Since reinventing itself from eBay Enterprise Marketing Solutions to the independent brand it is today, Pepperjam has grown and expanded, fighting for - and winning - its own space in the performance marketing industry.
Following up on the recent expansion of its UK office and the launch of new product features, PerformanceIN caught up with Derek Freer, Pepperjam’s UK general manager, to talk expansion, attribution challenges, influencer marketing, the rise of automation, and more.
It's been a year since Pepperjam started operating independently. What's been the biggest lesson or learning curve?
Derek Freer: Affiliate marketing is an ever-changing industry and you cannot rest for a moment if you want to remain competitive in the market. Combining three separate affiliate marketing companies into one, while working on new features and technology, was a heavy lift but a necessary one to continue exceeding our clients’ expectations.
We accomplished this by asking a simple question of our advertisers, agencies and publishers – what do you want to achieve?
By aligning our resources with our partners’ goals and KPIs, we were able to efficiently meet expectations whilst tuning our technology to make their lives ever easier. Client feedback tells us that this approach has paid off.
How do you think the industry has changed in the past year or two?
DF: It’s difficult to narrow this down as there have been so many changes in the past couple of years.
Affiliate marketing has become a lot more data-driven in the past couple of years and this is allowing brands to become more strategic in what they look to achieve.
However, I fear that the relationship-driven ‘service’ aspect of affiliate has slowly been getting lost; expert human help is still valuable when it comes to executing successful, data-driven strategy. At Pepperjam, we recognise this need and provide expert account managers who help our clients reach their goals.
We have seen different networks look to implement different attribution structures through the click path but again, a lack of human assistance means advertisers have struggled to realise the benefit and ROI this can offer due to the complexity and a lack of assistance.
The industry has also become more international, with advertisers, affiliates and agencies crossing borders as it becomes easier to sell and distribute internationally. All parties involved in affiliate transactions have assisted in this, with affiliates such as 55Haitao selling to the Chinese market becoming major players in the US and UK.
Pepperjam has advertisers running multiple countries and currencies through a single gateway. The main barrier that advertisers faced was they did not know this was possible.
What are the key trends Pepperjam has been focused on?
DF: Pepperjam listens to its partners’ needs to determine areas of focus and attribution is often the top concern.
Our advertisers want attribution solutions but not just data - they wanted to know what to do with it. Our attribution software allows our clients to see every click that has taken place in the affiliate space and to allocate commission accordingly. Through our technology, advertisers can strategically allocate commission to influencers in order to reward them for introducing their brand to the consumer. You would expect this to negatively affect voucher code and cashback commissions, but what we have seen from our data is that these affiliates are still heavily involved as influencers, reaping good rewards.
We frequently hear from advertisers who are not in the space or who have tried to use affiliate marketing services previously without success. We often hear that erroneous codes or poor publisher behaviour have put them off running an active affiliate programme. It’s all very good having programme terms, but who follows up and enforces them?
In response to these concerns, Pepperjam has built proprietary software that knows when publishers have violated programme terms and informs the advertiser or account manager, who can then determine next steps. This means that every programme we offer can maximise revenue returns in the correct way.
We’ve also been simplifying Pepperjam’s international affiliate offering. Advertisers are often put off going international due to the complexities involved. However, we offer multiple currencies and global affiliate reach through a seamless, single gateway.
With the launch of a number of new features, Pepperjam is aiming to "change the industry". Could you tell us more about those new developments and how they will impact affiliate marketing?
DF: We’ve listened to the needs of advertisers and publishers and have designed our new dynamic attribution suite to reward publisher loyalty, offering fairer pay-outs and driving ROI through accurate attribution. Advertisers can also access influencers and improve their margins by executing strategically through automated commissioning.
First, there is in-cart attribution. Advertisers can choose specific timeframes to eliminate payouts. For example, in a multiple click process, any click made in the final minute before purchase would not count. Commission would instead be payable to the click that influenced the consumer to start the process.
Pepperjam’s suppression tool allows advertisers to ‘blacklist’ codes they do not want advertised by publishers, increasing ROI for advertisers. Often, our advertisers have a specific publisher that sends a lot of traffic but does not convert. Pepperjam allows our clients to designate a select publisher to receive commission no matter where they appear in the click path, ensuring influencers are correctly rewarded for driving traffic.
Publishers have told us that when they get a market-leading code for placement, it is often copied for use by other affiliates and the ‘exclusivity’ is diluted. Pepperjam assigns a particular code to an affiliate in the network and rewards that affiliate regardless of who refers the transaction. This guarantees exclusivity of an offer and can improve placement for advertisers. This will also work well on social media channels where the code itself acts as the tracking link, reducing the need for URL clicks.
And where do you think the industry is heading?
DF: There is, and always has been, a trend towards automation; continuing tech developments will provide advertisers with further options as to how they commission their programmes.
However, this will bring further complexity that cannot all be resolved through convoluted algorithms. The role of the account manager will become even more crucial in executing client strategy. But automation will push affiliate marketing to its ultimate goal – true performance marketing. We already see certain affiliates undertaking search and display arbitrage on a performance basis – increased efficiency will help us reach the pinnacle of digital marketing.
Every year is allegedly the year of mobile, but in the next five years, I believe it will finally happen. Clickless tracking through mobile and apps and geo-targeting through mobile will reduce the gap between offline and online and force advertisers to align their strategy. Card linking will become the norm, allowing affiliate to provide seamless discounting and footfall in the world of brick and mortar.
I also expect international expansion to be a major step in the next five years. Internal markets are becoming saturated and with advertisers always looking for the next revenue driver, international expansion can be the answer. Brexit does raise some questions as to how easy this will be across Europe, but with 750 million customers in the EU and 360 million in North America alone, there is substantial scope for additional revenue streams.
Finally, what's next for Pepperjam?
DF: Pepperjam’s technical evolution will continue through 2017. We will look to expand our currency conversion capabilities to offer a seamless international gateway to even more countries and multi-region services to all of our clients. Our new in-network functionality will also continue to expand, helping advertisers uncover the most relevant publishers based on over 100 data points.
However, whilst Pepperjam will continue to lead the way in technological advances, we are first and foremost focused on providing invaluable service and insight to clients. With this in mind, we’re looking to expand our presence in the UK substantially over the next year, including a possible office move. So stay tuned for more updates!