“The Might of the Digital Coupon”

“Boom Time for Voucher Codes – More Hopping on the Bandwagon”

Vouchers are the Norm

I also see a major UK network releasing a browser extension which highlights voucher codes to affiliates when they land on a relevant brands' website, thereby sending out the message that voucher codes are now the norm.

I’m not commenting here on whether voucher code, cashback and loyalty sites add value, that debate has been vocalised sufficiently. However, I do believe that the perception of many people both within and outside of our industry is that there is an over reliance on the types of sites that promote discounts. I believe that they associate a high performing affiliate programme with the relationship they have with a small number of these affiliates, and precious little else.

Affiliate marketing has long been a hotbed of dynamic and innovative ideas and I believe that we are heading in a positive direction. At the same time, we do need to be mindful of the perception of people who hold both influence and purse strings, and ensure that they are aware of the full gamut of activity that underpins modern day performance marketing.

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Matt Bailey

Matt Bailey

Matt Bailey is business director at FusePump, and has finally reconciled himself with the fact that he deserves to be referred to as an 'industry veteran' after working in performance marketing for over 10 years. In a career encompassing roles within affiliate networks, media agencies and technology companies, Bailey has a well rounded view of the industry and has long been seen as one of the preeminent commentators on the space, always willing to give an opinion.

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